Wednesday, November 26, 2008

Credit J.L. Hudson's for Creating "Black Friday"

Note to non-Michigan readers... As a point of reference, J.L. Hudson's was 'the' department store in Michigan for many years. Hudson's was to Michigan (and surrounding states) what Macy's is to New York. Hudson's was sold in the 90's and became "Marshall Field's" until the purchase in 2007 by Macy's. I remember fondly, the trips to Hudson's to see Santa and to have lunch. It was 'the' shopping destination in Detroit and in later years, the 'burbs. Enjoy this bit of hometown trivia regarding Black Friday. This article originally appeared in the Wednesday edition of the Detroit News.
Early bird holiday sale in 1981 snowballed into shopping frenzy
Jaclyn Trop / The Detroit News

Before 4 a.m. openings were routine, the post-Thanksgiving retail orgy known as Black Friday was a day of modest discounts and unhurried browsing.
But few shoppers know that the sense of urgency that now rouses them to the pre-dawn hunt was manufactured here in Detroit, to spur sales during hard times in 1981.

The notion of an early bird sale to kick off the holiday shopping season was born at J.L. Hudson's, when the department store unlocked its doors at 9 a.m. -- half an hour earlier than usual -- and held a one-hour "doorbuster" sale.

"From the moment the store opened, we got this tremendous incremental business, and customers hung out all day," said Fred Marx, now a partner at Farmington Hills marketing firm Marx Layne.

Marx, who joined Hudson's marketing team in 1979, helped spearhead the "Beat the Clock" sale, inspired by a similar concept at Philadelphia department store John Wanamaker & Co. By applying the idea to the day after Thanksgiving, Hudson's created a tradition that has given way to a host of attention-grabbing incentives and ever-deepening discounts.

Although merchandisers thought they could justify the sales in terms of profits, store organizers "weren't really that crazy about it," Marx said. They worried that opening early and taking markdowns at the cash register would disrupt service levels.

"It wasn't this constant promotional drum beating that we know today," Marx said.
Hudson's kept the promotion a well-guarded secret, waiting until Thanksgiving Day to unleash a blitz of television spots and newspaper ads. The full-page ad in The Detroit News and the Detroit Free Press on that day, Nov. 26, 1981, featured an alarm clock alerting shoppers to the early opening.

"It didn't get any art award, but you couldn't miss it," Marx said. "It was very clear. Customers got it." The following year, "all patent rights were off," he said. "K-Mart, Crowley's, J.C. Penney's -- everybody had their version of it."

Economists call it the "Super Bowl of Shopping." Between 60 million and 65 million consumers hit the stores over Black Friday weekend looking for deals. It's become an odyssey of mythic proportions, according to Wayne State University economics professor Jeffrey Stoltman.
"It's a huge cultural event," Stoltman said, "like the opening day of hunting season."
Thanksgiving traditions such as parades and visits from Santa are nearly as old as the department stores that began sponsoring them in the 1920s and 1930s, said University of Detroit marketing professor Michael Bernacchi. Sales and discounts probably began appearing the day after Thanksgiving sometime in the 1950s, he said.

With the advent of shopping malls in the 1960s, the concept spread from department stores to independent retailers. By the 1970s, the concept of kicking off promotions the day after Thanksgiving was well-entrenched. But the day had no special name. "The thought was there, but no one had enunciated it," Bernacchi said.

The name Black Friday first appeared in print in 1966 in a newsletter from the American Philatelic Society, a group of stamp collectors, in reference to the holiday traffic in Philadelphia, and reappeared in 1981, when the Philadelphia Inquirer used it in reference to commerce, according to Bernacchi.

"It was a catchy expression, and folks gravitated toward it," he said.
According to modern lore, Black Friday was named for the day retailers earn their annual profits, turning their balance sheets from red to black. Some historians trace the usage back to the 18th century, but Marx said that's not true. The red-to-black yarn is "quoted like it's one of the Ten Commandments," said Marx, who prefers the term "National Shopping Day." "It's like it's been carved out on a tablet that this is the official explanation, but it isn't."

A second rationale behind the name derives from the frenzy induced when crazed shoppers descend on stores en masse. "It really has become a chess game" as retailers try to outdo each other by manipulating prices and hours, Bernacchi said. "Everybody wants to gain an edge."
The competitive and secretive nature of promotions remains to this day. "It's like we're making the atom bomb again," he said. "I mean, come on! It's a shopping day!"

To be sure, Black Friday becomes more frantic each year, as retailers implement an arsenal of sales strategies, including 4 a.m. coffee and doughnuts, giveaways, gifts with purchase, additional markdowns and guaranteed interest-free payments.

"Customers come to expect it, and if you don't offer it, they'll wait for the next bus," Marx said.
However, aggressive promotions can affect the quality of a shopper's experience, from long lines to a lack of inventory to the unavailability of in-store help, Stoltman said. "Some will find it downright unsatisfying," he said. "If I'm in line for an hour and a half, that's too much."


Elaine said...

Huh, I always wondered how Black Friday originated. Thanks for the bit of history!

John said...

Thanx Kenn for that bit of memorable history! Oh how I miss Hudson's. To this day I still wish I could go back in time to at least once experience the flagship store in Downtown Detroit. Happy Thanksgiving to all of you!