Thanksgiving is the unofficial kickoff of the holiday shopping season, and many Americans take to the frenzied stores on "Black Friday" to take advantage of the deep discounts that many retailers offer. According to the National Retail Federation (NRF), in 2015 more than 151 million people made purchases during Thanksgiving weekend, in stores or online, spending $299.60 on average per person. The NRF states that 72.8% of those who shopped in stores made their purchases on Black Friday and 32.5% admitted that the shopping was driven by sales and promotions offered by retailers. According to the 2016 forecast, this year's holiday sales, including both November and December activity, are expected to grow by 3.6% with online sales specifically increasing by 7 to 10 percent.
(See also: The 9 Worst Items to Buy on Black Friday)
Residents of the southern states typically spend more than those in the north. This is perhaps a little surprising since many Canadians cross the border to take advantage of Black Friday sales which aren't commonly offered north of the border. The state of Texas, and even more precisely the city of Austin, Texas, is home to the biggest spenders in the country. Other cities known to be home to the big spenders are Scottsdale, Ariz. and San Jose, Calif. States with a higher cost of living also tend to see larger expenditures. Some of the top states include Connecticut, Hawaii and California.
Online retailers are getting in on the Black Friday action as well. According to the NRF's data, the majority of online shoppers, 73.1%, were planning to shop on Black Friday and 49% on the following Saturday. (For related reading, see What Is Black Friday? ) Among online and mobile shoppers, 22.4% of consumers planned to purchase products using smartphone in 2015 and 25.3% planned to use tablet for purchases. Individuals who do a large portion of their holiday shopping online are also likely to spend more than those who opt for more traditional retail venues.
Statistics show that men are more likely to shop on Black Friday than women, with men spending an average of 3% more. Statistically, age also factors into holiday spending with those in the 50 to 65 year bracket spending nearly 75% more than those aged 18 to 25. These figures make sense when considering that older individuals who are generally more established in their careers tend to have more disposable income than those who are just starting out.
What's Being Bought
Black Friday tends to be when shoppers are looking to buy big ticket items. According the NRF, clothing and accessories are popular choices. In 2015, 51.6% of purchases made during Black Friday weekend were attributed to this group.
Though it's difficult to say for sure, some analysts suggest that colder weather may even lead to higher sales on Black Friday. Many retailers are also offering "Cyber Monday" sales on the Monday following Black Friday. These sales are meant to attract those who are unable to get out on Thanksgiving weekend to do their holiday shopping. Perhaps some consumers are saving their cash for Monday when the malls and online retailers are a little less swamped with traffic. Store hours are also thought to be a factor in Black Friday spending. (For related reading, see Goodbye, Black Friday; Hello, Green Monday.)
The Bottom Line
With people spending rather hefty sums of money on this notoriously busy shopping day, the amount spent on Black Friday is often thought of as a litmus test for the overall economic condition of the country and a way for economists to measure the confidence of the average American when it comes to discretionary spending. Those who are afraid of losing their job aren't likely to be out in the malls buying diamond rings or new video game systems to hide under the Christmas tree. However, using Black Friday expenditures as the sole measure of overall economic conditions isn't too wise, though these figures do help retailers to anticipate what kind of sales they can expect through the remainder of the holiday season. With 2016's Thanksgiving season just around the corner, it will be interesting to see what kind of story this year's figures will tell us about consumer confidence and spending.