Target Joins Walmart to End Thanksgiving Store Shopping

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Target joins Walmart in closing stores on Thanksgiving Day, ending a long-standing tradition of relaunching Black Friday door-to-door sales.The move, announced on Monday, comes as stores rethink this year’s Black Friday shopping weekend – along with other key retail days during the holiday season – as the country battles the pandemic COVID-19.

Stores have always depended on large holiday crowds and work up to a year in advance with manufacturers to secure exclusive items. Now the virus has turned the holiday shopping model upside down.

The stores have reduced orders and the crowds are anathema. With fears of a wave of virus cases in the fall, the biggest nightmare would be if retailers were to shut down during the most critical time of year, analysts said.

“Historically, finding deals and holiday shopping can mean crowded events, and this isn’t a year for crowds,” Minneapolis-based Target said in a corporate blog post. He said his vacation offers will come sooner than ever – starting in October.

Walmart, the country’s largest retailer, announced its move last week. Dick’s Sporting Goods also said Monday it would close stores on Thanksgiving Day.

Target first opened on Thanksgiving in 2011, joining other stores to start Black Friday sales a day earlier and create a new tradition of shoppers going to stores after their turkey feast. Many retailers did this because they were trying to compete better with Amazon and other online players.

But sales ended up eating away at Black Friday, and many critics criticized stores for not honoring the holidays and allowing their employees to spend it with family.

In response to the backlash and poor sales, some stores and malls, including the Mall of America, based in Bloomington, Minnesota, have reversed course and haven’t opened on Thanksgiving Day in recent years. Costco and Nordstrom, among others, have always remained closed on Thanksgiving Day, noting that they want to respect the holidays.

The bigger question still arises as to how to handle Black Friday itself, which also draws huge crowds – and sales. Despite the competition from Thanksgiving shopping, Black Friday ranks first or second in sales of the year.

Thanksgiving isn’t even in the top 10 as sales start around 5 p.m.

Walmart and Target declined to comment on their plans for Black Friday, but analysts believe retailers will pivot their business more online and focus on limiting the number of shoppers in stores. Like Target, other retailers will likely start holiday sales even earlier to stretch the crowds.

Macy’s CEO Jeff Gennette said this month the department store would be shifting its Black Friday business more towards online and likely going “full blast” with holiday marketing right after Halloween. It will also be amazing events to reduce customer traffic in the store.

However, furthering online sales is likely to be more costly for retailers due to shipping costs. And while many stores like Macy’s will be increasing curbside pickup for the first time this holiday season, this strategy will create logistical challenges to meet shoppers’ demands during the holidays.

Sucharita Kodali, ecommerce analyst at Forrester Research Inc., said the profit margins retailers get on their online sales are 50 to 80 percent of what they get when the same item is bought in a store.

“It will be a very difficult holiday season in terms of where sales come from,” said Joel Rampoldt, general manager of the retail practice at AlixPartners.

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