Black Friday looks very different this year. Here's why analysts are optimistic - CNN

Shopping traffic on Thanksgiving Day dropped by 95%, as many stores closed to give their employees time off and to avoid crowds.

Covid-19 and social distancing led shoppers to be more "purposeful" with in-person shopping, and many made their purchases online instead, Brian Field Sensormatic's senior director of global retail consulting, said in a press release. Field predicts that people may head to stores on and after December 19 to do some last-minute holiday shopping.

Sensormatic predicts in-store shopper traffic -- not sales -- and says in-person shopping will be at least 22% lower this year during the holiday season.

Shopping moved online this year in a big way, as customers spent $9 billion -- or $27.50 per person -- on Black Friday, up 21.6% from last year when they spent $7.4 billion, Adobe Analytics noted. That's the second biggest online spending day in US history, behind last year's Cyber Monday.

A record-setting Cyber Monday?

Customers could shatter those records on this year's Cyber Monday, which is expected to be the largest online sales day ever, with spending hitting at least $10.8 billion, according to Adobe.

"What we're seeing this year is $1 out of every $4 this season is being spent online. And that's a marked increase from last year when it was about $1 out of every $5," Adobe's senior digital insights manager Vivek Pandya told CNN Business. "That's additional billions of dollars that are being migrated online. And that's being done in a very short period of time because of the pandemic."

And even when customers visited stores, it was often to pick up items they had purchased online. In-store and curbside pickup increased 52% this year, Adobe said.

Don't forget Small Business Saturday

Small Business Saturday, which centers on celebrating mom-and-pop stores and other local businesses, is off to a good start, according to Adobe. As of Saturday morning, 44% of surveyed customers said they chose to support small and local retailers during this particularly difficult year. Sales for smaller retailers were already up 545% on Black Friday compared to a regular day in October. Full sales data for Saturday were not yet available, but that appears to be a strong start.

"Small businesses are the engine of America's economy. They are the fabric of our communities, and right now they need our help more than ever," the US Chamber of Commerce told CNN. A July poll by the organization found that more than half of small business believed they could continue operations for less than a year before permanently closing down.

Retailers are maintaining competitive discounts. Toys, electronics and appliances saw the steepest cuts, according to Adobe. Video games, toys, Apple AirPods were some of the most popular items being purchased, as were books, arts and crafts and household supplies like toilet paper.

Online deals

Online retailers began offering deals in early November, which helped drive momentum. And major retailers invested billions to follow Covid-19 protocols and take safety precautions, according to the National Retail Federation (NRF), which predicts holiday sales will grow by 3.6% to 5.2% compared to last year, to at least $755.3 billion.

While unemployment and the recession remain concerns, analysts still predict that customers are willing and wanting to spend.

"Consumers have experienced a difficult year but will likely spend more than anyone would have expected just a few months ago," said NRF chief economist Jack Kleinhenz in a press release. "After all they've been through, we think there's going to be a psychological factor that they owe it to themselves and their families to have a better-than-normal holiday."

Kleinhenz said that many households still have strong balance sheets, given that stocks are up, homes are growing in value and wages are rising. Reduced spending on travel and in-person services due to the coronavirus also means people have more money in their budgets for retail purchases.

Many analysts are still tracking sales data and will update totals on Monday and Tuesday.

CNN's Natasha Chen and Maria Cartaya contributed to this report.

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Black Friday looks very different this year. Here's why analysts are optimistic - CNN
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