Holiday Madness
By: Izzy DeAngelis
Christmas time is all the buzz in late November and December. Everyone’s looking for the “perfect” gift and those great deals. So with good deals comes some opportunity costs, especially on a hectic day like Black Friday. The day after Thanksgiving, also known as Black Friday, is when most people go out to shop for their gifts. According to the National Retail Federation, there are about 164 million people that go shopping during Thanksgiving weekend. The craziest thing about this day is people waking up at the crack of dawn to go sprint into the stores and get the limited offers. In this process, they may still not get the goods they seek to get, which would not only be an opportunity cost just like having to wake up early, or potentially getting hurt in the process by being trampled by crazy ladies.
Since this is the one of the most busiest shopping days of the year, the U.S. made on average last year about $655.8 billion(Amadeo). This increase over the years has shown substantial growth for the sales in retail stores like Kohl's, JCPenney’s, Boston Store, etc. With the increased traffic of people going in and out of the stores, there is usually an increase in employment options for these stores. These job opportunities open up which help create marginal benefits to people in need of a job/money. But as with anything there are always marginal costs. In this case, by having a new job the employees won’t have as much time to do other things besides work because of the increase of sales. In the end, the good outweighs the bad and the employers will not only be helping themselves but others too, especially when their customers find that perfect gift.
Not only do stores experience an increase in employment but they also increase the demand of their goods. According to the law of demand, with the increase in demand of certain products in these stores there will be a decrease in prices, which is why there are sales that happen during the holidays. Since there will be an increase in demand, the supply curve will also have to shift as well. With the decrease in a lot of the product’s prices, the supplier won’t want to produce as much therefore showing a decrease in production. This is why there are only a certain number of products available for purchase in stores, on Black Friday. 
Overall, companies like Kohl’s and Best Buy, usually have large sales around the holidays because their products are more elastic than companies of higher name value, like Gucci. Those companies are inelastic because they are known for their high prices and uniqueness, so those companies know that during the holidays people will spend an absurd amount of money on the ones closest to them. This is why Christmas is the most wonderful time of the year.
Works Cited
Amadeo, Kimberly. “How Much Do Americans Spend on Black Friday?” The Balance. n.p. 11 Nov. 2017. 13 Nov. 2017.
hibbardj@nrf.com. “Holiday Headquarters.” National Retail Federation, 6 Oct. 2014. 13 Nov. 2017.
Quora. “What Are The Economics Behind The Black Friday Sales?” Forbes, Forbes Magazine, 27 Nov. 2013. 13 Nov. 2017.
This is a great topic to talk about especially in this season. It is good to talk about the demand for the new and cheap products and also I liked how you incorporated the amount of money spent on the single day. I liked how you incorporated a lot of economic terms throughout and how the country as a whole is effected by the amount of products being bout and the amount of high demand for the products with the seemingly cheap price.
ReplyDeleteI liked how your topic was relevant as Thanksgiving is exactly a week away. One thing I would possibly add to your post to make it better would be the fact that as the years progress, stores keep opening up earlier and earlier, even up to 5 PM some open for their Black Friday sales. This would increase your argument for the demand of the goods on sale this holiday season. Though, overall you made very good points about how hectic Thanksgiving weekend can be, and how it affects some key components to an economy like we talked about with unemployment. You did a great job using the vocabulary we have learned so far, and it helped understand the craziness of the holiday!
ReplyDeleteI agree that I like the relevancy of your topic, and how you incorporated aspects of economics with into it. Since the holidays are so close the demand for products is increasing as everyone is looking to buy presents. Since the holidays get so hectic it gives producers the opportunity to change around their prices, and bring more awareness to their products so that they can sell more than their competitors.
DeleteIt makes sense that retail stores such as Kohl's, Best Buy, JC Penny, and the Boston Store have large sales during the Holiday season, because retail stores usually have the option to be a "seasonal worker" around the Holidays. An increase in customers requires more employees during this time. I'm surprised you didn't mention Walmart or Target because they usually have a lot of Black Friday deals as well as other deals during the Holiday season. It is interesting to look at the graph chart because the sales in 2008 (the time of the Recession) are still higher numbers than in 2005-2007. The sales in 2008 were about the same as in 2009, and after 2009 is when the economy was restored and the graph shows a much larger increase in sales after the year 2009. Good job on your blog post.
ReplyDeleteThe increase in sales definitely has an effect on a company’s growth. As with all things, people are mostly more willing to buy products at a lower price. I think it’ll be interesting to see what newer and higher-in-demand products, such as the iPhone X, will go on sale. But because of these higher demands, it’ll also be interesting to see how much people will pay for the iPhone X when there is such of a high demand.
ReplyDeleteI agree with your comment about how the craziest thing about Black Friday is that people actually wake up super early to go through the chaos of Black Friday. Since Black Friday is the busiest shopping day of the year, obviously stores are going to be making a lot of money this day. I work in retail and the holiday shopping has given me a marginal benefit because I was hired for the holiday season because stores are going to need more workers to work during the holiday months (Nov-Jan) because stores will be so busy. At the end, you claimed that "This is why Christmas is the most wonderful time of the year," if you are saying that holiday shopping and all the holiday deals are why it's the most wonderful time of the year, I'd have to disagree only because I feel like all these good things during the holidays cause bad outcomes from customers such as; fighting over items, chasing people through the store, running to the cashier line, and just overall very aggressive behavior during this time.
ReplyDeleteBlack Friday has always been a success for big retail companies with these insane limited offers on expensive products. Lots of companies are now relying on this time of year because of the increase use of online shopping. Now all these retail stores have to make these crazy deals to beat out the main competition, which is Amazon. Even though Amazon and other online commerce stores have their big deals on Cyber Monday, they still have to compete with revenue from retail's sales from Black Friday. I think retail stores will be less used throughout the years and eventually, shopping will only be on Amazon. But for now, Black Friday will always be a tradition for people and their families. (Vinny)
ReplyDeleteI think it’s very interesting to see how much money is spent on Black Friday from all the different stores around the US. It just shows how much people love the sales that each store provides. I think nowadays, more and more people are going out on Black Friday because of the bigger sales that they have unlike how it used to be years ago. It makes sense that there is only a limited amount of products that a store sells for a certain price because the supplier doesn’t want to produce as much which will decrease in production. Overall, I like the way you used your vocabulary and the evidence that you used to backup your topic.
ReplyDeleteBlack Friday is a great marketing strategy, especially since it is placed right after Thanksgiving and Christmas. Like you said, businesses increase profits during this time because of the high demand of their products. Because Black Friday is around the holidays, people jump at the opportunity to “buy more for less” in preparation for the holidays. However, in reality they spend around the same amount of money they’d spend at normal price because they are buying large quantities. The businesses understand this and because their opportunity cost is slim they are able to have elastic prices. Production costs for their products are still less compared to the sale price, thus allowing them to make a good amount of money during this time. Overall, your piece was interesting and you did a good job connecting it to econ.
ReplyDeleteI think it's interesting since you work in retail. I personally buy a lot more during the holiday season, and appreciate deals like Black Friday to buy gifts then. I definitely do agree though that I might be spending more as I buy more than I normally would during holiday deals.
DeleteVery interesting to see the changing graph of the retail sales over Thanksgiving. The downfall in sales over recent years could be because of the growing movement to spend more time with families instead of shopping till you drop.
ReplyDeleteI like that your ending sentence is,"This is why Christmas is the most wonderful time of the year." I definitely agree with you that most people don't celebrate Christmas for its actual meaning rather for the presents. When reading this blog I was amazed by the amount of people and the amount of sales that occur on thanksgiving weekend alone. As a customer I love the sales and low prices but as an employee I assume it is a horrible time to be working.
ReplyDeleteThe government was smart when they came up with Black Friday because. Christmas is a time of giving and spending time with your family. For example if Nike is having a 50% sale for Black Friday then consumers are going to buy. The demand for Nike products will rise. If the full price item is to much and you do not want to pay that. Then you can get it on Black Friday or Ciber Monday for a deal. Which is why Black Friday is the most successful shopping day of the year. I go out and every Black Friday, I buy stuff that I see. If I want a pair of ultimate leggings from pink that are 76.95, and there $40 dollars on Black Friday. Then the demand I want for those leggings rises and I could get 2 for the original price.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteYour mention of crazy ladies made me laugh, but overall this is a perfect topic for the holidays! I found the column graph you inserted very interesting as the trend is starting to go back down to form a bell curve. It would be really interesting to see a more up to date graph showing 2015 up to this year after the season is over. I wonder if it will continue to go down because people want to save money, or if it will go back up in a more random pattern. Despite the trend, personally, I spend a lot more money around the holidays.
ReplyDeleteI like the how in the final paragraph you mentioned Gucci and how it was an elastic good because of its high prices and uniqueness. You could also relate Gucci to clothing lines such as Supreme and Bape as both of these clothing companies have unique and high priced goods. I researched Supreme and they are coming out with different collaborations with other companies for the holidays however, they will still not have as many sales as stores such as Walmart and Target as their good are very inelastic compared to the elastic goods of Walmart and Target.
ReplyDeleteI agree with Mariano. Even though most people are starting to become bigger fans of expensive brands such as Gucci and Supreme, companies like Kohl's and Best Buy are still going to bring in more sales/revenue because they are selling goods that are more so necessities whereas Supreme and Gucci are selling luxury goods that are wanted but not needed. In addition, due to the deals of Black Friday, more people are going to want to buy goods that they need versus goods that are collectibles.
DeleteI really agree with this idea. Consumers tend to stay away from brands like Gucci and Supreme because they are luxury goods and cost a lot more. Black Friday does open up opportunities for consumers to buy the luxury goods and take away sales from retail stores like Kohl's and Best buy. Really interesting to see the different types of sales all these companies create to bring in more customers into their stores.
DeleteThis comment has been removed by the author.
ReplyDeleteI think this example for the holidays is a perfect way to show both the benefits of holiday sales such as increase in the amount supplied which lowers prices and the increase in employment, as well as the negative sides such as the opportunity costs for going shopping on this crazy day. I think that we do not always see all of those positive when people are frustrated and in a frenzy on black Friday, but they have a huge positive impact on our economy
ReplyDeleteThe holidays is a great time for both producers and consumers. Producers get to get rid of their surplus inventory, while producers get to buy their Christmas shopping done early and cheap. Overall, I think it is beneficial to both parties and it is smart for producers to keep their prices high year round so when they lower them for this one day it seems like a steal.
ReplyDeleteThe holidays are great for business - especially retail. Looking at the "U.S. Thanksgiving Weekend Retail Sales" graph, one question that occurs is why 2012 experienced such quantity of sales, and what is causing the decrease since then each year.
ReplyDeleteI agree that Black Friday is good for both the businesses and the customers. Since it's advertised so much in the media in today's society, it's more popular than ever before. Since businesses are opening earlier, they are allowing for more time for customers to be shopping for their products. Also, this benefits the customers since they have a wide range of time to purchase items that are on sale. However, like you said, this could also be a dangerous time of year because some people will do anything--even trample other customers--in order to get the item(s) that they want.
ReplyDeleteThis was a really great topic Izzy, your writing craft is truly beautiful. I really seems like you spent a lot of time working and perfecting this piece. Not to mention I couldn't agree more! Christmas is the best time of the year and this was a great topic to write about. Your graphs you included in this piece were truly riveting and I found great pleasure in seeing how the column graph had a steady rising and falling to give it the bell shaped curve. Using this example of the holidays was a really great idea that allowed us to see the benefits that holiday sales bring us, like producers being able to sell all their surplus items and consumers being able to buy those items at a cheaper price, so it really is a win win for everyone.
ReplyDeleteI really enjoyed this topic because many people are able to relate to crazy black friday shopping. The graph you included was very resourceful to the topic, and I found it interesting that over the years since 2012, the retail sales have decreased. Why do you believe they have decreased? And what do you predict the trend to be like in the future? I can see that maybe the increase in employment and or more expensive products or advertising being displayed could factor into the prices of black friday not being as low as they used to be, possibly decreasing the demand. But, overall a very strong argument with good vocabulary.
ReplyDeleteI really liked how you took such a relevant topic and mangaged to incorporate many of the economic concepts we have learn about. When you think of the holidays, you think of time with family or like in this example gifts, and not nessecarily the economic aspect. I find the economic changes this time of year really fascinating and you did a great of explaining the reasoning behind many of them.
ReplyDeleteGreat job Izzy! After conducting additional research myself, I discovered that the holiday season is crucial for the economy because around 30% of annual retail sales occur between Black Friday and Christmas. In 2016, there were 101.7 million people who braved the crowds, resulting in a grand total of 137 million people out shopping during the four-day Black Friday weekend. However, it’s important to consider when prices are lowest for Black Friday sales. In reality, the best Black Friday deals are surprisingly not on Black Friday, but are actually available leading up to Thanksgiving. Many large retailers, such as Amazon, offer deals earlier and earlier, in order to increase profits and overall economic competition. So, instead of battling the ferocious crowds on Black Friday—just one day after spending time with your family and giving thanks—start your Black Friday shopping early to ditch the long lines and fully enjoy your holiday season!
ReplyDeleteThis is a great topic to expand on and give your thoughts about. I never realized how many of the topics that we cover in econ are so relevant in our everyday life. It is also very important that companies really succeed during the holiday season as this is where they have potential to make the most profit, as customers are basically flying through their door.
ReplyDelete