By: Jack Somenske
I’m sure we’d all love if Black Friday deals lasted forever. Or even just more than once per year. I’m here to tell you why you may like this, but that can’t happen if companies want to be able to make so much money with these deals.
We’ve all heard of Black Friday. It’s the single most popular day for retail stores such as Target and Wal-Mart due to the amazing deals. It’s called Black Friday because “accountants use black to signify profit when recording each day's book entries. They use red to indicate loss. So, Black Friday means profitable Friday to retailing and to the economy. Retail and consumer spending drive almost 70 percent of U.S. gross domestic product.” (TheBalance.com)
We’ve all heard of Cyber Monday. It was created by retailers to encourage people to shop online. Cyber Monday has become the online equivalent to Black Friday and offers a way for smaller retail websites to compete with larger chains. I personally believe it’s just a thing because it’s literally just an online black friday, driving in even more sales for the company.
You may have also heard of Green Monday. “Green Monday is the biggest online shopping day in December. It falls on the second Monday of the month. That’s when shoppers realize they only have around 10 shipping days left before Christmas. In 2018, Green Monday falls on December 10.” (TheBalance.com) Green Monday is promoted by stores like Target, and Amazon. It’s called “Green Monday” due to the high number of sales on this day.
As we can see, Cyber Monday is in fact more profitable than Green Monday, but Green Monday is more profitable than Black Friday! This is due to a new wave of sales online that weren’t previously offered by retailers, and sense this is right before Christmas, people buy a lot more.
Now, if companies get so much money on these three days... why don’t they just have deals like this more often? Wouldn’t they get a lot more money? Well, not necessarily. If companies were just throwing out deals all the time, the demand for these deals won’t be as high when they do go on sale. If people know that items they want will always be going on sale, they won’t be as obligated to buy them on one particular day. Now, people know that these are one time deals, so they need to go and buy that 70 inch TV, or that new Apple Watch. The reason that these three days are so popular is because they don’t happen very often so there’s a lot of hype around them. If they happened all the time less people would buy things from them and the companies wouldn’t make as much money.
Works Cited
Amadeo, Kimberly. “Cyber Monday to Be Biggest Shopping Day of Year.” The Balance Small Business, The Balance, www.thebalance.com/cyber-monday-what-it-is-when-it-starts-and-current-trends-3305715.
Amadeo, Kimberly. “Don't Miss the Holiday Sales on Green Monday.” The Balance Small Business, The Balance, www.thebalance.com/green-monday-what-is-it-date-deals-sales-trends-3305475.
Amadeo, Kimberly. “How Black Friday Got Its Name.” The Balance Small Business, The Balance, www.thebalance.com/why-is-it-called-black-friday-3305712.
I had actually never heard of Green Monday and the meaning behind the words Black Friday before this article and it makes so much sense! I loved seeing the connection between demand and supply and how that contributes or affects the economy. However, it was interesting that Green Monday makes more profit than Black Friday. I think that is because Black Friday has turned into Black Thursday/Friday because so many deal start on Thursday which is very annoying so less people want to participate in the Black Friday madness.
ReplyDelete-Anika
Lowering the prices in general for a store is a big step towards making less profit. Indeed, you would be creating more of a want for a product but putting a sale for a small amount of time will force people to come in and buy it before the price raises again. With days such as Black Friday and Green Monday, sales are created to get customers a chance to buy new items for cheaper money. Now although the store is making a smaller profit margin, they are getting it at a faster rate which increases their profit margins overall. Making money at a faster rate is the goal here, even if it means they need a to shed a few dollars to create more of a necessity.
ReplyDeleteYou had a lot of good information and a good reasoning why companies don't just use these deals all willy nilly. It all relates to the supply of the customer and if we see these deals on the regular they basically aren't deals anymore. I also never had heard of green Monday until this and it makes since why it is so successful for those shoppers who procrastinate for their loved ones.
ReplyDeleteI wholly agree with you in that deals like Black Friday would not make enough money for stores if they happened all the time. One of the reasons Black Friday and Cyber Monday are so successful is because they happen right at the end of November, when everyone is doing their holiday shopping. If stores were to do a sale like that in, say, July, there wouldn't be nearly as many people giving them money, because they have no incentive to buy at that time of year. It's also an effective marketing strategy to have only one or two sales like that per year, so that retailers can hype up the sales even more, saying stuff like "This is the only sale like this for the year!". If sales like these were happening constantly, people wouldn't go out and buy, since they'd know that they can just wait for the next one to happen.
ReplyDeleteI agree that if stores had big deals like they do on Black Friday all the time, it wouldn’t generate any more revenue for them because people would be used to it. Black Friday has become such a big shopping day because the sales are what people don’t normally see, and if the sales happened more than once or twice a year, it would lose its novelty.
ReplyDeleteI agree with you that Cyber Monday is more profitable, however that is only because people around the world know about CYber Monday, personally I have never heard of Green Monday. I agree that these deals won't last forever, the only thing that makes these deals special is that it happens only once a year which increases demand for things big things, like a xbox, or a car. It forces consumers to buy now, if this happened every day consumers would soon become blind to how cheap these deals actually are, and soon they think it's too high, then they would demand lower deals, and the cycle will just continue.
ReplyDeleteI was surprised that Green Monday and Cyber Monday were producing more sales than Black Friday. I buy almost everything online, but for me and my family Black Friday is a holiday and we go out Thursday and Friday. But I also know a lot of people who don't bother with Black Friday because it is too much of a hassle to drive to a store to pick up one thing you want. The online sales are much more convenient for people with some of the same exact deals as brick and mortar stores on Black Friday. Some of the brick and mortar stores even have online sales from Black Friday, through Cyber Monday so it is a whole weekend of sales.
ReplyDeleteWhat is the point of Black Friday if everyday after that Friday, they continue to have sales? Green Monday and Cyber Monday are just repeats of black Friday. I honestly am not complaining because sales are amazing to have on clothes and things you love, but it ruins the fun of black Friday shopping. When we wait outside stores the night before and camp out, demanding for them to finally let us in and supply us with sales. It is just isn't the same anymore. We can online shop now and get so many good deals almost everyday. There always seems to be crazy sales at every store all the time. The Black Friday tradition is just not the same anymore.
ReplyDeleteEllie R
This obviously takes a big part of the economy to put up these shopping numbers, I mean more and more people are shopping online right now because they are to lazy to go out to stores now. I think that's also a big reason for cyber monday, and green monday, being so much more popular than Black Friday. Black friday is said to be the most popular shopping day of the year, and while the other days are one, and easier, it's still a lot more popular than black friday. And that gives a huge benefit to the online community.
ReplyDeleteIt makes sense that these deals can't be put out all year long. Although it does help the economy by people spending more money,people can't spend a lot of money all of the time. The supply and demand would be thrown off if these deals went on all year. It's almost like fiscal policy, except instead of tax breaks, people get discounted goods and are able to spend more because things cost less. However, if the government always gave out tax breaks, then there would be no money for roads, schools, and really anything that taxes pay for. Similarly for stores, they may start to lose money if they always gave out deals.
ReplyDelete- Colin Pham
I do agree with you and I did always wonder why black Friday was called black Friday. Also I think that Christmas is the best time for this because everyone is buying something for someone else or themselves but say if you did it in summer it wouldn't be as big of a deal because no one is really looking to buy much stuff and if you did it twice a year it would not be as significant.
ReplyDeleteI agree that while the lowering of prices is amazing for the consumers, the stores shouldn't do it as often for their best interest of making the best profit possible. If companies did this every other month, consumers wouldn't buy anything until those sale days and that would mess up the companies profits. In general right now, black friday is a huge profit booster for companies because they are making smaller profits but at a super fast rate. It is interesting to me how green Monday (which I had never heard of) is also a large discount day.
ReplyDeleteThis is an interesting topic because it relates back to supply and demand. Not only do you see an increase in consumer spending on these days but also a lot of business spending and manufacturing on products that are expected to increase in demand as the price decreases. For example, if a popular laptop goes on sale for 30% on Black Friday, companies will stock more laptops and less 70" TVs that only go on sale for 25% because economists can predict that more people are going to buy the laptop. You should also consider how much money retailers spend the week before Black Friday; as demand increases, supply of products just before Thanksgiving will increase in stores which means retailers increase their spending to supply more products. So my question is, how much of an increase in profit (net profit) are businesses making even when they are buying and supplying more products? Is it really that different than any other products that go on sale?
ReplyDeleteBesides the fact that black Friday, cyber Monday and green Monday all bring in huge profits due to the amount of consumers, they also gain these profits from the time they are held. Like you were talking about how green Monday happens when people realize they need to shop for Christmas, they days happen on focal points during the year. Black Friday happens the day after thanksgiving. So when your family is over and you are looking for something to do, you can go and shop hours with them. Cyber Monday happens after black Friday, which is perfect because if you didn't get that one thing you wanted in time, chances are you will find it for sale as well online. When this trend starting happening how ever long ago, it really did happen on the right day for businesses to make insane profits.
ReplyDeleteI actually learned a few things reading your blog, I never knew there was a “Green monday” and that it has more sales than black friday. Also while I mostly agree with you on your reasoning for why these deals don’t last forever there’s just a little part I feel you are forgetting. Having the products stay at such low prices will make the companies of the product lose money but not because of the consumers not buying the product. If apple watches and 70 inch TV’s stayed at $50 people would be buying them all the time because they are so much cheaper for such a high quality product. The way the companies will be losing money is keeping the products at such low prices won’t reimburse them for making the product. Products have certain prices for a reason and have varying price floors and ceilings, that’s because it cost more to make some products than others. So if these companies keep spending lets say, $200 to make their product but sell it at $100, that means they are losing $100 every sale. So while keeping the deals would make them lose money it’s not because nobody would buy them anymore but rather they would just simply be losing money every sale because of the low prices.
ReplyDelete-Noah
I have never heard of "green Monday" until this post, this is really interesting actually. Noah's comment is very interesting about the apple watch. Its true lowering prices can affect thing drastically. Having big deals all of the time could negatively affect your business since you would be making less money and it still costs so much to create products. I feel like sales are good because every once in a while you need to draw in more consumers and get rid of old product so you can bring in the new ones but you cant have constant deals on new pricey products or you will lose profit that other places will be making a bigger profit out of.
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ReplyDeleteThis obviously takes a big part of the economy to put up these shopping numbers, I mean more and more people are shopping online right now because they are to lazy to go out to stores now. I think that's also a big reason for cyber monday, and green monday, being so much more popular than Black Friday. Black friday is said to be the most popular shopping day of the year, and while the other days are one, and easier, it's still a lot more popular than black friday. And that gives a huge benefit to the online community.
This was my first time hearing of Green Monday. It is interesting to know that a random Monday in December creates more money for stores comapred to Black Friday. In my opinion, the hype of Black Friday and the great deals bring in the consumers throughout the night. I agree with you that if these sales were to continue more often than Black Friday, Cyber Monday, and Green Monday, the demand would drop on these specific "holidays". It would be interesting to see the amount of sales the week prior to Black Friday. Consumers know that the price will be decreasing. That should shift the demand curve to the left, decreasing companies profits prior to Black Friday.
ReplyDeleteI also have never heard of Green Monday. Surprising that Green Monday actually makes more money than Black Friday since Black Friday is always a big hype. I think it's smart on their part to not have Cyber Monday, Green Monday, and Black Friday to be spread out across the year because that would give people more chances to get a deal on something they want in February instead of having to pay the full amount because the big deal is all the way in December.
ReplyDeleteWhen you look at shopping and you know that a deal either on black Friday or green Monday people will always by things and that would boost the economy and also the small stores profits would as well. But for me I really never heard of green Monday but if that day is almost like black Friday than having these days are perfect for the economy. but to much of it wouldn't bring as much money because how much they would have to keep buying the product.
ReplyDeleteFollowing economics concepts that we learned in class, lowering prices of products permanently would lead to less profit. This means that days such as grey thursday, black friday, and cyber monday are only profitable due to the fact that they are a once-a-year type of deal, which makes people feel like this special day is worthy of their attention when it comes to spending their money "smartly". Not only do people feel like they should get what they originally wanted, they often find new items and place them in their "cart", bringing more revenue to the stores.
ReplyDeleteIt's very interesting that retail and consumer spending drives almost 70 percent of U.S. gross domestic product. Continually using data and statistics in your blog is a great way to enhance it as a whole. While it was great to have that graph up to see the difference between each sales event, I wish you could have had an updated one. I think it would be even more interesting to the audience if you happened to find one that went from 2014 to 2018, because over the years more and more people hear about these sales events and it would be interesting to see today's numbers and how they compare.
ReplyDeleteI definitely agree that there is no point in having these sales all year around. One aspect of that is obviously, there will be less demand on the consumer side of the business, but the producer side will also suffer. If companies start having sales all the time, they will receive less profits because customers would be paying less for the products. Also, as stated in the article, less people will buy from these sales. When the prices of the products decrease, the factors of production that are needed also decrease. Hence, less people will have jobs and companies will have less capital. One thing to note is that all this will happen in the long term and large quantities.
ReplyDeleteIt's interesting that Green Monday, something I have never heard of, is more profitable than Black Friday. I agree that this has to do with the online shopping trend that is taking over current day shopping practices; but this is also occurring because the demand for ease of purchase is so high now, that firms like Amazon will dominate the market (over brick and mortar stores), especially during high traffic shopping days. On the topic of constantly lowering prices, I agree that there could not be the level of deals offered year round that are currently available on Black Friday, as it would not be sustainable in terms of profit. However, some products like TVs are on "sale" more often than not because they are an elastic good (meaning they are not a necessity and total revenue will increase when prices are lowered). This "year round sale" is a common practice used by furniture stores or other retailers that deal in elastic goods. So I wonder if, based on the good, it really would be better to offer bigger sales more often or if maintaining the price will lead to more profit.
ReplyDeleteI liked your article and I used to be an avid Black Friday Shopper. Recently I have noticed that companies are decreasing the deals that they used to offer and are now increasing the price before Black Friday and then they are decreasing the price on Black Friday to fool consumers because Black Friday has become such a huge day for consumers to spend money. So I believe that the companies are not even losing money by decreasing the price because they are not really putting anything on sale. In fact Black Friday might even hurt consumers.
ReplyDeleteConsumers like it when they get to spend less money on the same products. I like how you point out that the reason one-a-year sales are so attractive is because of their scarcity, "You only have one day to get prices this great!" I would like to bring up that year round sales (throwing out sales all the time) are also attractive in a semantic sort of way. "Pay only $800 on a product worth $1200!" vs. "$800." or the most common one: $19.99 (with tax added) vs. $21.01 (the actual price).
ReplyDeleteThis is the perfect example of "too much of a good thing." Deals like these are so popular because scarcity increases demand, whereas if sales were constant consumer surplus may increase but producer surplus would decrease as well as consumers would be less likely to go out in throngs to buy these products, as you mentioned. Another reason for why Cyber Monday may be even more popular than Black Friday is because of accessibility and supply. More people can access the internet better than they can drive over to the nearest mall and with all the hype for Black Friday, things can sell out quickly, while the supply is more readily available online when they come from warehouses etc. I also didn't know about Green Monday but I'm pretty confident I was shopping online that day!
ReplyDeleteAgastya Asthana,
ReplyDeleteI agree with Jack that Black Friday Deals are only efficient if they are a one time stop. Black Friday Deals are like diamonds. Diamonds are expensive because they are so rare, if everybody had diamond just lying around, then the value of the diamond will go down. I personally like the Black Friday Deals on one day because there is a lot of energy in the atmosphere during the time and it makes me feel like I am really getting a good deal. If the 70-inch TV started going on deal everyday for $100 instead of $1000 I would start to except TV prices to be on average to be $100 instead of a thousand.
This is a great example of too much of a good thing. A reason why that Cyber Monday be be even more popular then Black Friday is because of accessibility and supply of the product. It is easier for people to go on the internet and find what they are looking for rather then going to the the store and maybe finding it or maybe not finding there product.
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