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Reply #38: Barry Ritholtz: No, Black Friday Sales Were Not Up 16% (not even 6%) [View All]

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DemReadingDU Donating Member (1000+ posts) Send PM | Profile | Ignore Mon Nov-28-11 08:26 AM
Response to Reply #36
38. Barry Ritholtz: No, Black Friday Sales Were Not Up 16% (not even 6%)


11/28/11 No, Black Friday Sales Were Not Up 16% (not even 6%)

If its the Monday after Black Friday, then its national hype the fabricated data day! Every year around this time, we get a series of loose reports coincident with Black Friday and the holiday weekend. Each year, they are wildly optimistic. And like clockwork, the media idiotically repeats these trade organizations spin like its gospel. When the data finally comes in, we learn that the early reports were pure hokum, put out by trade groups to create shopping hype. (Yes, the Media ALWAYS screws the pooch big time on this one, with the occasional exception). Lets start with this whopper from an utterly breathless press release from the National Retail Federation:


No, retail sales did not climb 16%. Surveys where people forecast their own future spending are, as we have seen repeatedly in the past, pretty much worthless.

We actually have no idea just yet as to whether, and exactly how much, sales climbed. The data simply is not in yet. The most you can accurately say is according to some foot traffic measurements, more people appeared to be in stores on Black Friday 2011 than in 2010.

Another absurd example: Does any one actually believe nearly one-quarter (24.4%) of Black Friday shoppers were at the stores by midnight on Black Friday? Perhaps the NRF competing with the NAR for title of most ridiculous trade group.


Next up is ShopperTrak, who claimed a 6.6% gain in sales:


What is the basis of that 6.6% gain? ShopperTrak uses equipment installed in stores to measure traffic. But that does not measure changes in window shoppers vs buyers from year to year, how much money and or credit people have, how large their holiday budgets are, or how much they are willing to spend. It is a very poor system for forecasting actual sales.

The fact that NRF and ShopperTrak are so widely disparate confirms for us at least one of their methodologies are suspect. In my opinion, both are mostly meaningless.

Here is my challenge to the CEOs of the National Retail Federation and ShopperTrak: $1,000 to the charity of the winners choice that your forecasts for Black Friday, the Thanksgiving weekend and the entire holiday shopping season are wildly off. I bet you your forecasts miss the mark by at least 10%-20% (though I believe its closer to 40-50%).

more...
http://www.ritholtz.com/blog/2011/11/no-black-friday-sa... /





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