Canadian retailers adopt Black Friday to stem U.S. tide

Wed Nov 21, 2012 4:21pm EST

* Black Friday sales planned across Canada

* Retailers hoping Canadian shoppers will stay home

* Competition heats up as U.S. retailers head north

By Allison Martell

TORONTO, Nov 21 (Reuters) - The company that owns Canada's highest-traffic mall knows many of its customers work on Black Friday - that's why Toronto's downtown Eaton Centre is opening at 6 a.m.

Tough competition and sluggish growth have spurred Canadian retailers to look for novel ways to defend market share, and many are opting to import U.S.-style Black Friday sales, even though Canadians celebrated Thanksgiving in October and the year's biggest sales traditionally come after Christmas.

A recent report from Deloitte forecast an anemic 1 to 2 percent retail sales growth in Canada this holiday season, and noted that Canadian retailers will have to compete with online merchants and with U.S. retailers, both those south of the border and those that have moved north.

No one thinks the Black Friday trend will whip up crowds on par with those in the United States, but most major retailers are planning some kind of sale.

Best Buy Co Inc is branding its Canadian promotions "Black Friday" for the first time, joining early adopters Sears Canada Inc and Wal-Mart Stores Inc. Commercial real estate heavyweight Cadillac Fairview, which owns and operates Toronto's Eaton Centre, is also opening nine of its other Ontario shopping centers early.

"What we really wanted to do was show retailers how we can work together to embrace the phenomenon," said Meredith Vlitas, senior marketing director at the Eaton Centre.

Last year, there were occasional early morning line-ups as about half of the Eaton Centre's outlets advertised weekend or one-day sales, but certainly no need for crowd control. The mall expects bigger things this year.

Ran Ravitz, general manager of Yellow Media Inc's discount tracking site Red Flag Deals, said Black Friday started to gain traction in Canada in 2009, and nearly all major retailers joined in last year.

This year, he expects better deals will make it less worthwhile to cross the border, where Canadians long found lower prices and heavier discounts.

"They're getting closer and closer," he said of U.S. and Canadian prices. "If you're trying to compare apples to apples and taking into consideration shipment and all that stuff, it's getting closer to parity."

Sears Canada Inc spokesman Vincent Power said the department store chain expects televisions to be a major category during its "Black Friday" sales, which start on Thursday, along with major appliances, apparel and accessories.


In June, the government increased the amount that Canadians traveling abroad for at least 24 hours can spend without paying duty, to C$200 from C$50 each for trips up to 48 hours, and to C$800 from C$400 for trips up to seven days - making cross-border shopping trips cheaper for those who stay in the U.S. overnight.

"Canadian retailers have responded," Powers said. "I don't think there's a major Canadian retailer out there who doesn't consider Black Friday an extremely important day on the calendar."

At the same time sluggish retail growth in the United States has lured more U.S. retailers to Canada, where consumer spending has been relatively robust.

That has put pressure on domestic players, and competition can only get tougher in the run-up to Target Corp's Canadian launch this spring.

Canada's big shopping event used to be Boxing Day, Dec. 26, when bargain hunters endure long lines to snap up heavily discounted clothing and electronics and lucky teenagers set out to spend their Christmas money in one glorious spree. But Black Friday is catching up, at least by flyer count.

At Red Flag Deals, where committed coupon clippers swap tips in busy forums and others drop in to browse flyers, traffic spikes ahead of Boxing Day and Black Friday. Ravitz said visits may come close to parity this year. On Wednesday, a traffic surge brought the site down for several hours.

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California state worker Albert Jagow (L) goes over his retirement options with Calpers Retirement Program Specialist JeanAnn Kirkpatrick at the Calpers regional office in Sacramento, California October 21, 2009. Calpers, the largest U.S. public pension fund, manages retirement benefits for more than 1.6 million people, with assets comparable in value to the entire GDP of Israel. The Calpers investment portfolio had a historic drop in value, going from a peak of $250 billion in the fall of 2007 to $167 billion in March 2009, a loss of about a third during that period. It is now around $200 billion. REUTERS/Max Whittaker   (UNITED STATES) - RTXPWOZ

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