Each year I predict the lowest pricing we’ll see for a variety of tech products during Black Friday.  Last year I predicted we’d see notebook computers selling for as low $299.  In fact Walmart sold a notebook for $198 on Black Friday.  This year I’m predicting the lowest prices we’ll see for notebook computers will be $250 – actually higher than last year. Tonight Walmart’s Black Friday circulate was leaked and it highlighted a notebook computer for $250 – consistent with my forecast and higher than last year’s price.  You can see Walmart’s entire circulate here.

Amazon is now a library – sorta. Last week, Amazon launched the Kindle Owners’ Lending Library which gives Kindle users who own an actual Kindle device (and not just use the Kindle app on other devices) AND are Amazon Prime subscribers access to 5,000+ books they can “borrow.” A few things worth noting:

1) this is probably the first example of a subscription service for digital books.  We have subscription services for other digital content (music, video, games) so books are a logical step. I assume all digital content will eventually be available either through a unit price or through a subscription service.

2) Amazon is quickly making all of their subscriptions a part of their Prime offering.  Prime subscribers now have a digital video subscription (instant streaming of movies and TV shows), a digital library subscription, and a free two-day shipping subscription. With each addition, Prime subscription becomes more attractive to two audiences, the first audience is the group that actually wants the new additional offering and the second audience is the group that finds the new addition attractive on the margin (and of value when coupled with the entire suite of services).  Ultimately this raises the number of overall Prime subscribers which in turn provides Amazon with more collective bargaining power and consequently the ability to increase the value of what is offered.  In other words, Amazon can go to the studios or publishers or whomever and say, “hey we have XXX million subscribers to our video/book/fill-in-the-service and we’d like you to do/provide/settle for….”

No surprise we’ll see TV promotions this holiday season. TVs have been a key holiday tech category for several years. With volume down domestically in 2011 and concerns of macroeconomic-led weakness in Q4 the category is well positioned for promotions. More, inventory levels for other tech categories are low on a seasonal-basis.

But for further proof, check out Samsung’s recently quarterly report here.  As you can see here from slide #12, the Q4 Outlook suggests strong promotional activities.  Expect to see promotions especially pronounced for higher-end sets (3D, connected/smart, LED, and large-screen).  Samsung states their goal in Q4 is to “outperform the market and enhance profitability through the peak season marketing and sales expansion of premium/localized models.”

 

 

A few thoughts on retail:

Black Friday has Moved to Thursday:  As I predicted last year, stores are opening earlier for Black Friday this year.  ToysRUs jumped the gun in 2010 and opened at 10PM on Thursday.  Each ToysRUs store landed 1,000+ shoppers – the largest crowds of any retailer largely because there was nothing else open.  I predicted then that stores would open earlier and that is exactly what is happening.  Target was one of the first to announce that they would open at Midnight (and are even opening some Denver-area stores on Thanksgiving). Macy’s, BestBuy and others have subsequently announced they’ll also open at Midnight. Beyond store openings, I’ve been saying for awhile that online shopping will set new records on Thursday. A recent survey from Accenture suggests in-store traffic could be the lowest in 3 years.  ShopperTrak is also forecasting store traffic will be down this year.

The Rise of Social: the use of social networking sites by retailers isn’t new, but their use heading into the 2011 holiday season is pronounced. Walmart, HHgregg, and others are pushing consumers to their Facebook page for early Black Friday deals and promises of the first glimpses of their actual Black Friday offerings. ToysRUs released their annual holiday catalog early to followers on Facebook.

Daily/Timed Deals: We’re all familiar with the rise of daily deal sites like LivingSocial and recently public Groupon.  This holiday season traditional retailers are increasingly offering daily or timed deals. Amazon offered a variety of deals in and around Black Friday last year and is already offering limited and timed “lightening deals” again this year on their Black Friday site amazon.com/blackfriday. This year, retailers like Sam’s Club, Walmart, and others are offering daily deals/offers.

The Use of Mobile: The use of mobile will be more pronounced than ever this holiday season.  The increase in smartphone/tablet ownership together with Thanksgiving turning into a big day for online retail will have mobile e-commerce setting giant records.  Sam’s Club and others are using mobile apps. ToysRUs is adding QR codes to their annual holiday catalog driving customers to additional content

LayAway:  The jury is still out if lay away will be a big driver, but Walmart has brought it back after ending the practice in 2008. Their focus is on tech and toys.  ToysRUs and others are also offering lay away options.

Price Guarantee: Last month Walmart announced they would match lower advertised prices for any purchases made between November 1 and December 25th.  Notably, they’ll match the price by providing the difference in the form of a Walmart giftcard.

Consumer Tech: ToysRUs is making a stronger push into consumer electronics (more on their assortment at CEPro). Tech is the new Toy kids most want. A different sign that games are changing for kids – GameStop is entering the tablet business.

 Lower Inventories this Year Might Suggest Fewer Deals: Inventories remain well managed, even perhaps thin headed into the final months of the year. That might suggest fewer bargains to be had.  Read more in the WSJ.
Finally, an infograph on holiday spending:

Mary Meeker’s 2011 Internet Trends if you haven’t seen them already.  You can access the slides here.  I’ll add my commentary when I can.

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Japan, the US, and many other developed nations are quickly aging – but they are doing so after gettting rich.  China on the other hand is getting old quicker than it is getting rich.  A constant debate ensues on China outgrowing the US.  Here’s one take on the topic.