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SPECIAL BUSINESS REPORT: Five Surprising Big Earners On Black Friday


(Editor's Note: This article was released by IBISWorld, which is recognized as the nation’s most trusted independent source of industry and market research.)

Black Friday has long been the nation’s most hectic shopping holiday for both consumers and retailers. Although department stores, clothing outlets, toy stores, electronics manufacturers and other major retailers will once again experience their busiest day of the year this Friday, there are several lesser-known industries that might not have doorbuster sales, but nevertheless view this unofficial holiday as the biggest revenue-generating opportunity of the year. Here are some unsung industries that will also reap the economic rewards of this year’s Black Friday.


Search Engines

Dominated by culturally ubiquitous tech giants Google, Yahoo and Microsoft, enterprises in the Search Engines industry (IBISWorld report 51913a) benefit substantially from enormous Black Friday order volumes, competitive keyword bidding processes, growth in retailers’ online advertisement spending and the continual shift toward online holiday shopping. Search engines generate revenue from advertisers that pay the search engine based on the total number of clicks their advertisements receive. Search engines often charge varying rates depending on the key words included within the advertisement’s search terms, and Black Friday-specific advertisements typically command significant cost-per-click rates during peak holiday periods that generate high volumes of user click-throughs (the number of times an advertisement is clicked on from the landing page). Search engines also generate additional revenue from advertisers that are willing to pay a premium rate for having their advertisements located at highly visible locations on websites or at the top of a search engine’s search results. Combined with increasing click-through rates for Black Friday shopping, advertisement rate increases have led to massive revenue gains for search engines. According to digital marketing research firm Kenshoo, click-through rates are about 50.0% higher on Black Friday than the average day, while cost-per-click rates are about 75.0 % higher. The Search Engines industry is expected to grow an annualized 6.2% to $30.7 billion over the five years to 2015, with industry revenue anticipated to increase an additional 8.2% in 2015 alone.

Gas Stations

Black Friday represents one of the busiest long- and short-distance automobile travel periods of the year. According to the US Department of Transportation’s Bureau of Transportation Statistics, the Thanksgiving travel period from November 25 to 29 generates a 54.0% increase in the number of long-distance trips of 50 miles or more. The Gas Stations industry (IBISWorld report 44719) is poised to benefit substantially from the additional travel, particularly as consumers are attracted by the considerably lower per-gallon price of gasoline. While the Gas Stations industry has experienced a decline over the past five years, much of this is due to the volatility and subsequent drops in the world price of crude oil. Consequently, revenue is expected to decline an annualized 2.6% to $106.3 billion over the five years to 2015. Nevertheless, as prices have fallen, demand has still increased, bolstering profit margins. With gas prices appearing relatively low going into the holiday season, consumers are expected to increase their time at the pump to fuel both their return trips home and their shopping activities following the holiday. According to a survey conducted by the National Association of Convenience Stores, 42.0% of all traditional Black Friday shoppers are expected to increase their shopping times this season, while 87.0% of traditional Black Friday shoppers attribute their higher spending to lower gas prices and increasing confidence about the state of the US economy. According to IBISWorld estimates, individual consumers comprise a dominant 68.8% of all gas station sales, with the remaining 31.2% stemming from sales to disparate manufacturers, contractors, wholesalers, agricultural workers and government organizations. Although the retail price of gasoline has been extremely volatile over the past five years, the anticipated 46.3% decline in price per barrel of crude oil in 2015 will likely generate enormous flows of traffic on Black Friday this year.

Cardboard Box and Container Manufacturing

Manufacturing, retail trade, and packaging and labeling industries are key buying industries for the Cardboard Box and Container Manufacturing industry (IBISWorld report 32221), which makes Black Friday an important day for these manufacturers. The retail sector accounts for 20.2% of revenue for the industry. Typically, cardboard boxes and packaging are used for shipping items from companies’ inventories to shoppers’ homes. With online retail growing faster every year, cardboard manufacturers ship a massive amount of boxes to retailers for later packaging and shipping. According to IBM, 2014 Black Friday mobile traffic reached 49.6% of all online traffic, representing an increase of 25.0% from the previous year. Additionally, the National Retail Federation cites that 65.0% of shoppers did so online on Black Friday in 2014, purchasing clothing, consumer electronics, books, CDs, DVDs and video games. Online shopping is expected to continue its growth into this Black Friday; IBISWorld anticipates the percentage of services conducted online to increase from 8.2% in 2010 to an estimated 9.8% in 2015. As more consumers opt to purchase holiday clothing, electronics, books and other gifts online, online and big-box retailers will require additional cardboard to package and ship these goods during the busy shopping season. Consequently, this industry is expected to grow 2.2% to $61.7 billion over the five years to 2015, with a 1.1% anticipated gain in 2015.

Movie Theaters

Black Friday heralds the beginning of the movie industry’s holiday film season, which has become an increasingly crucial time for Hollywood to generate revenue outside of the traditional summer blockbuster season. The Movie Theater industry (IBISWorld report 51213), which IBISWorld estimates will grow 1.1% to $16.4 billion in 2015, will continue to depend on the box office performance of Hollywood’s anticipated winter releases. This year, that includes the November 20 opening of the final installment of the high-grossing Hunger Games series. Thanksgiving weekend remains a lucrative time for movie exhibitors; according to Box Office Mojo, the Movie Theater industry generated $163.8 million during the holiday weekend in November 2014 and $208.1 million the same time in 2013.

Higher spending on leisure and entertainment during the holiday season will not be enough to offset the challenges that threaten the Movie Theatre industry. Operators are reeling with lower overall attendance and the rising prominence of streaming sites, such as Netflix. In an effort to maintain loyalty among frequent moviegoers and attract a wider audience, movie theaters have expanded their concession menus, offered promotional events and, in some cases, upgraded their theater seating.

Security Services

Extended hours, jam-packed parking lots and overzealous crowds will continue to increase demand for the Security Services industry (IBISWorld report 56161) this Black Friday. Outsourced security guards are primarily hired on both a salary and contract basis to prevent shoplifting and deter other crimes, such as vandalism and personal theft. Moreover, under the legal theory of “premises liability,” property owners or lessees of retail space are liable for any accidents and injuries that occur on their property. Consequently, security guards are also hired to protect the health and safety of shoppers and employees. The growing need to protect the property of business owners and the safety of their customers has resulted in an estimated 2.4% annualized increase in revenue for the Security Services industry over the past five years, reaching a projected $30.7 billion in 2015.

Major security service companies, such as Securitas, G4S and AlliedBarton, ordinarily sign multiyear contracts with commercial real estate investment trusts and property managers of malls, retail outlets and shopping centers. These contracts are structured such that additional security personnel needs for Black Friday are planned well in advance of seasonal shopping mayhem, thereby preventing any significant seasonal bumps in revenue for the Security Services industry’s top companies.

However, as the shoppers gather and foot-traffic mounts during this busy kick-off to the holiday season, security services will bolster their on-site guards and vehicle patrols. This will provide a temporary boost for security guard employment. Furthermore, as stores and malls extend their hours, security guards will likely be required to stay on the job longer in parallel, thereby increasing overtime pay-outs. According to the Bureau of Labor Statistics, the average hourly wage for a security guard totals $11.74 per hour. During peak holiday seasons, however, employees at major security companies can earn about $20.00 per hour in overtime wages.

About IBISWorld Inc.

Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit www.ibisworld.com or call 1-800-330-3772.


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