Black Friday

Marketing strategies, paired with consumers’ need to locate the best deals on Christmas gifts has led to Black Friday being celebrated as a consumption ritual comparable in importance to Thanksgiving Day. (Thomas and Peters, 2011) How has Black Friday become the largest retail sales day of the year? What is it that drives people to artificially induced hyper consumption, almost like an annual ritual? Many scientist and psychologists have many different theories and conclusions of why Black Friday has become the biggest shopping day of the year. In this paper, I will take your through the research and conclusions that many psychologists have produced and the advantages and disadvantages of Black Friday. Dr. Stephanie Sarkis, Ph. D. explored the work of Jane Boyd Thomas and Cara Peters, professors at South Carolina’s Winthrop University, who spent two years in research trying to find common traits in Black Friday shoppers. They conducted thirty-eight extensive interviews with â€Å"experienced† Black Friday shoppers and found four recurring themes: 1. Familial bonding (multiple generations and close friends) 2. Strategic planning . The great race 4. Mission accomplished But how do the four themes they came up with relate to one another? Thomas and Peters figured that all the traits when analyzed together showed one commonality. They wrote, â€Å"the traits are coalesced around a military metaphor, and is a bonding activity Shoppers prepare for the ritual by scanning Black Friday ads, and they map out their stra tegy. † (Sarkis 2011) In essence, the family is a type of team that scans adds, plans their route and potential purchases, executes their plans by buying products, and rejoices in their accomplishments. When all of these traits are analyzed individually, they mean little to main the main outcome, bonding. But when all the traits are looked at collectively, they all contribute to the overall success and goal of bonding. Besides giving us a breakdown of bonding activities, the analysis also shows how the average consumer plan for Black Friday. Just as Sarkis found themes that make up this military metaphor, Byun, professor of consumer affairs at Auburn University came up with her own theory on why people react the way they do on Black Friday. Crowds create a sense of competition — such as when hundreds of shoppers are rushing to collect marked-down goods — they generate a different feeling entirely. Competition creates what’s called hedonic shopping value, or a sense of enjoyment from the mere process of buying goods. At certain levels, consumers enjoy arousal and challenges during the shopping process. † (Khazan 2011) In essence what Byun is saying is consu mers get more enjoyment because the crowds create an obstacle, which hinders the execution of the plans and preparations made. The crowds make getting what they want harder, which creates more value for the goods purchased. Just as Byun noted that crowds contribute to the Black Friday Craze, Kelly McGonigal, Ph. D. describes another factors that plays a big part in the â€Å"Black Friday frenzy†. Retailers, she notes, use innovative designs to lure customers into their stores and keep them there. McGonigal says â€Å"time pressure sales on limited products or scarce resources† triggers a negative physiological affect on the consumer. Scarcity for a certain commodity creates a sense of urgency to act now, a natural instinct to survive. This survival instinct can be related to hunting for some people. Black Friday is â€Å"hunting for women,† said Leisa Reinecke Flynn, professor of marketing and fashion merchandising at the University of Southern Mississippi. â€Å"It’s so much like deer hunting it’s hard to tell the two apart. † (Khazan 2011) Unfortunately, shopping on Black Friday is not motivated by survival instincts or a life in death situation. This paradox stimulates unusual behavior in consumers that creates disadvantages and potential dangers for those that are not necessarily into the hunt. The concept of Black Friday creates a â€Å"perfect storm† for consumer misbehavior. Misbehavior, as defined by Lennon, Johnson, and Lee is, â€Å"acts that violate accepted norms of conduct in consumption contexts. † (Lennon, Johnson, Lee, 2011) This compulsive behavior, or compulsive consumption, feeds off of the idea of scarcity. It induces people to act inappropriately harming others and often themselves. â€Å"For many, if not most compulsive purchasers, buying is a reaction to stress or unpleasant situations. Compulsive consumption is a type of consumer behavior which is inappropriate, typically excessive, and clearly disruptive to the lives of other individuals. (Ronald, Thomas, and Raymond 1987) Both hunting and shopping hinge on long-standing traditions and generally involve pursuing a goal as a group. Whether the group actually hits its target is secondary to the fun of the chase. Hunting and shopping as shown above are very closely linked and motivated by the idea of scarcity. Just like there are limited deer in the forest, there are limited goods in the stores. The result is paradoxical in nature. People are fraudulently deceived into acting compulsively. (Herpen, Pieters and Zeelenberg 2005) Just as Ronald, Thomas, and Raymond concluded that compulsive behavior negatively affects the lives of others, Peter McGraw, Ph. D. drew a similar connection. He focuses more on social trends and pressures being the root of the problem. In The Link between Thanksgiving Gluttony and Black Friday Insanity, McGraw makes a connection between Black Friday shopping and Thanksgiving Dinner. He explores the idea that once a year, people will consume more calories in one meal, than the average person consumes on a normal day. The next day they wake up, or sometimes not sleeping at all, and go shopping for hours on end. (McGraw and Warner 2011) Dr. McGraw’s research shows us that in a short period of forty eights hour there is over consumption of food on Thanksgiving and the hyper consumption or shopping on Black Friday. McGraw believes that the cause of this phenomenon is social influence and pressure. He writes, â€Å"One of the hallmarks of psychological science is that we are influenced by the actions of others—often more so than we’d like to admit. Sometimes we’re impelled to take positive actions, such as switching to reusable bags or cutting down on littering. Other times, social influence can be quite negative. When it comes to Thanksgiving and Black Friday, unfortunately, the influences skew more toward bad than good. † (McGraw and Warner 2011) In other words McGraw places responsibility of hyper consumption on social trends, pressures, and even perhaps familial rituals for the ever-popular Black Friday. Another concept of Black Friday is one of mutual benefit for both consumer and retailer. Consumers’ benefit from large discounts on all sorts of items including clothing, electronics, furniture, and literally any other commodity available on the market. Retailers’ benefit by getting out of the red zone, finally making a profit for the fiscal year. The opportunities available on Black Friday is what drove 212 million shoppers to stores during Black Friday weekend in 2011. (Wilson, 2010) Retailers experience surging sales during Black Friday and the days that follow. This monetary benefit is what drives their extensive promotion and deal offerings, further influencing the consumer’s willingness to partake in the shopping frenzy. In a society where a corporation or business’s main purpose is to grow profits for the benefit of its shareholders, a company’s number one purpose is to increase sales, in order to increase profits. According to a New York Times article written by Adam Davidson, approximately one fifth of retailer’s total annual sales are made during the holiday shopping season. (Davidson, 2011) In conclusion, we can see that shopping on Black Friday brings people together in one way or another. For some, it brings people together in a positive way. Families and friends are able to work as a team who plan, prepare and execute their plans to achieve their goals. For others, Black Friday shoppers experience the negative affects of other people’s behavior. There are also advantages and disadvantages for both the consumer and retailer. Consumers get amazingly cheap prices on products while retailers experience a massive surge in sales. However one may look at Black Friday, it is a day that cannot be ignored. It’s influence and popularity are ever growing and expanding. Reference Page Davidson, Adam. The Black Friday Effect: Let’s Stimulate the Economy with Inflation. † The New York Times, 16 Nov. 2011. Web. 30 Oct. 2012. Herpen, Erica van, Rik Pieters, and Marcel Zeelenberg (2005) ,†How Product Scarcity Impacts on Choice: Snob and Bandwagon Effects†, in Advances in Consumer Research Volume 32, eds. Geeta Menon and Akshay R. Rao, Advances in Consumer Research Volume 32 : Association for Consumer Research, Pages: 623-624. Faber, J. Ronald, O’Guinn, C Thomas, and Krych, Raymond. (1987) â€Å"Compulsive Consumption†, in Advances in Consumer Research Volume 14, eds. Melanie Wallendorf and Paul Anderson, Advances in Consumer Research Volume 14: Association for Sonsumer Research, Pages: 132-135. McGonigal, Kelly, Ph. D. â€Å"The Science of Willpower. † Comments on â€Å"Black Friday Shopping: How Stores Use Psychology to Fill Your Cart† N. p. , 19 Nov. 2010. Web. 30 Oct. 2012. . McGraw, Peter, Ph. D. , and Warner, Joel. â€Å"The Humor Code. † The Link between Thanksgiving Gluttony and Black Friday Insanity. N. p. , 21 Nov. 2011. Web. 30 Oct. 2012. . Ridgwar, Nicole, â€Å"Black Friday Sales Hit Record. † CNNMoney. Cable News Netwrok, 26 Nov. 2011. Web. 30 Oct. 2012. Sarkis, Stephanie, Ph. D. â€Å"Here, There, and Everywhere. † Black Friday: A Collective Consumption Ritual. N. p. , 20 Nov. 2011. Web. 30 Oct. 2012. . Thomas, Jane Boyd, and Peters, Cara. (2011) â€Å"An exploratory investigation of Black Friday consumption rituals†, International Journal of Retail Distribution Management, Vol. 39 Iss: 7, pp. 522 – 537 Wallendorf, M. , Arnould, E. â€Å"We gather together: consumption rituals of Thanksgiving Day†, in Journal of Consumer Research, (1991) Vol. 18 No. 1, pp. 13-31. Wilson, April. â€Å"By the Numbers: Black Friday Shoppers and Their Impact on the Economy. † The Luckie ReTink Tank. 23 Nov. 2011. Web. 30 Oct 2012. . Black Friday Marketing strategies, paired with consumers’ need to locate the best deals on Christmas gifts has led to Black Friday being celebrated as a consumption ritual comparable in importance to Thanksgiving Day. (Thomas and Peters, 2011) How has Black Friday become the largest retail sales day of the year? What is it that drives people to artificially induced hyper consumption, almost like an annual ritual? Many scientist and psychologists have many different theories and conclusions of why Black Friday has become the biggest shopping day of the year. In this paper, I will take your through the research and conclusions that many psychologists have produced and the advantages and disadvantages of Black Friday. Dr. Stephanie Sarkis, Ph. D. explored the work of Jane Boyd Thomas and Cara Peters, professors at South Carolina’s Winthrop University, who spent two years in research trying to find common traits in Black Friday shoppers. They conducted thirty-eight extensive interviews with â€Å"experienced† Black Friday shoppers and found four recurring themes: 1. Familial bonding (multiple generations and close friends) 2. Strategic planning . The great race 4. Mission accomplished But how do the four themes they came up with relate to one another? Thomas and Peters figured that all the traits when analyzed together showed one commonality. They wrote, â€Å"the traits are coalesced around a military metaphor, and is a bonding activity Shoppers prepare for the ritual by scanning Black Friday ads, and they map out their stra tegy. † (Sarkis 2011) In essence, the family is a type of team that scans adds, plans their route and potential purchases, executes their plans by buying products, and rejoices in their accomplishments. When all of these traits are analyzed individually, they mean little to main the main outcome, bonding. But when all the traits are looked at collectively, they all contribute to the overall success and goal of bonding. Besides giving us a breakdown of bonding activities, the analysis also shows how the average consumer plan for Black Friday. Just as Sarkis found themes that make up this military metaphor, Byun, professor of consumer affairs at Auburn University came up with her own theory on why people react the way they do on Black Friday. Crowds create a sense of competition — such as when hundreds of shoppers are rushing to collect marked-down goods — they generate a different feeling entirely. Competition creates what’s called hedonic shopping value, or a sense of enjoyment from the mere process of buying goods. At certain levels, consumers enjoy arousal and challenges during the shopping process. † (Khazan 2011) In essence what Byun is saying is consu mers get more enjoyment because the crowds create an obstacle, which hinders the execution of the plans and preparations made. The crowds make getting what they want harder, which creates more value for the goods purchased. Just as Byun noted that crowds contribute to the Black Friday Craze, Kelly McGonigal, Ph. D. describes another factors that plays a big part in the â€Å"Black Friday frenzy†. Retailers, she notes, use innovative designs to lure customers into their stores and keep them there. McGonigal says â€Å"time pressure sales on limited products or scarce resources† triggers a negative physiological affect on the consumer. Scarcity for a certain commodity creates a sense of urgency to act now, a natural instinct to survive. This survival instinct can be related to hunting for some people. Black Friday is â€Å"hunting for women,† said Leisa Reinecke Flynn, professor of marketing and fashion merchandising at the University of Southern Mississippi. â€Å"It’s so much like deer hunting it’s hard to tell the two apart. † (Khazan 2011) Unfortunately, shopping on Black Friday is not motivated by survival instincts or a life in death situation. This paradox stimulates unusual behavior in consumers that creates disadvantages and potential dangers for those that are not necessarily into the hunt. The concept of Black Friday creates a â€Å"perfect storm† for consumer misbehavior. Misbehavior, as defined by Lennon, Johnson, and Lee is, â€Å"acts that violate accepted norms of conduct in consumption contexts. † (Lennon, Johnson, Lee, 2011) This compulsive behavior, or compulsive consumption, feeds off of the idea of scarcity. It induces people to act inappropriately harming others and often themselves. â€Å"For many, if not most compulsive purchasers, buying is a reaction to stress or unpleasant situations. Compulsive consumption is a type of consumer behavior which is inappropriate, typically excessive, and clearly disruptive to the lives of other individuals. (Ronald, Thomas, and Raymond 1987) Both hunting and shopping hinge on long-standing traditions and generally involve pursuing a goal as a group. Whether the group actually hits its target is secondary to the fun of the chase. Hunting and shopping as shown above are very closely linked and motivated by the idea of scarcity. Just like there are limited deer in the forest, there are limited goods in the stores. The result is paradoxical in nature. People are fraudulently deceived into acting compulsively. (Herpen, Pieters and Zeelenberg 2005) Just as Ronald, Thomas, and Raymond concluded that compulsive behavior negatively affects the lives of others, Peter McGraw, Ph. D. drew a similar connection. He focuses more on social trends and pressures being the root of the problem. In The Link between Thanksgiving Gluttony and Black Friday Insanity, McGraw makes a connection between Black Friday shopping and Thanksgiving Dinner. He explores the idea that once a year, people will consume more calories in one meal, than the average person consumes on a normal day. The next day they wake up, or sometimes not sleeping at all, and go shopping for hours on end. (McGraw and Warner 2011) Dr. McGraw’s research shows us that in a short period of forty eights hour there is over consumption of food on Thanksgiving and the hyper consumption or shopping on Black Friday. McGraw believes that the cause of this phenomenon is social influence and pressure. He writes, â€Å"One of the hallmarks of psychological science is that we are influenced by the actions of others—often more so than we’d like to admit. Sometimes we’re impelled to take positive actions, such as switching to reusable bags or cutting down on littering. Other times, social influence can be quite negative. When it comes to Thanksgiving and Black Friday, unfortunately, the influences skew more toward bad than good. † (McGraw and Warner 2011) In other words McGraw places responsibility of hyper consumption on social trends, pressures, and even perhaps familial rituals for the ever-popular Black Friday. Another concept of Black Friday is one of mutual benefit for both consumer and retailer. Consumers’ benefit from large discounts on all sorts of items including clothing, electronics, furniture, and literally any other commodity available on the market. Retailers’ benefit by getting out of the red zone, finally making a profit for the fiscal year. The opportunities available on Black Friday is what drove 212 million shoppers to stores during Black Friday weekend in 2011. (Wilson, 2010) Retailers experience surging sales during Black Friday and the days that follow. This monetary benefit is what drives their extensive promotion and deal offerings, further influencing the consumer’s willingness to partake in the shopping frenzy. In a society where a corporation or business’s main purpose is to grow profits for the benefit of its shareholders, a company’s number one purpose is to increase sales, in order to increase profits. According to a New York Times article written by Adam Davidson, approximately one fifth of retailer’s total annual sales are made during the holiday shopping season. (Davidson, 2011) In conclusion, we can see that shopping on Black Friday brings people together in one way or another. For some, it brings people together in a positive way. Families and friends are able to work as a team who plan, prepare and execute their plans to achieve their goals. For others, Black Friday shoppers experience the negative affects of other people’s behavior. There are also advantages and disadvantages for both the consumer and retailer. Consumers get amazingly cheap prices on products while retailers experience a massive surge in sales. However one may look at Black Friday, it is a day that cannot be ignored. It’s influence and popularity are ever growing and expanding. Reference Page Davidson, Adam. The Black Friday Effect: Let’s Stimulate the Economy with Inflation. † The New York Times, 16 Nov. 2011. Web. 30 Oct. 2012. Herpen, Erica van, Rik Pieters, and Marcel Zeelenberg (2005) ,†How Product Scarcity Impacts on Choice: Snob and Bandwagon Effects†, in Advances in Consumer Research Volume 32, eds. Geeta Menon and Akshay R. Rao, Advances in Consumer Research Volume 32 : Association for Consumer Research, Pages: 623-624. Faber, J. Ronald, O’Guinn, C Thomas, and Krych, Raymond. (1987) â€Å"Compulsive Consumption†, in Advances in Consumer Research Volume 14, eds. Melanie Wallendorf and Paul Anderson, Advances in Consumer Research Volume 14: Association for Sonsumer Research, Pages: 132-135. McGonigal, Kelly, Ph. D. â€Å"The Science of Willpower. † Comments on â€Å"Black Friday Shopping: How Stores Use Psychology to Fill Your Cart† N. p. , 19 Nov. 2010. Web. 30 Oct. 2012. . McGraw, Peter, Ph. D. , and Warner, Joel. â€Å"The Humor Code. † The Link between Thanksgiving Gluttony and Black Friday Insanity. N. p. , 21 Nov. 2011. Web. 30 Oct. 2012. . Ridgwar, Nicole, â€Å"Black Friday Sales Hit Record. † CNNMoney. Cable News Netwrok, 26 Nov. 2011. Web. 30 Oct. 2012. Sarkis, Stephanie, Ph. D. â€Å"Here, There, and Everywhere. † Black Friday: A Collective Consumption Ritual. N. p. , 20 Nov. 2011. Web. 30 Oct. 2012. . Thomas, Jane Boyd, and Peters, Cara. (2011) â€Å"An exploratory investigation of Black Friday consumption rituals†, International Journal of Retail Distribution Management, Vol. 39 Iss: 7, pp. 522 – 537 Wallendorf, M. , Arnould, E. â€Å"We gather together: consumption rituals of Thanksgiving Day†, in Journal of Consumer Research, (1991) Vol. 18 No. 1, pp. 13-31. Wilson, April. â€Å"By the Numbers: Black Friday Shoppers and Their Impact on the Economy. † The Luckie ReTink Tank. 23 Nov. 2011. Web. 30 Oct 2012. . Black Friday

Company analysis Essay Example | Topics and Well Written Essays - 250 words

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Lehman brothers Literature review Example | Topics and Well Written Essays - 2000 words

Lehman brothers - Literature review Example The trick works perfectly, and manages to lure unsuspecting investors into trusting the company’s financial reports. Banks however use Repo 105 for purposes of short term borrowing, while in the case of Lehman, it was used to reflect a healthier balance sheet than it actually was. Jeffers (2011, p. 2) observes that the Lehman brothers used the â€Å"Repo 105† in its accounting severally to report impressive financial statements and win the trust of potential investors, by showing healthy securities. The company was an investment bank which had gone global. Lehman’s’ auditors on three occasions used the Repo 105 creative accounting trick to boost investor confidence. The trick used by Lehman helped them temporarily remove from its balance sheet roughly $ 50 billion, making the balance sheet look better the actual status of the company’s financial statements. However, at the time of filing its bankruptcy case, the company has a total of $ 639 billion in assets and $ 619 billion in debts. This formed the biggest bankruptcy case that affected over $ 10 trillion in investments. The company’s scheme involved the use of collateral firms such as Alpha Ville, with counter parties from banks such as Barclays Bank of Britain, USB of Switzerland, Mizuho Bank and Mitsubishi UFJ Financial Group. To be exact, the company involved in Repo 105, the transactions’ worth was estimated at over 105 per cent of the actual cash it received. This meant that the company was experiencing a shortage through these transactions. When they repaid the cash it received from the counterparties, interest was included, which made it a very expensive technique, thus losing money. Repo 105 is a tricky phenomenon for any company which opts to use it as a model of reporting its financial status. According to accounting standards, it is wrong and unethical for a firm to alter its books of accounts (Nguyen & Gong, 2012, p. 31). It is an issue that is qui te sensitive, deciding to report a misleading state of a company’s financial status. Whether such a situation finds its way to legal courts or not, it makes no difference, involved parties ought to hold responsibility for any eventuality through their actions. Not unless a company is planning on a strategy to defraud and steal from potential investors, it would never go to such lengths like Lehman did, with clear knowledge of the implications that are likely to come (Law, 2011, p 511). Some examiners hold that â€Å"Repo 105† actually is a â€Å"gross negligence† and does not amount to crime. However, the fact that Lehman altered its accounts with the intention of deceiving investors, rating agencies and perhaps the industry regulators is proof enough that this was criminal and that the presenters of the company acted in malice. The scheme led to the largest corporate bankruptcy case in the United States financial history (Sharp, 2010, n.p). Investors lost money , in the process. No matter how much conservatives refer to this as a form of negligence, it is still a crime. According to the accounting theories, Lehman accountants and managers contravened the theories of accounting and broke the oath of conduct of accountants. Although some scholars like Jennings (2011, p. 38) felt that the internal misleading of the company itself by the altered