Friday Charts: Black Friday's Coming Irrelevance

Per our regular routine, we’re ditching the longwinded analysis. And instead, we’re featuring a handful of charts to reveal some important economic and investing insights.

You can thank American journalist, Arthur Brisbane, for the change of pace. As he said in 1911, Use a picture. It’s worth a thousand words. And we couldn’t agree more, which is why we devote one day each week to pretty pictures.

Since today also happens to be Black Friday, the most epic shopping day in the world, guess what we’ll be focusing on? You got it, retail sales.

Let’s get to it…

From Brick-And-Mortar To Click-And-Order
Mark my words. A few decades from now, Black Friday will be nothing more than a footnote in the history books. Why? Well, consumers keep opting to click and order, instead of making their purchases at traditional brick-and-mortar stores.


Propelled by the internet craze of the 1990s -- not an Al Gore endorsement -- online sales keep surging. They now account for 9% of total U.S. retail spending.

They’re headed higher, too. Much higher.

In the here and now, Doug Anmuth, an analyst at JP Morgan (JPM), expects online purchases to break the 10% barrier for the first time in history this year. Given the latest sales growth estimates, I’d have to agree.

Traditional retail spending is only expected to increase 4.1% this holiday season. Whereas online sales are expected to grow by 15% to 18%, according to comScore (SCOR).

Rest assured, the diverging growth rates aren’t an anomaly. They’re signaling a trend.

As you can see, both retail sales and e-commerce sales naturally rebounded at solid double-digit rates in the aftermath of the Great Recession. Now, though, as e-commerce sales growth is accelerating, traditional retail sales growth is decelerating.

Like I said, Black Friday’s on a crash course with irrelevance. Before long, all we’re going to be talking about is Cyber Monday.

Fear Not, All Retail Isn’t Dead
Now that I have you shaking your head about the fate of traditional retail sales, it’s time to highlight the bright spot in the market

You see, not all retail stores are destined for the dustbin courtesy of the internet. The few, proud Apples (AAPL) of the world still rake in the loot at their brick-and-mortar locations.

Based on RetailSails data, Apple stores ring up more than $6,000 in sales per square foot.

If you’re after growth investments in the traditional retail space, the companies at the top of this chart would be a good place to start your due diligence. Like Gang Starr, they still have mass appeal, which translates into serious sales and profits.

My personal favorite -- not because I like to carry a man-purse, but because of its dividend growth potential -- is handbag maker, Coach (COH). If you’re an income investor, you should check out my recent research on Coach here.

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