Retailers with physical channels need to make sales in stores, but to do so, they need employees. One factor cannot be separated from the other. Accordingly, keeping employees happy is a critical prerequisite of retail success—a lesson that Walmart appears to be embracing. In the past, it may have earned substantial sales around the Thanksgiving holiday, but this year, it will close its stores on Thanksgiving, giving employees a day off to spend with their families.

The company’s CEO explicitly noted this point as a determinant of the decision to close, citing the difficult year that store employees had had, the extra efforts they had devoted to helping customers during the COVID-19 pandemic, and their need for some time off. In further appreciation and support for these workers, Walmart also announced that it would be distributing cash bonuses ($150 for part-time and $300 for full-time employees working in stores or fulfillment centers), the third time it has done so this year.

Although clearly an effort to express appreciation and support for employees, other factors encourage the decision to close on Thanksgiving too. Due to broader market shifts, the sales contributions of the one- or two-day shopping events that surround Thanksgiving and Black Friday have diminished over time, in terms of the retailer’s revenues. That is, even as some shoppers continue to line up outside or in cordoned-off areas inside stores to access great deals, many others have moved online, spreading out their holiday spending across several weeks. Even the concept of Cyber Monday tends to encompass at least a week’s worth of deals, offered by various multichannel retailers. As Walmart works to expand its online presence, it likely will shift more of its attention and resources to these online deals, rather than devoting itself exclusively to the stressful one-day events.

Furthermore, the decision to close appeals to consumers, which may seem somewhat surprising. In the past, shoppers had lined up behind established barriers in stores, which roped off the Thanksgiving Day deals until a certain hour (usually 6:00 p.m.), then rushed the sections when Walmart opened them. But as noted, many of these shoppers already have shifted their deal-seeking tendencies online. They also express general support for the notion that employees deserve to be at home on Thanksgiving, suggesting a more altruistic view among consumers who can appreciate a company treating its employees well.

Perhaps then, a staff of well-rested employees will be better prepared for their next busy shift, which is pertinent. Walmart still will open its stores on Black Friday, in the hope that some shoppers will continue to want to get holiday shopping deals in its stores.

Discussion Questions

1. How might Walmart leverage this strategic choice to close on Thanksgiving in its communications with customers?
2. What can Walmart do to attempt to make up for sales it might lose by closing on the holiday?
3. Should other retailers also close on Thanksgiving?

Source: Sara DiNatale, “Walmart Stores Will Close on Thanksgiving, So No Early Black Friday,” Tampa Bay Times, July 21, 2020; Minda Zetlin, “Walmart Just Announced It’s Changing a 30-Year Tradition. Here’s What Customers Are Saying,” Inc., July 24, 2020