Black Friday marks the real beginning of the holiday season, at least for retailers and serious shoppers. Pundits and a few analysts have been prognosticating a gradual slowdown in the Black Friday shopping frenzy for some years now, but it has not come to pass.

Citi Research has produced a report “Specialty Retail Black Friday 2013” (written by analysts Oliver Chen and Nancy Hilliker) that elaborates on the specific factors impacting this year’s Black Friday.

The numbers

The report begins with the basics. The continuing economic doldrums combined with the government shutdown a couple of months ago has led analysts to project that Black Friday consumer spending will drop by 3 to 5% from last year. That said, big improvements in the real estate and stock markets have benefited the top 20% of earners in the US, who also have 50% of the discretionary spending. In other words, the well-to-do have plenty of money to spend on Christmas this year, and that augurs well for certain retailers.

Black Friday 2013 outlook

Overall, Citigroup Inc (NYSE:C) is somewhere between cautious and negative regarding retail sales for Black Friday 2013. They believe it is likely that traffic will be significantly lower at most brick and mortar retailers compared to Black Friday 2012.

Black friday

Weather is even expected to be a negative factor, as forecasts are for poor weather in both the Midwest and on the East Coast. Very cold weather could also give a real boost to retailers with a strong online presence.

Other negative factors include a lack of one or more “must-have” gifts this year and extremely  intense competition among retailers and online operators.

Citi is expecting strong overall results from the specialty retailers with greatest online penetration, including Urban Outfitters, Inc. (NASDAQ:URBN), L Brands Inc (NYSE:LTD) and Vera Bradley, Inc. (NASDAQ:VRA).

New for 2013

One noticeable trend is the blurring of lines between e-commerce and brick-and-mortar store promotions. They point to new developments such as simultaneous in-store and online sales, and the growing trend of carrying online reserves at retail locations. It should be noted this could result in higher online sales conversion rates.

The Citi report also advances the argument that accessories will continue to outperform apparel this season, and the hottest brands such as Lululemon Athletica inc. (NASDAQ:LULU) (TSE:LLL) and Michael Kors Holdings Ltd (NYSE:KORS) will continue to gain market share.