The competition is fierce for holiday sales this year. So much so, that when it comes to some retailers, Black Friday has already begun. There are myriad ways you can play the bargain-hunting with exchange traded funds (ETFs).

Black Friday is the traditional kick-off for the holiday shopping season, but you may have noticed the deals began popping up a little earlier than usual this year. Retailers are eager to lure consumers out of their hidey-holes, and they may find a receptive audience. Consumers are less afraid of spending right now, but that doesn’t mean they don’t want a great deal. (Retailers feeling cautious).

After all, it says a lot about the economy when this year’s must-have toy is the Zhu Zhu Pet, a robotic hamster that retails for under $10 – if you can find one.

Some of the happenings in the retail sector include:

  • This year, Wal-Mart (NYSE: WMT) stores are actually staying open all night on Thanksgiving. It’s partially an attempt to ease the crowding that led to the trampling death of a store employee on Black Friday a year earlier, as well as an attempt to drum up extra sales, reports Andrea Chang for The Los Angeles Times.
  • In some product categories, such as LCD TVs, retailers will match cut-rate prices offered by their online brethren — Amazon (NYSE: AMZN) and, for example — even if it means selling at a loss, just to get people into their stores. (Read about the price wars of online retailers). Amazon also started its Black Friday pricing on Nov. 23.
  • Target Corp.’s (NYSE: TGT) profit is up 18% so far this year, however, the outlook for the holidays are uncertain. Like Wal-Mart, the retailer is banking on markdowns and sales to drive business, and Target is even offering Black Friday pricing prior to Thanksgiving. Target’s third-quarter profit was helped by its ongoing cost-cutting efforts along with better sales in its stores and better profit from its credit card business, reports Associated Press on The Los Angeles Times.

So who will come out on top on Black Friday, the retailers or the consumers? Recent research suggests that savvy shoppers are armed and abundant. Google data shows that the upswing in searches for “Black Friday deals” started about two weeks earlier this year than last, beginning in October. Jack Neff and  Natalie Zmuda for Advertising Age say the closely watched post-Thanksgiving sales data will largely decide who succeeds at outsmarting the other.

For more stories about retail,visit our retail category.

  • SPDR S&P Retail (NYSEArca: XRT): up 73% year-to-date; Amazon 2.20%

  • Consumer Discretionary Select Sector SPDR (NYSEArca: XLY): up 34.7% year-to-date; Amazon 4.75%; Target 4.38%

  • iShares Dow Jones US Consumer Services (NYSEArca: IYC): up 28.5% year-to-date; Wal-Mart 8.98%; Amazon 3.07%; Target 2.48%

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.