It might be time to get excited about the potential of movie theaters. Even in a period dominated by the strength of streaming services, there is a confluence of trends that just might give this segment a much needed boost. A critical starting point is that when looking at visits to AMC Theaters and Regal Cinemas nationwide, there is a clear recovery trend. Looking at a 2022 ravaged by challenges from Omicron in January to inflation and rising gas prices in the Spring, and yet, the Year over Three Year visit gap was still at its lowest in May.
The impact of rising inflation and gas prices has reached consumer spending. In May 2022, US retail sales fell by 0.3% relative to April as shoppers thought twice about spending their increasingly tight budget. But while some spending might be down, certain categories are thriving. One of the clear beneficiaries are those companies gaining from consumers “trading down” from higher-priced products and services in favor of cheaper alternatives. To better understand this phenomenon, we looked at year-over-year (YoY) foot traffic patterns for major retail, dining, and hospitality sub-sectors.
With summer almost upon us, we took a look at foot traffic trends associated with a classic American activity – spending time in nature. We dove into visits to 20 national and state parks as well as foot traffic to a rising star in the recreational equipment space, Sierra, to see what its strength can tell us about the demand for leisure time in the great outdoors. With the recent rise in costs of consumer goods and services, people may be turning to outdoor activities as a cost-friendly leisure option.
Foot traffic to some of the Kroger Company’s biggest brands may be lagging slightly, but the success of the company’s prepared foods expansion and recently rolled out ghost kitchen collaboration hints at the supermarket giant’s growth potential. Following its strong pandemic performance, the grocery sector’s offline visit growth slowed in recent months as inflation and high gas prices continued to strain many consumers’ budgets. Still, nationwide year-over-year (YoY) grocery foot traffic was positive every month between January and May 2022 while year-over-three-years (Yo3Y) foot traffic remained close to pre-pandemic visit levels.
As consumers ponder cutting down on spending in the face of high inflation, the QSR sector seems to be maintaining relatively steady visitation patterns. We dove into year to date offline visits to leading brands to see how the various QSR subcategories are faring. While the data doesn’t fully capture delivery orders or drive-thru visits, the foot traffic numbers can still provide a rough sense of the state of the sector going into the second half of 2022.
Our latest white paper dives into domestic migration trends over the past two years in the United States. While many assumed that there would be a mass exodus from cities, the foot traffic data tells a slightly different story. While some people made big moves, most stayed in place. Others moved, but stayed close to their region of origin. And many of those who did relocate across state lines chose areas whose population had already been trending up pre-pandemic. Below is a taste of our findings. For the full report, click here.
From Omicron in January to the impact of rising inflation and the systemwide shock driven by rising gas prices, 2022 kicked off with anything but an easy start. Yet, industry-level analysis provides powerful insights into the segments that have been more resistant to these negative effects and the wider trends that could be driving a more significant retail-wide recovery. At this stage, there are some segments that are seemingly immune to the wider impacts on the retail landscape.
Even as pandemic restrictions eased, the prevailing culture around coming into the office seems to have changed for good. In a recent article, 65% of workers said they would not return to full-time in-office work, and companies are adjusting their expectations accordingly, allowing for a more hybrid work model. A look at our most recent foot traffic data confirms these trends. Visits to office buildings in San Francisco, New York City, and Chicago are still significantly lower than they were three years ago.
Looking at Mall Index visits between April and May showed a clear pattern of expanded visit gaps for all three segments. And while this is certainly not ideal, it does also demand context. The comparison for malls, outlet malls, and open-air lifestyle centers in May compares to a much more significant peak than in March or April. So while elements like inflation and gas prices are likely playing a role here, the relatively minimal increase in the visit gap indicates that this role has been far more muted than might have been otherwise expected.
As demand for consumer electronics softens, it’s no surprise that Best Buy saw visits and sales decelerate this quarter. According to the company’s Q1 2022 results, U.S. comparable store sales declined 8.5% year over year (YoY) and U.S. online sales decreased 14.9% YoY. Nevertheless, two things stood out to us from the quarter: (1) the shift to a higher average selling price helping to offset inflationary pressures; and (2) encouraging trends from new retail formats.
Our latest whitepaper explores five retailers who have stayed relevant over decades of changing shopping habits. The oldest retailer in our report, Macy’s, has consistently kept their finger on the pulse of shifting consumer preferences and adapted their brick and mortar strategy accordingly. We dove into one of the brand’s latest innovations – the off-price shop-in-shop concept Macy’s Backstage – to understand how incorporating Macy’s Backstage into existing Macy’s locations was boosting visits to the department store.
In this Placer Bytes, we dive into two brands in the gaming and entertainment space – GameStop and Dave & Buster’s. Like most other businesses that rely on crowds congregating indoors, Dave & Buster’s took a hit over COVID. But foot traffic began picking already in July 2021, and recent data shows that the brand’s growth streak is continuing in 2022. Year-over-year (YoY) visits have increased dramatically since the height of the pandemic, and year-over-three-year (Yo3Y) foot traffic has exceeded pre-pandemic levels for the past three months.
As inflation and gas prices remain high, foot traffic to dollar, discount, and thrift stores is booming. We dove into visits to Dollar General, Family Dollar, Five Below, and Goodwill to find out more about these high-performing retailers. Inflation hasn’t spared dollar stores, with a recent analysis of various discount brands finding that prices at leading chains increased for several basic products. But since prices have also increased across retail categories throughout the western world, discount retailers are still remaining comparatively cheaper and giving value-driven customers a reason to visit their stores.
In the retail space, the divide between outdoor-focused brands and sporting goods retailers is becoming increasingly blurred. But no one has done more to integrate all manners of recreational gear under one company than Dick’s Sporting Goods. The retailer operates several specialized brands to cater to customers looking for equipment to support a diverse range of activities, from golf to fishing to team sports to yoga. To better understand this sector, we took a closer look at the wider ecosystem of Dick’s Sporting Goods.
In this Placer Spotlight, we dive into the visit data for Ulta Beauty to understand how the variety of its brick and mortar offerings is impacting retail foot traffic to the brand. Ulta is one of the non-essential retail brands that recovered the fastest from the COVID lockdowns and store closures, with retail foot traffic reaching 2019 levels in early 2021. As the country continued to open up and people began socializing again, Ulta’s visit surge continued, with foot traffic throughout most of 2021 higher than it was pre-pandemic.
We last looked at the impact of inflation and increased gas costs on retail foot traffic in late March 2022. With another month of data in, we dove into the numbers to find out if retail visits have recovered from the shock of rising prices and what categories are proving particularly resilient. Gas prices increased gradually in January and February 2022, but the beginning of March saw a dramatic spike relative to an end of 2020 baseline.
Over the past couple of years, several home furnishing retailers – including At Home, HomeGoods, and Floor & Decor – have expanded their physical footprint, while other brands such as Tuesday Morning shrunk their store count. We dove into the foot traffic numbers to find out how modifying the store fleet size has affected these retailers’ recent performance. Despite the wider challenges impacting retail, recent location analytics data shows that several home furnishing leaders are seeing visits that match or exceed 2019 foot traffic levels.
The wholesale category was thriving when we last checked in. Costco landed on our 2022 Predicted Winners list and BJ’s and Sam’s Club were still riding the wave of 2021 success. But the end of 2021 and beginning of 2022 brought about a new set of challenges that threatened to upend the consistent strength the segment had seen. We dove deeper into the retail foot traffic trends to see how these chains are doing.
Department stores have been part of the American retail landscape for decades – but their role in consumers’ shopping routines is changing. We dove into foot traffic trends for leading mid-range and luxury brands to see how these iconic retailers are performing in this almost-post COVID world. COVID hit department stores particularly hard – even after non-essential business reopened, many consumers still avoided shopping indoors. By summer 2021, however, many brands, including Macy’s, Dillard’s, and Kohl’s, were nearing – and sometimes exceeding – pre-pandemic levels.
Following a strong 2021, the impact of inflation and rising prices have now reached the home improvement sector. We dove into location analytics data for leading retailers to understand whether the pandemic-induced surge has finally come to an end and what lies ahead for these categories. The home improvement sector was one of the biggest retail winners of 2020 and 2021, as consumers stuck at home – or moving home – invested heavily in their living space.
