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Small-format stores which offer consumers more convenient and localized shopping experiences are on the rise. The trend has been gaining traction since COVID – spearheaded by major retailers like Macy's and Nordstrom, and followed by players such as IKEA, Target, Best Buy, and others.
But what impact do small-format stores have on shopper behavior? We dove into the data to explore consumer interaction with three retailers that are leaning into the small-format space: Sprouts Farmers Market, Bloomingdale’s, and BJ’s Wholesale Club.
Sprouts Farmers Market provides a great example of how a small-format expansion strategy can drive visit growth. Since January 2022, the chain has doubled down on a small-format strategy aimed at significantly reducing the chain’s square footage and environmental impact. And partially thanks to this expansion effort, Sprout saw visits to its smaller format stores increase by nearly 50.0% over the same period – helping the brand outpace the overall grocery sector in early 2024.
By focusing on customer acquisition through smaller accessible stores, Sprouts is successfully meeting the demand for convenience and sustainability. And as a pioneer in the small-format grocery space, Sprouts is setting a high bar for other grocery chains like Whole Foods and Trader Joe’s, who are rolling out their own smaller convenience-style locations. Could this mark the start of an overall shift in the grocery sector? Only time will tell.
In February 2024, Macy’s announced a turnaround plan calling for the closing of about 30% of its traditional department stores, the opening of smaller versions of the company’s eponymous chain, and the addition of more Bloomingdale’s locations. Macy’s also plans the addition of at least one more small-format Bloomie’s store this year – the highly curated, small-format neighborhood concept launched by Macy’s in 2021. With three locations nationwide – and a fourth set to open this fall in New Jersey – Bloomie’s features a mix of established brands and trendy pop-ups tailored to local tastes.
And zooming in on visitation data for the Bloomie’s in Skokie, Illinois shows how the format helps Bloomingdale’s attract new audience segments. Compared to Bloomingdale’s full-size locations, visitors to the Skokie Bloomie’s in May 2024 came from areas with higher shares of urbanites – including STI: Landscape’s “Urban Cliff Dwellers”, “Seasoned Urban Dwellers”, and “Urban Cliff Climbers” segments. This indicates that Bloomie’s appeals to city dwellers – aligning with Bloomingdale’s goal of providing a contemporary, accessible, and convenient shopping experience in urban settings.
In April 2022, BJ’s Wholesale Club unveiled BJ’s Market - a smaller-format store in Warwick, Rhode Island that’s roughly half the size of a full-sized club location. Examining the location’s visit performance over the last two years highlights the significant impact small-format stores can have on customer engagement and loyalty.
During the first five months of 2024, BJ’s small-format Warwick location experienced consistent YoY visit growth – outperforming the chain’s already-impressive state- and nationwide averages over nearly the entire analyzed period.
But visitors also interacted with the small-format venue differently in other important ways as well. Unsurprisingly, the average visit stay at the small format BJ’s in May 2024 was significantly shorter than the average stay at BJ’s in Rhode Island and at the chain nationwide (21 minutes, versus 27.6 and 30.7 minutes, respectively). And people tended to drop by the Warwick BJ’s more frequently – with 55.0% of visitors visiting the location at least twice during the month, compared to just 37.5% in Rhode Island and 38.7% nationwide.
BJ’s testing of the Warwick small-format location proves that wholesale can be extended beyond endless roaming through enormous big box stores in search for the best value bargain. There is a clear demand for a quicker, more frequent and more efficient shopping experience in the wholesale space, and BJ’s is seizing the opportunity.
Retailers across categories are increasingly incorporating small format stores into their evolving store footprints – with promising results. How will this trend continue to play out? And will consumer preferences continue to shift towards quick, efficient, experiential, and curated shopping experiences?
Follow Placer.ai to keep up with the latest data-driven retail trends.
June 16th, 2024 was Father’s Day – and sons and daughters nationwide took the opportunity to show their dad some appreciation. But how did Father’s Day retail and dining foot traffic compare to that of Mother’s Day?
We dove into the data to find out.
Last month, we observed that though Mother’s Day wasn’t actually created by the greeting card industry, the holiday is one of Hallmark’s busiest days of the year.
And foot traffic analytics show that Father’s Day isn’t far behind. On June 15th, 2024 (the Saturday before Father’s Day), Hallmark stores drew 54.9% more visits than on an average year-to-date (YTD) Saturday – making it the company’s third-busiest day of the year so far. Only May 10th and May 11th, the days before Mother’s Day, drew bigger crowds to the greeting card chain.
And a look at visits to major industries that are top picks for dads shows that a variety of segments enjoyed visit boosts in the run-up to Father’s Day – though for most categories, the magnitude of the bump was considerably smaller than that seen before Mother’s Day.
But for one category in particular – recreational and sporting goods – it was the day before Father’s Day that was the bigger deal. On June 15th, 2024, visits to these retailers jumped 30.9% compared to an average YTD Sunday – making them the biggest beneficiaries of dad’s special occasion. Hobbies, crafts, & gift stores, on the other hand – which saw a substantial visit boost in the lead-up to Mother’s Day – experienced a drop in foot traffic.
Like on Mother’s Day, grateful offspring ponied up on Father’s Day to treat their dads to a nice, sit-down meal. On June 16th, 2024, visits to full-service dining venues jumped 30.3% compared to a YTD Sunday average. Meanwhile, visits to quick-service restaurants increased just slightly, and those to fast-casual establishments declined.
Still, throughout most of the country, full-service restaurants (FSRs) were much busier this year on Mother’s Day than on Father’s Day. The discrepancy was most pronounced in Northeastern states like Connecticut, Pennsylvania, New York, New Hampshire, Massachusetts, Maine, and New Jersey – where Mother’s Day FSR visits were more than 20.0% higher than Father’s Day ones. But two states in the Pacific Northwest, Washington and Oregon, drew more FSR foot traffic on Father’s Day than on Mother’s Day – perhaps due in part to the region’s special connection to the occasion honoring dads. (The tradition of celebrating Father’s Day originated in Spokane, WA in the early 1900’s, decades before it was declared a federal holiday in 1972).
The dining difference between Father’s Day and Mother’s Day is about more than just quantity: Where moms have a clear soft spot for Olive Garden, dads are all about the steak. Texas Roadhouse was the single busiest FSR chain on Father’s Day this year, with visits outpacing an average YTD Sunday by 49.4%.
Father’s Day doesn’t have quite the same retail and dining impact as Mother’s Day – but it’s an important milestone nonetheless.
What other special calendar days are poised to draw outsize customer foot traffic in 2024?
Follow Placer.ai’s data-driven retail and dining analyses to find out.
We’ve previously written about the influence of East Asian, Southeast Asian, and Hispanic cultures and their influence on groceries, malls, and food halls with the likes of H Mart, 99 Ranch, Asia Garden Mall, and Mercado Gonazlez. Now, let’s turn our attention to the huge Indian subcontinent, which includes India, Pakistan, Bangladesh, Nepal, Bhutan, Sri Lanka, and the Maldives.
One of this summer’s breakout sports stories is that of Sarubh Netravalkar, Oracle software engineer by day, Cricket star on the side! He helped Team USA beat Pakistan during the Men’s T20 Cricket World Cup in a huge upset, and has now been nicknamed the “Desi Diaspora Darling.” The United States is co-hosting and participating in this Cricket tournament for the first time, and fans came out in droves to Eisenhower Stadium in Nassau, NY, which essentially became a pop-up stadium in order for the competition to take place. Tikka fries, an ultimate combo of South Asian flavor and American snack favorite, were on offer at the concession stands.
The embrace of South Asian flavors can also be seen in the growth and success at grocery. Patel Brothers and India Bazaar are two Indian grocery chains that have been growing rapidly. The former saw increased year-over-year growth in 8 of the 12 months preceding. Meanwhile, the latter saw year-over-year growth in 11 out of the last 12 months.
The grocery stores can be found in various states in the US, with a particular concentration for Patel Bros in the Chicago, New York, Boston, and DC areas and for India Bazaar in the Dallas area.
South Asian food has many highly flavorful vegetarian and vegan options, which makes it attractive to those seeking a taste boost to dishes. Chai is a staple at many tea and coffee specialty stores, and some are saying that naan sandwiches could be the next burrito. Having the right recipe can really open doors. Bombay Frankie, now located within Westfield Culver City, has its origins at a gas station, but the demand became so high that they opened up a brick-and-mortar restaurant. Their affectionately called “Indian Burrito” comes both rolled up or deconstructed. With deconstructed, one can decide the perfect bite ratio of fluffy naan, seasoned chicken, cool raita, crunchy cucumbers, and tomatoes bursting with flavor.
A quick Google search shows a burst of restaurants that incorporate naan into their name, such as Naan-tastic, Naansense, and Naan & Kabob. Naan n Curry is an example of a naan chain that has seen positive year-over-year growth.
Sourcing food at home has become a lot more attractive for consumers against the backdrop of economic concerns in 2024. In Kroger’s earnings call, CEO Rodney McMullen called out that out of home food costs are outpacing in home food costs, leading shoppers to focus more on in-home meal solutions. Cooking can be seen as a cost saving lever for visitors, but the pandemic period also fostered a love of cooking and spending time in the kitchen, even for higher income households not necessarily looking to save money. And it appears through Placer’s location insights that retailers that focus on outfitting the kitchen have been benefiting from this change in consumer behavior.
Despite the home industry having its challenges in foot traffic after the pandemic, housewares retailers have had some positive momentum over the past few months. Beyond that, houseware retailers that specialize in kitchen wares, such as Crate & Barrel and Sur La Table, have seen traffic growth throughout 2024. Williams-Sonoma, despite challenging year-over-year declines in traffic, reported comparable sales growth in the first quarter of 2024, which signals a higher level of conversion in-store.
Sur La Table, a retailer that’s been challenged in the past, has found new life in changing consumer needs. One of Sur La Table’s core competencies is in-store cooking classes, and experiential retail continues to be one way the industry can provide inherent value to visitors. Dwell times are almost 10 minutes longer than Williams-Sonoma, its closest competitor (below). It also has the highest median household income of visitors and has the highest share of visits from households over $150k. Certainly at-home cooking has increased across income brackets, but high-end consumers also appear to be interested in adjacent home categories to take their skills to the next level. Blending product knowledge, experiences and assortment has greatly benefitted Sur La Table, and even against a challenging specialty retail landscape, the retailer has once again found its niche.
These retailers are often at the top of wedding registry lists, which could benefit traffic as we head into the summer months and the height of wedding season. Crate & Barrel, while not solely a kitchen focused retailer, has long been known as a registry destination that helps registrants outfit a kitchen with all of the cookware and gadgets one could need. Year to date through June, Crate & Barrel traffic is up 3% year-over-year, which is even more impressive considering that its assortment features an array of home furnishings categories, including furniture. Looking at demographic segments using Spatial.ai, Crate & Barrel over indexes in visits from Educated Urbanites and Young Professionals and Sunset Boomers compared the the average of other housewares chains, a signal that the wedding registry business, typically fueled by kitchen goods, could be attracting these particular subsets. Crate & Barrel also has a high level of loyalty in visits compared to other competitors in the space.
As we reported about Wayfair a few weeks ago, home retailers that have created exciting experiences and reasons to visit are still resonating with consumers, despite the tempered interest in the home category. An increased interest in cooking by consumers certainly plays a part in these retailers' success, but they have also had to provide even more incentive to drive traffic growth as consumers shift their attention away from purchasing for their homes. Having an experiential component or registry business have kept kitchen focused retailers more aligned with their consumer’s needs, which drive inherent value in today’s retail landscape, something not easy to come by.
Thrifting is on the rise. Whether fueled by a desire to shop more sustainably, find unique pieces, or save money, consumers have been increasingly turning to secondhand clothing stores for their new threads. And interest in thrift shopping is only expected to grow over the next few years – with some estimates putting the U.S. secondhand market at $73 billion by 2028.
With 2024 nearly at the midway point, we dove into the data to take a closer look at the segment.
The past few years have seen a growing interest among consumers in all things value, and thrift shops have been reaping the benefits. Between January and May 2024, the segment experienced strong monthly year-over-year (YoY) foot traffic growth. And compared to pre-COVID, too, thrift stores drew 29.6% more foot traffic in Q1 2024 than in Q1 2019.
Diving into the visit performance of individual thrift store chains reveals strength across a variety of brands. YoY visits to Goodwill, Crossroads Trading Co., and Savers were consistently elevated between January and May 2024.
Who are the shoppers driving thrift shop visit growth? Analyzing the demographics of thrift store visitors’ trade areas reveals that in 2024, thrift stores serve an economically diverse customer base. Data from the STI: PopStats dataset combined with Placer.ai captured market data shows that Goodwill draws customers from areas with a median household income (HHI) below the nationwide median $76.1K. Savers, for its part, draws shoppers from average-income areas, while Crossroad Trading Co. attracts a high-HHI customer base – likely due to the chain’s strong presence in affluent California and focus on high-end items.
Still, a look at the wider apparel shopping habits of thrift store visitors shows that these shoppers tend to be bargain hunters: Between January and May 2024, visitors to Crossroads Trading Co. and Savers were more likely to visit Goodwill than any other clothing chain. But they – together with Goodwill visitors – also did plenty of shopping at off-price chains like Ross Dress For Less, Marshall’s, and T.J. Maxx. (Crossroad Trading Co., which places a strong emphasis on selling on-trend, high-end items, also saw many of its customers shopping at Macy’s, while Savers visitors were more likely to frequent Kohl’s).
This consistent interest in budget-friendly venues underscores the strong preference for value among the growing ranks of thrift store shoppers
Thrifting is proving its staying power, with visits to major thrift stores outpacing those of other apparel categories. Will the secondhand market continue on its upward trajectory?
Follow Placer.ai to keep up with the latest data-driven retail trends.
Limited-assortment value grocery stores like Aldi and Grocery Outlet Bargain Market have thrived in recent years, as inflation-wary consumers sought out ways to save money at the till.
But how are these chains faring in 2024? Have cooling inflation and increased consumer confidence put a dent in their performance? We dove into the data to find out.
As the name suggests, limited-assortment grocery stores are known for carrying fewer products than traditional grocery stores in a bid to cut down on overhead costs and pass savings on to consumers. These chains also utilize other methods, such as private label brands, opportunistic merchandising, and fewer in-store amenities, to keep prices low.
And foot traffic data shows that in the first part of 2024, consumers continued flocking to these brands to grab groceries at a discount – driving year-over-year (YoY) foot traffic growth that far outperformed that of traditional grocery stores. In May 2024, for example, visits to the overall grocery segment grew by 7.9% YoY, while Aldi and Grocery Outlet Bargain Market experienced YoY growth of 26.3%, 14.3%, and respectively.
Some of this foot traffic growth can be attributed to the two chains’ continued expansion: Aldi added dozens of new stores in 2023 – with hundreds more in the pipeline – and Grocery Outlet Bargain Market also significantly grew its footprint. But the average number of visits to both brands’ individual locations also increased, again outpacing traditional grocery, showing that their expansion is meeting robust demand.
Looking into the loyalty rates of visitors to these limited-assortment value chains provides more reason for optimism for the sector: Over the past three years, Aldi and Grocery Outlet Bargain Market both saw an increase in loyal visits – defined as those made by people who frequented the chains at least four times in a month.
In April 2022, for example, 28.0% of visits to Aldi and 27.0% of visits to Grocery Outlet Bargain Market were made by people who visited the chains at least four times during the month – but by 2024, these shares grew to 30.1% and 30.2%, respectively. A similar trend was observed in May 2024.
Increasingly, it seems, people are doing at least part of their routine weekly grocery shopping at these limited-assortment chains. And with consumers continuing to seek ways to save money, these grocers are well-positioned to continue growing their visit shares.
The limited-assortment, value grocery model continues to prove its staying power, with impressive foot traffic, visits per location, and loyalty rates.
Will the segment continue on its upward trajectory?
Visit Placer.ai to find out.
The grocery industry has navigated unprecedented challenges in recent years – from pandemic-driven shifts in consumer behavior and supply chain disruptions to rising costs, labor shortages, and increased operational demands. In the face of these hurdles, the category has been pushed to innovate, adapting everything from product selections to shopping formats to meet changing consumer expectations.
But within the grocery industry, some segments resonate particularly strongly with the 2024 consumer. This white paper dives into the data to explore two segments that have been leading category-wide visit growth for some time: specialty and fresh format stores, which focus on produce, organic foods, and culturally specific items (think Trader Joe’s, Sprouts Farmers Market, and H Mart, to name a few), and value grocery chains like Aldi, WinCo Foods, and Grocery Outlet Bargain Market. Location analytics show shoppers are increasingly drawn to these two grocery store types, a shift that has the potential to reshape the grocery landscape.
How did value and specialty grocery chains perform in Q3 2024 in comparison to traditional supermarkets like Kroger, Albertsons, and H-E-B? How does visitor behavior vary between the three grocery segments, and what differences can be observed in the demographic and psychographic make-ups of their trade areas? The report explores these questions and more below.
The grocery industry has performed well over the past few months, with steady weekly year-over-year (YoY) visit increases throughout Q3 2024. During the week of July 1st, the segment saw a 4.6% YoY foot traffic boost, likely driven by shoppers loading up on ingredients for Independence Day barbecues and picnics. And after tapering somewhat in early August, visits picked up again in September, with YoY increases ranging from 2.0% to 2.9% throughout the month. This positive growth is a good sign for the segment – which has experienced more than its fair share of challenges over the past few years.
Though the grocery category as a whole is thriving, a closer look at different segments within the industry reveals that some are seeing more significant growth than others.
Indeed, digging deeper into grocery visits throughout Q3 2024 reveals that much of the industry’s growth is being driven by specialty and fresh format stores and value grocery chains. The two segments offer markedly different shopping experiences: Specialty chains tend to emphasize harder-to-find ingredients and fresh produce – sometimes even at higher price points than traditional grocery stores – while value grocery stores focus on affordability. But both categories are experiencing outsize visit growth in 2024, highlighting consumers’ dual interest in both quality and value.
In July and August 2024, traditional supermarkets, specialty grocers, and value chains all experienced positive YoY visit growth. But while traditional grocery stores saw a 3.1% increase in July and just a 0.9% uptick in August, value and specialty chains saw YoY growth ranging from 4.7% to 7.7% during the two months. In September 2024, YoY visits to traditional grocery stores fell by 0.5%, while value and specialty chains saw 5.0% and 5.2% increases, respectively. For today’s consumer, it seems, savings are key – but specialty offerings also resonate strongly.
Today’s grocery shoppers are increasingly embracing specialty grocery options – and analyzing consumer driving habits to grocery stores shows that they are willing to go the extra mile to reach them.
Breaking down grocery visits by distance traveled reveals that just 18.5% of visits to specialty and fresh format grocery chains came from less than one mile away in Q3 2024 – compared to 23.9% for traditional grocery stores and 23.2% for value chains. Similarly, 31.3% of visits to specialty and fresh format grocery stores originated from one to three miles away, compared to 34.7% and 34.5% for the other analyzed segments.
On the flip side, some 26.4% of visits to specialty and fresh format stores were made by people traveling at least seven miles to do their shopping – compared to 22.7% and 21.4% for traditional and value chains, respectively. Specialty grocery operators can account for this difference, locating stores in areas accessible to geographically dispersed audiences eager to shop their unique offerings.
And a look at changes in visitor behavior at three key specialty chains – Trader Joe’s, Sprouts Farmers Market, and Great Wall Supermarket – shows that even as these brands expand their footprints, customers are increasingly willing to travel the distance to visit them. Between 2019 and 2024, all three chains saw a marked increase in the share of visitors traveling over seven miles to shop their offerings. .
Asian grocery chain Great Wall Supermarket, a relatively small regional chain with some 22 locations across eight states, saw the most significant increase in visits from afar over the analyzed period. In Q3 2024, 32.3% of visits to the chain originated from seven or more miles away, up from 28.3% in Q3 2019. Ranked America’s Best Supermarket by Newsweek in 2024, the chain’s wide selection of everything from seafood to fresh produce has made it a hit among Asian food aficionados – and as the supermarket’s reputation grows, so does its draw among customers living further away from its venues.
Consumer favorite Trader Joe’s and organic grocery chain Sprouts Farmers Market also grew their shares of long-distance visits between 2019 and 2024 – no small feat for the two chains, given their expansion over the past several years.
This travel distance snapshot serves as a reminder of the unique role played by specialty grocery stores that offer their customers unique shopping experiences, premium or organic products, and culturally specific items. Shoppers will go out of their way to travel to these stores – and even as they expand and become more readily accessible, their growing popularity makes them ever-more attractive destinations for customers coming from further away.
While visitors to specialty grocery chains often travel long distances for unique offerings, cost-conscious consumers at value stores exhibit other behaviors that differentiate them from traditional and specialty grocery shoppers.
The rising cost of living has pushed the discount retail segment into overdrive – and value grocery chains are also benefiting. The category has flourished in recent years, with many bargain-oriented grocery chains adding new stores at a rapid clip to meet burgeoning consumer demand.
Like visitors to specialty grocery chains, value grocery shoppers demonstrate segment-specific behaviors that reflect their preferences and habits. And perhaps most strikingly, foot traffic data reveals that these shoppers tend to stay longer in-store than visitors to traditional and specialty grocery chains.
In Q3 2024, 26.5% of visits to value grocery chains lasted longer than 30 minutes, compared to 23.4% for traditional grocery chains and 23.7% for specialty and fresh format chains. This suggests that these stores attract shoppers who take their time and carefully consider price points, looking for the best value for their dollar – a need that the chains they frequent seem to be meeting.
Given the tremendous success of the value grocery space in recent years, it may come as no surprise that some traditional supermarkets are getting in on the action by opening or expanding discount banners of their own. How do such off-shoot banners impact these grocers’ reach?
Cult-favorite Texas grocery chain H-E-B opened the first branch of its value banner, Joe V’s Smart Shop, in 2010. The discount arm currently includes 11 stores – mainly in the Houston area – with several new stores opening, or in planning stages, in Dallas.
And foot traffic data shows that Joe V's attracts mission-driven shoppers who make less frequent but significantly longer trips than visitors to traditional grocery stores. In Q3 2024, the average visit duration at Joe V’s was 37.8 minutes, compared to just 26.8 minutes at H-E-B – a full 11 minute difference. At the same time, while 38.5% of Q3 visits to H-E-B were made by customers frequenting the chain, on average, at least four times a month, just 11.8% of visits to Joe V’s were made by visitors reaching that threshold.
Joe V’s is also more likely than H-E-B to attract parental households, with 36.8% of its captured market made up of households with children – significantly higher than H-E-B’s 32.0%.
Together, these data points paint a picture of the average Joe V’s shopper: cost-conscious, likely to have children, and inclined to carefully plan shopping trips to maximize savings and cut down on grocery runs. This suggests that they are mission-driven and focused on stocking up rather than running out to grab ingredients as the need arises.
Major grocery store operators often operate a variety of store types at different price points to appeal to as many shoppers as possible, and Hy-Vee is no exception. The regional grocery favorite launched a discount chain, Dollar Fresh, in 2018 and currently operates 25 stores under that banner, aiming to attract middle-class, cost-conscious shoppers.
Using Experian’s Mosaic dataset to analyze Dollar Fresh’s trade area reveals that the chain’s captured market features significantly higher shares of lower-middle-class family consumers than its potential one – highlighting its special draw for these shoppers. (A chain’s potential market is obtained by weighting each Census Block Group (CBG) in its trade area according to population size, thus reflecting the overall makeup of the chain’s trade area. A business’ captured market, on the other hand, is obtained by weighting each CBG according to its share of visits to the chain in question – and thus represents the profile of its actual visitor base. Comparing a chain’s captured market to its potential one can serve as a helpful gauge of the brand’s success at attracting key audience segments.)
In Q3 2024, the “Pastoral Pride” family segment represented 11.4% of Dollar Fresh’s captured market, compared to just 5.3% of its potential market. This over-representation of lower-middle-class consumers from small towns in Dollar Fresh’s captured market indicates that the chain is especially effective at drawing customers that belong to this segment. Though Hy-Vee’s captured market also boasted a higher share of this demographic than its potential one in Q3, the difference was much smaller – and the chain’s overall reach among these consumers was more limited.
In contrast, Hy-Vee excels at attracting “Flourishing Families” – affluent, middle-aged families and couples – who made up 10.3% of the supermarket’s captured market in Q3 2024. Dollar Fresh’s captured market, on the other hand, featured a smaller share of this segment than its potential one – showing that the discount chain is of less interest to these consumers. So while Hy-Vee tends to appeal to higher-income families with more spending flexibility, value-conscious shoppers have been making their way to Dollar Fresh.
This audience segmentation analysis shows how value offerings help grocery chains attract wider audiences – and highlights the advantage of operating multiple store types to appeal to a broader range of shoppers.
People will always need access to a variety of fresh foods – ensuring that grocery stores and supermarkets continue to play a vital role in in the retail landscape. And while the category as a whole has continued to thrive even in today’s challenging environment, specialty and value grocery chains resonate particularly strongly with the 2024 consumer. As grocery retailers diversify their formats, those aligning with consumer preferences for affordability, uniqueness, and quality are well-positioned for continued growth.
Malls have come a long way since their introduction to the world in the 1950s. These gleaming retail hubs promised shoppers a taste of the American dream, offering a third place for teens, families, and everyone in between to shop, socialize, and hang out.
And though malls have faced challenges in recent years, as e-commerce and pandemic-induced store closures led to shifts in consumer habits, the outlook is brightening. Malls have embraced innovation, incorporating enhanced entertainment, dining, and experiential offerings that attract a diverse range of visitors and redefine their purpose.
This white paper takes a look at the recent location intelligence metrics to gain an understanding of the changes taking place at malls across the country – including both indoor malls and open-air shopping centers. The report explores questions like: Why do malls experience foot traffic bumps during the summer months? How much of an impact do movie theaters have on mall visits, and what can mall operators learn from the Mall of America and American Dream malls’ focus on experiential entertainment?
Mall visitation is highly seasonal, with strikingly consistent monthly visitation patterns. Each year, visits decline somewhat in February, pick up in March, and begin to trend upward again in May – before peaking again in August. Then, after a slower September and October, foot traffic skyrockets during the holiday season, spiking dramatically in December.
And while these trends follow similar patterns every year, comparing monthly visits throughout 2019, 2023, and 2024 (YTD) to each year’s own January baseline shows that this seasonality is growing more pronounced - especially for indoor malls.
Following a lackluster 2023, visits to both indoor malls and open-air shopping centers peaked higher in March 2024 than in 2019. And this summer, indoor malls in particular saw a much larger visit boost than in previous years. In August 2024, for example, visits to indoor malls were 27.3% higher than in January 2024 – a substantially higher baseline jump than that seen either in August 2019 (17.0%) or in August 2023 (12.0%). And though open-air shopping centers experienced a smaller summer visit boost, they too saw a bigger bump this year than in 2019 or in 2023.
But malls aren’t just seeing larger visit spikes this year relative to their January baselines – they are also drawing bigger crowds than they did in 2023.
Between June and August 2024, indoor malls and open-air shopping centers both experienced year-over-year (YoY) visit growth. Indoor malls saw the largest YoY foot traffic boost (3.7%) – perhaps owing in part to 2024’s record-breaking heat, which led many patrons to seek refuge in air conditioned spaces. Still, open-air shopping centers, which feature plenty of air conditioned stores and restaurants, also enjoyed a YoY visit boost of 2.8% during the analyzed period.
Malls’ strong summer baseline and YoY foot traffic growth built upon the strong performance seen during most of 2024 so far, leading to the question: What is driving malls’ positive momentum? We delve into some of the factors propelling these changes below.
One offering that continues to play a significant role in driving foot traffic to malls is on-site movie theaters. Summer blockbuster releases, in particular, help attract crowds to theaters, in turn boosting overall visits to malls.
Much like malls, movie theaters have also proven their resilience over the past few years. While pundits fretted about the theater’s impending death, production houses were busy releasing blockbuster after blockbuster and shattering box-office records at an impressive clip. And while 2023 was certainly a banner year for blockbuster summer releases, 2024 has had its fair share of stunning box-office successes, leading to major visit boosts at theaters across the country.
Analyzing visits to malls with and without movie theaters highlights the impact of these summer Hollywood hits. Between June and August 2024, malls with theaters saw bigger visit boosts compared to a monthly year-to-date (YTD) average than malls without – an effect observed both for indoor malls and for open-air shopping centers.
For both mall types, the gap between centers with and without movie theaters was most pronounced in July 2024, likely owing to the release of Inside Out 2 in mid-June as well as the July releases of Deadpool & Wolverine and Twister. But in June and August 2024, too, centers with movie theaters sustained particularly impressive visit boosts – a solid sign that movie theaters and malls remain a winning combination.
Malls with movie theaters also drew higher shares of evening visits (7:00 PM - 10:00 PM) this summer than those without. Between June and August 2024, for example, evening outings accounted for 22.9% of visits to open-air shopping centers with movie theaters – compared to 18.2% of visits to centers without theaters. Indoor malls with theaters also saw a larger share of evening visits than those without – 18.1% compared to 15.0%.
This increase in evening traffic is likely driven by major summer movie releases and the flexibility of summer schedules, with many visitors – including families – taking advantage of late-night outings without the concern of early wakeup calls. These summer visitation trends benefit both theaters and malls, opening up opportunities for increased sales through concessions, promotions, and evening deals that attract a more relaxed and engaged crowd.
Analyzing the demographics of malls’ captured markets also reveals that centers with movie theaters are more likely to attract certain family-oriented segments than those without. (A mall’s captured market consists of the mall’s trade areas – the census block groups (CBGs) feeding visitors to the mall – weighted according to each CBG’s actual share of visits to the mall.)
Between June and August 2024, for example, 14.2% of the captured markets of open-air shopping centers with movie theaters were made up of “Wealthy Suburban Families” – compared to 9.7% for open-air shopping centers without theaters.
Indoor malls saw a similar pattern with regard to “Near-Urban Diverse Families”: Middle class families living in and around cities made up 9.0% of the captured markets of indoor malls with movie theaters, compared to 7.1% of the captured markets of those without.
This increase in foot traffic from middle-class and wealthy family segments can be a boon for malls and retail tenants – driving up food court profits and bolstering sales at stores with kid-friendly offerings.
Malls have long positioned themselves as destinations for summer entertainment as well as retail therapy, holding – in addition to back to school sales – events like Fourth of July celebrations and even indoor basketball and arena football games. And during the summer months, malls attract visitors from further away.
Between June and August 2024, indoor malls drew 18.2% of visitors from 30+ miles away – compared to just 16.7% during the first five months of the year. Similarly, open-air shopping centers drew 19.6% of visits from 30+ miles away during the summer, compared to 17.1% between January and May.
Extended daylight hours, summer trips away from home, and more free time are likely among the contributors to the summer draw for long-distance mall visitors. But in addition to their classic offerings – from movie theaters to stores and food courts – malls have also invested in other kinds of unique experiences to attract visitors. This next section takes a look at two mega-malls winning at the visitation game, to see what sets them apart.
The Minneapolis-based Mall of America opened in 1992, redefining the limits of what a mall could offer. The mall boasts hundreds of stores, games, rides, and more – and is constantly expanding its attractions, cementing its status as a top destination for retail and entertainment.
Between June and August 2024, Mall of America experienced a 13.8% YoY visit increase, far outperforming the 3.7% visit boost seen by the wider indoor mall space. And as a major tourist attraction – the mall hosted a series of Olympic-themed events throughout the summer – it also drew 41.6% of visits from 30+ miles away. This share of distant visitors was significantly higher than that seen at the mall during the first five months of 2024, and more than double the segment-wide summer average of 18.2%.
The Mall of America also seems to be attracting more upper-middle-class families during the summer than other indoor malls: Between June and August 2024, some 18.0% of Mall of America’s captured market consisted of “Upper Suburban Diverse Family Households” – a segment including upper-middle-class suburbanites – compared to just 11.1% for the wider indoor mall segment. The increased presence of these families at the Mall of America may be driven by the variety of events offered during the summer.
In 2019, the American Dream Mall in New Jersey opened and became the second-largest mall in the country. Since the mall opened its doors, it has also focused on blending retail and entertainment to draw in as wide a range of visitors as possible – and summer 2024 was no exception.
The mall hosted the Arena Football League Championship, ArenaBowl XXXIII, on Friday, July 19th. The event successfully attracted a higher share of visitors traveling from 30+ miles away compared to the average summer Friday – 35.4% compared to 25.7%.
Visits to the mall on the day of the championship were also 13.6% higher than the Friday visit average for the period between June and August 2024, showcasing the mall’s ability to draw in crowds by hosting major events.
Malls – both indoor and open-air – continue to evolve while playing a central role in the American retail landscape. Increasingly, malls are emerging as destinations for more than just shopping – especially during the summer – driving up foot traffic and attracting visitors from near and far. And while much is often said about the impact of holiday seasons on mall foot traffic, summer months offer another opportunity to boost mall visits. Malls that can curate experiences that resonate with their clientele can hope to see foot traffic growth – in the summer months and beyond.
New York City is one of the world’s leading commercial centers – and Manhattan, home to some of the nation's most prominent corporations, is at its epicenter. Manhattan’s substantial in-office workforce has helped make New York a post-pandemic office recovery leader, outpacing most other major U.S. hubs. And the plethora of healthcare, service, and other on-site workers that keep the island humming along also contribute to its thriving employment landscape.
Using the latest location analytics, this report examines the shifting dynamics of the many on-site workers employed in Manhattan and the up-and-coming Hudson Yards neighborhood. Where does today’s Manhattan workforce come from? How often do on-site employees visit Hudson Yards? And how has the share of young professionals across Manhattan’s different districts shifted since the pandemic?
Read on to find out.
The rise in work-from-home (WFH) trends during the pandemic and the persistence of hybrid work have changed the face of commuting in Manhattan.
In Q2 2019, nearly 60% of employee visits to Manhattan originated off the island. But in Q2 2021, that share fell to just 43.9% – likely due to many commuters avoiding public transportation and practicing social distancing during COVID.
Since Q2 2022, however, the share of employee visits to Manhattan from outside the borough has rebounded – steadily approaching, but not yet reaching, pre-pandemic levels. By Q2 2024, 54.7% of employee visits to Manhattan originated from elsewhere – likely a reflection of the Big Apple’s accelerated RTO that is drawing in-office workers back into the city.
Unsurprisingly, some nearby boroughs – including Queens and the Bronx – have seen their share of Manhattan worker visits bounce back to what they were in 2019, while further-away areas of New York and New Jersey continue to lag behind. But Q2 2024 also saw an increase in the share of Manhattan workers commuting from other states – both compared to 2023 and compared to 2019 – perhaps reflecting the rise of super commuting.
Commuting into Manhattan is on the rise – but how often are employees making the trip? Diving into the data for employees based in Hudson Yards – Manhattan’s newest retail, office, and residential hub, which was officially opened to the public in March 2019 – reveals that the local workforce favors fewer in-person work days than in the past.
In August 2019, before the pandemic, 60.2% of Hudson Yards-based employees visited the neighborhood at least fifteen times. But by August 2021, the neighborhood’s share of near-full-time on-site workers had begun to drop – and it has declined ever since. In August 2024, only 22.6% of local workers visited the neighborhood 15+ times throughout the month. Meanwhile, the share of Hudson Yards-based employees making an appearance between five and nine times during the month emerged as the most common visit frequency by August 2022 – and has continued to increase since. In August 2024, 25.0% of employees visited the neighborhood less than five times a month, 32.5% visited between five and nine times, and 19.2% visited between 10 and 14 times.
Like other workers throughout Manhattan, Hudson Yards employees seem to have fully embraced the new hybrid normal – coming into the office between one and four times a week.
But not all employment centers in the Hudson Yards neighborhood see the same patterns of on-site work. Some of the newest office buildings in the area appear to attract employees more frequently and from further away than other properties.
Of the Hudson Yards properties analyzed, Two Manhattan West, which was completed this year, attracted the largest share of frequent, long-distance commuters in August 2024 (15.3%) – defined as employees visiting 10+ times per month from at least 30 miles away. And The Spiral, which opened last year, drew the second-largest share of such on-site workers (12.3%).
Employees in these skyscrapers may prioritize in-person work – or have been encouraged by their employers to return to the office – more than their counterparts in other Hudson Yards buildings. Employees may also choose to come in more frequently to enjoy these properties’ newer and more advanced amenities. And service and shift workers at these properties may also be coming in more frequently to support the buildings’ elevated occupancy.
Diving deeper into the segmentation of on-site employees in the Hudson Yards district provides further insight into this unique on-site workforce.
Analysis of POIs corresponding to several commercial and office hubs in the borough reveals that between August 2019 and August 2024, Hudson Yards’ captured market had the fastest-growing share of employees belonging to STI: Landscape's “Apprentices” segment, which encompasses young, highly-paid professionals in urban settings.
Companies looking to attract young talent have already noticed that these young professionals are receptive to Hudson Yards’ vibrant atmosphere and collaborative spaces, and describe this as a key factor in their choice to lease local offices.
Manhattan is a bastion of commerce, and its strong on-site workforce has helped lead the nation’s post-pandemic office recovery. But the dynamics of the many Manhattan-based workers continues to shift. And as new commercial and residential hubs emerge on the island, workplace trends and the characteristics of employees are almost certain to evolve with them.
