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Discount & Dollar stores thrived in 2022 and 2023, as inflation drove many shoppers to trade down and seek out cheaper retail alternatives. But how has the category continued to fare in the new year? Have stabilizing prices led shoppers away from discount chains? Or have dollar stores cemented their position as go-to retailers even when money isn’t quite as tight?
We dove into the data to find out.
Over the past two years, Discount & Dollar Stores have emerged as major disruptors, diversifying both their offerings and their price points – and the category leaders’ continued visit growth suggests that this strategy is helping the chains build significant strength. By investing in private label food items and stocking fresh produce at thousands of locations, Dollar General has established itself as a prime low-cost grocery destination. Family Dollar, owned by Dollar Tree, has also made strong inroads into the supermarket scene, with everything from fruits and veggies to cage-free eggs. Dollar Tree has also broadened its grocery selection to include an array of chilled and frozen foods.
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In January 2024, Discount & Dollar Stores saw a further increase in year-over-year (YoY) visits, building upon the category’s impressive post-COVID gains. Most of the analyzed category leaders also saw YoY visit jumps – no small feat given these retailers’ strong 2022 and 2023 performance.
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Zooming out on the longer-term visitation trajectories of leading discount chains shows just how well positioned the category remains for continued success. Compared to a January 2020 pre-COVID baseline, visits to Dollar General and Dollar Tree were up 24.3% and 14.0%, respectively, in January 2024. While these foot traffic increases were undoubtedly fueled in part by the continued expansion of the chains’ footprints, they highlight strong and growing demand for the category’s bargain fare.
The chains’ visit patterns also reveal clear seasonality in visitation patterns to leading Discount & Dollar Stores, with the chains emerging as holiday shopping destinations. Dollar Tree, which continues to price most items at $1.25, experiences more pronounced seasonal peaks, with visits spiking during the holiday season. And though Dollar General has firmly positioned itself as a year-round destination for essential goods, it too sees foot traffic spikes in December.
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The emergence of Discount & Dollar chains as affordable venues for much-needed necessities has been a major factor in the segment’s success. But the category’s strong positioning as a key holiday shopping player has also helped solidify its place in the nation’s retail landscape.
And looking at monthly fluctuations in the median household income (HHI) of Discount & Dollar Stores’ captured markets shows a subtle but distinct HHI spike during the peak holiday season – meaning that the category draws its audiences from slightly more affluent areas during this all-important time of the year. This trend may be a further indication of the mainstreaming of dollar stores – with higher-HHI consumers especially likely to seek out their bargain-priced quality merchandise in the runup to Christmas.
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Since COVID, Discount & Dollar Stores have solidified their position as mainstream shopping destinations for everything from basic food items to home goods and party supplies. And if January 2024 is any indication, you can bet your bottom dollar on the category’s continued strength heading into the new year.
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This blog includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.
The U.S. box office had a particularly strong 2023. Barbenheimer was the word out of everyone’s mouths over the summer, but other films like Spider-Man: Across the Spider-Verse, Guardians of the Galaxy Vol. 3, and The Super Mario Bros. helped boost both sales and visits.
How was the overall theater performance compared to 2022 and 2019? Who’s visiting these chains? And what can cinemas do to boost visits during lulls? We take a closer look at location intelligence for the three major theaters – AMC, Regal Cinemas, and Cinemark – to find out.
Last year started on a high note, likely related to the strong box office performance of “Avatar: The Way of Water” (which may have also caused January 2024’s visit lag in comparison).
The “The Super Mario Bros. Movie” release in April helped spike visits further, with foot traffic to AMC, Regal Cinemas, and Cinemark increasing by 43.2%, 36.2%, and 40.8%, respectively. And July brought with it two of the most successful movie releases of all time – “Barbie” and “Oppenheimer” – which topped box office charts for weeks.
Both films were released in late July, with the massive August visit spikes showing the full power of the two movies. “The Taylor Swift: Eras Tour” movie release in October also boosted visits, though AMC and Cinemark appear to have been the primary beneficiaries of the Swifty-driven foot traffic increase.
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Year-over-four-year (Yo4Y) foot traffic trends offer a broader picture of how out-of-home entertainment is faring. The pandemic forced many movie theaters to shut their doors as social distancing guidelines made going to the movies impossible. In tandem, streaming services like Netflix and Amazon Prime became major movie studios in their own right.
The increase in at-home entertainment may have something to do with the overall Yo4Y decline in movie theater visits. Despite last year’s success, foot traffic data shows that fewer people are visiting theaters in 2023 than in 2019. Some of the dip is likely due to the chains’ rightsizing, with both AMC and Regal downsizing their fleet in recent years. But the success of this past summer’s blockbusters still brought visits to the two chains close to pre-pandemic numbers – and drove a positive Yo4Y visit surge to Cinemark – indicating that the right feature film can still draw crowds to cinemas nationwide.
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A closer look at the psychographic characteristics of visitors to the three movie theater chains reveals that families are overrepresented in the chains’ trade areas, while young professionals are underrepresented: Consumer segments identified by the Spatial.ai: PersonaLive dataset as “Ultra Wealthy Families” and “Wealthy Suburban Families” were more prevalent in the theaters’ captured* markets than in their potential markets, while “Young Professionals” were less prevalent. With some analysts lamenting the death of superhero movies, movie studios looking for the next big idea may want to invest in more family-friendly films to cater to these theater-going family segments.
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*A chain’s captured market weighs each CBG according to the actual number of visits originating to the chain from that CBG. A chain’s potential market refers to the population residing in a given trade area, weighted to reflect the number of households in each Census Block Group (CBG) comprising the trade area. A chain’s captured market weighs each CBG according to the actual number of visits originating to the chain from that CBG.
Unsurprisingly, movie theaters were busiest on the weekends – Saturday and Sunday received the lion's share of visits across all analyzed cinema chains, followed by Fridays. But the busiest non-Friday or weekend day was Tuesday – likely thanks to the theater chains’ "Discount Tuesday" special.
Cinemark experienced the largest Tuesday surge – with 12.6% of its weekly visits occurring on its discount day – perhaps due to the company’s decision to extend its discount to non-club members. AMC and Regal also received more visits on Tuesdays than they did during every other weekday (except for Friday).
As theaters continue to find creative ways to remain competitive in the evolving world of entertainment, “Discount Tuesdays” underscore the significance of a good deal when looking to drive visits to theaters.
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Movie theater visits exceeded all expectations in 2023 as film enthusiasts flocked to watch any number of major box-office releases. Will this momentum continue into 2024?
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This blog includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.
With Q4 2023 under our belts, we dove into the data to check in with leading eyewear brands Warby Parker and America's Best Contacts & Eyeglasses – both of which have expanded their brick-and-mortar footprints in recent years. How did they fare in the final months of 2023? And what does their performance bode for the future of offline eyewear sales this year?
Warby Parker, the digitally-native darling that burst onto the scene in 2010 as an online-only retailer, opened its first physical store in 2013 and now operates some 250 venues across 38 states and the District of Columbia. And the trendy eyewear brand’s visits continue to grow alongside its expanding store fleet, with chain-wide year-over-year (YoY) foot traffic increases ranging from 16.6% to 37.0%. Warby Parker’s continued offline flourishing – despite the chain’s online origins – highlights the continued importance of physical stores for the glasses-buying experience.
National Vision’s America’s Best Contacts & Eyeglasses – the discount eyewear chain that features more than 900 locations nationwide – has also been on a growth trajectory. Over the past several months, the chain saw consistent YoY visit increases, partly driven by its expanding physical presence. And in Q3 2023, the brand also reported a rise in comparable store sales – showcasing healthy demand for its offerings.
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What is the secret to the success of these very different chains? To explore some of the factors driving traffic to Warby Parker and America’s Best, we segmented the audiences of their trade areas with demographic data from STI’s PopStats and psychographics from Spatial.ai’s PersonaLive – and the results were striking.
Over the past four years, the median household income (HHI) of Warby Parker’s potential market – i.e. the census block groups (CBGs) from which the chain draws its customers, weighted to reflect each one’s population size – has decreased. This indicates that as Warby Parker has expanded its fleet, it has opened stores in areas that are slightly less affluent than Warby Parker’s legacy markets – although the median HHI in these newer markets also stands significantly above the nationwide median of $69.5K.
But over the same period, the median HHI of the brand’s captured market continued to climb. (A chain’s captured market is derived by weighting the CBGs in its trade area according to the share of visitors from each CBG – thus mirroring the characteristics of the chain’s actual visitor base). The increase in captured market median HHI over time indicates that Warby Parker has been successful at reaching well-to-do audiences even within its newer, more economically diverse markets.
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Unlike Warby Parker, America’s Best Contacts & Eyeglasses serves a lower-HHI demographic. The median household income of the chain’s captured market in Q4 2023 was $66.2K – 4.7% below the nationwide median of $69.5K. And looking at America’s Best’s three largest regional markets – Texas, Florida, and California – shows that the chain’s captured market median HHI in each of these states is also lower than the relevant statewide baseline.
But while the chain’s visitor median HHI trends seem consistent across regions, diving deeper into the data suggests that the chain does attract different types of shoppers in different areas. Nationwide, the share of singles and individuals from large households in America’s Best’s captured market is just slightly above nationwide baselines. But in California, the share of large households in America’s Best’s captured market is 21.0% – significantly higher than the statewide baseline of 16.5%, while the share of singles falls below the Golden State’s baseline of 23.2%.
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Digital try-on and easy returns have made online glasses shopping a viable option for many consumers. But the continued offline success of Warby Parker and America’s Best shows that there’s still plenty of demand for brick-and-mortar eyewear stores – discount and higher-end alike. What lies in store for the offline eyewear space in 2024?
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This blog includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.
We checked in with AutoZone and O’Reilly – two pandemic winners from the auto parts industry – to understand what location intelligence reveals about the retailers in 2024.
AutoZone and O’Reilly Auto Parts are both major players in the multi-billion dollar automotive aftermarket industry with thousands of locations across the country. As car prices skyrocketed over the pandemic, visits to these retailers increased – and analyzing foot traffic patterns to these retailers reveals that although growth in the sector may be slowing down, leading auto parts chains are holding on to their pandemic gains.
On a year-over-year (YoY) basis, visits to AutoZone and O’Reilly Auto Parts continued growing in the first half of 2023 before stalling in Q3 2023 and dipping in Q4. But looking at year-over-four-year (Yo4Y) visits suggests that the drop may be due to the challenging comparison to an unusually strong period rather than to any drop in demand for auto parts. Last year’s visits to both AutoZone and O’Reilly Auto Parts were significantly higher than the chains’ 2019 baseline, with Q4 2023 visits exceeding Q4 2019 levels by 11.9% and 22.6% for AutoZone and O’Reilly Auto Parts, respectively.
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The pattern continued in January 2024, with visits to AutoZone and O’Reilly significantly higher than they were pre-pandemic, but slightly lower on a YoY basis. But the Q4 2023 YoY visit gaps narrowed for both chains, and used cars are still outselling new vehicle and fueling demand for car parts – so visits to the space are likely to remain strong in 2024.
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Analyzing the demographic data of visitors to O’Reilly Auto Parts and AutoZone reveals that both companies succeeded in staying far ahead of their pre-pandemic visit baseline despite attracting a large number of visitors from lower-income households. In 2023, the median household income (HHI) within the two chains’ potential market* trade area was lower than the nationwide median of $69.5K/year, while the median HHI in the captured market trade area was even lower.
The income level of AutoZone and O’Reilly Auto Parts’ visitor base may help explain the chains’ Yo4Y strength and the YoY lags. With prices for used cars still significantly higher than they were in 2019, budget-conscious consumers are likely looking to patch up their existing rides instead of trading them in for newer vehicles – which could explain the sustained Yo4Y growth. At the same time, the ongoing inflation is likely straining this segment’s available funds, which may account for the YoY dips towards the end of 2023.
*A chain’s potential market refers to the population residing in a given trade area, weighted to reflect the number of households in each Census Block Group (CBG) comprising the trade area. A chain’s captured market weighs each CBG according to the actual number of visits originating to the chain from that CBG.
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When focusing on the trade area median HHI, the visitor base of AutoZone and O’Reilly Auto Parts looks nearly identical. But looking at the psychographic makeup of the two brands’ trade areas highlights differences between the companies. Using the Experian: Mosaic dataset to analyze the audience segments in the chains’ trade areas revealed that AutoZone tended to attract more city-based visitors, while O’Reilly seems to draw more small-town and rural households. Data from the Spatial.ai: PersonaLive’s dataset supports this pattern – and the success of both chains indicates that there is plenty of demand for car parts across a variety of audience types.
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As both companies continue to expand, location intelligence indicates that there is plenty of demand for car parts to go around.
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This blog includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.
Coffee has been a popular topic for us the past few months. We looked at why the category should still post a solid 2024 despite being one of the stronger categories in the restaurant industry last year. We also examined loyalty trends among Starbucks visitors, and where that might trend in the quarters ahead.
This week, we’re revisiting Dutch Bros., which has been one of our favorite growth stories to watch going back to (and even before) the company’s initial public offering. During the quarter, the company posted 5% comparable-store sales growth, representing 100 basis points of acceleration from Q3 2023. The growth was driven by a combination of factors, including sequential improvement in customer traffic with particular strength in the mid-day and afternoon dayparts (something we see in Q4 2023 visits by daypart compared to Q4 2022). Our data indicates that the periods between 1:00 PM and 7:00 PM saw the largest increases in percentage of visits year-over-year.
What’s driving the growth in mid-day and afternoon dayparts? Management chalked it up to category innovation, including new product platforms like Protein Coffee as well as limited time offers (LTOs), including the successful Truffle Mocha platform that was introduced in Q4 2023. The company is mindful that new products can have an impact on speed of service but appears to be focused on new products that don’t add “a layer of extra complexity” but can still drive incremental visits (something our data also indicates this quarter). Mobile app ordering–something the company plans to test in the Arizona market before potentially rolling out to a multi-shop test–also offers an opportunity with potential to attract new visitors and introduce new occasions, though it will likely be a few years before this functionality contributes to visit counts and financial results.
Looking ahead, Dutch Bros expects to open 150-165 new locations in 2024, compared to the 159 opened across 13 states in 2023. Over time, the company still sees the opportunity for 4,000-plus shops, balanced with “a renewed emphasis on capital efficiency” and a longer-term shift toward more build-to-suit leases and a wider array of prototype units such as end caps (management expects to see the impact of these changes beginning in 2025). From a market standpoint, the company expects to have more openings in existing markets like California, have less relative openings in the Texas market, and opened its first location in Florida (Orlando) this week.
Valentine’s Day presents an opportunity – or at least lays on the pressure – for coupled-up consumers to shower their significant other with chocolates, flowers, or special gifts. And while some shoppers choose to order online or visit stores ahead of time to find the perfect Valentine’s Day gift, those who forgot to plan in advance can stop by brick-and-mortar retailers the day of to ensure they don’t show up to date night empty-handed. So which industries saw the largest boost on February 14th? And how did 2024’s patterns compare to last year’s trends? We dove into the data to find out.
Valentine’s Day may not be a major retail holiday – but the occasion still drives a mid-week visit boost across many retail categories, including Restaurants, Discount & Dollar Stores, Liquor Stores, Grocery, Superstores, Breakfast Shops, and Beauty & Spa. Comparing Valentine’s Day 2024 visits to average visit levels over the previous six Wednesdays reveals a significant jump in traffic compared to the typical mid-week shopping lull.
Restaurants saw the largest visit bump, with visits up 60.0% compared to the average number of Restaurant visits over the previous six Wednesdays. Others opted for a morning coffee or brunch date, driving a 19.7% increase in foot traffic to Breakfast, Coffee, Bakeries, and Dessert Shops. And some consumers seem to have chosen a romantic evening, leading to surges in Grocery and Liquor Store visits. Retailers carrying affordable gifts, including Discount & Dollar Stores, Superstores, and Beauty & Spa brands also benefited from the Valentine’s Day Boost.
And visits to the analyzed categories weren’t just up relative to the year-to-date Wednesday average – traffic across the board also rose relative to Valentine’s Day 2023, boding well for brick-and-mortar retail in 2024.
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Valentine’s Day is sometimes referred to – not always affectionately – as a Hallmark Holiday. And foot traffic data reveals that the day really does drive significant visit increases to Hallmark stores nationwide, with Valentine’s Day 2024 traffic up 123.2% relative to the previous six Wednesday average. The Paper Store, another major greeting card retailer, also saw a large jump in Valentine’s Day visits compared to the year-to-date same weekday average, and Walgreens and CVS – also major greeting card purveyors – received a visit boost as well.
At the same time, Hallmark, Walgreens, and CVS did not display the same year-over-year (YoY) increases as for the other categories. Instead, YoY Valentine’s Day visits stayed relatively steady – likely due to these chains’ store fleet contractions rather than to any drop in demand. Meanwhile, Valentine’s Day visits to The Paper Store grew by 10.8% YoY – perhaps aided by the company’s expansion.
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Valentine’s Day yields a clear mid-week boost for brick-and-mortar retail, driving visits to a variety of dining and retail segments. And this year’s Valentine’s Day seems to have been particularly successful, driving YoY jumps across many major categories and brands.
For more data-driven retail insights, visit our blog at placer.ai.
Grocery chains in the United States are increasingly investing in on-site healthcare clinics, transforming their stores into hubs for both food and wellness. While grocery stores have long featured pharmacies and some basic healthcare services like vaccinations, recent years have seen a shift towards more extensive healthcare offerings.
Today, many grocery stores offer a range of services – from primary and urgent care to dental and mental health care. In addition to providing an important community service, grocery-anchored healthcare clinics can boost foot traffic at chains, help health providers reach more patients, and allow shoppers to manage their health and home needs in one convenient trip.
This white paper examines the impact these in-store clinics have on grocery chain visitation patterns and trade area characteristics. Are shoppers more or less likely to make repeat visits to grocery stores with healthcare services? And how does the addition of a clinic affect the demographic profile of a grocery store’s captured market? The report examines these questions and more, offering insights for stakeholders across the grocery and healthcare industries.
Analyzing foot traffic to grocery stores with and without in-store clinics shows the positive impact of these services: Across chains, locations with on-site healthcare offerings drew more visits in H1 2024 than their chain-wide averages.
The Kroger Co., which operates numerous regional banners as well as its own eponymous chain, has been a leader in in-store healthcare services since the early aughts. The company introduced its in-store medical center, The Little Clinic in 2003 – and today operates over 225 Little Clinic locations across its Kroger banner, as well as regional chains Dillons, Jay C Food Stores, Fry’s, and King Soopers.
And in H1 2024, the eight Dillons locations with clinics saw, on average, 93.0% more visits per location than the chain’s banner-wide average. Jay C, which offers two in-store clinics, also saw visits to these venues outpace the H1 2024 banner-wide average by 92.9%. For both chains, relatively small overall footprints may contribute to their outsize visit differences: Indiana-focused Jay C operates just 22 locations, all in the Hoosier State, while Kansas-based Dillons has some 64 locations.
But similar patterns, if somewhat less pronounced, could be observed at Kroger (43.0%), Fry’s (19.2%), and King Soopers (16.5%) – as well as at H-E-B (14.5%), which boasts its own expanding network of in-store clinics.
Analyzing the trade areas of grocery stores with healthcare clinics shows that these services tend to draw more affluent visitors from within the stores’ trade areas.
For some chains, including King Soopers, H-E-B, and Jay C, the clinics are positioned to begin with in areas serving higher-income communities. The median household income (HHI) of King Soopers’ in-store clinic’s potential markets, for example, came in at $92.3K in H1 2024 – significantly above the chain’s overall potential market median HHI of $88.1K. Similarly, the potential markets of H-E-B and Jay C Food Stores with clinics had higher median HHIs than the chains’ overall averages.
And for all three chains, stores with clinics tended to attract visitors from captured markets with even higher median HHIs – showing that within these affluent communities, it is the more well-to-do customers that tend to frequent these venues. (A chain or store’s potential market is obtained by weighting each CBG in its trade area according to the size of the population – thus reflecting the general composition of the community it serves. A chain or store’s captured market, on the other hand, is obtained by weighting each CBG according to its share of visits to the business in question – and thus represents the population that actually visits it in practice.)
Other brands, including Fry’s, Kroger, and Dillons, have positioned clinics in stores with potential market median HHIs slightly below chain-wide averages. But within these markets, too, it is the more affluent consumers that are visiting these stores, pushing up the median HHI of their captured markets.
These patterns highlight that, for now, grocery store clinics tend to attract consumers on the upper ends of local income spectrums. This information can be utilized by healthcare professionals and grocery store owners to pinpoint neighborhoods that may be open to grocery-anchored clinics, or to take steps to increase penetration in other areas.
Supermarket giant Kroger is a major player in the world of grocery-anchored healthcare, offering visitors access to pharmacies, clinics, and telehealth options via its grocery stores. What impact has the company’s embrace of healthcare had on visits and loyalty?
An analysis of household compositions across the potential and captured markets of Kroger-owned stores with and without Little Clinic offerings suggests that families with children are extremely receptive to these services.
In H1 2024, Kroger, King Soopers, Fry’s, Jay C, and Dillons all featured captured markets with higher shares of STI: PopStats’ “Households With Children” segment than their potential ones – highlighting the chains’ appeal for families. But the share of parental households in those stores with Little Clinics jumped significantly higher for all five banners.
The share of families with children in King Soopers’ overall captured market stood at 28.3% in H1 2024, higher than the 27.2% in its potential one. But the households with children in the captured markets of King Soopers locations with Little Clinics was significantly higher – 30.6% – and similar patterns emerged at Jay C, Dillons, Kroger, and Fry’s.
This special draw is likely linked to the clinics' focus on family health services like physicals, nutrition plans, and vaccines. The convenience of being able to take care of healthcare, grocery shopping, and pharmacy needs all in one go makes these stores particularly attractive to parents. And this jump in foot traffic shows the strategic advantage of incorporating healthcare services into the retail environment.
Providing essential healthcare services at the supermarket can establish a grocery chain as a crucial part of a shopper's daily life, enhancing visitor loyalty, and helping nurture long-term customer relationships. Indeed, in-store clinics offer a unique opportunity for grocery providers to connect with customers on a level that extends beyond the transactional.
An analysis of several Kroger-branded locations in the Cincinnati metro area showcases the profound impact in-store clinics can have on customer loyalty. In H1 2024, stores with Little Clinics had significantly higher shares of repeat visitors – defined as those making six or more stops at the store during the analyzed period – than those without.
For instance, 36.4% of visitors to a Kroger Marketplace store with an in-store clinic in Harrison, Ohio, frequented the location at least six times during the first half of 2024. But over the same period, only 29.0% of visitors stopped by at least six times to a nearby Kroger location in Cleves, Ohio – just ten miles away. Similarly, 30.7% of visitors to the Beechmont Ave. Kroger Food & Drug location with a clinic visited at least six times in H1 2024, compared to 23.0% for the nearby Ohio Pike Kroger store.
This trend was consistent across the analyzed locations, with those offering in-store clinics attracting significantly higher shares of loyal visitors. These metrics support the value of offering additional services as a draw for frequent visitors, while also providing the clinics themselves with the visitor volume needed to operate profitably.
Texan grocery chain H-E-B is beloved across the state – and though the chain isn’t new to the healthcare scene, it has been doubling down on wellness. In 2022, H-E-B launched H-E-B Wellness, a healthcare platform that offers patrons a variety of medical services, including – as of today – some 12 primary care clinics, many of them inside stores.
H-E-B stores with primary care clinics are helping to cement the grocer’s role as a convenient one-stop for local residents – allowing them to drop in to a nearby location for both daily grocery needs and wellness care.
H-E-B has always placed a premium on community, stepping up to help local residents in times of need. And though the chain as a whole draws an overwhelming majority of its visitors from nearby areas, those with clinics do so even more effectively. In H1 2024, some 83.6% of visitors to H-E-B came from less than 10 miles away. But for locations with primary care clinics, this share increased to 88.0%.
This suggests that wellness services are particularly appealing to nearby residents, strengthening H-E-B’s connection with local consumers even further. And for a grocery store centered on community engagement, the integration of health services into its offerings is proving to be a winning strategy.
H-E-B has been steadily expanding its primary care offerings since it launched the Wellness concept, adding two primary clinics at locations in Cypress, TX and Katy, TX in June 2023. Following the opening of these clinics – which operate Mondays through Fridays – both locations saw marked increases in the share of “Urban Cliff Dwellers” in their weekday captured markets. This STI: Landscape segment group encompasses families both with and without children, earning modest incomes and enjoying middle-class pleasantries.
Between June 2022 - May 2023, the share of “Urban Cliff Dwellers” in the weekday captured markets of the Cypress and Katy locations stood at 9.5% and 7.2%, respectively. But once the stores had clinics in place, those numbers jumped to 12.4% and 11.0%, respectively.
This increase in the stores’ reach among “Urban Cliff Dwellers” immediately following the clinics’ openings suggests that in addition to more affluent consumers, middle-class families also harbor considerable interest in these services. As more retailers continue making inroads into the healthcare sector, they may find similar success in attracting diverse groups of convenience-seeking shoppers.
As grocery stores lean into healthcare, they are transforming into multifaceted hubs that offer both essential health services and everyday shopping needs. Retailers like Kroger and H-E-B are reaping the benefits of boosted foot traffic, higher-income visitors, and strengthened community ties – while offering their shoppers convenience that helps streamline their daily routines.
Walmart, Target, and Costco are three of the most popular retailers in the country, drawing millions of shoppers through their doors each day. Each of these retail giants boasts distinct strengths and strategies that cater to their unique customer bases, allowing them to thrive in a highly competitive market.
This white paper takes a closer look at some of the factors that are helping the three chains flourish. How does Walmart’s positioning as a family-friendly retailer help it drive visits in its more competitive markets? How can Target leverage its reach to drive more loyal visits? And what does the increase in young shoppers frequenting membership warehouse clubs mean for Costco?
We dove into the location analytics to explore these questions further.
Examining monthly visitation patterns for the three retail giants shows Costco’s wholesale club model leading the way with consistent year-over-year (YoY) visit growth – ranging from 6.1% in stormy January 2024 to 13.3% in June. Family favorite Walmart followed closely behind, seeing YoY foot traffic growth during all but two months, when visits briefly trailed slightly behind 2023 levels before rebounding.
Target, meanwhile, had a slower start to the year, with visits trending below 2023 levels for most of January to April. Over this same period (the three months ending May 2024), Target reported a 3.7% decline in YoY comparable sales. But since then, things have begun to turn around for the chain, with YoY visits rising in May (2.5%), June (8.9%), and July (4.7%). This renewed visit growth into the second half of the year bodes well for the superstore – and the ongoing back-to-school season may well push visits up further as the summer winds down.
For all three chains, Q2 2024’s visit success has likely been bolstered in part by summer deals and intensifying price wars – as the retailers slash prices to woo inflation-weary consumers back to the store.
Over the past few years, consumer behaviors have been changing rapidly in response to shifting economic conditions. This next section explores some of these changes at Walmart, Target, and Costco, to better understand what may be driving these shifts.
One way that consumers have traditionally responded to inflation and other headwinds has been through the adoption of mission-driven shopping – making fewer, but longer, trips to retailers, so that every visit counts. Superstores and wholesale clubs, which offer one-stop shopping experiences, have long been prime destinations for these extended shopping trips. And even during periods when visits have lagged, these retailers have often benefited from extended dwell times – leading to bigger basket sizes.
A look at changes in average dwell times at Walmart and Target suggests that as YoY visits have picked up, dwell times have come down – perhaps reflecting a normalization of consumers’ shopping patterns. With inflation stabilizing and gas prices lower than they were in 2022 and 2023, customers may feel less pressure to consolidate shopping trips than they have in recent years.
In contrast, Costco’s comparatively long dwell times have remained stable over the past several years. The warehouse club’s bulk offerings, plentiful free samples, and inexpensive food court encourage shoppers to spend more time browsing the aisles than they would at other retailers. And even if mission-driven shopping continues to subside, Costco customers will likely keep on making extra-long shopping trips.
While inflation is cooling faster than expected, prices remain high, and new players are stepping into the retail space occupied by Walmart, Target, and Costco – especially dollar stores. Though higher-income customers increasingly rely on the three retail giants for many of their purchases, customers of more modest means are often drawn to the rock-bottom prices offered at dollar stores.
And analyzing the cross-shopping patterns of visitors to Walmart, Target, and Costco shows that growing shares of visitors to the three behemoths also visit Dollar Tree on a regular basis. In Q2 2019, the share of visitors to Walmart, Target, and Costco who frequented Dollar Tree at least three times ranged between 9.8% and 13.7%. But by Q2 2024, that share rose to 16.7%-21.6%.
Dollar Tree is leaning into this increased interest among superstore shoppers. Over the past year, Dollar Tree added some 350 Dollar Tree locations, even as it shuttered nearly 400 Family Dollar stores. And the chain recently acquired the leases of some 170 99 Cents Only Stores – offering Dollar Tree access to a customer base accustomed to buying everything from groceries to household goods. As Dollar Tree continues to grow its footprint and expand its food offerings, the chain will be better positioned than ever to provide a real challenge to Walmart, Target, and Costco.
Still, the three retail giants each have unique offerings that distinguish them from dollar stores. This next section examines what sets Walmart, Target, and Costco apart – and how they can continue to strengthen their competitive edge.
With competition on the rise, Walmart, Target, and Costco must display agility in navigating an ever-evolving market landscape. This section dives into the data for each chain’s more successful metro areas to see what factors are helping them outperform nationwide averages – and what metrics the retailers can harness to try to replicate these results nationwide.
Target recently expanded its Target Circle Rewards program, rolling out three new tiers for its 100 million members. And this focus on loyalty has proven successful for the chain. Demographic and visitation data reveal a strong correlation between the median household incomes (HHIs) of Target locations’ captured markets across CBSAs (core-based statistical areas), and their share of loyal visitors in Q2 2024: CBSAs where Target locations’ captured markets had higher median HHIs also tended to draw more repeat monthly visitors.
Target’s captured markets in the Los Angeles-Long Beach-Anaheim, LA CBSA, for example, featured a median HHI of $89.8K in Q2 2024 – and 48.0% of the chain’s LA visitors frequented a Target at least twice a month during the quarter. Target stores in the Chicago-Naperville-Elgin, IL-IN-WI CBSA, where the chain’s captured markets had a median HHI of $88.7K in Q2 2024, also had a loyalty rate of 48.0%.
Target generally attracts a more affluent audience than Walmart. And even as the superstore slashes prices to attract more price-conscious consumers, the retailer is also taking steps likely to enhance its popularity among higher-income households. In April 2024, Target debuted a paid membership tier within its loyalty program offering perks like same-day delivery for a fee. Maintaining and expanding these premium offerings will be key for Target as it seeks to attract more affluent customers and replicate its high-performing results in CBSAs nationwide.
The persistent inflation of the past few years, while challenging for some retailers, has also created new opportunities – particularly for wholesalers. Membership warehouse clubs, including Costco, are gaining popularity among younger shoppers, a cohort often looking for new ways to stretch their more limited budgets. An October 2023 survey revealed that nearly 15% of respondents aged 18 to 24 and 17% of those aged 25 to 30 shop at Costco.
A closer look at some of Costco’s best-performing CBSAs for YoY visit-per-location growth highlights the significance of these younger shoppers: In H1 2024, the company’s YoY visit-per-location growth was strongest in areas with higher-than-average shares of young urban singles.
For example, the San Diego-Chula Vista-Carlsbad, CA CBSA experienced visit-per-location growth of 10.4% YoY in H1 2024, while the nationwide average stood at 7.9%. And the CBSA’s share of Young Urban Singles, defined by the Spatial.ai: PersonaLive dataset as “singles starting their careers in trade and service jobs,” was 12.1%, well above Costco’s nationwide average of 7.3%.
Walmart is a one-stop shop for everything from affordable groceries to clothing to home furnishings, making it especially popular among families. The retailer actively courts this segment with baby offerings designed to meet the needs of both kids and parents, virtual offerings in the metaverse, and collectible toys.
And visitation data reveals a connection between the extent of different Walmart locations’ YoY visit growth and the share of households with children in their captured markets.
In H1 2024, nationwide visits to Walmart increased by 4.1% YoY, while the share of households with children in the chain’s overall captured market hovered just under the nationwide baseline. But in some CBSAs where Walmart outpaced this nationwide growth, the retail giant also proved especially adept at attracting parental households – outpacing relevant statewide baselines.
In Boston-Cambridge-Newton, MA, for example, Walmart experienced 5.0% YoY visit growth in H1 2024 – while the share of households with children in the chain’s local captured market stood 7% above the Massachusetts state average. And in Grand Rapids-Kentwood, MI, where Walmart’s share of parental households outpaced the Minnesota state average by an even wider 15% margin, the retailer saw impressive 7.3% YoY visit growth. This pattern repeated itself in other metro areas, suggesting that there may be a correlation between local Walmart locations’ visit growth and their relative ability to draw households with children.
Walmart can continue solidifying its market position by leaning into its family-oriented offerings and expanding its footprint in regions with growing populations of young families.
Walmart, Target, and Costco all experienced YoY visit growth in the final months of H1 2024, with Costco leading the way. And though the three chains still face considerable challenges, each one brings unique strengths to the table. By continuously innovating and responding to changing market conditions, Walmart, Target, and Costco can not only overcome obstacles but also leverage them to reinforce their market positions and drive continued growth.
The first Lollapalooza – a four-day music festival – took place in 1991. Chicago’s Grant Park became the event’s permanent home (at least in the United States) in 2005, drawing thousands of revelers and music fans to the park each year.
This year, the festival once again demonstrated its powerful impact on the city. On August 1st, 2024, visits to Grant Park surged by 1,313.2% relative to the YTD daily average, as crowds converged on the park to see Chappell Roan’s much-anticipated performance. And during the first three days of the event, the event drew significantly more foot traffic than in 2023 – with visits up 18.9% to 35.9% compared to the first three days of last year’s festival (August 3rd to 5th, 2023).
Lollapalooza led to a dramatic spike in visits to Grant Park – and it also attracted a different type of visitor compared to the rest of the year.
Analyzing Grant Park’s captured market with Spatial.ai’s PersonaLive dataset reveals that Lollapalooza attendees are more likely to belong to the “Young Professionals” and “Ultra Wealthy Families” segment groups than the typical Grant Park visitor.
By contrast, the “Near-Urban Diverse Families” segment group, comprising middle-class diverse families living in or near cities, made up only 6.5% of visitors during the festival, compared to 12.0% during the rest of the year.
Additionally, visitors during Lollapalooza came from areas with higher HHIs than both the nationwide baseline of $76.1K and the average for park visitors throughout the year. Understanding the demographic profile of visitors to the park during Lollapalooza can help planners and city officials tailor future events to these segment groups – or look for ways to make the festival accessible to a wider range of music lovers.
Lollapalooza’s impact on Chicago extended beyond the boundaries of Grant Park, with nearby hotels seeing remarkable surges in foot traffic. The Congress Plaza Hotel on South Michigan Avenue witnessed a staggering 249.1% rise in visits during the week of July 29, 2024, compared to the YTD visit average. And Travelodge on East Harrison Street saw an impressive 181.8% increase. These spikes reflect the festival’s draw not just for locals but for out-of-town visitors who fill hotels across the city.
The North Michigan Avenue retail corridor also enjoyed a significant increase in foot traffic during the festival, with visits on Thursday, August 1st 56.0% higher than the YTD Thursday visit average. On Friday, August 2nd, visits to the corridor were 55.7% higher than the Friday visit average. These numbers highlight Lollapalooza’s role in driving economic activity across Chicago, as festival-goers venture beyond the park to explore the city’s vibrant retail and hospitality offerings.
City parks often serve as community hubs, and Flushing Meadows Corona Park in Queens, NY, has been a major gathering point for New Yorkers. The park hosted one of New York’s most beloved summer concerts – Governors Ball – which moved from Governors Island to Flushing Meadows in 2023.
During the festival (June 9th -11th, 2024), musicians like Post Malone and The Killers drew massive crowds to the park, with visits soaring to the highest levels seen all year. On June 9th, the opening day of the festival, foot traffic in the park was up 214.8% compared to the YTD daily average, and at its height, on June 8th, the festival drew 392.7% more visits than the YTD average.
The park also hosted other big events this summer – a July 21st set by DMC helped boost visits to 185.1% above the YTD average. And the Hong Kong Dragon Boat Festival on August 3rd and 4th led to major visit boosts of 221.4% and 51.6%, respectively.
These events not only draw large crowds, but also highlight the park’s role as a space where cultural and civic life can find expression, flourish, and contribute to the health of local communities.
Analyzing changes in Flushing Meadows Corona Park’s trade area size offers insight into how far people are willing to travel for these events. During Governors Ball, for example, the park’s trade area ballooned to 254.5 square miles, showing the festival's wide appeal. On July 20th, by contrast, when the park hosted several local bands and DJs, the trade area was a much more modest 57.0 square miles.
Summer events drive community engagement, economic activity, and civic pride. Cities that invest in their parks and event hubs, fostering lively and inclusive spaces, can create lasting value for both residents and visitors, enriching the cultural and social life of urban areas.
For more data-driven civic stories, visit Placer.ai.
