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Big Lots – the big-box discount store offering everything from snacks to higher-ticket items like furniture and mattresses – recently announced a major rightsizing initiative. Against the backdrop of declining sales, the company disclosed its intention to shutter up to 315 stores in coming months.
We dove into the data to explore some of the factors that may be impacting Big Lots’ store closure decisions – and to see which chains stand to benefit the most from Big Lots’ big move.
Store closures mean major markdowns – and the some 280 Big Lots locations already slated to close are drawing crowds with big sales. Analyzing monthly visit fluctuations at Big Lots shows that the shuttering locations experienced an impressive 19.2% month-over-month (MoM) visit spike in July 2024, even as the chain as a whole saw just a 1.9% uptick. Customers, it seems, are flocking to the stores on the chopping block to snag high-ticket items at even steeper discounts.
Rightsizing is all about fleet optimization – trimming underperforming locations and retaining those stores best equipped to meet the needs of a chain’s evolving customer base. And identifying common denominators among stores slated for closure can shed light on the considerations informing a retailer’s rightsizing strategy.
Analyzing the median household incomes (HHIs) of Big Lots’ closing locations' captured markets shows that the retailer is shuttering stores that serve more affluent consumers than the chain as a whole. Nationwide, for example, Big Lots drew visitors from areas with a median HHI of $65.5K in H1 2024. But the Big Lots slated for closure drew shoppers from areas with a median HHI of $73.5K. This pattern repeated itself across major markets where Big Lots is reducing its footprint – including Ohio, Florida, Washington, California, and Arizona.
Big Lots has noted a revitalization strategy focused on value and even more extreme bargain offerings. And the decision to shutter stores in more affluent areas may reflect a move by the retailer to lean into its core audience of price-conscious shoppers – though higher HHI customers can still benefit from the chain’s value offerings.
As Big Lots reduces its fleet, shoppers will naturally seek out alternatives. But which chains are best poised to reap the benefits? Cross-shopping data shows, unsurprisingly, that the vast majority of Big Lots visitors also frequent superstores – especially Walmart. In Q2 2024, a whopping 92.3% of Big Lots visitors nationwide stopped by a Walmart – compared to 52.7% for Target and just 20.8% for Costco.
But shopping behaviors vary significantly between regions. And zooming in on California, where Big Lots plans to close a majority of its 109 locations, paints a different picture. Golden State Big Lots shoppers, to be sure, also visit Walmart in high numbers (74.6% in Q2 2024). But they are much more likely than nationwide visitors to the chain to frequent Target and Costco. Given Big Lots’ significant fleet reduction in California, these two chains appear well-positioned to acquire some of this new regional business.
And drilling down even deeper into the habits of California shoppers at Big Lots, Walmart, Target, and Costco shows that of the three retail giants, Costco may be especially well-positioned to benefit from Big Lots’ Golden State closures.
Like Big Lots, Costco draws a high share of visits during the mornings and afternoons – with just over 50.0% of 10:00 AM - 8:00 PM visits taking place between 10:00 AM and 3:00 PM. As Big Lots’ California footprint contracts, some of these mid-day shoppers may hop over to Costco, which is also bustling during these hours.
Rightsizing creates opportunities – both for chains taking proactive steps to optimize their fleets, and for competitors seeking to pick up extra business. How will Big Lots’ big rightsizing move continue to play out in the months ahead?
Follow Placer.ai’s data-driven retail analyses to find out.
This blog includes data from Placer.ai Data Version 2.1, which introduces a new dynamic model that stabilizes daily fluctuations in the panel, improving accuracy and alignment with external ground truth sources.
Dave & Buster's and Main Event, two leading chains in the eatertainment industry, offer a unique mix of dining, arcade games, and immersive experiences, successfully drawing crowds seeking more than just a meal out.
We took a closer look at the two chains – both of them owned by parent company Dave & Busters Entertainment, Inc. – to see how they are faring as summer winds down.
Dave & Buster’s and Main Event have plenty of games for children – but with extensive drinks menus, they also decidedly cater to adults, offering both groups a much-needed opportunity to kick back, play some games, and enjoy a meal out with friends.
And recent foot traffic data shows that despite challenges, both chains are seeing overall YoY visit increases – partially driven by the chains’ fleet expansions. On a quarterly basis, foot traffic to Dave & Buster’s and Main Event has remained elevated year over year (YoY) since Q3 2023, finishing out Q2 2024 with respective visit boosts of 6.9% and 4.7%.
As prime eatertainment destinations, Dave & Buster’s and Main Event are busiest on weekends – with Saturday evening between 7:00 to 10:00 PM drawing the biggest crowds to both chains.
Between August 2023 and July 2024, 11.9% of visits to Dave & Buster’s and 9.4% of visits to Main Event took place during the Saturday evening time slot. Friday and Sunday also experienced increased foot traffic, with hourly fluctuations reflecting the rhythms of weekend activities: Friday visits picked up between 7:00 and 10:00 PM, as people likely wrapped up their work weeks and headed out to unwind with a drink and some skee ball. Sunday visits followed the opposite pattern, with stronger foot traffic earlier in the day that tapered off towards evening, as people put down their pool cues and got ready for the upcoming week.
But Dave & Buster’s and Main Event are both adept at harnessing special promotions to drive visits on off-peak, weekday hours. Dave & Buster’s famous Wednesdays half-off deals fueled significant visit upticks throughout the analyzed period – so it may come as no surprise that the chain recently stepped up its off-peak offerings with a new all-you-can-eat weekday wings deal. And Main Event, which has long offered a Monday Night Madness promotions, also unveiled a “Summer Season Pass” to encourage weekday visits among its customers.
Visitor behavior to Dave and Buster’s and Main Event also changes throughout the week. Analyzing the average driving distances of visitors to the two chains shows, unsurprisingly, that people drive further distances to visit the venues on the weekends – when they have more time on their hands.
Between August 2023 and July 2024, 43.9% of weekend visits (Friday to Sunday) to Dave & Buster’s, and 49.7% of weekend visits to Main Event were made by people traveling 10 miles or less to reach the restaurant. On Weekdays (Monday to Thursday), these numbers increased to 49.4% and 55.3%, respectively – indicating that on weekdays, the eatertainment chains are particularly appealing to locals looking for a convenient night out.
But interestingly, it was on weekdays that visitors to the two chains were most likely to come from more than 100 miles away, suggesting that these customers may be on vacation away from home – the perfect time to pop into an arcade mid-week and “unlearn adulthood.”
Dave & Buster's and Main Event Entertainment continue to flourish, attracting weekend crowds and drawing visitors from near and far. Can the two eatertainment chains continue to draw crowds as summer draws to a close?
Visit Placer.ai to keep up with the latest data-driven dining and entertainment trends.
The last several years have seen many Americans relocate to states like Texas, Florida, Montana, and Maine. We checked in with another region of the country that’s become a domestic migration hotspot in recent years – South Carolina – to explore what’s attracting movers to the state.
Analyzing domestic migration trends throughout the United States between June 2020 and June 2024 reveals several regions of the country that have attracted new residents over the past four years. Idaho led the charge with positive domestic net migration of 4.5%, meaning that the total number of people that moved to Idaho from elsewhere in the U.S., minus those that left, constituted 4.5% of the state’s June 2024 population.
And South Carolina – with a thriving economy, a robust job market, and plenty of affordable living – came in a close second, with a net domestic migration increase of 3.5%. Several other Southeastern states also saw a net inflow of relocators – including Tennessee (2.0%), Alabama (0.7%), Georgia (0.5%), Florida (2.4%), and North Carolina (2.1%).
To uncover local trends driving South Carolina’s net migration growth we analyzed the quarterly cumulative migration to several of the state’s largest CBSAs, focusing on the period between Q1 2020 and Q2 2024.
Of the CBSAs analyzed, Myrtle Beach-Conway-North Myrtle Beach saw the most significant influx of new residents – with a whopping 12.9% cumulative net migration as of Q2 2024. With a low cost of living, a vibrant job market, and plenty of access to the outdoors, it may come as no surprise that Myrtle Beach has become the nation’s fastest-growing city and most popular relocation hotspot. The CBSA is also home to The Grand Strand – a collection of unique communities spanning 60 miles of pristine beaches.
The Charleston-North Charleston metro area also experienced substantial cumulative migration between early 2020 and Q2 2024 (4.7%). The CBSA’s primary municipality, Charleston, has been acclaimed as a top destination for relocators, due in part to its rich history, culture, and sense of community. And like Myrtle Beach, Charleston is also on the coast.
And diving deeper into population growth patterns in South Carolina’s Myrtle Beach-Conway-North Myrtle Beach metro area showcases the unique lifestyle that is attracting many new residents. In many regions of the country, suburban areas are experiencing the most substantial population growth. But in Myrtle Beach – and in South Carolina more generally – it is urban areas that are on the rise.
Between June 2020 and June 2024, South Carolina’s urban population grew by 4.3%, compared to 3.3% for suburban communities, and 2.3% for rural ones. Over the same period, urban areas in the Myrtle Beach-Conway-North Myrtle Beach metro area saw a remarkable 9.9% population increase, likely driven by the popularity of hubs like Myrtle Beach and North Myrtle Beach – coveted by lovers of the year-round beach lifestyle. Still, the CBSA’s suburban and rural communities also experienced significant population growth, outperforming statewide baselines.
South Carolina is home to several metro areas seeing positive net migration, and its coastline is one of the most popular regions for new residents. Will these areas continue to see population growth? Which other parts of the country are popular for those taking on relocation?
Visit Placer.ai to find out.
Summer events and concerts are more than just entertainment – they drive community engagement and have a significant economic impact on local businesses.
We took a closer look at the effect of major summer events, like Lollapalooza in Chicago and Governors Ball in New York, on foot traffic to local venues.
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.
With summer winding down (sigh!) and undergrads nationwide heading back to campus, we dove into the data to explore consumer behavior in college towns – where students and other university-affiliated communities make up a substantial share of the overall population.
Once again, we focused our analysis on nine CBSAs dominated by the comings and goings of a university-centered community – including Ithaca, NY (Cornell University); State College, PA (Penn State); Bloomington, IN (Indiana University); Lawrence, KS (University of Kansas); College Station-Bryan, TX (Texas A&M); Columbia, MO (University of Missouri); Champaign-Urbana, IL (University of Illinois); Ann Arbor, MI (University of Michigan); and Gainesville, FL (University of Florida). How does college life impact local retail performance? And what lies ahead for popular back-to-college shopping destinations as the school year begins?
We dove into the data to find out.
Retail giants Target and Walmart have been thriving in recent months. And nowhere has this been more true than in college towns, where the two behemoths are popular destinations for college students. Nationwide, college students make up just small percentages of the chains’ customer bases. But in college towns, the picture is very different.
In Q2 2024, STI: Landscape’s “Collegian” segment – a group encompassing currently enrolled college students living both on and off campus – made up a remarkable 19.4% of Target’s captured markets in the analyzed CBSAs. Though Walmart’s audiences in these cities included smaller shares of undergrads, the coveted demographic comprised an impressive 11.4% of its local captured markets.
And superstore locations in the analyzed college towns experienced higher-than-average YoY visit growth in Q2 – showcasing the power of this demographic to drive retail success. Target, for example, saw a 2.6% YoY increase in average monthly visits per location in college towns – compared to 1.4% nationwide. And Walmart followed a similar pattern, with average monthly visits per location up 5.8% in college towns, compared to 4.1% nationwide.
With a strong Q2 2024 under their belts, Target and Walmart both appear poised to enjoy an even stronger back-to-college shopping season. And a look at seasonal fluctuations in visits to the two retailers shows just how important the summer shopping scramble is for retailers in these CBSAs.
Nationwide, Target experiences its biggest monthly visit spike in December, when consumers throughout the country fill up their carts with holiday fare and gifts for loved ones. But in college towns, Target’s August visit spike is even bigger than its December one – as students load up on everything from dorm furniture to school supplies. Walmart, too, experiences a college-town August visit bump outpacing the one seen in the run-up to Christmas.
College students may eat many of their meals on campus – but they also frequent grocery stores, whether to pick up snacks or to buy ingredients for off-campus, home-cooked meals. And like superstores, grocery chains in college towns follow unique seasonal rhythms of their own.
Nationwide, grocery stores tend to see weekly visits peak in November and December. But in college towns, these holiday retail milestones carry less weight, as many collegians head home for Thanksgiving and Christmas. Instead, weekly grocery store foot traffic in these CBSAs reaches its high point in August, when collegians likely converge on stores all at once as they head back to campus.
And taking a closer look at value grocer Aldi – which features locations in all nine analyzed CBSAs – highlights other differences in the shopping habits of college town residents. Aldi has been crushing it in recent months, ranking high on the Placer 100 Retail & Dining Index visit growth lists throughout the summer. Like Target and Walmart, the discount supermarket enjoyed even greater visit-per-location growth in college towns than in other areas of the country.
And comparing Aldi visitation patterns in the analyzed CBSAs to those nationwide shows that in college towns, shoppers tend to do their grocery shopping later in the day. In Q2 2024, some 40.3% of visits to Aldi in college towns took place between 4:00 PM and 8:00 PM – compared to just 37.4% nationwide. And on the flip side, just 27.9% of college town Aldi visits took place in the morning, compared to 30.1% nationwide. Whether because they’re busy attending classes, or because they prefer to (ahem) sleep in, college students appear less likely than others to visit grocery stores in the morning.
Americans spend billions of dollars each year on back-to-college shopping – and this year is shaping up to be no different. For superstores and grocery chains in college towns, recent strong performance offers plenty of reason for optimism as the August shopping bonanza continues.
For more data-driven retail analyses, follow Placer.ai.
Discount and Dollar Stores as a whole had resounding success in Q2 2024. We dove into the data for Five Below and Ollie’s Bargain Outlet to take a closer look at what’s driving the recent foot traffic gains to these discount chains.
Five Below and Ollie’s have been on a growth trajectory for quite some time. In 2023, Five Below opened a company-record 205 new stores, and in fiscal Q1 2024 opened another 61 locations. Ollie’s grew its real estate footprint by 45 locations in 2023 and added 4 new stores in fiscal Q1 2024.
Ollie and Five Below’s visit growth has at least partly been fueled by their growing fleets. In Q2 2024 (April-May), Five Below and Ollie’s saw YoY visit increases of 14.0% and 17.1%, respectively.
And while both brands have plans to continue their physical-world expansions in the near future, a robust digital and social media presence also appears to be part of both Ollie’s and Five Below’s long-term strategies.
An examination of changes in visitor engagement with these two chains indicates that increasing consumer loyalty has been a significant factor for both Five Below and Ollie’s in recent years.
Five Below’s focus on recreational items appears to be a key driver of visitor frequency and visits – especially during the holidays. And visitor frequency is on the rise for the chain. In December 2021 and 2022, the share of visitors that visited Five Below at least twice during the month peaked at 18.3% and 18.2%, respectively. But in December 2023, the share of Five Below’s repeat visitors climbed to 20.1%. This could be due in part to the company’s doubling down on the Five Beyond store-in-store concept, which offers merchandise beyond the chain’s traditional $5 price-ceiling – broadening their offerings and enhancing the treasure-hunting experience. With the addition of a loyalty program next year, Five Below could expect to see an even greater share of frequent visitors.
Meanwhile, Ollie’s closeout business model and recruitment of consumers into its “army” likely encourage frequent visitation to the chain throughout the year. And still-high prices appear to have consumers visiting Ollie’s more often than in previous years, perhaps as they keep their eyes out for bargains on everyday items and home goods to help stretch their dollars.
Visits to Five Below and Ollie’s remain elevated as consumers appear hungry-as-ever for bargains on items that excite and fill everyday needs. Will foot traffic to these retailers remain strong through the second half of 2024?
Visit Placer.ai to find out.
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.
The pandemic and economic headwinds that marked the past few years presented the multi-billion dollar hotel industry with significant challenges. But five years later, the industry is rallying – and some hotel segments are showing significant growth.
This white paper delves into location analytics across six major hotel categories – Luxury Hotels, Upper Upscale Hotels, Upscale Hotels, Upper Midscale Hotels, Midscale Hotels, and Economy Hotels – to explore the current state of the American hospitality market. The report examines changes in guest behavior, personas, and characteristics and looks at factors driving current visitation trends.
Overall, visits to hotels were 4.3% lower in Q2 2024 than in Q2 2019 (pre-pandemic). But this metric only tells part of the story. A deeper dive into the data shows that each hotel tier has been on a more nuanced recovery trajectory.
Economy chains – those offering the most basic accommodations at the lowest prices – saw visits down 24.6% in Q2 2024 compared to pre-pandemic – likely due in part to hotel closures that have plagued the tier in recent years. Though these chains were initially less impacted by the pandemic, they were dealt a significant blow by inflation – and have seen visits decline over the past three years. As hotels that cater to the most price-sensitive guests, these chains are particularly vulnerable to rising costs, and the first to suffer when consumer confidence takes a hit.
Luxury Hotels, on the other hand, have seen accelerated visit growth over the past year – and have succeeded in closing their pre-pandemic visit gap. Upscale chains, too, saw Q2 2024 visits on par with Q2 2019 levels. As tiers that serve wealthier guests with more disposable income, Luxury and Upscale Hotels are continuing to thrive in the face of headwinds.
But it is the Upper Midscale level – a tier that includes brands like Trademark Collection by Wyndham, Fairfield by Marriott, Holiday Inn Express by IHG Hotels & Resorts, and Hampton by Hilton – that has experienced the most robust visit growth compared to pre-pandemic. In Q2 2024, Upper Midscale Hotels drew 3.5% more visits than in Q2 2019. And during last year’s peak season (Q3 2023), Upper Midscale hotels saw the biggest visit boost of any analyzed tier.
As mid-range hotels that still offer a broad range of amenities, Upper Midscale chains strike a balance between indulgence and affordability. And perhaps unsurprisingly, hotel operators have been investing in this tier: In Q4 2023, Upper Midscale Hotels had the highest project count of any tier in the U.S. hotel construction and renovation pipeline.
The shift in favor of Upper Midscale Hotels and away from Economy chains is also evident when analyzing changes in relative visit share among the six hotel categories.
Upper Midscale hotels have always been major players: In H1 2019 they drew 28.7% of overall hotel visits – the most of any tier. But by H1 2024, their share of visits increased to 31.2%. Upscale Hotels – the second-largest tier – also saw their visit share increase, from 24.8% to 26.1%.
Meanwhile, Economy, Midscale, and Upper Upscale Hotels saw drops in visit share – with Economy chains, unsurprisingly, seeing the biggest decline. Luxury Hotels, for their parts, held firmly onto their piece of the pie, drawing 2.8% of visits in H1 2024.
Who are the visitors fueling the Upper Midscale visit revival? This next section explores shifts in visitor demographics to four Upper Midscale chains that are outperforming pre-pandemic visit levels: Trademark Collection by Wyndham, Holiday Inn Express by IHG Hotels & Resorts, Fairfield by Marriott, and Hampton by Hilton.
Analyzing the captured markets* of the four chains with demographics from STI: Popstats (2023) shows variance in the relative affluence of their visitor bases.
Fairfield by Marriott drew visitors from areas with a median household income (HHI) of $84.0K in H1 2024, well above the nationwide average of $76.1K. Hampton by Hilton and Trademark Collection by Wyndham, for their parts, drew guests from areas with respective HHIs of $79.6K and $78.5K – just above the nationwide average. Meanwhile, Holiday Inn Express by IHG Hotels & Resorts drew visitors from areas below the nationwide average.
But all four brands saw increases in the median HHIs of their captured markets over the past five years. This provides a further indication that it is wealthier consumers – those who have had to cut back less in the face of inflation – who are driving hotel recovery in 2024.
(*A chain’s captured market is obtained by weighting each Census Block Group (CBG) in its trade area according to the CBG’s share of visits to the chain – and so reflects the population that actually visits the chain in practice.)
Much of the Upper Midscale visit growth is being driven by chain expansion. But in some areas of the country, the average number of visits to individual hotel locations is also on the rise – highlighting especially robust growth potential.
Analyzing visits to existing Upper Midscale chains in four metropolitan areas with booming tourism industries – Salt Lake City, UT, Palm Bay, FL, San Diego, CA, and Richmond, VA – shows that these markets feature robust untapped demand.
Utah, for example, has emerged as a tourist hotspot in recent years – with millions of visitors flocking each year to local destinations like Salt Lake City to see the sights and take in the great outdoors. And Upper Midscale hotels in the region are reaping the benefits. In H1 2024, the overall number of visits to Upper Midscale chains in Salt Lake City was 69.4% higher than in H1 2019. Though some of this increase can be attributed to local chain expansion, the average number of visits to each individual Upper Midscale location in the area also rose by 12.5% over the same period.
Palm Bay, FL (the Space Coast) – another tourist favorite – is experiencing a similar trend. Between H1 2019 and H1 2024, overall visits to local Upper Midscale hotel chains grew by 36.4% – while the average number of visits per location increased a substantial 16.9%. Given this strong demand, it may come as no surprise that the area is undergoing a hotel construction boom. Upper Midscale hotels in other areas with flourishing tourism sectors, like San Diego, CA and Richmond, VA, are seeing similar trends, with increases in both overall visits and and in the average number of visits per location.
Though Economy chains have underperformed versus other categories in recent years, the tier does feature some bright spots. Some extended-stay brands in the Economy tier – hotels with perks and amenities that cater to the needs of longer-stay travelers – are succeeding despite category headwinds.
Choice Hotels’ portfolio, for example, includes WoodSpring Suites, an Economy chain offering affordable extended-stay accommodations in 35 states. In H1 2024, the chain drew 7.7% more visits than in the first half of 2019 – even as the wider Economy sector continued to languish. InTown Suites, another Economy extended stay chain, saw visits increase by 8.9% over the same period.
And location intelligence shows that the success of these two chains is likely being driven, in part, by their growing appeal to young, well-educated professionals. In H1 2019, households belonging to Spatial.ai: PersonaLive’s “Young Professionals” segment made up 9.6% of WoodSpring Suites’ captured market. But by H1 2024, the share of this group jumped dramatically to 13.3%. At the same time, InTown Suites saw its share of Young Professionals increase from 12.0% to 13.4%.
Whether due to an affinity for prolonged “workcations” (so-called “bleisure” excursions) or an embrace of super-commuting, younger guests have emerged as key drivers of growth for the extended stay segment. And by offering low–cost accommodations that meet the needs of these travelers, Economy chains can continue to grow their share of the pie.
The hospitality industry recovery continues – led by Upper Midscale Hotels, which offer elevated experiences that don’t break the bank. But today’s market has room for other tiers as well. By keeping abreast of local visitation patterns and changing consumer profiles, hotels across chain scales can personalize the visitor experience and drive customer satisfaction.
The past few years have provided the tourism sector with a multitude of headwinds, from pandemic-induced lockdowns to persistent inflation and a rise in extreme weather events. But despite these challenges, people are more excited than ever to travel – more than half of respondents to a recent survey are planning on increasing their travel budgets in the coming months.
And while revenge travel to overseas destinations is still very much alive and well, the often high costs associated with traveling abroad are shaping the way people choose to travel. Domestic travel and tourism are seeing significant growth as more affordable alternatives.
This white paper takes a closer look at two of the most popular domestic tourism destinations in the country – New York City and Los Angeles. Over the past year, both cities have continued to be leading tourism hotspots, offering a wealth of attractions for visitors. What does tourism to these two cities look like in 2024, and what has changed since before the pandemic? How have inflation and rising airfare prices affected the demographics and psychographics of visitors to these major hubs?
Analyzing the distribution of domestic tourists across CBSAs nationwide from May 2023 to April 2024 reveals New York and Los Angeles to be two of the nation’s most popular destinations. (Tourists include overnight visitors staying in a given CBSA for up to 31 days).
The New York-Newark-Jersey City, NY-NJ-PA metro area drew the largest share of domestic tourists of any CBSA during the analyzed period (2.7%), followed closely by the Los Angeles-Long Beach-Anaheim, CA CBSA (2.5%). Other domestic tourism hotspots included Orlando-Kissimmee-Sanford, FL (tied for second place with 2.5% of visitors), Dallas-Fort Worth-Arlington, TX (1.9%), Las Vegas-Henderson-Paradise, NV (1.8%), Miami-Fort Lauderdale-Pompano Beach, FL (1.8%), and Chicago-Naperville, Elgin, IL-IN-WI (1.6%).
The Big Apple. The City That Never Sleeps. Empire City. Whatever it’s called, New York City remains one of the most well-known tourist destinations in the world. And for many Americans, New York is the perfect place for an extended weekend getaway – or for a multi-day excursion to see the sights.
But where do these NYC-bound vacationers come from? Diving into the data on the origin of visitors making medium-length trips to New York City (three to seven nights) reveals that increasingly, these domestic tourists are coming from nearby metro areas.
Between 2018-2019 and 2023-2024, for example, the number of tourists visiting New York City from the Philadelphia metro area increased by 19.2%.
The number of tourists coming from the Boston and Washington, D.C metro areas, and from the New York CBSA itself (New York-Newark-Jersey City, NY-NJ-PA) also increased over the same period.
Meanwhile, further-away CBSAs like San Francisco-Oakland-Berkeley, CA, Atlanta-Sandy Springs-Alpharetta, GA, and Miami-Fort Lauderdale-Pompano Beach, FL fed fewer tourists to NYC in 2023-2024 than they did pre-pandemic. It seems that residents of these more distant metro areas are opting for vacation destinations closer to home to avoid the high costs of air travel.
Diving even deeper into the characteristics of visitors taking medium-length trips to New York City reveals another demographic shift: Tourists staying between three and seven nights in the Big Apple are skewing younger.
Between 2018-2019 and 2023-2024, the share of visitors to New York City from areas with median ages under 30 grew from 2.1% to 4.5%. Meanwhile, the share of visitors from areas with median ages between 31 and 40 increased from 34.3% to 37.7%.
The impact of this trend is already being felt in the Big Apple, with The Broadway League reporting that the average age of audiences to its shows during the 2022- 2023 season was the youngest it had been in 20 seasons.
The shift towards younger tourists can also be seen when examining the psychographic makeup of visitors to popular attractions in New York City. Analyzing the captured markets of major NYC landmarks with data from Spatial.ai’s PersonaLive dataset reveals an increase in households belonging to the “Educated Urbanites” segment between 2018-2019 and 2023-2024.
These well-educated, young singles are increasingly visiting iconic NYC venues such as the Whitney Museum of American Art, The Metropolitan Museum of Art, The American Museum of Natural History, and the Statue of Liberty. This shift highlights the growing popularity of these attractions among young, educated singles, reflecting a broader trend of increased domestic tourism among this demographic.
New York City’s tourism sector is adapting to meet the changing needs of travelers, fueled increasingly by younger visitors who may be unable to take a costly international vacation. How have travel patterns to Los Angeles changed in response to increasing travel costs?
While New York City is the East Coast’s tourism hotspot, Los Angeles takes center stage on the West Coast. And as overseas travel has become increasingly out of reach for Americans with less discretionary income, the share of domestic tourists originating from areas with lower HHIs has risen.
Before the pandemic, 57.6% of visitors to LA came from affluent areas with median household incomes (HHIs) of over $90K/year. But by 2023-2024, this share decreased to 50.7%. Over the same period, the share of visitors from areas with median HHIs between $41K and $60K increased from 9.7% to 12.5%, while the share of visitors from areas with HHIs between $61K and $90K rose from 32.1% to 35.8%.
Diving into the psychographic makeup of visitors to popular Los Angeles attractions – Universal Studios Hollywood, Disneyland California, the Santa Monica Pier, and Griffith Observatory – also reflects the above-mentioned shift in HHI. The captured markets of these attractions had higher shares of middle-income households belonging to the “Family Union” psychographic segment in 2023-2024 than in 2018-2019.
Experian: Mosaic defines this segment as “middle income, middle-aged families living in homes supported by solid blue-collar occupations.” Pre-pandemic, 16.0% of visitors to Universal Studios Hollywood came from trade areas with high shares of “Family Union” households. This number jumped to 18.8% over the past year. A similar trend occurred at Disneyland, Santa Monica Pier, and Griffith Observatory.
And like in New York City, growing numbers of visitors to Los Angeles appear to be coming from nearby areas. Between 2018-2019 and 2023-2024, the share of in-state visitors to major Los Angeles attractions increased substantially – as people likely sought to cut costs by keeping things local.
Pre-pandemic, for example, 68.9% of visitors to Universal Studios Hollywood came from within California – a share that increased to 72.0% over the past year. Similarly, 59.7% of Griffith Observatory visitors in 2018-2019 came from within the state – and by 2023-2024, that number grew to 64.7%.
Even when times are tight, people love to travel – and New York and Los Angeles are two of their favorite destinations. With prices for airfare, hotels, and dining out increasing across the board, younger and more price-conscious households are adapting, choosing to visit nearby cities and enjoy attractions closer to home. And as the tourism industry continues its recovery, understanding emerging visitation trends can help stakeholders meet travelers where they are.
