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Over Memorial Day Weekend, Wayfair opened its highly anticipated addition to the world of physical retail, something we've been waiting for since the company's large-format store plan first came into view in early 2022. Technically, Wayfair’s new mega-store, sized at 150,000 square feet in Wilmette, Illinois, isn’t its first foray into brick-and-mortar, but it is certainly its splashiest. In an era when many home furnishing retailers are going small, early indications from Placer show that betting big has yielded success in attracting visitors, but questions about the longevity of success and health of the broader home industry remain.
This week, we had a chance to visit the store ourselves, and it's immediately evident how much attention was put into the store. Most visitors enter through the "Market Square", which feature unique housewares, locally-relevant products, and seasonal merchandise. Above the Market Square is a large video board that showcases certain products and other digital media assets which help set the tone for the shopping experience.
According to the retailer, its first namesake location brings a new shopping experience to consumers and features its first food service offering, The Porch (below).
The store also features an expanded selection and one-on-one personal design services, which can be seen in store layout below. The new location clearly took learnings from other Wayfair-owned brands like Joss & Main or All Modern, each of which have also opened physical stores.
The Wilmette large format store opened on May 23, just in time for Memorial Day Weekend foot traffic, and the location greatly benefitted from the timing. According to Placer’s early reads from May 18-June 1, 2024, Wayfair’s visits accounted for almost half of the visits to Edens Plaza (below), the shopping center in which it’s located. Beyond that, during its opening weekend from May 23-27, it drove 60% of visits to the plaza. The shopping center is located right off the Edens expressway, and the store is visible from the road, which helping to draw the attention of travelers.
Wayfair’s debut is a clear victory for the shopping center, with the store’s first few weeks helping to attract new visitors to the center. Comparing the two week period before the store opening to the two weeks of its opening using Spatial.ai’s PersonaLive segments, the percentage of visits coming from trade areas from Ultra Wealthy Families--the typical center visitors--actually decreased from 45% to 32%. However, there was a large increase in the percentage of visits by Educated Urbanites and Young Professionals. Buzzworthy openings help to revitalize shopping centers and Wayfair’s initial success will hopefully provide some meaningful shifts in visitors beyond the first few weeks.
Home furnishing retailers, in particular, have made experiences and expanded service offerings a cornerstone of their strategies to foster a captive consumer audience and increase dwell time, and hopefully conversion. Looking at local home furnishing experiential retail locations in the Metro Chicago area, Wayfair’s opening splash is even more apparent with its two story, expansive footprint. Compared to the closest IKEA store (Schaumburg), Wayfair Wilmette's visits were 12% higher during its initial two-week period and saw 19% more visits than IKEA during the highest traffic day of opening weekend. The trade area of the two retailers, even in the first two weeks, starts to tell the story of the visiting consumer; Wayfair drove more visits despite having a smaller trade area than IKEA and more overlapping territory, and primarily pulled its visitors from the northern Chicago suburbs.
Wayfair’s early indicators of traffic highlight a combination of the right concept, the right consumer, and the right location. It will be fascinating to watch the long-term visit trends for Wayfair, especially compared to other large-scale regional furniture retailers. Despite many home furnishing retailers looking to smaller formats for growth, if Wayfair’s location sustains its traffic growth, larger-format stores may become an attractive solution for shopping centers to revitalize themselves.
Mixing high-low fashion means pairing expensive designer items with more budget-friendly ones, think H&M jeans with a tweed Chanel jacket. This concept has been around for a while, and though one may originally have had to frequent different stores to attain this, with the way investment firms are snapping up different brands, shopping “High-Low” may become a more commonplace occurrence. Regent acquired Escada in 2019 and Club Monaco in 2021. While one might not normally think of those brands in the same sentence, if you’re walking on Beverly Drive and enticed by the Club Monaco outfits, walk in a bit deeper and before you know it, you will be encountering designer pantsuits and evening gowns by Escada.
Since the space is all one, it’s hard to decipher who’s going in for Club Monaco versus for Escada. Technically, Escada has its own entrance on Brighton Way. Either way, overall traffic for this space is up in the last few months, so perhaps this is simply the evolution of real estate as owners become creative with how they use their spaces and the brands within. As for us shoppers, we love to be surprised and delighted, so for sure finding an unexpected brand as you meander around is always welcome.
Over the past few months, we’ve noted how consumers–particularly from lower-income trade areas–have started to migrate from QSR to value-grocers, dollar stores, and convenience stores. Against that backdrop, we wanted to examine visitation trends for QSR chains in the state of California, where a $20 per hour minimum wage law was put in place on April 1 for employees of fast-food chains with more than 60 locations nationwide (with some exemptions for smaller stores at grocery stores, airports, and entertainment venues). This represented a 25% increase from the previous minimum wage for fast-food employees of $16 per hour (which remains the state’s minimum wage for other categories except for workers in healthcare facilities, which also saw minimum wage increased to $20 per hour).
As a result of the minimum wage increase, most chains have raised prices in the region anywhere from the mid-single digits to the midteens. We compared year-over-year visit trends for QSR chains nationwide and California, and it’s clear that the menu price increase is having an impact. During February-March 2024 (we’ve excluded January due to inclement weather across much of the country), year-over-year QSR visit trends in the state of California had been running slightly ahead of national averages (below). However, this abruptly shifted when the minimum wage increase went into effect, with the nationwide visit trend year-over-year exceeding the state average seven of the eight weeks during the April-May 2024 timeframe.
We also see the impact at the chain level. Below, we’ve looked at year-over-year visitation trends for McDonald’s nationwide and in California (where about 9% of its restaurants are located) from February through May. Again, we see a situation where McDonald’s California was seeing roughly the same year-over-year visit trends as its national average during February-March but underperformed by almost 250 basis points after the minimum wage increase went into effect.
Our data indicates that QSR burger chains have generally been the hardest hit by the California increase in minimum wage and subsequent increase in menu prices. In addition to McDonald’s, we see that other large QSR burger chains in the state also underperformed their national average following the minimum wage increase. Chipotle–which raised menu prices by 6%-7% in California to help offset the minimum wage increase–also saw year-over-year visit trends in California underperform its national average in April and May.
It’s early, but we’re starting to see the ripple effect of the minimum wage increase across the broader restaurant industry. First, we’ve started to see some operators close locations in the state, especially chains that were already facing financial difficulties. Earlier this week, Rubio’s Coastal Grill shut down almost 50 locations in California and filed for Chapter 11 bankruptcy protection, citing “significant increases to the minimum wage in California” as a reason for closing the restaurants. Second, the minimum wage hike and subsequent increase in QSR menu prices may be benefitting casual dining chains (many of which were already paying above the new minimum wages for many employees). Below, we see that Darden’s Olive Garden concept and Brinker International’s Chili’s concept in California have outperformed their national averages with respect to year-over-year visit trends starting in April (below). Finally, the minimum wage increase could make it more costly to do business across other retail and restaurant categories, something we called out in our recap of 99 Cents Only going out of business.
As we discussed following this year’s National Restaurant Association show, casual dining has been making a comeback the past several months, with many chains accentuating value proposition through promotions. Chili’s has seen visitation trends outperform casual-dining category averages by a significant amount the past several weeks (below) through its value messaging, while Buffalo Wild Wings All-You-Can Eat wings promotions on Monday and Wednesdays starting in mid-May has been one of the more successful promotions that we’ve seen in the full-service restaurant category in some time. However, with several QSR chains starting to get more promotional ahead of McDonald’s planned $5 value menu promotion at the end of the month, it’s clear that QSR chains are looking to also emphasize value in the coming months, even while facing higher labor costs.
About the Mall Index: The Index analyzes data from 100 top-tier indoor malls, 100 open-air shopping centers (not including outlet malls) and 100 outlet malls across the country, in both urban and suburban areas. Placer.ai leverages a panel of tens of millions of devices and utilizes machine learning to make estimations for visits to locations across the country.
After a brief calendar-driven slowdown in April, May saw a resurgence in foot traffic to malls. Indoor malls led the way with an 8.6% YoY increase, followed by open-air shopping centers and outlet malls, which experienced YoY jumps of 6.2% and 5.7%, respectively.
This uptick is likely due to a variety of factors – from warmer weather to rising consumer confidence amidst slowly easing inflation. And malls’ particularly strong showing on two of May’s most important retail milestones – Mother’s day and Memorial day also helped propel the segment forward.
Taking a closer look at visit patterns to the three mall types on Mother’s Day and Memorial Day shows how significant these special days were for mall foot traffic. On Mother’s Day (May 12th), indoor malls, open-air shopping centers, and outlet malls saw respective visit spikes of 15.8%, 26.0%, and 11.4%, compared to an average year-to-date (YTD) Sunday. And Mother’s Day visits were up significantly YoY as well – further highlighting the category’s robust positioning.
All three mall types also saw impressive visit bumps on Memorial Day – this time compared to an average YTD Monday. The relative spikes were bigger across the board, since malls tend to be less busy on Mondays than on Sundays. But for outlet malls, Memorial Day visits really hit it out of the park – with foot traffic up by a whopping 123.3%. As a day off work featuring plenty of markdowns, Memorial Day is an ideal time to make the longer trip to an outlet mall and hunt for bargains.
And in another promising sign for the category, Memorial Day visits to all three mall types increased YoY – showing that despite continued headwinds, malls are still on the rise.
Comparing weekly mall visits to an early January baseline also shows the varying impact of different holidays on the three mall types.
On Easter, and even more so on Memorial Day – an extended weekend very much focused on savings – outlet malls won the day. On these holidays, shoppers may be more likely to have the time and state of mind to make a day of their shopping trip and lean into the treasure-hunting experience.
But on Mother’s Day, more upscale open-air shopping centers took the lead, as consumers embraced a more unique and luxurious shopping experience. Still, all three mall types drew increased traffic on the different special days – showing that each can benefit from a variety of calendar highlights.
Malls’ strong May performance – especially on the holidays – shows that shopping centers are on the upswing once again. This could be an encouraging sign for the category heading into the summer, and may hint at a promising shopping season during the warm months ahead.
For more data-driven retail insights, visit our blog at Placer.ai.
The Placer.ai Nationwide Office Building Index: The office building index analyzes foot traffic data from some 1,000 office buildings across the country. It only includes commercial office buildings, and commercial office buildings with retail offerings on the first floor (like an office building that might include a national coffee chain on the ground floor). It does NOT include mixed-use buildings that are both residential and commercial.
With summer nearly upon us, we dove into the data to see how the return-to-office fared in May 2024. Did the post-pandemic visit recovery trajectory observed in April continue apace? And which major regional hub saw the most YoY visit growth?
The office recovery is still very much underway. Visits to office buildings nationwide in May 2024 were just 32.2% lower than in May 2019 – and slightly higher than they’ve been during any other month since COVID. Year-over-year (YoY), office foot traffic in May increased by 8.6%.
And drilling down into the data for 11 major business hubs nationwide shows recovery continuing unabated throughout (most of) the country. For New York, Atlanta, Boston, Los Angeles, and San Francisco, May 2024 was the single busiest in-office month since February 2020. And for Miami, Washington, D.C., and Denver, it was the second-busiest month.
Consistent with recent trends, Miami continued to lead the post-COVID recovery pack, followed by New York: Foot traffic to the two cities was just 12.8% and 17.3%, respectively, below May 2019 levels.
But the data also contained some surprises. Atlanta, which saw the biggest YoY visit jump of any analyzed city, pulled into third place – outpacing Washington, D.C. And Houston, the only city to see a YoY decline in visits, fell significantly in the rankings.
Why did Houston YoY office visits drop in May? A look at weekly YoY visits to local office buildings confirms that this was likely due to the extreme weather that engulfed the city during the second half of the month. On Thursday, May 16th, Houston was hit by a particularly violent storm that caused significant damage to the downtown area – breaking windows, downing power lines, and leaving a battered city in its wake. Additional severe weather events pummeled the region as the month wore on – forcing many residents to hunker down at home. And it was when the storm hit that YoY visits began to turn negative, with the week of May 20th seeing a significant 20.0% drop. As the weather improves in the southeast Texas hub, office recovery will likely resume.
Five years after COVID upended office routines, employees and companies are still feeling out the ideal balance between WFH and in-person interaction. Will office attendance increase or decrease as the weather warms up?
Follow Placer.ai’s data-driven office analyses to find out.
With summer upon us, we dove into the data to explore Memorial Day foot traffic trends. How did people spend the long weekend? And how did major dining and retail categories fare on the holiday?
Gas stations were bustling on Friday, May 24th, as people filled their tanks in anticipation of a long, travel or activity-filled weekend. Visits to gas stations were up 32.3% compared to an average day this year – and the highest they’ve been since January 1st, 2024.
Year over year (YoY), gas station foot traffic increased 1.5%. And compared to pre-COVID, too, gas station visits were up 1.8% – showing that people are once again hitting the road, whether to go on weekend getaways or to visit nearby parks and attractions.
Indeed, Americans partake in many different activities on Memorial Day – from attending parades and memorial events to sight-seeing or enjoying the great outdoors. And visiting museums is a time-honored holiday tradition: On Monday, May 27th, museums nationwide drew a whopping 71.5% more visits than on an average Monday this year.
YoY, Museums were 1.6% busier on May 27th than in 2023 – and museum-goers spent more time exploring the exhibits (who says attention spans are decreasing?), browsing the gift shop, or fueling up at the cafeteria.
Memorial Day weekend is a prime time for picnics and barbecues. But for many Americans, it’s also an opportunity to enjoy a nice meal at a restaurant with friends and family.
Like on Mother’s Day, full-service restaurants get a much bigger Memorial Day visit boost than either fast-casual eateries or fast-food (QSR) joints. But all three dining segments enjoyed a significant YoY holiday visit increase this year – proving that despite still-high food-away-from-home prices, people are finding room in their budgets to treat themselves on their day off.
And the last Monday in May is, of course, a big day for savings, on everything from big-ticket items like mattresses, furniture, and major appliances, to clothing and other discretionary items. This year, apparel stores saw the biggest Memorial Day visit spike, with foot traffic up 40.5% compared to an average day and 88.2% compared to an average Monday. But home furnishing stores, home improvement stores, electronics retailers, and (to a lesser extent), grocery stores, all experienced considerable holiday visit spikes of their own.
And comparing Memorial Day retail activity to last year shows most of the analyzed categories seeing minor visit increases or holding steady – no small feat in today’s challenging retail environment. Like dining segments, grocery stores impressed with a 9.3% YoY visit increase – perhaps buoyed by consumers buying last-minute ingredients for their picnics or barbecues.
People were on the move this year on Memorial Day – fueling up their cars, and enjoying museums, restaurants, and retail sales. What does the rest of the summer hold in store for American consumers?
Follow Placer.ai’s data driven analyses to find out.
This report includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.
Grabbing a coffee or snack at a convenience store is a time-honored road trip tradition – but increasingly, Convenience Stores (C-Stores) have also emerged as places people go out of their way to visit.
Convenience stores have thrived in recent years, making inroads into the discretionary dining space and growing both their audiences and their sales. Between April 2023 and March 2024, C-Stores experienced consistent year-over-year (YoY) visit growth, generally outperforming Overall Retail. Unsurprisingly, C-Stores fell behind Overall Retail in November and December 2023, when holiday shoppers flocked to malls and superstores to buy gifts for loved ones. But in January 2024, the segment regained its lead, growing YoY visits even as Overall Retail languished in the face of an Arctic blast that had many consumers hunkering down at home.
C-Stores’ current strength is partially due to the significant innovation by leading players in the space: Chains like Casey’s, Maverik, Buc-ee’s, and Rutter’s are investing in both in their product offerings and in their physical venues to transform the humble C-Store from a stop along the way into a bona fide destination. Dive into the data to explore some of the key strategies helping C-Stores drive consumer engagement and stay ahead of the pack.
While chain expansion may explain some of the C-Store segment growth, a look at visit-per-location trends shows that demand is growing at the store level as well. Over the past year (April 2023 to March 2024), average visits per location on an industry-wide basis grew by 1.8%, compared to the year prior (April 2022 to 2023).
And within this growing segment, some brands are distinguishing themselves and outperforming category averages. Casey’s, for example, saw the average number of visits to each of its locations increase by 2.3% over the same time frame – while Maverik, Buc-ee’s and Rutter’s saw visits per location increase by 3.2%, 3.4% and 3.9%, respectively.
Each in its own way, Casey’s, Maverik, Buc-ee’s, and Rutter’s, are helping to transform C-Stores from pit stops where people can stretch their legs and grab a cup of coffee to destinations in and of themselves.
Midwestern gas and c-store chain Casey’s – famous for its breakfast pizza and other grab-and-go breakfast items – has emerged as a prime spot for fast food pizza lovers to grab a slice first thing in the morning. And Salt Lake City, Utah-based Maverik – which recently acquired Kum & Go and its 400-plus stores – is also establishing itself as a breakfast destination thanks to its specialty burritos and other chef-inspired creations.
Casey’s and Maverik’s popular breakfast options are likely helping the chains receive its larger-than-average share of morning visits: In Q1 2024, 16.3% of visits to Maverik and 17.5% of visits to Casey’s took place during the 7:00 AM - 10:00 AM daypart, compared to just 14.9% of visits to the wider C-Store category.
Psychographic data from the Spatial.ai’s FollowGraph dataset – which looks at the social media activity of a given audience – also suggests that Casey’s and Maverik’s have opened stores in locations that allow them to reach their target audience. Compared to the average consumer, residents of Casey’s potential market are 7% more likely to be “Fast Food Pizza Lovers” than both the average consumer and the average C-Store trade area resident. Residents of Maverik’s potential market are 16% more likely than the average consumer to be “Mexican Food Enthusiasts,” compared to residents of the average C-Store’s trade area who are only 1% more likely to fall into that category.
With both chains expanding, Casey’s and Maverik can hope to introduce new audiences to their unique breakfast options and solidify their hold over the morning daypart within the C-Store space over the next few years.
Everything is said to be bigger in the Lone Star State, and Texas-based convenience store chain Buc-ee’s – holder of the record for the worlds’ largest C-Store – is no exception. With a unique array of specialty food items and award-winning bathrooms, Buc-ee’s has emerged as a well-known tourist attraction. And the popular chain’s status as a visitor hotspot is reflected in two key metrics.
First, Buc-ee’s attracts a much greater share of weekend visits than other convenience store chains. In Q1 2024, 39.6% of visits to Buc-ee’s took place on the weekends, compared to just 28.3% for the wider C-Store industry. And second, Buc-ee’s captured markets feature higher-than-average shares of family-centric households – including those belonging to Experian: Mosaic’s Suburban Style, Flourishing Families, and Promising Families segments.
Rather than merely a place to stop on the way to work, Buc-ee’s has emerged as a favored destination for families and for people looking for something fun to do on their days off.
Buc-ee’s isn’t the only C-Store chain that believes bigger is better. Pennsylvania-based Rutter’s is increasing visits and customer dwell time by expanding its footprint – both in terms of store count and venue size. New stores will be 10,000 to 12,000 square feet – significantly larger than the industry average of around 3,100 square feet. And in more urban areas, where space is at a premium, the company is building upwards.
Rutter’s added a second floor to one of its existing locations in York, PA in December 2023. The remodel, which was met with enthusiasm by customers, provided additional seating for up to 30 diners, a beer cave, and an expanded wine selection. And in Q1 2024, the location experienced 15.6% YoY visit growth – compared to a chainwide average of 7.6%. Visitors to the newly remodeled Rutter’s also stayed significantly longer than they did pre-renovation. The share of extended visits to the store (longer than ten minutes) grew from 20.8% in Q1 2023 to 27.0% in Q1 2024 – likely from people browsing the chain’s selection of beers or grabbing a bite to eat.
Convenience stores are flourishing, transforming into some of the most exciting dining and tourist destinations in the country. Today, C-Store customers can expect to find brisket sandwiches, gourmet coffees, or craft beers, rather than the stale cups of coffee of old. And the data shows that customers are receptive to these innovations, helping drive the segment’s success.
The first quarter of 2024 was generally a good one for retailers. Though unusually cold and stormy weather left its mark on the sector’s January performance, February and March saw steady year-over-year (YoY) weekly visit growth that grew more robust as the quarter wore on.
March ended on a high note, with the week of March 25th – including Easter Sunday – seeing a 6.1% YoY visit boost, driven in part by increased retail activity in the run-up to the holiday. (Last year, Easter fell on April 9th, 2023, so the week of March 25th is being compared to a regular week.)
Though prices remain high and consumer confidence has yet to fully regain its footing, retail’s healthy Q1 showing may be a sign of good things to come in 2024.
Drilling down into the data for leading retail segments demonstrates the continued success of value-priced, essential, and wellness-related categories.
Discount & Dollar Stores led the pack with 11.2% YoY quarterly visit growth, followed by Grocery Stores, Fitness, and Superstores – all of which outperformed Overall Retail. Dining also enjoyed a YoY quarterly visit bump, despite the segment’s largely discretionary nature. And despite the high interest rates continuing to weigh on the housing and home renovation markets, Home Improvement & Furnishings maintained just a minor YoY visit gap.
Discount & Dollar Stores experienced strong YoY visit growth throughout most of Q1 – and as go-to destinations for groceries and other other essential goods, they held their own even during mid-January’s Arctic blast. In the last week of March, shoppers flocked to leading discount chains for everything from chocolate Easter bunnies to basket-making supplies – driving a remarkable 21.5% YoY visit spike.
Dollar General continued to dominate the Discount & Dollar Store space in Q1, with visits to its locations accounting for nearly half of the segment’s quarterly foot traffic (44.7%). Next in line was Dollar Tree, followed by Family Dollar and Five Below. Together, the four chains – all of which experienced positive YoY quarterly visit growth – drew a whopping 91.6% of quarterly visits to the category.
Rain or shine, people have to eat. And like Discount & Dollar Stores, traditional Grocery Stores were relatively busy through January as shoppers braved the storms to stock up on needed items. Momentum continued to build throughout the quarter, culminating in a 10.5% foot traffic increase in the week ending with Easter Sunday.
Like in other categories, it was budget-friendly Grocery banners that took the lead. No-frills Aldi drove a chain-wide 24.4% foot traffic increase in Q1, by expanding its fleet – while also growing the average number of visits per location. Other value-oriented chains, including Trader Joe’s and Food Lion, experienced significant foot traffic increases of their own. And though conventional grocery leaders like H-E-B, Kroger, and Albertsons saw smaller visit bumps, they too outperformed Q1 2023 by meaningful margins.
January is New Year’s resolution season – when people famously pick themselves up off the couch, dust off their trainers, and vow to go to the gym more often. And with wellness still top of mind for many consumers, the Fitness category enjoyed robust YoY visit growth throughout most of Q1 – despite lapping a strong Q1 2023.
Predictably, Fitness’s visit growth slowed during the last week of March, when many Americans likely indulged in Easter treats rather than work out. But given the category’s strength over the past several years, there is every reason to believe it will continue to flourish.
For Fitness chains, too, cost was key to success in Q1 – with value gyms experiencing the biggest visit jumps. EōS Fitness and Crunch Fitness, both of which offer low-cost membership options, saw their Q1 visits skyrocket 28.9% and 22.0% YoY, respectively – helped in part by aggressive expansions. At the same time, premium and mid-range gyms like Life Time and LA Fitness are also finding success – showing that when it comes to Fitness, there’s plenty of room for a variety of models to thrive.
Superstores – including wholesale clubs – are prime destinations for big, planned shopping expeditions – during which customers can load up on a month’s supply of food items or stock up on home goods. And perhaps for this reason, the category felt the impact of January’s inclement weather more than either dollar chains or supermarkets – which are more likely to see shoppers pop in as needed for daily essentials.
But like Grocery Stores and Discount & Dollar Stores, Superstores ended the quarter with an impressive YoY visit spike, likely fueled by Easter holiday shoppers.
As in Q4 2023, membership warehouse chains – Costco Wholesale, BJ’s Wholesale Club, and Sam’s Club – drove much of the Superstore category’s positive visit growth, as shoppers likely engaged in mission-driven shopping in an effort to stretch their budgets. Still, segment mainstays Walmart and Target also enjoyed positive foot traffic growth, with YoY visits up 3.9% and 3.5%, respectively.
Moving into more discretionary territory, Dining experienced a marked January slump, as hunkered-down consumers likely opted for delivery. But the segment rallied in February and March, even though foot traffic dipped slightly during the last week of March, when many families gathered to enjoy home-cooked holiday meals.
Coffee Chains and Fast-Casual Restaurants saw the largest YoY visit increases, followed by QSR – highlighting the enduring power of lower-cost, quick-serve dining options. But Full-Service Restaurants (FSR) also saw a slight segment-wide YoY visit uptick in Q1 – good news for a sector that has yet to bounce back from the one-two punch of COVID and inflation. Within each Dining category, however, some chains experienced outsize visit growth – including favorites like Dutch Bros. Coffee, Slim Chickens, In-N-Out Burger, and Texas Roadhouse.
Since the shelter-in-place days of COVID – when everybody had their sourdough starter and DIY was all the rage – Home Improvement & Furnishings chains have faced a tough environment. Many deferred or abandoned home improvement projects in the wake of inflation, and elevated interest rates coupled with a sluggish housing market put a further damper on the category.
Against this backdrop, Home Improvement & Furnishings’ relatively lackluster Q1 visit performance should come as no surprise. But the narrowing of the visit gap in March – which also saw one week of positive visit growth – may serve as a promising sign for the segment. (The abrupt foot traffic drop during the week of March 25th, 2024 is likely a just reflection of Easter holiday shopping pattern.)
Within the Home Improvement & Furnishings space, some bright spots stood out in Q1 – including Harbor Freight Tools, which saw visits increase by 10.0%, partly due to the brand’s growing store count. Tractor Supply Co., Menards, and Ace Hardware also registered visit increases.
January 2024’s stormy weather left its mark on the Q1 retail environment, especially for discretionary categories. But as the quarter progressed, retailers rallied, with healthy YoY foot traffic growth that peaked during the last week of March – the week of Easter Sunday. All in all, retail’s positive Q1 performance leaves plenty of room for optimism about what’s in store for the rest of 2024.
This report includes data from Placer.ai Data Version 2.0, which implements improvements to our extrapolation capabilities, adds short visit monitoring, and enhances visit detection.
Over the past year, Fast-Casual & Quick-Service Restaurant (QSR) chains have thrived, consistently outperforming the Full-Service Dining segment with positive year-over-year (YoY) visit growth every quarter since 2023. In this white paper, we dive into the data for leading dining chains to take a closer look at what’s driving visitors to the QSR segment and what other dining categories can learn from fast-food’s success.
One of the key factors separating QSR chains – aptly known as “fast food” – from the rest of the dining industry is the speed at which diners can get a ready-to-eat meal in their hands. And within the QSR space, speed of service is one of the ways chains differentiate themselves from their competition.
Leading fast-food chains are investing heavily in technologies and systems designed to help them serve customers ever more quickly:
Taco Bell’s “Touch Display Kitchen System” is designed to optimize cooking operations and improve wait times, while the chain’s Go Mobile restaurant format seeks to alleviate bottlenecks in the drive-thru lane. Chick-fil-A also has dedicated channels for quick mobile order pick-up and is planning four-lane drive-thrus with second-floor kitchens to get meals out even faster. And to save time at the drive-thru, Wendy’s is experimenting with generative AI and developing an underground, robotic system to deliver digital orders to designated parking spots within seconds.
And location intelligence shows that all three chains are succeeding in reducing customer wait times. Over the past four years, Taco Bell, Chick-fil-A, and Wendy’s have seen steady increases in the share of visits to their venues lasting less than 10 minutes.
The data also suggests that investment in speed of service can increase overall visitation to QSR venues.
In late 2022, McDonald’s opened a to-go-only location outside of Dallas, TX with a lane dedicated to mobile order fulfillment via a conveyor belt. And in Q1 2024, this venue not only had a larger share of short visits compared to the other McDonald’s locations in the region, but also more visits compared to the McDonald’s average visits per venue in the Dallas-Fort Worth CBSA.
This provides further support for the power of fast order fulfillment to drive QSR visits, with customers motivated by the prospect of getting in and out quickly.
The success of the fast-food segment is even driving other restaurants to borrow typical QSR formats – especially during time slots when people are most likely to grab a bite to eat on the go.
In September 2023, full-service leader Applebee’s opened a new format: a fast casual location focusing on To Go orders in Deer Park, NY, featuring pick-up lockers for digital orders and limited dine-in options without table service.
And the new format is already attracting outsized weekday and lunchtime crowds. In Q1 2024, 20.5% of visits to the chain’s To Go venue took place during the 12:00 PM - 2:00 PM time slot, while the average Applebee’s in the New York-Newark-Jersey City CBSA received less than 10% of its daily visits during that daypart. The new restaurant also drew a significantly higher share of weekday visits than other nearby venues.
This suggests that takeaway-focused venues could help full-service chains grow their visit share during weekdays and the coveted lunch rush, when consumers may be less inclined to have a sit-down meal.
An additional factor contributing to QSR and Fast Casual success in 2024 may be the rise of chicken-based chains. Chicken is a versatile ingredient that has remained relatively affordable, which could be contributing to its growing popularity and the rapid expansion of several chicken chains.
Comparing the relative visit share (not including delivery) of various sub-segments within the wider Fast Casual & QSR space showed that the share of visits to chains with chicken-based menus has increased steadily between 2019 and 2023: In Q1 2024, 15.3% of Fast Casual & QSR visits were to a chicken restaurant concept, compared to just 13.4% in Q1 2019.
The strength of chicken-based concepts is also evident when comparing average visits per venue at leading chicken chains with the wider Fast Casual & QSR average.
Both Chick-fil-A, the nation’s predominant chicken chain, and Raising Cane’s, a rapidly expanding player in the fast-food chicken space, are receiving significantly more visits per venue than their Fast Casual & QSR peers: In Q1 2024, Raising Cane’s and Chick-fil-A restaurants saw an average of 153.0% and 237.7% more visits per venue, respectively, compared to the combined Fast Casual & QSR industries average.
The elevated traffic at chicken chains likely plays a part in their profitability per restaurant relative to other Fast Casual & QSR concepts with more sizable fleets.
QSR and Fast-Casual chains are also particularly adept at generating seasonal visit spikes through unique Limited Time Offers and holiday promotions adapted to the calendar.
Arby’s recently launched a 2 for $6 sandwich promotion on February 1st, with two of the three sandwich options on promotion being fish-based in an apparent attempt to entice diners eschewing meat in observance of Lent. The company also brought back a specialty fish sandwich, likely with the goal of further appealing to the Lent-observing demographic.
The offers seem to have driven significant traffic spikes, with foot traffic during the promotion period significantly higher than the January daily visit average. And traffic was particularly elevated during Lent – which this year fell on Wednesday, February 14th through Thursday, March 28th, with visits spiking on Fridays when those observing are most likely to seek out fish-based meals.
Some of the elevated visits in the second half of Q1 may be attributed to the comparison to a weaker January across the dining segment. But the success of the fish-forward promotion specifically during Lent suggests that the company’s calendar-appropriate LTO played a major role in driving visits to the chain.
Shorter-term promotions – even those lasting just a single day – can also drive major visit spikes.
Since 1991, White Castle has transformed its fast-food restaurants into a reservation-only, “fine-dining” experience for dinner on Valentine's Day. In 2024, Valentine’s Day fell on a Wednesday, and White Castle’s sit-down event drove a 11.8% visit increase relative to the average Wednesday in Q1 2024 and a 3.9% visit increase compared to the overall Q1 2024 daily average.
The elevated visit numbers over Valentine’s Day are even more impressive when considering that a full-service dining room can accommodate fewer visitors than the drive-thrus and counter service of White Castle’s typical QSR configuration. The spike in February 14th visits may also be attributed to an increased number of diners showing up throughout the day to take in the Valentine’s Day buzz.
QSR and Fast-Casual dining are having a moment. And the data shows that a combination of factors – including fast and efficient service, the rising popularity of chicken-based dining concepts, and effective LTOs – are all playing a part in the categories’ recent success.
