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With sales of mountain passes up and eager skiers and snowboarders ready to hit the slopes, let’s take a look at how Backcountry has been performing of late. This brand may be familiar to many, as it has been an online retailer for the past 27 years. Lately, though, the retailer has made a foray into brick-and-mortar stores in areas where they have a strong concentration of online customers, with the store count currently up to 9 nationwide.
The Palo Alto store opened in Spring 2023. Visitation trendlines show that this store at the Stanford Shopping Center has jumped to be neck-and-neck with the Seattle store in Dec 2023.
The majority of Backcountry shoppers come from very high-income households, such as Ultra Wealthy Families, Educated Urbanites, and Sunset Boomers (using PersonaLive data for select store trade areas).
Backcountry opened its first physical store downstairs from its corporate headquarters in Park City, UT in 2021. The impetus for opening a brick-and-mortar store was to “deepen connections with its customers.” In addition to the Palo Alto store, Backcountry also opened its first east coast outpost on 14th St in Washington DC during spring 2023, one of the hot retail corridors we wrote about. The newest entrant is a 23,000 square-foot flagship location open at the Grove in Los Angeles in July, which will provide gear for all sorts of popular outdoor activities, such as hiking, camping, water sports, running and climbing.
The holidays conjure up warm, cozy images of families sitting around artfully-set tables and enjoying delicious home-cooked meals. But for many people, Christmas Day is also a time to eat out. And while many restaurants are closed on December 25th, several national and regional chains keep their doors open for patrons eager to enjoy a nice, stress-free meal with loved ones – without the clean-up.
So with the holiday season in the rearview mirror, we dove into the data to explore nationwide December 25th dining trends – focusing our analysis on more than 100 chains, mostly full-service, with significant national or regional presence. Which brands are most popular on Christmas Day? And what differences can be observed in different regions of the country?
Nationwide, visits to dining chains nationwide were down 59.7% on December 25th, 2023, compared to a Q4 2023 daily average. But digging down deeper into the different areas of the country reveals significant regional differences.
The Pacific states – including California, Washington, Oregon, Alaska, and Hawaii – saw a drop of just 33.8% in dining visits on Christmas Day compared to the region’s Q4 2023 daily average. Next in line were the various regions of the South, where December 25th foot traffic dropped between 51.2% and 56.9%, followed by the Mountain states. And on the other end of the spectrum lay New England, where visits were down 83.3% compared to a Q4 baseline. Other areas of the Northeast and Midwest also experienced foot traffic dips in excess of 70.0% – indicating that residents of these areas are less likely to dine out on the holiday.
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But which chains are most popular on December 25th? Analyzing the distribution of holiday visits among 25 leading Christmas Day restaurant destinations shows that three all-day breakfast chains – Waffle House, IHOP, and Denny’s – dominated the Christmas Day dining market this year.
Together, these 24/7 eateries, which tend to experience significant holiday visit bumps, accounted for an impressive 70.4% of holiday dining foot traffic. After a leisurely morning of presents and hot cocoa, it seems, nothing quite hits the spot like waffles, pancakes, and other breakfast favorites. And with affordable prices, seasonal menus, and special holiday vibes (complete with pajama-clad customers), these restaurants offer plenty of holiday cheer.
But breakfast chains aren’t the only dining venues that draw Christmas Day crowds. Red Lobster, the popular seafood chain, cornered 4.9% of this year’s December 25th dining foot traffic. And Applebee’s, Black Bear Diner, Golden Corral, and TGI Fridays each received between 2.0% and 3.0% of Christmas Day visits.
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Drilling down deeper into the data for holiday visit trends shows that each state has its own favorite Christmas Day destination. In no fewer than 21 states nationwide – including New York, Texas, Michigan, and Florida – IHOP topped the chart. Denny’s and Waffle House, for their parts, each led the charge in 11 states, with Waffle House dominating the Christmas Day scene in much of the South.
But in some places, other chains topped the Christmas Day rankings. In Iowa, Minnesota, and North Dakota, people flocked to Perkins Restaurant & Bakery – the casual-dining chain known for its iconic pies and pancakes. In Wyoming and South Dakota, Red Lobster drew the biggest crowds. And in Oregon, Shari’s – a chain with some 80 locations in the western region of the country – attracted the most holiday visits.
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Foot traffic data also reveals, unsurprisingly, that visitors to the three Christmas Day leaders – Waffle House, IHOP, and Denny’s – spent more time in the restaurants on Christmas Day than they usually do. Some 17.3% of Christmas Day Waffle House visits lasted more than one hour – compared to 14.7% on an average day in 2023. IHOP and Denny’s also saw significant holiday increases in dwell time.
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Though many restaurants are closed on December 25th, chains that do stay open – especially all-day breakfast eateries – draw significant crowds. How will holiday winners like Waffle House, IHOP, and Denny’s continue to fare as people settle back into their post-holiday routines? And how will Christmas Day dining trends evolve nationwide in the years to come?
Follow placer.ai/blog to find out.
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.
Has the remote work war run its course? For a while last year, it seemed like not a day went by without another headline proclaiming the demise of WFH. And as return-to-office mandates continued to pile up (et tu, Zoom?), the debate over offsite work productivity grew ever more rancorous.
But amidst all the noise, a new hybrid reality appears to have taken hold, offering both companies and employees the benefits of a mixed model. Yes, productivity can thrive outside the office – but there is something about the intangible spark that ignites when people interact with one another in person that has proven crucial to business success. So while recent survey data shows a precipitous drop in fully remote work over the past three years, most companies aren’t requiring people to go back to the office full time.
With these trends in mind, we dove into the data to explore the state of office foot traffic as the year drew to a close. How did December 2023 office visits compare to pre-COVID? And what impact did the holiday season have on the demographic profile of the typical office-goer?
Last month, buildings in our Nationwide Office Index received 36.5% fewer visits than they did in December 2019 – reflecting a continuation of the same general holding pattern that has seen foot traffic hovering around 40.0% of pre-COVID levels, with some minor fluctuations.
But delving further into the data for key commercial hubs nationwide highlights the persistence of important regional differences – with New York City emerging as last month’s clear office recovery winner. In December 2023, the Big Apple experienced a year-over-four-year (Yo4Y) visit gap of just 19.2% – the smallest seen by the city in some time. At the other end of the spectrum lay San Francisco, with a Yo4Y visit gap of 53.1%.
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But December is a bit of an outlier, work-wise. It’s the heart of the holiday season – kicked off by Thanksgiving at the end of November, and bookended by New Year’s Eve on the other side. And foot traffic data shows a small but distinct shift in the demographic profiles of office buildings’ captured markets – i.e. the areas their visitors come from – during the last month of the year.
Nationwide, and in major cities like New York and San Francisco, office-goers tend to come from relatively affluent areas with greater-than-average shares of one-person households. But over the final three months of 2023, both of these metrics in office buildings’ captured markets gradually declined. November office visitors were more likely to come from larger and lower-HHI households than October visitors – and December visitors were more likely to come from such households than November ones. This may reflect the greater flexibility of higher-HHI employees to work from home more often during the holiday season. It may also reflect a greater tendency on the part of singles to take extended trips to visit family during the holidays, and plug in from afar.
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Hybrid work may be here to stay, but employees and companies will likely continue to negotiate the exact terms of the new model in the months and years ahead. Are the remote work wars really over? And what will office recovery look like in the new year?
Follow placer.ai/blog to find out.
With their experiential vibes and treasured blends of well-known brands and local gems, high-street retail corridors are experiencing something of a renaissance. Iconic shopping districts like Fifth Avenue and SoHo in New York City, Rodeo Drive in Beverly Hills, and Newbury Street in Boston are seeing steady influxes of luxury and high-end apparel brands. And economic headwinds notwithstanding, consumers continue to flock to these important retail destinations to shop, grab a bite to eat, and take in all the sights and sounds they have to offer.
So with the new year upon us, we dove into the data to see how major urban shopping districts nationwide fared this holiday season. How did visits to these corridors in the final months of 2023 compare to last year? And who are the consumers driving the high-street revival?
Over the past six months, visits to major urban shopping districts have been consistently higher than they were last year. And as the holiday season kicked into gear, the year-over-year (YoY) growth trajectory trended upwards – indicating a robust turnout during this holiday period.
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To examine some of the factors behind this growth, we analyzed the demographic profiles of the captured markets of POIs (points of interest) corresponding to major high-street corridors throughout the country.
The analysis shows that throughout the U.S., high-street shopping districts hold special appeal for affluent audiences – and for consumers belonging to Spatial.ai’s PersonaLive’s “Educated Urbanite” psychographic segment. This segment encompasses well-educated young singles that live in dense urban areas and make relatively high salaries. Given the demographic profile of their visitors, it’s no wonder that high-street corridors are finding success while expanding their luxury and high-end apparel portfolios.
In Q4 2023, the captured markets of Fifth Avenue, SoHo, and Times Square all featured higher median household incomes (HHIs), and greater shares of the “Educated Urbanite” segment than New York’s statewide baselines. Each of these quintessential New York City landmarks, however, drew a somewhat different visitor base.
Fifth Avenue, with its array of museums, luxury high-rises, and expensive department stores, drew the most affluent crowd, with a captured market median HHI of $105.6K – some 35.7% above the statewide median. SoHo, for its part, known for designer apparel stores, trendy cafes, and whimsical tourist attractions (Museum of Ice Cream, anyone?), attracted the largest share of “Educated Urbanites.” And Times Square, a top Big Apple attraction with broad popular appeal, boasted a visitor profile closest to statewide baselines.
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A look at the visitor profiles of major California shopping districts reveals a similar trend. The captured markets of Beverly Hills’ Rodeo Drive, Santa Monica’s 3rd Street Promenade, Hayes Valley in San Francisco, and Abbot Kinney in Los Angeles all had higher median HHIs in Q4 2023 than the statewide median of $85.7K. Of these, the captured market with the highest median HHI was that of Hayes Valley in San Francisco – an unsurprising finding given the relative affluence of the Bay Area. Not far behind was Rodeo Drive, with a median HHI of $113.9K.
Hayes Valley also led the charge for “Educated Urbanites,” with no less than 61.4% of the population of its captured market – nearly two-thirds – belonging to this segment. But all four of the analyzed high-street corridors were significantly over-indexed for this demographic compared to the California baseline of 13.1%.
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Looking at urban shopping districts in other major cities nationwide – including Newbury Street in Boston, Fulton Market in Chicago, and Walnut Street in Philadelphia – shows that the unique draw of these corridors for young, affluent singles isn’t confined to New York and Chicago. In all three corridors, the median HHIs and shares of “Educated Urbanites” in the captured markets
also exceeded statewide baselines – oftentimes by a wide margin.
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Evolving work routines and post-COVID population shifts continue to present municipalities and other civic stakeholders with significant challenges. But the revival of high-street retail corridors shows that cities are up to the task. How will major urban shopping districts fare in the new year? And how will their audiences continue to evolve?
Follow Placer.ai’s data-driven retail foot traffic analyses to find out.
How did the brick-and-mortar divisions of Walmart, Target, and other leading retailers perform this holiday season? Which days drove the most visits, and how did foot traffic performance this year compare to 2022? We dove into the data to find out.
Looking at daily visits to Target, Walmart, mid-tier department stores (including Macy’s, JCPenney, Kohl’s Belk, and Dillard’s), luxury department stores (including Saks Fifth Avenue, Neiman Marcus, Bloomingdale’s, and Nordstrom) and Best Buy reveals several common trends.
In all cases, retail visits began to creep up over the days leading up to Thanksgiving (Monday through Wednesday) as consumers took advantage of early Black Friday discounts. And the visit increase on Black Friday 2023 relative to the Q4 daily average was larger than in 2022 – perhaps thanks to budget-conscious consumers holding out for the steep discounts offered the day after Thanksgiving. The Christmas Eve Eve (December 23rd) and Super Saturday spikes were also particularly pronounced in 2023, likely thanks to the combination of both retail events falling on the same day this year.
All retailers and retail segments analyzed also saw smaller surges on Boxing Day (December 26th) 2023 when compared to 2022, likely due to calendar differences. Christmas fell on a Sunday in 2022, so December 26th was declared a federal holiday in lieu of December 25th, and many private-sector employers likely gave time off as well – giving consumers the opportunity to hit the stores and enjoy after-Christmas sales. But Boxing Day still drove visit peaks across the board in 2023 (albeit not smaller peaks than in 2022) – indicating that Boxing Day is now a U.S. phenomenon as well.
December 27th, 28th, and 29th saw a greater increase relative to the daily Q4 average in 2023 compared to 2022, culminating in a larger New Years Eve Eve (December 30th) spike. The December 30th surge may be because this year’s December 30th fell on a Saturday, which is a major shopping day in its own right. But the increase in the days prior to New Years Eve Eve, when after-Christmas sales were in full force, could indicate that consumers are still particularly attune to sales events.
Still, despite the similarities across retail categories, foot traffic data also reveals some important differences between the segments.
Visits to Target began to increase in November 2023 relative to October as the retailer offered “Four Weeks of Early Black Friday Deals,” starting October 29th. And like the other categories analyzed, Target saw its first small visit peak of the season on the Wednesday before Thanksgiving (also known as Turkey Wednesday thanks to the massive Grocery visit spikes on the day). Visits on the day before Thanksgiving were up by 21.5% and 22.1%, in 2022 and 2023, respectively, despite foot traffic on an average Wednesday tends to be lower than the Q4 daily average – indicating that “Turkey Wednesday” also holds retail significance for grocery-adjacent categories.
Visits then spiked on Black Friday and returned to seasonally normal levels on Saturday. Throughout December, foot traffic continued to swell, with every week exceeding the previous week’s visit performance. The intensity of the visit growth picked up the week before Christmas, with Christmas Eve Eve/Super Saturday seeing a significant jump. Finally, Target visits on Boxing Day and the week following Christmas also exceeded the Q4 daily average as consumers took advantage of end-of-season sales and looked for festive attire for their New Year’s Eve celebrations.
The holiday season visit pattern at Walmart differs from those at Target in several instances. The superstore’s Turkey Visit spike was significantly more pronounced than Target’s, likely thanks to Walmart’s more extensive grocery offerings. Walmart also saw smaller spikes on Black Friday – perhaps due to the retailer’s famous “everyday low prices,” which may reduce the appeal of specific sales events. The Christmas Eve Eve/Super Saturday surge were also lower than for Target, but the Super Saturday increase relative to Black Friday spike was more pronounced, with some consumers probably visiting Walmart for last-minute groceries ahead of their Christmas dinners.
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Visits to luxury department stores (Saks Fifth Avenue, Neiman Marcus, Nordstrom, and Bloomingdale’s) followed the general retail foot traffic trends, with larger peaks on Black Friday and on Christmas Eve Eve/Super Saturday in 2023 compared to 2022. Boxing Day 2023 drove a smaller visit spike relative to last year, but foot traffic was still 98.2% higher than the Q4 2023 daily average – indicating that the day is still emerging as an important retail milestone, especially for pricier segments.
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Mid-tier department stores (Macy’s, Kohl’s, JCPenney, Belk, and Dillard’s) saw more significant spikes on Black Friday and Christmas Eve Eve/Super Saturday, and smaller spikes on Boxing Day. Luxury’s department stores’ biggest post-Christmas visit peak was on Boxing Day, but mid-tier department stores experienced their largest end-of-year increase on New Year’s Eve Eve (December 30th).
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Best Buy saw the strongest Q4 visit spike on Black Friday out of all the retailers and retail segments analyzed, with foot traffic up a whopping 510.9% compared to its Q4 2023 daily average. The electronics leader also had the largest Christmas Eve Eve/Super Saturday bump – with visits up 188.1% – and Boxing Day boost, with traffic up 112.9% compared to the Q4 daily average. The visit surges over the holiday season’s retail milestones indicate that demand for electronics remains strong – even as some consumers may be putting off large purchases due to economic headwinds.
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The holiday season drove significant retail foot traffic across categories, with every segment displaying its own unique Q4 visitation pattern. How will these sectors perform in the year ahead?
Visit placer.ai/blog to find out.
2023 was a year that forced restaurant operators to stay agile. Inflation was top-of-mind for most consumers throughout the year, resulting in a trade-down to value-oriented restaurants (or trading out to value grocery chains, dollar stores, and convenience stores). That said, value wasn’t the only factor driving visits, as new menu innovations (Taco Bell was a standout) or marketing partnerships (McDonald’s Famous Orders and “adult” happy meals helping the chain to outperform from a visitation perspective). While we’ve seen visitation trends for the morning daypart improve due to a steady recovery in return to office trends, we continue to see visits during late morning and early afternoon for coffee and QSR chains due to changes in consumer routines (not to mention a resurgence in late night dining). This has also prompted several chains to refine their approach to drive-thrus and pick-up windows (Shake Shack, Chipotle, Taco Bell, among several others). On top of these trends, we’ve seen massive changes in restaurant trade areas, driving many chains to rethink their expansion plans (including an emphasis on South and Southeast, which have seen population growth due to migration).
McDonald’s new exploratory restaurant concept CosMc’s sits at the intersection of several of these trends. The smaller-format (approximately 2,800 square feet, compared to 4,000-4,500 square feet for the average McDonald’s), drive-thru only concept opened its doors last month in Bolingbrook, IL, and is part of a “limited test run”. Its menu heavily focuses on beverages, including four “Signature Galactic Boosts” (featuring Sour Cherry Energy Boost and Island Pick-Me-Up Punch drinks), iced teas and lemonades (such as a Tropical Spiceade and Blackberry Mist Green Tea), slushes and frappes (including a Chai Frappe Burst and Popping Pear Slush), and coffee-based products (highlighted by the S’Mores Cold Brew and Turmeric Spiced Latte). While beverages are the focal point, there are also a variety of breakfast and snack food options, including a Spicy Queso and Creamy Avocado Tomatillo breakfast sandwiches, McPops (filled doughnuts), Savory Hash Brown Bites, and Pretzel Bites. In addition to the experimental fare, the menu also features a host of traditional breakfast sandwiches and beverage offerings.
Given the early buzz, we decided to check out the concept for ourselves this week. It was immediately apparent how much interest CosMc’s was drawing, as the drive-thru lane spanned roughly 80 vehicles upon arrival (which required use of a separate parking lot at the Maple Park Place shopping center, which also features Burlington, Ross Dress for Less, Dollar Tree, Aldi, and Best Buy stores).
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While its unique menu has rightfully generated a significant amount of attention, it’s also clear that McDonald’s is also using CosMc’s as a test for other potential drive-thru only locations in the future. Customers order from dynamic menu boards and cashless payment devices are used to expedite the payment process. Visitors wait at the menu board until their order is ready, and then pickup windows are assigned when the order is ready.
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Admittedly, it’s tough to make definitive conclusions about CosMc’s with the location being open for only a few weeks. Placer’s data suggests that CosMc’s saw more than double the number of visits that a typical McDonald’s saw chainwide during December 2023 (despite being open only since Dec. 7) and more than triple the number of visits per square foot (given CosMc’s smaller, roughly 2,500 square feet footprint). However, it’s also worth noting that CosMc’s visitation numbers would likely have been much higher if the location had additional capacity to satisfy the overwhelming demand.
Still, Placer offers some other ways to evaluate CosMc’s early trends. Based on 2019 Census Block Group data, CosMc’s trade area size (using a 70% of visit threshold) was just over 155 square miles during December 2023 (below). This is roughly 2.5 times the size of the trade area for the average McDonald’s location during December 2023 (62 miles) and significantly larger than the average trade area for most coffee brands (25-35 miles for more urban focused brands to 50-60 miles for more suburban/secondary market brands). In fact, the closest recent comparison we could find for CosMc’s was Raising Cane’s Post Malone and Dallas Cowboys restaurant collaboration, which had an impressive 264-mile trade area during its initial month of opening (though also helped by cross-traffic from Dallas Cowboys home game visitors from across the state of Texas). In some ways, there were also similarities between CosMc's and the Hello Kitty Cafe Trucks, which the Placer.ai Blog team wrote about last September.
Given that McDonald’s also appears to be targeting a younger demographic with CosMc’s, we thought we’d also look at the age breakdown for the potential market trade area (the population living within the trade area for the CosMc’s store). McDonald’s collective potential market trade area largely mirrors U.S. trends given its reach (the company has previously stated that 85% of the population in its top five markets–the U.S., France, the U.K., Germany and Canada–are within three miles of a McDonald’s location), it’s interesting that the potential market trade area for CosMc’s does skew to a younger audience, particularly the 22–29-year-old cohort.
By the end of 2024, McDonald’s plans to open an additional 10 CosMc’s test units, including locations in the Dallas-Fort Worth and San Antonio markets (notably some of the fastest growing markets in the U.S.). Does CosMc’s have the potential to be something more than a 10-unit test over a longer horizon? McDonald's has attempted to differentiate its coffee business in the past with its McCafe menu and standalone McCafe locations in international markets, but competition with Starbucks and others made it difficult for the company to distinguish McCafe as a standalone retail brand in the U.S. CosMc's is interesting from this perspective, as it may allow the company to build a brand more naturally and stand out with a younger audience (which appears to be working). It’s unlikely that future CosMc’s will look or operate like the pilot location in Bolingbrook. Nevertheless, the excitement around new products, an expansive trade area, and potential to connect with younger audience make it a worthwhile test (especially with 2024 shaping up to be a strong year for unit growth within the coffee category).
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.
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.
The first American mall opened in 1956 and reinvented retail – within a decade there were over 4,500 malls across the country. But a rise in e-commerce coupled with the oversaturation of mall options across the country paved the way for mall visits to slow, and many predicted that malls would go the way of the dinosaur.
But although malls were hit hard over the past few years as lockdowns and rising costs contributed to a significant drop in foot traffic, shopping centers have proven resilient. Leading players in the space have consistently reinvented themselves and explored alternate ways to draw in crowds – and as inflation cools, malls are bouncing back as well.
This white paper analyzes the Placer.ai Shopping Center Industry – a collection of over 3000 shopping centers across the United States – as well as the Placer.ai’s Mall Indexes, which focus on top-tier Indoor Malls, Open-Air Shopping Centers, Outlet Malls. The report examines how visits are shifting and where behaviors are changing – and where they’re staying the same – and takes a closer look at the strategies malls are using to attract shoppers in 2024.
Malls experienced a rocky few years as pandemic-related restrictions and economic headwinds kept many shoppers at home, and visits to all mall types in 2021 were between 10.7% to 15.3% lower than in 2019. But foot traffic trends improved significantly in 2022 – likely due to the fading out of COVID restrictions.
By 2023, visits to the wider Shopping Center Industry were just 2.3% lower than they had been in 2019, and the visit gaps for Indoor Malls and Open-Air Shopping Centers had narrowed to 5.8% and 1.0% lower, respectively. Outlet Malls also saw visits ticking up once again, with the visit gap compared to 2019 narrowing to 8.5% in 2023 after having dropped to 11.3% in 2022. This more sustained foot traffic dip may stem from consumers’ desire to save on gas costs or the impacts of inclement weather. However, the narrowing visit gaps suggest that shoppers are increasingly returning to the segment, and foot traffic may yet pick up again in 2024.
COVID-19 impacted more than just visit numbers – it also changed in-store consumer behavior. And now, with the Coronavirus a distant memory for many, some of these pandemic-acquired habits are fading away, while other shifts appear to be holding steady.
One visit metric that appears to have reverted to pre-COVID norms is the share of weekday vs. weekend visits. Weekday visits had increased in 2021 – at the height of COVID – as consumers found themselves with more free time midweek, but the balance of weekday vs. weekend visits has now returned to 2019 levels.
In 2023, the Shopping Center Industry, which includes a number of grocery-anchored centers along with open-air shopping centers and their relatively large variety of dining options, saw the largest share of weekday visits, followed by Indoor Malls. Outlet Malls received the lowest share of weekday visits – around 55% – likely due to the longer distances usually required to drive to these malls, making them ideal destinations for weekend day trips.
While the day of the week that people frequent malls hasn't changed significantly since 2019, there is one notable difference in mall foot traffic pre- and post-pandemic. Almost all mall categories are seeing fewer during the late morning-midday and late evening dayparts, while the amount of people heading to a mall in the afternoon and early evening has increased.
In 2019, Indoor Malls saw 20.1% of visits occurring between 10:00am and 1:00pm, but that share decreased to 18.6% in 2023. Meanwhile, the share of visits between 4:00-7:00 pm rose from 29.1% in 2019 to 32.4% in 2023. Similar patterns repeated across all shopping center categories, with the 1:00-4:00pm daypart seeing a slight increase, the 4:00-7:00 pm daypart receiving the largest boost and the 7:00-10:00 pm daypart seeing the largest drop. So although changes in work habits have not altered the weekly visit distribution, it seems like hybrid workers are taking advantage of their new, and likely more flexible schedules to frequent malls in the afternoon instead of reserving their mall trips for after work. The significant numbers of Americans moving to the suburbs in recent years may also be contributing to the decline of late night visits, with these suburban newcomers perhaps less likely to spend time outside the house during the evening hours.
Although malls have enjoyed consistent growth in foot traffic over the past two years, visits still remain below 2019 levels. How can shopping centers attract more shoppers and recover their pre-COVID foot traffic?
Some malls are attracting visitors by looking beyond traditional retail with offerings such as gyms, amusement parks, and even entertainment complexes. And with more traditional mall anchors shutting their doors than ever, even smaller shopping centers are adding lifestyle experiences options in newly vacant spaces – and incorporating unique elements into traditional retail spaces.
In September 2023, the Chandler Fashion Center in Arizona opened a giant SCHEELS store in its mall. The 250,000-square-foot sporting goods store boasts more than just sneakers – visitors can ride on a 45-foot Ferris Wheel or marvel at a 16,000-gallon saltwater aquarium. And monthly visitation data to the mall reveals the power of this new retail destination, with foot traffic to the mall experiencing a major jump from October 2023 onward. The excitement of the new SCHEELS seems to be sustaining itself, with February 2024 visits 23.3% higher than the same period of 2023.
Restaurants, too, can help bring people into malls. The Southgate Mall in Missoula, Montana, experienced a jump in monthly visits following the opening of a Texas Roadhouse steakhouse in November 2023. Customers seem to be receptive to this new addition – the mall saw a sustained increase in foot traffic from November 2023 onward, with year-over-year (YoY) visit growth of 17.0% in February 2024.
The addition of Texas Roadhouse provides Missoula residents with a family-friendly dining experience while tapping into the evergreen popularity of steakhouses.
Malls that don’t want to choose between adding a dining option and incorporating a novel entertainment venue can blend the two and go the “eatertainment” route. One shopping center – North Carolina’s Cross Creek Mall – is proving just how effective these concepts can be for a mall looking to grow its foot traffic.
Eatertainment destination Main Event opened at the mall in August 2023, bringing laser tag, video games, virtual reality, and 18 bowling lanes with it. Main Event’s opening also provided a boost in foot traffic to the mall – monthly visits to Cross Creek Mall surged following the opening. And this foot traffic boost sustained itself, particularly into the colder winter months – January and February 2024 saw YoY growth of 12.3% and 25.1%, respectively.
Integrating entertainment options at malls is one strategy for driving visits, but there are plenty of other ways to bring people through the doors. Pop-ups have been a particularly popular option of late, especially as more online brands venture into the world of physical retail. And malls, which typically tend to leave a small portion of their storefronts vacant, can be the perfect place to host a retailer for a limited time.
One brand – Shein – has been a leader in the pop-up space, bringing its affordable fashion to malls in Las Vegas, Seattle, and Indianapolis. These short-term residencies – typically no longer than three to four days – allow shoppers to try the popular online retailer’s products before they buy.
Shein has enjoyed success with its mall residencies, evidenced by the foot traffic at the Woodfield Mall in Illinois, which hosted a three-day pop-up from December 15-17, 2023. The retail event was hugely popular, with visits reaching Super Saturday (the last weekend before Christmas) proportions – even though this year’s Super Saturday coincided with Christmas Eve Eve (December 23rd) and drove unusually high traffic spikes.
Shein pop-ups are typically very short – no more than three to four days. This format, known for creating a sense of urgency among shoppers, has proven powerful in driving store visits. But can longer-lasting pop-ups find success as well?
Foot traffic data from pop-ups hosted by Swedish home furnisher IKEA suggests that yes – longer-term residencies can be successful. The chain is working on growing its presence across the country, particularly in malls. To that end, IKEA has been experimenting with mall pop-ups, beginning with a six-month residency at the Rosedale Center in Roseville, Minnesota.
IKEA opened its store on February 16, 2024, and visits to the mall increased significantly immediately after. The first week of the pop-up saw a 12.9% growth in visits compared to a January 1-7, 2024 baseline. And by the third week of the pop-up, there were still noticeably more people frequenting the mall than before the launch.
The luxury retail segment has had a great few years, and malls are tapping into this popularity. Nearly 40% of new high-end store openings in 2023 were in mall settings, many in Sunbelt states like Texas, Florida, and Arizona, perhaps driven in part by demand from an influx of wealthy newcomers to those states.
A comparison of upscale shopping malls to standard shopping centers across Sunbelt States reveals just how popular high-end retail is in the region. Malls with a high percentage of luxury and designer stores like the Lenox Square Mall in Georgia or the NorthPark Center in Texas saw considerably more YoY visit growth than the average visit growth for shopping centers in their respective states.
Lenox Square Mall saw foot traffic increase 31.2% YoY in 2023, while shopping centers in Georgia saw their visits grow by just 2.7% YoY in the same period. Similar trends repeated in Louisiana, Arizona, California, and Florida. And while some of this growth may be due to the resilience of these wealthier shoppers in the face of inflation, one thing is clear – luxury is here to stay.
Malls are thriving, carving out spaces for themselves in a competitive retail environment. By prioritizing experiential retail, entertainment, pop-up shops, and luxury offerings, shopping centers across the country are remaining relevant in a rapidly changing retail world. And mall operators that recognize the power of innovation and evolve along with their customers can hope to meet with continued success.
