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In a market ruled by value and convenience, traditional full-service restaurants (FSRs) have faced an uphill slog. But even in 2024, some FSRs are flourishing. We dove into the data to explore factors driving success at three very different full-service chains: First Watch, Chili’s Grill & Bar, and Outback Steakhouse.
First Watch first burst onto the scene in 1983 with a single restaurant in California – and now boasts some 544 locations across 29 states. With offerings ranging from Superfood Kale Salads to more traditional pancakes and bacon and eggs, First Watch has emerged as a prime destination for diners seeking to enjoy a leisurely breakfast with family and friends.
And foot traffic data shows that First Watch, still firmly in expansion mode, is continuing to grow its audience. Between June and September 2024, First Watch saw consistent year-over-year (YoY) visit growth, outperforming both the full-service restaurant category and other diners & breakfast spots.
One factor that may be helping to propel First Watch’s success is the relative affluence of its customer base. Analyzing the income breakdown of First Watch’s trade area shows that in Q3 2024, nearly ten percent (9.7%) of households in the chain’s captured market earned $200K+ per year, compared with 6.5% for diners & breakfast chains and 6.9% for the wider FSR space. On the flip side, only 43.9% of households in First Watch’s captured market had annual incomes below $75K, compared to just over 50.0% for both analyzed segments.
Amidst concerns surrounding food inflation, rising labor costs, and discretionary spending cutbacks, First Watch’s wealthier customer base may be helping to shield it from some of the value pressures that have weighed on other restaurants – contributing to its resilience.
Another FSR that has been experiencing outsized visit growth this year – at least since April – is Chili’s Grill & Bar. Following a tepid start to the year, Chili’s launched its much-vaunted Big Smasher Burger on April 29th, 2024, and hasn’t looked back since.
The new offering, added to Chili’s 3 For Me value menu, presented a full-service value challenge to QSR favorites like the Big Mac. And in Q2 2023, the item helped drive a 14.8% increase in same-store sales.
Since the big launch, weekly YoY visits to Chili’s have been consistently elevated – kept aloft with the help of viral hype around Chili’s long standing Triple Dipper offering, as well as the new secret Nashville Hot Mozz offering that became so popular it spawned a halloween costume.
Unlike First Watch, Chili’s has found success by embracing its role as a value chain. The median household income (HHI) of Chili’s captured market in Q3 2024 was $73.1K – below the nationwide median of $76.1K, and on par with that of the wider FSR space ($73.7K – By way of comparison, the median HHI of First Watch’s captured market was $85.6K in Q3).
And a closer look at the demographic make-up of Chili’s captured market shows just how broad the appeal of the chain is. In Q3 2024, Chili’s visitor base was over-represented for a wide range of segments across age and income groups – from “Wealthy Suburban Families” to “Young Urban Singles”, “Suburban Boomers’, and residents of “Blue Collar Suburbs”. By delivering high-quality meals at affordable prices, Chili’s has solidified its place as an everyman’s chain, offering value comparable to that of quick-service restaurants.
Aussie-themed Outback Steakhouse – Bloomin’ Brands’ biggest chain – is another full-service restaurant that is successfully weathering the storm. Like other FSRs, Outback has faced its fair share of challenges over the past few years, with rising costs and spending cutbacks taking a toll on the chain’s performance. But in Q3 2024, the average number of visits to each Outback Steakhouse location increased 0.5% YoY, even as overall traffic to the chain fell 1.7% in the wake of strategic rightsizing moves that included the shuttering of a number of underperforming locations. By contrast, the average number of visits per location in the wider FSR space dropped 1.2%, while overall foot traffic to the segment fell 2.1%. Outback Steakhouse’s ability to sustain a YoY visit-per-location uptick in Q3, even if a minor one, shows that its rightsizing efforts are paying off.
And drilling down deeper into regional data for the chain shows that in some areas of the country, Outback Steakhouse is positively thriving. In California, Outback’s third-largest market in terms of store count, the chain saw a YoY visit increase of 5.3% – significantly higher than the statewide FSR average of 1.1%. In Washington and Oregon, Outback Steakhouse experienced even more substantial visit increases – 9.0% and 9.6%, respectively – even as full-service restaurants generally languished. And in all three states, the number of Outback Steakhouse locations has remained basically unchanged over the past year, meaning that these increases reflect the growing draw of the chain’s existing venues.
First Watch, Chili’s Grill & Bar, and Outback Steakhouse are very different full-service chains – but each of them is thriving in its own way. How will the three brands fare as the holiday season picks up steam?
Follow Placer.ai’s data-driven dining analyses to find out.
This blog includes data from Placer.ai Data Version 2.1, which introduces a new dynamic model that stabilizes daily fluctuations in the panel, improving accuracy and alignment with external ground truth sources.
Quick-service restaurants (QSRs) have faced headwinds in 2024, from higher costs to increased competition. But some brands are weathering the storm particularly well. We dove into the data to check in with two of the nation’s most prominent restaurant companies – Restaurant Brands International (RBI) and Yum! Brands – to see how their biggest chains, Burger King (RBI) and Taco Bell (Yum!), performed in Q3 2024.
Burger King, RBI’s largest restaurant chain, has been the focus of a major modernization effort, dubbed the “Royal Reset”, that includes a series of restaurant remodels and equipment and technology upgrades. Burger King has also been rightsizing – closing underperforming restaurants to shore up the chain’s overall strategic positioning.
And foot traffic data shows that these initiatives are paying off. In Q3 2024, overall visits to Burger King dipped 1.7% YoY – but the average number of visits to each Burger King location increased slightly (0.4%). This per-location uptick may have been fueled, in part, by the chain’s summer “$5 Your Way” value meal special, which kept YoY visits elevated through July. And some major markets – including Texas, Illinois, Washington, and Connecticut – performed even better, with average visit-per-location growth ranging from 1.5% - 5.1% YoY.
Taco Bell is Yum! Brands’ largest chain – accounting for over 70.0% of visits to the company’s U.S. restaurants in Q3 2024. And the Tex-Mex leader is another QSR that is standing strong in 2024. Throughout the summer, Taco Bell experienced YoY visit growth ranging from 1.2% to 2.2% – and though the chain saw a minor 1.9% YoY dip in September, this may be due to the month having one fewer Friday than the equivalent period of 2023. (Friday is Taco Bell’s busiest day of the week). Even accounting for this dip, visits to Taco Bell were up 0.6% YoY overall in Q3 2024.
One factor that has likely helped Taco Bell weather recent QSR storms has been its strength in executing special promotions. In July, the Tex-Mex leader attracted big crowds with a limited-time offer commemorating the 20th anniversary of the chain’s popular Baja Blast beverage. And in October 2024, the restaurant marked National Taco Day (Tuesday, October 1st) with ten hours of $1 tacos – fueling a substantial traffic spike: On the big day, visits rose 14.7% above the chain’s daily year-to-date (YTD) average, and 18.4% above the chain’s Tuesday YTD average.
Burger King and Taco Bell found success in Q3 2024 through limited-time promotions – and in the case of the former, a strategic focus on rightsizing while updating existing stores. How will RBI and Yum!’s biggest brands perform in Q4?
Follow Placer.ai’s data-driven restaurant analyses to find out.
This blog includes data from Placer.ai Data Version 2.1, which introduces a new dynamic model that stabilizes daily fluctuations in the panel, improving accuracy and alignment with external ground truth sources.
Starbucks’ preliminary fiscal Q4 2024 (July-September 2024) results--including a 10% decline in comparable transactions in its North America segment--reinforce that the company has "drifted from its core", as new Starbucks CEO Brian Niccol discussed following the release. The results also come at a time when other coffee and beverage chains are seeing year-over-year visit increases, reinforcing that new product innovations aren't connecting with consumers–management explained that “accelerated investments in an expanded range of product offerings coupled with more frequent in-app promotions and integrated marketing to entice frequency across the customer base did not improve customer behaviors.” (The difference between our visit per location figure and Starbucks’ reported number is likely due to lower coverage of urban stores in our platform).
As we wrote when Niccol assumed the CEO role in August, Starbucks’ transformation won’t happen overnight, but the data behind Niccol’s early strategies at Chipotle still hints at a successful turnaround. Niccol's plan to improve the Starbucks customer experience, remove bottlenecks and operational complexities (including a more streamlined menu), and refine Mobile Order and Pay is a sound strategy, but it will take time to implement. Positively, we believe that Starbucks has a strong foundation to work from. Below, we show the monthly visitor per location trend line since the beginning of 2022. While declines in visit frequency is something the company will work to address with its current initiatives, the number of visitors coming into each location generally remains strong (down only 2%-3% per month on average thus far in 2024). Assuming the company can execute Niccol’s plan to reduce bottlenecks and operation complexities, Starbucks’ wide visitor reach should drive improved engagement and visit frequency.
As we also pointed out a few months ago, we believe that Starbucks’ success in smaller underpenetrated markets have been somewhat overlooked. We analyzed Starbucks’ unit expansion opportunities in detail in September 2022, and we’ve seen progress on this initiative since then. Starbucks’ recent store development effects have been focused on “Tier 2 and Tier 3 cities where we see population growth and forecast both underserved demand and high incrementality.” We’ve revisited our visit per location data for Starbucks’ Top 25 designated market areas (DMAs) versus non-Top 25 DMAs over the last 12 full months below, and similar to our last update, Starbucks is seeing higher visits per location in its non-Top 25 markets. Many of these non-Top 25 DMA stores have been opened in the past 12-18 months, which suggests improved metrics as operational complexities are reduced and these locations enter the same-store sales base.
Photo Image Credit: Orange County Register
We know there’s appetite for Six Flags Fright Fest, Universal Studios Halloween Horror Nights, Knotts’ Scary Farm, and Halloween Screams at Walt Disney World, but one innovative car wash takes you to another level, inviting you to go on a “nightmarish journey that turns an ordinary car wash into a realm of terror.” Big Wave Car Wash in Anaheim is one of the locations, and it’s immediately clear that this spooky spectacular is a hit. Compared to another local car wash competitor, we see that the addition of the scary performers nearly triples Big Wave’s traffic, especially Thursday-Sunday with the October kickoff.
We compared the Spatial.ai PersonaLive segments for Big Wave and Drive Thru Express Car Wash from January-September 2024 vs from October 1-19, 2024. In the month of October alone, we saw over 4x more visits from Near-Urban Diverse families and from Melting Pot Families to the haunted carwash compared to the entire rest of the year. Among Young Urban Singles, there was a 2.5x multiplier for just the three weeks in October compared to January-September. And while Ultra Wealthy Families normally only make up 1% of the visits, during this spooky spectacular, they accounted for 5%. Now you know where to go when junior is bored–head for the haunted car wash!
No surprise, the trade area drawn during the month of October is significantly larger as people come from a total trade area of 53 sq miles during this event (October 1-19, 2024 in red), compared to 12 sq miles the rest of the year (January-September 2024 in blue).
Over the past two weeks, the home industry has been abuzz with news from the remnants of Bed Bath & Beyond. A retailer that stood as the leader among specialty players continues to try and find new life in physical retail despite the closure of the original chain and its subsidiaries. After a year back in business, buybuy BABY, under new management, announced that it would be closing its 10 reopened locations.
Over at Beyond Inc., the new holding company for Overstock.com and the newly reformed Bed Bath & Beyond brand, they announced new partnerships with both Kirkland’s and The Container Store. The former partnership is going to help bring the brand back to physical retail with the creation of five Bed Bath & Beyond “neighborhood” small format stores, with locations to be announced; stores will be scouted, developed and operated by Kirkland’s. In the partnership with The Container Store, Beyond Inc. made a financial investment in the retailer and will allow The Container Store to leverage the brand’s assets, name, assortment and data; shop-in-shops also appear to be a part of this new partnership.
The home industry has been incredibly challenged in the post-pandemic period (below). However, as the category became further consolidated over the past few years, these new partnerships could help to revitalize all three brands, all of which have a strong brand identity with consumers. These partnerships also allow the brands to harness their strengths to benefit multiple banners.
How closely aligned are these brands? Kirkland’s tends to focus on furniture and furnishings, The Container Store handles all things organization, and the Bed Bath & Beyond brand name still carries weight as the undisputed leader in all things home.
Looking at PersonaLive’s demographic and psychographic segmentation of visitors to all three brands in 2022, before Bed Bath & Beyond’s closure the next year, there are some clear alignments and also opportunities to reach new visitors through the partnerships. Kirkland outperformed Bed Bath & Beyond with suburban cohorts such as Wealthy Suburban Families, Upper Suburban Diverse Families and Blue Collar Suburbs.
Through the lens of The Container Store, it provides a lot more opportunity for Beyond Inc. to reach higher concentrations of visitors from segments such as Ultra Wealthy Families, Educated Urbanites and Young Professionals. Looking at the partnerships with both Kirkland’s and the Container Store as a collective strategy, Beyond Inc. can capitalize on the migration to suburban communities by consumers and higher income households with the new brand.
Another positive sign for the partnerships is the high levels of cross visitation between the retailers before the closing of Bed Bath & Beyond. In 2022, Bed Bath & Beyond’s final full year of operation, 20% of visitors to Kirkland’s and almost a quarter of visitors to The Container Store cross visited Bed Bath & Beyond.
In theory, both partnerships will allow Bed Bath & Beyond to return to physical retail in alignment with both consumers and the current retail landscape. Industry specific retailers and incredibly important to the health and long term success of the industry, and the idea of welcoming back a beloved brand is exciting. It should be interesting to see the new small format stores and installations as the debut and look at the impacts of the partnership on the broader home category.
The holiday shopping season is nearly upon us – and one category that always benefits from holiday sales is apparel. So with Q4 underway, we checked in western wear leader Boot Barn and discount footwear chain DSW (Design Shoe Warehouse, owned by Designer Brands, Inc.) to see how they fared in Q3 2024 – and what awaits them as Black Friday approaches.
Boot Barn and DSW – two very different shoe retailers – have been thriving in recent months. Since May 2024, the two chains have seen sustained monthly year-over-year (YoY) visit growth, finishing out Q3 2024 with visit upticks of 10.8% (Boot Barn) and 10.5% (DSW).
For Boot Barn in particular, Q3’s robust visit growth was at least partially driven by the chain’s aggressive expansion strategy: Between July 2023 and June 2024, Boot Barn opened some 50 new stores – and plans to open dozens more over the coming year. But foot traffic data also shows that the chain has succeeded in growing its footprint without significantly diluting traffic at existing locations. During Q3, the average number of visits to each Boot Barn location dipped just slightly below 2023 levels (2.8%), even as YoY visits to the chain surged by 10.8%.
DSW, for its part saw significant YoY visit growth throughout Q3, despite a store count that has remained relatively stable. As a store that offers shoppers access to high-quality, name-brand products at affordable prices, DSW lets consumers trade down while splurging at the same time.
DSW isn’t called a warehouse for nothing. The typical DSW store spans about 25,000 square feet (though the chain has begun experimenting with smaller formats) – compared to just 12,000 - 14,000 for Boot Barn. But despite the smaller size of Boot Barn’s locations, visitors to the western wear chain tend to spend more time in-store than visitors to DSW. Since 2022, average visitor dwell times at Boot Barn have ranged between 34.9 and 35.8 minutes, while dwell times at DSW have hovered between 32.1 and 32.8 minutes.
Customers at DSW may be more likely to know in advance what they’re looking for, making a bee-line for the discounted footwear they’ve been waiting to get their hands on. Visitors to Boot Barn, on the other hand, may spend more time browsing the brand’s wider selection of merchandise.
The difference in visitor dwell times may also be partially due to Boot Barn’s firmer positioning as a weekend destination: Over the past twelve months (October 2023 - September 2024), 59.5% of visits to Boot Barn took place between Fridays and Sundays, compared to 56.3% for DSW.
Still, visitors to both chains tend to remain in-store for more than half an hour – revealing a highly engaged customer base eager to explore the brands’ varied offerings.
With a strong Q3 2024 under their belts, what can DSW and Boot Barn expect this holiday season?
Looking at weekly fluctuations in visits to Boot Barn and DSW in 2022 and 2023 – compared to yearly weekly averages – reveals another striking difference between the two chains: Visits to Boot Barn peak in November and December each year, as customers descend upon the chain to purchase western-themed gifts for loved ones. DSW, on the other hand, sees greater visit boosts in spring, perhaps buoyed by shoppers updating their wardrobes in anticipation of warmer weather.
But zooming in on the two chains’ busiest days of the year tells a somewhat different story. Even though DSW experiences a more muted holiday shopping season, the shoe leader – like Boot Barn – draws its biggest crowds of the year on Black Friday. On November 24th, 2023, visits to DSW jumped 134.5% compared to the chain’s daily average for the 12-month period from October 2023 to September 2024 – a smaller spike than that seen by Boot Barn, but significant nonetheless.
After that, however, the chain’s visitation patterns diverged. For DSW, the next eight busiest days of the year were all Saturdays in Spring – including the Saturday before Mother’s Day (May 11th) and the Saturday before Easter (March 30th). For Boot Barn, on the other hand, December shopping days – including Super Saturday (December 23rd) – drove the biggest foot traffic spikes.
With holiday shopping just around the corner, DSW and Boot Barn both appear poised to enjoy a healthy Q4 – each in their own way. Which other footwear and apparel brands are likely to succeed this holiday season?
Follow Placer.ai's data-driven retail analyses to find out.
This blog includes data from Placer.ai Data Version 2.1, which introduces a new dynamic model that stabilizes daily fluctuations in the panel, improving accuracy and alignment with external ground truth sources.
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.
