In our Quarterly Index, we noted that the pent-up consumer demand for home furnishings gave many home goods chains a visit boost in Q2 2021 – but some brands, like Bed Bath & Beyond and Tuesday Morning, were still struggling. With Q3 almost behind us, we dove into the foot traffic data to uncover the summer recovery trajectory of these two brands.
While brands like Home Goods and At Home have succeeded in tapping into the emergence of home nesting – July visits were up 28.6% and 16.9%, respectively, when compared to 2019 – visits to Bed Bath & Beyond and Tuesday Morning were still significantly lower than they were in 2019. In July, Bed Bath and Beyond saw a 23.1% decrease and Tuesday Morning a 16.2% drop.
A major reason for the drop in visits is that both Tuesday Morning and Bed Bath & Beyond have been closing a significant number of stores. Tuesday Morning, which filed for bankruptcy in light of the pandemic, announced the closure of about 230 stores – around a third of its nearly 700 stores. Bed Bath & Beyond is also continuing with its planned store closures after already shuttering around 60 stores in 2020, in order to reduce its store fleet by over 20% and improve its omnichannel and e-commerce capacities. Meanwhile, At Home and HomeGoods have been opening new stores.
Effect on Competitive Dynamics
The shifts in visit patterns have changed the market dynamics between the home goods players. At the beginning of last year, Bed Bath & Beyond and HomeGoods received almost the same number of monthly visits, with 49.5% and 50.5% of visits going to the respective retailers. A little over a year and a half later, in July 2021, HomeGoods has surpassed Bed Bath & Beyond with 56.2% of visits going to HomeGoods compared to 43.8% of visits going to Bed Bath & Beyond.
Hints of a Comeback
But despite the drop in visits compared to 2019, weekly visit data over the past few months reveals consistent growth when comparing each week to the week that came prior. Both brands have experienced week-over-week drops in weekly visits only 4 times between May 17th and August 22nd, while the other weeks showed a clear gain over the previous week.
This could mean that fewer stores are closing now, and visits to the retailers are beginning to stabilize. So, while it’s unlikely that Bed Bath & Beyond or Tuesday Morning will return to the 2019 levels now that the brands have fewer stores, the home goods retailers’ positions are improving - an especially important factor ahead of a critical holiday season.
Will visits to HomeGoods continue to grow relative to 2019? Will the week-over-week growth in visits continue for Bed Bath & Beyond and Tuesday Morning?
Visit Placer.ai to find out.