Walmart and Target are dominant forces in the retail sector that seem to only grow stronger over time. Popeyes is a brand that reached new heights in QSR in 2019, and has maintained that strength well into 2020.
We dove into some fascinating - and impressive - new data from both brands.
Kings of Retail See a Positive Sign
Target and Walmart have followed similar patterns thus far in the crisis, with early year-over-year growth in weekly visits hitting a peak in the second week of March, before dropping into early April. And both have seen a similar flattening of drops in the last week of March and the first two weeks of April. Though both have still seen year-over-year declines, the pace has definitely slowed.
Target and Walmart have followed similar patterns thus far in the crisis, with early year-over-year growth in weekly visits hitting a peak in the second week of March, before dropping into early April. And both have seen a similar flattening of drops in the last week of March and the first two weeks of April. Though both have still seen year-over-year declines, the pace has definitely slowed.
And the change isn’t limited to a year-over-year growth perspective, but also in the week-over-week changes that both brands have seen. In fact, in the second week of April, both brands saw week-over-week growth for the first time since early March. Though the increases were just 1.3% and 1.0% for Walmart and Target respectively, they still supported a wider feeling that these brands have reached their floor for the period. And with the trend continuing at an even greater magnitude in the third week of April - with week over week growth of 12.1% and 19.4% for Walmart and Target, respectively - the signs of a rebound are certainly present.
This flat traffic is a tremendous sign of the continued resonance and strength of both brands especially considering they have both placed serious limitations on in-store traffic across the country. And it doesn’t appear to be slowing down.
A Regional Perspective
Looking at week-over-week data from key states - New York, Arizona, Florida and Texas - shows both brands continuing to show a positive trajectory three weeks into April. In both Arizona and Texas, Target showed increases of more than 20%, with a likelihood that these jumps would have come a week earlier, if at a lower magnitude - were it not for store closures on Easter.
For Walmart, the same pattern held with the third week of April seeing traffic jumps in all four states, though the magnitude was slightly decreased by the week earlier being stronger because stores were open on Easter.
And taking a nationwide year-over-year perspective shows the trend even more. While Target is still operating far below its norm when looking at data from January 2018 through April 20th, 2020 it is clearly bouncing back for the first time since the pandemic began to affect the US in earnest. In fact, were it not for the fact that the third week of April aligned with Easter 2019, year over year declines would likely have decreased significantly.
And the same held true for Walmart with visits even coming within striking distance of weeks in early 2018. And while overall visits for the brand are still down year over year - also heavily impacted by a later Easter 2019 - the trend is bringing normal trends back within reach.
Is retail fully back? No. Does the data indicate that consumers are likely to release pent up demand for well-positioned retailers when restrictions are removed? Yes.
Popeyes!
Admittedly, we have a bit of an unhealthy obsession with Popeyes, but the brand is simply too fascinating to ignore for long. And, earlier this week a colleague shared a screenshot of its performance from our COVID-19 Retail Tracker and we saw something impressive, year-over-year growth for the first time since mid-March.
In fact, on the 15th, 16th and 17th of April, the brand saw year-over-year traffic increases of 27.7%, 9.3%, and 15.4% compared to the equivalent days in 2019. And this is happening when in-store dining has been closed.
There are likely a few contributing factors. Firstly, drive-thru and takeaway options can still be longer than the threshold we use to count a ‘visit’. Secondly, it does appear that people are ordering their food and then consuming the meal in the car. This bodes incredibly well for a brand already experiencing massive growth on the heels of the Chicken Sandwich phenomenon it drove in late 2019 making it one of the most exciting brands to monitor in the post-coronavirus period.
There is an important caveat here. While growth is obviously impressive no matter the scenario, the pace of growth is not on par with the huge numbers the brand was seeing earlier in the year. For example, on the first Saturday of February 2020, the brand saw a year-over-year increase of 40.0% in daily visits. So, essentially the jump Popeyes experienced in late 2019 has been so powerful and has continued to drive growth amid coronavirus, though not at the same levels as before the crisis.
Has the General Merchandise sector found its tipping point? Will the Popeyes reign continue? Check-in at Placer.ai to find out.
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