Q1 2022 proved to be a challenge for many businesses, especially due to rising costs associated with inflation. Many retailers like Macy’s, Dollar Tree, and Costco had great starts to the year with strong earnings results in the first quarter of 2022, but some struggled to keep up with their competitors. How did consumer foot traffic play a part? We analyzed foot traffic data to retailers from Q1 2021 to Q1 2022 to gain a deeper understanding of how various sectors of the retail industry are faring and how direct competitors stack up against each other.
Walmart and Target
Top 3 Takeaways:
- Walmart’s foot traffic increased steadily in Q2 and Q3, compared to Q1 2021 levels. However, in Q4 and into 2022, foot traffic declined.
- Meanwhile, Target’s foot traffic decreased significantly in Q2 and Q3, compared to Q1 2021. But in Q4, foot traffic spiked, before declining again in Q1 2022.
- By the end of Q1 2022, each brand’s foot traffic was below the levels each experienced in Q1 2021. Walmart saw a 5% decline, while Target saw a 27% decline, compared to Q1 2021.
What Does This Mean for Walmart and Target?
Year-over-year, Walmart has better sustained its foot traffic compared to Target, possibly due to rising prices associated with inflation. Walmart’s low prices may be helping the company attract and retain shoppers looking to make their dollars stretch further.
Home Depot, Lowe’s, and Competitors
Top 3 Takeaways:
- All home improvement store brands analyzed followed a similar pattern in foot traffic throughout 2021 and into 2022.
- Home Depot and Lowe’s, as well as Ace Hardware and Menards, all experienced an increase in foot traffic in Q2, compared to Q1 2021, followed by a steady decline in foot traffic.
- By the end of Q1 2022, each brand’s foot traffic was well below the levels each experienced in Q1 2021. Home Depot saw a 34% decline and Lowe’s saw a 24% decline, while Ace Hardware and Menards saw declines of 27% and 25%, respectively, compared to Q1 2021.
What Does This Mean for Home Improvement Retailers?
The steady decline in foot traffic to Home Depot, Lowe’s, and many other home improvement retail brands could signify decreased consumer interest in home improvement projects, a trend that was extremely popular during the height of the pandemic. In the midst of easing COVID-19 restrictions and elevated inflation, consumers are likely choosing to spend their money elsewhere.
Darden Restaurants and Competitors
Top 3 Takeaways:
- Foot traffic to Darden’s Olive Garden and LongHorn Steakhouse locations both followed similar trends throughout 2021 and into 2022, but there were greater variations when looking at the other restaurant brands analyzed.
- In March 2022, foot traffic to Olive Garden was flat compared to March 2021, but in April and May 2022, foot traffic increased compared to the same timeframe a year prior. Meanwhile, LongHorn Steakhouse experienced an increase in foot traffic in March, April, and May of 2022, compared to the same time period in the previous year.
- By May 2022, Outback Steakhouse and Red Lobster foot traffic was above the levels each experienced a year prior in May 2021, while Ruth’s Chris Steak House saw a decline over the same period.
What Does This Mean for Restaurants?
Year over year, foot traffic has increased at Darden’s Olive Garden and LongHorn Steakhouse locations as well as at many of its competitors, likely due to the pent-up consumer demand to dine out after COVID restrictions were lifted. But amid the recent rise in inflation rates, foot traffic to all restaurants we analyzed decreased from April to May as many consumers perhaps focused their spending on essentials.
CarMax and Competitors
Top 4 Takeaways:
- Starting in March 2021, CarMax experienced an increase in foot traffic, compared to February of that year, which peaked in July 2021. Following this peak, foot traffic declined through the end of the year and into 2022. However, foot traffic began to rise significantly again in March 2022.
- Ford, General Motors, and Toyota followed similar foot traffic trends throughout 2021 and into 2022. Meanwhile, foot traffic to Tesla locations primarily decreased throughout this same timeframe, but in March 2022, foot traffic began to rise similarly to the other brands analyzed.
- In March and April 2022, foot traffic to CarMax increased compared to the same timeframe in the previous year, but in May 2022, CarMax experienced a decrease year over year and month to month.
- By May 2022, foot traffic to Ford, General Motors, Toyota, and Tesla locations was below the levels each experienced a year prior in May 2021.
What Does This Mean for Car Companies?
Similar to the housing market, the reduced supply increased demand for cars during the pandemic, driving prices up for both new and used vehicles. However, there may now be a shift in consumer interest away from cars as foot traffic to CarMax and other car dealerships has decreased year over year. In the midst of rising inflation and interest rates, it’s not surprising that many consumers are putting big purchases, like cars, on hold.
Measure Company Performance with Location Analytics
Many companies measure their performance based on earnings reports and other financial datasets. However, this type of data only shows part of the picture on how businesses are performing. Data enrichment can provide organizations with a better understanding of how they are doing against their competitors. One type of dataset that can be used to enrich earnings data is consumer foot traffic like the data we analyzed in this blog post.
To learn how to use foot traffic data in your business, book a meeting with us today.
