For the first time since the pandemic began, foot traffic in big-box stores like Costco
Following a massive surge in in-store shopping in the second week of March, foot traffic fell by 8.7% year-over-year for Costco, 6.7% for Walmart, and a whopping 20.5% for Target. During the second week, Walmart and Target saw increases of just under 20% year-over-year, while Costco's traffic reached an increase of 35% year-over-year.
Sam's Club, on the other hand, saw a jump of 67% in foot traffic year-over-year in the second week of March, but traffic for the third week was still 21% higher than the previous year. Placer.ai suggested this was because of "the company's overall resurgence".
In a blog written by the company's VP of Marketing, Ethan Chernofsky, Placer.ai reported that there are several possible reasons for the decline in traffic. First, it's possible that consumers have already gone and stocked up on everything they need for a while.
"There is a downside to stocking up for the long haul. Once you have all the things you need, there is little need for more visits," Chernofsky wrote.
Chermofsky also argues that delivery and curbside pickup may be depressing in-store shopping. Adobe data showed that buy-online-pickup-in-store sales increased 62% year-over-year between Feb. 24 and March 21. The increase in sales included not just groceries, but also exercise equipment and computers.
Another possibility is that these stores are just finally seeing the impact of the virus and social distancing. To determine the cause, Placer.ai analyzed data based on the region and how hard that region has been hit by the virus. In New York, for instance, the impact of the virus has been extreme, and third-week traffic fell by an average of nearly 10%. Arizona, on the other hand, where the virus has been less prevalent, foot traffic in the third week of March still showed a 6% increase year-over-year.
"The positive here is that the data indicates that as the situation improves, and doesn't worsen, consumer behavior tends to return to more normal patterns," Chermofsky wrote. "Should this trend hold, it's a very strong endorsement for those who believe that wider retail activity could quickly return to previous levels should the preventative measures being enacted serve their ultimate goal."
While it is possible that the decline will hold as long as the virus does, it's also possible that we will see another surge in traffic as soon as consumers need to restock.
