Consumers seem to be pulling back on spending, but the return to pre-pandemic behaviors is generating bright spots of demand. One example is surging foot traffic and spending at clothing retailers focused on workplace attire, driven by people equipping themselves for a return to the office.
In our last update, we illustrated how spending is down in nearly every category to make room for increased costs at the gas station. However, this pullback is countered by a desire to get out and do things as the pandemic becomes more manageable. People are going out to visit the things they missed – shopping malls, vacations, and more – but they’re spending less.
However, if we zoom down from categories to individual brands, we can identify bright spots in spending driven by a return to pre-COVID norms.
Take, for instance, the clothing retail vertical. Visits are up 7% year-over-year while spending is down 19%. But if we look at the individual brands comprising the category, we can identify two additional trends driven by the return to normal.
- Business attire is back
- Clothing retailers known for selling business attire – Men’s Wearhouse, Banana Republic, and Nordstrom – are achieving higher visitation and higher spend.
- Outdoor and Sporting Goods retailers fall behind.
- Both visitation and spend continue to decline for brands like Academy Sports and Dick’s Sporting Goods.
Men’s Wearhouse, the clear year-over-year outlier, is seeing 24% more visits and 44% more spend. People are heading back to the office and reequipping themselves for the shift. Nordstrom validated this datapoint for us with their Q1 earnings, where they saw strong sales driven by, “customers refresh[ing] their wardrobes for occasions such as social events, travel, and return to office.”
As we stated last report, trends that were strong during COVID have fallen out of fashion. In the clothing sector we can see sports focused retailers falling behind in both visits and spend, which is unique for the category. The great rush to the outdoors that occurred in 2020 and 2021 is receding.
As we zoom into the brand level, we can see that a desire to return to normal is affecting demand nearly as much as gas prices. It’s tricky to spot, but thankfully we can pull out this nuance with PlaceIQ’s unique ability to analyze visitation and purchase data within the same system.
Demand is changing and adapting to new, complex consumer behaviors is going to be crucial to understanding the current market conditions we find ourselves in. Consumers are looking for ways to save, true, but pent-up demand is manifesting itself despite consumer’s frugalness. Discovering new behaviors using a combination of visitation and purchase data as consumer patterns evolve enables markers to identify when to engage prospective customers.
PlaceIQ’s new Purchase Audiences define actual recent spenders, backed by visitation behaviors. And, PlaceIQ’s behavioral shift audiences allow you to target shoppers whose recent category activity has increased or decreased so you can follow along with vertical trends (search: PlaceIQ Travel Activity Increasing in your DSP).
It is crucial that we don’t miss the bright spots hidden by macro trends. Multisource behavioral data, as employed by PlaceIQ here, is the key to finding that nuance within the greater narrative.
We are gratified to see our analyses being included in various reports, since it is our goal to contribute to the #dataforgood effort. If you choose to re-use one of our analysis, all we ask is that you attribute the analysis or content to PlaceIQ. Thank you!
While the debate between remote, on-site, and hybrid work continues to bubble, visitation to offices is steadily tracking upwards.
Higher prices, especially at the pump, are driving down spending in nearly every vertical, despite COVID-weary consumers’ desire to get out of the home. Visits are healthy and travel and entertainment venues are steady.
Analysis from PlaceIQ reveals mirrored patterns in 2021 and 2022 traffic – predicting an enthusiastic return in traffic.