August store traffic trends might not be as bad as initially thought.
Retail has been abuzz over May’s sales bump, which got a boost from federal stimulus checks and bonus unemployment benefits that have since dried up, not to mention the lackluster back-to-school season suffering under uncertainty about the safety of classroom education. But now a new report shows that department stores including Macy’s and Kohl’s are showing signs of a sustained recovery in footfall.
Even hard-hit states like Florida, Texas, New York and Illinois are bouncing back, according to data analytics firm Placer.ai, which monitors consumer foot traffic. There’s no question that retailers, especially the downtrodden department store model, still have much to do to woo back consumers but Placer data suggests that traffic to department stores indicates the channel still has a fighting chance.
Foot traffic in those four states is still down but rising. Macy’s stores are showing a more than 40 percent year-over-year decline in Florida, Texas and Illinois. That said, foot traffic started to tick up beginning in July in Texas and Florida, despite a resurging outbreak that month after tapering off by more than 95 percent in April. With the exception of Illinois, where some government restrictions were tightened, the three other states also saw slight improvement in August.
At Kohl’s, customer visits lag 2019 comparisons, but foot traffic was down just 14.7 percent year-over-year at its New York stores beginning in July, after April’s number were off by 98 percent, per Placer data. Kohl’s stores in Illinois also showed improvement in July, down just 21.7 percent versus down 90.7 percent in April. Both states saw what appears to be a slowdown in traffic in August, down 24.5 percent in New York stores and down 31.3 percent in Illinois doors. But the analytics firm said those percentages were really a reflection of tough comparisons from a year ago due to “2019’s stellar back-to-school season” in those states.
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The opposite was true of stores in Texas and Florida that showed improved foot traffic trends overall. Kohl’s foot traffic for July and August was down 38.7 percent and down 35.5 percent in Texas, and down 32.6 percent and down 27.7 percent in Florida, respectively, even as Covid cases were rising “en masse,” Placer.ai said.
Weekly year-over-year traffic trends show that Kohl’s might be on to something with its off-mall format. Nationwide, Kohl’s has seen some improvement in traffic patterns, down just 26.6 percent for the week of Aug. 24. Performance at Macy’s was mixed, down 48.1 percent for the same week. With Macy’s testing different formats away from the traditional enclosed shopping malls, Placer.ai questions whether the retailer could be “replicating” competitors’ strategies.