Placer: COVID-19 Crisis Spotlights Walmart, Target Strengths

According to store traffic tracker Placer.ai, the COVID-19 pandemic, with its various restrictions to retail operations, demonstrates the strength of the Walmart and Target business models.

Although Walmart saw a 4.8% overall decline in visits to supercenters in the latest quarter, the brand’s strength may never have been more on display, Placer asserted. Visits in February gained 8.3% year over year, and the first two weeks of March showed year-over-year growth of 6.7% and 15% respectively, before turning down. The visit rates for those weeks were such that, since 2018, only the holiday shopping season, Easter and July 4th holiday weeks drove more visits.

Critically, much of the decline in visits was due to restrictions that Walmart self-imposed in order to protect employees and customers. Even with the restrictions, March visits were only down 4.4% and April visits, in an entire month impacted by the restrictions, slipped 17.9%. Gains are better than losses, but it is hard to see these relative declines as anything other than a testament to Walmart’s strength, the market research firm added, especially considering its use of curbside pickup and delivery as secondary channels to augment the in-store traffic declines. With restrictions easing, daily visits are turning toward normal levels with the week from April 27th through May 3rd seeing a year-over-year decline of less than 6%.

Sam’s Club has also been experiencing growth, with an overall store traffic jump of 7.3% year over year in the first quarter. Traffic gains of 11.9% and 16.4% in February and March more than offset an April decline of 7.1%. Given the membership model Sam’s employs, the visit growth should buoy future months and drive even greater success in the Sam’s Club turnaround, Placer stated.

Target experienced pandemic extremes even more intensely than Walmart with an overall first quarter traffic decline of 11.3% resulting from February visits up 10.6% year over year and March and April visits down 11.7% and 31% respectively.

Again, Placer indicated, Target’s own restrictions were the primary cause of declines as opposed to any reduction in consumer demand. With restrictions easing, Target has seen daily visits return to year-over-year growth for the first time in months. Visits on May 4, 5, 6, and 7 advanced 4.3%, 3.6%, 4.9%, and 5.1% respectively for the first days of growth since mid-March.