We're in a period of volatile economic and governmental change, and we're all desperately awaiting a reprieve from the coronavirus and the resulting lockdowns. Historical insights data on consumer behavior pre-coronavirus isn't helping us predict the future because we're in such a different world now. But we can examine data from the last month to understand the leading indicators that portend the future, so we can prepare our response in advance.
Grocery stores are playing a more important role in our lives than ever, so we examined foot traffic data from the last several weeks in some of the largest DMAs in the country, and overlaid this heat map with key quarantine announcements from national and local governments.
A key question in the food industry is how to anticipate consumers' reaction when governments issue announcements - either extensions of stay-at-home orders, or decisions to lift them. How much of a local change can we expect in some places, and how would that differ from national as a whole? There are many implications on inventory management, staffing, marketing, and brand differentiation - predicting the future is a critical need at this time.
In the month of March, we examined foot traffic spikes in supermarket channel to see if they correlate with days when particular cities or states issued a shelter in place order.
The chart below shows a heat map of variances in foot traffic in some of the biggest DMAs, as well as highlights on the day that shelter-in-place orders were issued.
The numbers in each cell are an index of year over year change in supermarket foot traffic, relative to what the year over year change was on average for the entire month. For instance, on March 16th, San Francisco saw a year-over-year increase in supermarket foot traffic than was over 2x the rate they saw on average during March.
Across nearly all of these DMAs, the lift in year over year traffic towards supermarkets really started around March 12th, the day after the WHO pandemic announcement.
Consumers have followed a pattern of reacting to global news and national developments more so than the social distancing orders of their particular city.
San Francisco was the first to have a full shelter in place order on March 16th. There was a large spike in San Francisco grocery foot traffic on that day - it was their biggest day in year over year performance.
Seattle and Philadelphia also had traffic spikes on March 16th, when they issued partial restrictions regarding restaurant dine-in activity and large group gatherings. A few days later, they also implemented full shelter-in-place orders.
But on March 16th, even though San Francisco was the only DMA shown here that issued an full order on that day, people in many other DMAs followed suit with large spikes in grocery traffic. This indicates that people take cues from what they see in the media, like the news of San Francisco going into lockdown.
Our perspective is that people seem to be much more influenced by global or major national developments, which tend to be highly publicized in the news, versus the policies of a local area. But smaller jumps do seem to occur upon the issuance of orders in a specific city in a specific day, including cities with later shelter-in-place orders like Atlanta and Detroit.
However, it’s likely that foot traffic won’t spike to its initial peak levels immediately after the WHO pandemic announcement in mid-March. Throughout the rest of March we didn’t see traffic spike to that extent, so it’s possible that the initial panic and stock-up behavior won’t repeat itself to the same extent again.