(Bloomberg) — Americans flocked to off-price retailers during the holiday period, with visits rising above pre-pandemic levels, according to new data.
Foot traffic at T.J. Maxx and Marshalls, both owned by TJX Cos., rose 14.7% and 16.2%, respectively, from Dec. 1 to Christmas Day compared with a year earlier, data from analytics firm Placer.ai show. Burlington Stores Inc.’s foot traffic increased 17.5%, while Ross Stores Inc.’s rose 22.2% during the same period. Nordstrom Rack’s 39.8% traffic jump was the largest increase among discount retailers that Placer.ai analyzed. The company uses mobile-phone data to determine store visits.
Additionally, traffic at T.J. Maxx, Marshalls, Burlington, Ross and HomeGoods Inc. all rose at least 4.9% compared with two years ago. HomeGoods saw the biggest two-year jump at 14.7%. Nordstrom Rack was the only off-price retailer that saw a decline in foot traffic over the two-year period. The overall performance of off-price stores contrasts with department-store chains like Neiman Marcus, Macy’s Inc. and Kohl’s Corp., where foot traffic declined this year compared to 2019, according to Placer.ai.
The trend at off-price retailers, which comes in spite of rising concerns related to the omicron Covid variant, validates their “treasure hunt” model which lures shoppers into stores in the hopes that they will find unique and discounted items. The strategy may have resonated even more this holiday season amid higher prices and limited stocks.
U.S. holiday sales jumped 8.5% from Nov. 1 to Dec. 24 compared to last year, according to data released from Mastercard on Dec. 26 — above its projections from September. Sales were fueled by higher prices and spending on clothes, jewelry and electronics, among other categories. E-commerce sales increased 11%, which was a slower clip than 2020’s growth.
In 2022, off-price retailers are poised to gain more ground, said Liza Amlani, principal and founder of the Retail Strategy Group. The ongoing supply-chain logjam may have sparked larger orders from big retailers of apparel, shoes and other items that didn’t arrive in time for the holidays — which means the merchandise may be sold off to discount chains in the coming weeks.
“We’re going to see an excess of inventory in January,” Amlani said in an interview. “What this means for off price is that they’re going to have a lot of selection from more contemporary, mid-to-lower price items. They’ll have a lot to choose from.”
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