In this Placer Bytes, we break down Target and dive into Kohl’s and Ross.
Target Rising Again
It may be stating the obvious at this point, but Target seems poised for an exceptionally strong year. After seeing visits hover just under 2019 levels for most of the spring and summer, September and October drove visits that were up 2.6% and 5.2% year over year. Yet, like most other retailers, the resurgence of COVID cases impacted visits driving a year over year visit gap of 8.5% in November and 5.4% in December. Critically, all of this was happening while visit durations were spiking indicating that, while overall visits were down, the magnitude of those visits was significantly stronger, highlighting the mission driven shopping trend.
And while the caliber of visit looks unchanged, Target had already returned to year-over-year visit growth in January with traffic to locations up 0.5% year over year. This is an exceptional start for a brand that is perfectly aligned with key retail trends and has shown that it will leverage its current strength to drive innovative new concepts and partnerships.
But even this strength requires context. While January 2021 saw 0.5% year-over-year growth compared to January in 2020, when put alongside January 2019 the growth was an even stronger 4.5%. And this number is very important for a few reasons. First, it shows just how impressive Target’s January growth was as it came in comparison to an, especially strong January a year prior. Second, the 2019 comparison will likely be a common comparison moving deeper into 2021 as brands and analysts look for a more effective means of benchmarking current performance against ‘normal’ times. This should work in Target’s favor as the brand could be among the few to show strength against both 2019 and 2020 levels.
Kohl’s and Ross Show Potential for Big Years
A big reason we chose Kohl’s as one of our 2021 winners was the relative strength the brand had shown compared to other department store and apparel players and the fact that it was leveraging the strength to drive new and exciting concepts. And Koh’s took another step forward in January with visits down 17.8% year over year, the best mark since before the pandemic. Ross, a leading brand in one of retail’s most exciting segments, also saw strong results in January. The brand saw visits down just 10.2% - the second best mark since the pandemic kicked off and a continuation of the strong recovery for off-price leaders.
And here too, the 2019 comparisons are illustrative. While Kohl’s saw January visits down 17.8% compared to January 2020, the gap was just 7.9% when compared with January 2019. For Ross, the shift was even more significant. Instead of the 10.2% visit gap the brand saw with January 2020, Ross actually showed growth compared to January 2019.
Like Target, these numbers are important for context. First they demonstrate that the year-over-year decline is also relative to the fact that both brands had been seeing significant strength heading into the pandemic in 2020. Second, it will provide a strong opportunity to measure the performance against ‘normalcy’ giving both the chance to show their current strength in a fuller context.
Will Target continue to set the standard in offline retail? Will Kohl’s and Ross drive continued recoveries? Visit Placer.ai to find out.
