Small businesses have been hit hard by COVID-19. In February, about 1 in 3 reported being worried that they would not survive the pandemic. Even compared to other types of shops and services (namely fast-casual dining chains, auto dealerships, and brand-name retailers), foot traffic to small businesses was hit especially hard. However, a recent analysis of foot traffic data to small businesses indicates that better days are approaching — indeed, visits to small businesses actually remained fairly stable in recent months.
As more and more people receive vaccinations, many businesses of all sizes are starting to prepare for customers to return. But to prepare for what could be a gradual return to normalcy, small businesses should take note of foot traffic trends from the last year and adapt their strategies to fit potentially permanently changed consumer behaviors and identify opportunities to meet gaps in consumer needs.
Here are several key trends to keep in mind:
- The shoppers are back – but consumers are spending less time in small business: Foot traffic to small business retailers has remained fairly stable since returning to pre-pandemic levels in late August 2020. However, as of late February, people were still unsurprisingly spending less time in small business venues compared to pre-pandemic. While some retailers and restaurants may be able to offer curb-side pick-up and call-in ordering, others may have to find other ways to fill in the gap left by reduced dwell times, such as limiting the number of people allowed inside at once to give shoppers or patrons more peace of mind while browsing or enjoying a meal.
- Independent restaurants are seeing more foot traffic than some dining chains: While fast-food restaurants continue to see the most foot traffic, independent restaurants are still outpacing casual dining chains when it comes to in-venue visits. While foot traffic to independent restaurants was still well below pre-pandemic levels as of early March, traffic levels are steadily rising. With warmer weather approaching and more people becoming vaccinated, it’s possible that more consumers will feel comfortable dining in at local restaurants and the level of foot traffic will continue to rise.
- Small businesses in rural and suburban areas are recovering faster: In rural areas, foot traffic to small businesses returned to pre-pandemic levels back in by early June 2020 and has actually remained mostly elevated over the past year. Foot traffic to small businesses has continued to slowly rise in suburban areas — down only -10% as of March. However, visits have remained fairly stable in urban areas and were still down -22% as of March. Perhaps consumers in more densely populated cities are more hesitant to venture into local venues compared to those in more suburban and rural areas. Again, as the national vaccine rate rises, it’s likely that so too will foot traffic in cities.
- Younger people are more likely to visit small businesses than older consumers: Throughout the past year, small business visits skewed slightly younger during the pandemic compared to pre-pandemic traffic. In fact, roughly 38% of small business visitors overall were between ages 18-34 during the pandemic and less than 5% of all small business visitors were over the age of 65. This could be due to older individuals being at higher risk for developing severe COVID-19 symptoms and were, therefore, more cautious about being out and about.
With COVID-19 vaccines now available to all adults in the U.S., it’s likely that foot traffic volume to small businesses will pick up even more in the coming months. However, there are still actions that small businesses can take to drive even more visits and win the loyalty of consumers. For example, small businesses can target their marketing efforts — be it through advertising, special promotions, or merchandising — toward key audiences that are already expressing interest in supporting small businesses. Such audiences include foodies, frequent travelers, urban dwellers, and hosts. It also helps to stay on top of key trends in foot traffic data and consumer behaviors, as these will continue to evolve as the economy recovers in the coming months.