New Insights from Gravy Analytics Reveal Consumers Are Spending on Experiences Despite Inflation
The company’s Q2 Consumer Trends Report highlights that Americans are prioritizing entertainment and activities over material purchases, challenging the recession debate
Gravy Analytics, a leading provider of enterprise location intelligence, released its Q2 Consumer Trends Report, which analyzed foot traffic data across a variety of place categories from Q2 2021 to Q2 2022 to see how consumer behavior has changed. Foot traffic increased to places where consumers can have experiences, including sports arenas, movie theaters, and music venues, as well as travel-related places like airports and accommodations. The data signals potential economic resilience driven by a post-COVID pent-up demand for ‘living life’ again, despite the higher cost of experiences caused by inflation and other socioeconomic issues.
Consumers are prioritizing entertainment, leisure and travel experiences
The insights from Gravy’s human mobility data challenge the U.S. recession rumor mill as the company’s latest report reveals consumers are still spending but prioritizing where and what they spend their money on – namely, experiences. During Q2 2022, consumers began returning to both indoor and outdoor activities with larger crowds as social distancing restrictions and mask mandates were lifted across the country. Foot traffic to outdoor and recreational locations was 23% higher during this quarter than in Q2 2021, while entertainment venues saw 33% more foot traffic year-over-year.
Travel was revealed as another priority. Airport foot traffic was up by 67% in Q2 2022. However, the rising cost of airfares and ongoing reports of flight delays and cancellations could take a toll on the industry in Q3. Visits to all transportation locations including airports, bus/train stations and rental car locations during Q2 2022 were up significantly as a whole (+31%), compared to the second quarter of 2021. Additionally, foot traffic at golf resorts and destination hotels was 29% and 21% higher, respectively, in Q2 2022 compared to Q2 2021.
“Insights from our report show that consumers are refusing to put their lives on hold any longer now that the country has opened up following two years of pandemic restrictions,” said Jeff White, founder and CEO of Gravy Analytics. “Amid heavy inflation this year, many consumers seem to be carefully considering where they spend their money and are opting for experiences over material goods. Our foot traffic data for Q2 2022 shows consumer visits are up across multiple categories such as travel and leisure, indicating a more positive outlook for the U.S. economy among a sea of recession debates.”
Material purchases and fast food take a back seat
Data from the report reveals that fast food now takes a back seat to the sit-down restaurants that typically provide a more enjoyable ambiance. During the height of the pandemic, many consumers opted for quick fast food options, no doubt to adhere to restrictions and safety precautions, but in Q2 2022 that reversed, with foot traffic to fast food restaurants dropping 18% compared to the second quarter of 2021. Consumers today prefer eating at bistros (+14%) and grills (+15%), which provide an inexpensive sit-down dining experience.
Material purchases are also being traded in as consumers look to spend money on long-awaited experiences. Throughout much of 2021 and 2022, both new and used car prices soared, and it became increasingly difficult for consumers to find cars within their budget. By Q2 2022, foot traffic to new car dealerships was 21% lower, while foot traffic to used car dealerships was 35% lower, compared to Q2 2021.
Consumer foot traffic related to shopping as a whole was only 4% higher in Q2 2022 than in the second quarter of 2021. This could mean that, although some consumers are going back to malls and shopping centers, the majority of their shopping could still be happening online, or they are prioritizing experiences over goods.
Implications for brands
“It’s becoming more important than ever for brands to understand their customers and reach new audiences,” said White. “Location intelligence provides brands with the data and insights to mitigate challenges amid inflation and uncover new growth opportunities. This data can provide enterprises with a better understanding of market trends, consumer behaviors, foot traffic patterns, logistics and operational performance, and can even reveal how a brand is performing against competitors. In a chaotic world, utilizing insights from human mobility data takes out the guesswork.”