We analyzed credit card consumer spend for hundreds of thousands of consumers across the United States through March 4, 2020 (we will be updating this going forward with a one-week lag). Specifically, we looked at growth in spend and transactions in the past few weeks vs. the baseline trend pre-crisis (December-January).
Our data confirms that we are starting to see significant impact across categories – in line with general trends we are hearing from other markets like China, South Korea and Italy – in the United States as of the first week of March at the national level. Travel is most negatively impacted, while grocery, pharmacy and mass retail is up significantly. However, other categories are also seeing a slowdown.
We also looked at the trends in spend for thousands of consumers in the Seattle-Tacoma-Bellevue area. These data give an indication of how the trends across categories might unfold – where we should a further slowdown and increased acceleration in 2-3 weeks’ time in other markets.
Finally, we looked at credit card transaction trends vs. sales trends. In many categories, the two move in tandem, but in places they diverge, either due to discounting and promotions or consumers simply buying more/less items or more/less expensive items. For example, retailers in the Home category (e.g. DIY retailers as well as homeware stores and furniture stores) as a category are seeing a big pickup in traffic vs. pre-crisis trends but tickets are lower. Some of these discrepancies are even more pronounced in the Seattle area, where ride-sharing and transportation-related transactions are down, but sales are down even more, likely driven by discounting.
This is the first analysis of our US vs. Seattle consumer spend series. To read the second analysis, please visit here.
ABOUT THE AUTHORS
Mark Abraham is a Managing Director & Senior Partner in BCG's Seattle office. He leads BCG's Marketing & Sales Practice in North America as well as BCG's Personalization & Digital Marketing teams globally.
Aaron Arnoldsen is an Associate Director and AI Software Engineer in BCG's Seattle office and a leader on BCG's GAMMA team of over a thousand data scientists and engineers.
APPENDIX: Data and methodology
This study is based on BCG GAMMA data science analytics, leveraging credit card spend data compiled by Earnest Research and also BCG internal estimates. The sample size varies by category, ranging from 1,200-15,000 consumers for the Seattle area and 120,000-750,000 for the national data. The categories are as defined below:
· Travel: mostly airlines like United, Southwest, etc.
· Electronics retail: electronics and gaming retailers like Best Buy, GameStop
· Entertainment: cinema chains like AMC and Regal, bookstores like Barnes & Noble as well as other venues like Six Flags and Dave & Busters but also media companies like Netflix, NY Times, Hulu, Spotify and WWE
· Department stores: Higher end (e.g. Neiman Marcus, Nordstrom, Saks Fifth Ave, Macy’s) as well as mass (e.g. Kohl’s, JC Penney, T.J. Maxx etc.)
· Health Fitness & Beauty: Fitness chains and brands like Orange Theory, SoulCycle, Peleton and Planet Fitness, Nutrition brands and chains like NutriSystem, WeightWatchers, GNC and beauty chains like Ulta, Sephora, The Body Shop.
· Apparel and Accessories: Broad range of apparel brands like H&M, Zara, J Crew, The Gap, UnderArmour, A&F, VF, Urban Outfitters, Ralph Lauren, Tapestry, Levi’s, Luxottica, Lululemon, etc. luxury accessory brands like Gucci, Louis Vuitton, etc. and jewelry brands like Tiffany’s.
· Transportation and rideshare: Uber and Lyft as well as auto services like AutoZone, Advance Auto Parts, Pep Boys, Juffy Lube, etc.
· Restaurants: Broad coverage of largest QSR and casual dining chains.
· Home: DIY retailers like Home Depot and Lowe’s as well as homewares stores like Bed Bath & Beyond and furniture stores like Restoration Hardware
· Amazon: Amazon, Amazon Prime, Amazon Prime Now, Pillpack, Amazon Fresh, Zappos, Diapers.com, Kindle and a select few smaller Amazon properties. Does not include Whole Foods.
· Grocers: Largest grocery chains (including in-store and online sales for those brick and mortar grocers) owned by Kroger, Alberstons, HEB, Giant Eagle, also includes Whole Foods.
· Mass retail: mass retailers like Walmart, Target, Big Lots, club stores like BJ’s, Sam’s Club and Costco dollar stores like Dollar Tree, Family Dollar, etc., convenience stores like Kwik Shop – includes their online businesses like Jet.com for Walmart.
· Pharmacy: Pharmacy chains like Walgreens, CVS, RiteAid, etc.
· Online grocery: Online-only grocers like FreshDirect and Instacart.
