Analysis of Industry and Spending Trends - Greater Omaha Chamber
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SpendTrend ® Special Report
Analysis of Industry and
Spending Trends
Glenn Fodor, CFA; Glenn.Fodor@Fiserv.com
SVP, Head of Data & Analytics
November 19, 2020
All data is Fiserv proprietary data and includes only actual card-based forms of payment. SpendTrend is a macroeconomic indicator that reports aggregated year-over-
year same store sales activity for card-based payments. SpendTrend from Fiserv does not represent Fiserv financial performance. © 2020 Fiserv. All rights reserved. FORTUNE World's Most Admired Companies®
1 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020
Payment volume growth during the Great Recession
During the Great Recession Visa and Mastercard US volume growth fell from 12% to -5%, but quickly rebounded once the crisis
was over, as did retail sales
YoY change
15% 1.00
Recession
0.90
12%
Visa + 0.80
Mastercard
9% 0.70
US Volume
0.60
6%
0.50
3%
US 0.40
Retail
0% Sales1 0.30
0.20
-3%
0.10
-6% 0.00
1Q07 2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10
Note: 1. Retail sales and food services excludes motor vehicle and parts and gasoline stations, non-seasonally adjusted.
Source: Visa, Mastercard, US Census Bureau.
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Mobility
Nationwide, mobility has generally been in a holding pattern for a couple of months; Nebraska is tracking slightly higher than the
U.S. overall.
Source: Dallas Fed. Note: The Dallas Fed Mobility and Engagement Index summarizes the information in seven different variables based on geolocation data collected from a large sample of mobile devices. Index is
scaled such that the average for January through February is 0 and the average for the week ended April 11 is -100.
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Housing Market
Inventory on Zillow.com continues to reach new lows (in Omaha, and Nationwide), driven by moves away from urban areas, low
mortgage rates and millennials reaching home-buying age.
Zillow For-Sale Inventory – Omaha
Percent Growth YoY
20%
10%
0%
-10%
-20%
-30%
-40%
Mar-2019 Jun-2019 Sep-2019 Dec-2019 Mar-2020 Jun-2020 Sep-2020
Source: Zillow.com.
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Nebraska’s Top-Performing Sectors
The top-performing sectors in Nebraska all performed very similarly, as of the latest reading.
General Merchandise and Clothing were the best performing as of mid-November; earlier in the pandemic, home improvement was far
and away the best performer (similar to nationwide trends as well).
Nebraska’s Top-Performing Sectors (by $ spend)
Dollar Spend – Indexed to 100 for January
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
August 8, 2020
September 7, 2020
October 7, 2020
September 17, 2020
September 27, 2020
July 9, 2020
October 17, 2020
October 27, 2020
April 10, 2020
April 20, 2020
April 30, 2020
August 18, 2020
August 28, 2020
June 9, 2020
January 31, 2020
November 6, 2020
March 11, 2020
March 21, 2020
March 31, 2020
July 19, 2020
July 29, 2020
June 19, 2020
June 29, 2020
May 10, 2020
May 20, 2020
May 30, 2020
March 1, 2020
November 16, 2020
February 10, 2020
February 20, 2020
Building / Garden Supply Clothing Furniture General Merchandise Misc Retail
Source: Fiserv. Top performing sectors determined by greatest spend percent growth from January.
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Paradigm Shifts or Passing Fads – Gardening
Then Now
How to Easily Grow Your Own Defeated Quarantine Gardeners Are
Pandemic Garden Throwing in the Trowel
Vice, April 24, 2020 The Wall Street Journal, September 16, 2020.
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Paradigm Shifts or Passing Fads – Cooking and Baking
Then Now
Forget the Sourdough, Everybody’s Americans Are Starting to Get
Baking Banana Bread Sick of Cooking at Home
The Wall Street Journal, April 30, 2020 New York Post, August 20, 2020.
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Paradigm Shifts or Passing Fads – Home Workouts
Then Now
At-Home Fitness May Outlast Tired of Your At-Home Workouts?
Coronavirus Pandemic as Digital Maybe It’s Time to Try Running
Offerings Keep Customers Engaged Outdoors.
Fox Business, November 9, 2020 Washingtonian, July 14, 2020
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Evaluation Framework – Paradigm Shifts or Passing Fads
Who is adopting the change?
Is the new paradigm a sufficient substitute for the original?
Is the change scalable (tech or digital driven), or is it a manual work-around?
Was the change already underway, and the pandemic accelerated the inevitable?
Is the change gimmicky or a stop-gap for something better that’s on the horizon?
Does the new way bring about more benefits than simply substituting for the old way?
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Broad Implications Stem From the Shift to Working From Home
Transportation Fashion and beauty
Place of residence Coffee and breakfast
Building materials Daycare Furniture / Electronics Lunchtime
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10 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Home Improvement – DIY
Have you started any
60% new DIY projects in
or around your home 60% 71% 74%
of DIYers are focusing on their homes March April May
than other expenditures in the last week?
(Maintenance, replacement,
repair, or remodeling work
that you are doing)
Improving the Home Office
“ Our DIY customers are reengaging with
their home and with The Home Depot in
a meaningful way, and they are
“ Desk or table for
computer
Chair Phone
engaging across the store. Functional Privacy Noise canceling
lighting headphones
– Edward Decker,
EVP of Merchandising at The Home Depot
Robust home network (new Computer equipment (ergonomic
router, mesh router system) keyboard, printer, external monitor)
Source: General industry information, The Farnsworth Group and the Home Improvement Research Institute, The Home Depot.
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11 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020SpendTrend ® Special Report
Building Materials and
Garden Supply YoY Transaction Growth (7-day moving average)
36%
The sector remains well
32%
above pre-crisis growth 28%
levels, thanks to continued 24%
21%
stay-at-home dynamics. 20%
16%
While velocity has pulled
12%
back from its early-summer 8%
peak, overall levels remain 4%
very healthy. 0%
-4%
-8%
11-Jan
22-Sep
12-Jun
2-Mar
2-Aug
22-Apr
Source: SpendTrend. Note: Data represents Brick & Mortar and E-commerce,
on a same-store-sales basis.
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12 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020SpendTrend ® Special Report
Furniture
YoY Transaction Growth (7-day moving average)
Furniture spending velocity 20%
has seen some spikes and 10% 10%
dips in recent weeks, likely a 0%
result of Labor Day, but -10%
continues to be solidly above -20%
pre-crisis levels as consumers -30%
continue refreshing their living -40%
spaces. -50%
Potential lift from
stimulus payments
-60%
12-Jun
2-Mar
11-Jan
22-Sep
22-Apr
2-Aug
Source: SpendTrend. Note: Data represents Brick & Mortar and E-commerce,
on a same-store-sales basis.
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13 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Future of Social Media
Social media usage will likely normalize
post pandemic. A recent survey of U.S.
adults revealed the following:
~25%
stated they would continue to spend
more time on social media after the pandemic
I don’t expect this exact spike in
51% usage will sustain over a longer
thought their pre- and post-pandemic social period of time
usage would be the same
– Mark Zuckerberg,
21% CEO of Facebook
thought of decreasing social media
use after the pandemic
Source: General industry information, eMarketer.
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14 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Retailer’s Focus on Digital
“ “ “
I continue to be excited about the Customer shopping behavior will be Growth in digital is way bigger to us
opportunity I see for NIKE in permanently changed in a way that than just the sales or profit on that
digital. We know that digital is the is even more digital and puts them one digital transaction because it
new normal. The consumer today
is digitally grounded and simply
“ “
entirely in control to shop how they
want. Our strategy is to embrace
deepens our relationship with the
guest, and that pays off in spending
“
will not revert. that reality and lead, not follow. in aggregate.
– John Donahoe, – Corie Barry, – Michael J. Fiddelke,
CEO of Nike CEO of Best Buy CFO of Target
+83% +240% +195%
YoY sales growth for Nike’s Domestic online YoY revenue growth Comparable YoY digital sales growth
digital channel
+200%
Growth in demand for Nike’s
53%
Of total domestic revenue from
10M
New digital guests added in 1H20
commerce app online; vs. 16% last year
Source: Nike, Best Buy, Target.
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15 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Brick-and-Mortar Remains an Important Channel
“ “ “
When you look beneath the surface of Our unmatched drive-thru We will not look to ecommerce as
the reported numbers, you find that our penetration has allowed us to our major leveraging point to get us
stores actually drove over 90% of our
Q2 growth and enabled more than 3/4 “ continue serving more customers in
more markets than anyone else.
“
through COVID and out the other
side. It'll be complementary, as it
of our digital sales and an even higher While we've seen a significant uptick always is.
percentage of our digital growth. in drive-thru as a percentage of total
sales throughout the segment, a “ – Ernie Herrman
– Brian Cornell, crucial step in our recovery is the CEO of The TJX Companies
CEO of Target reopening of dining rooms.
– Chris Kempczinski
CEO of McDonald’s
9 retailers that are avoiding
the industry’s shakeout and Burlington banks on
opening stores in-store shopping
Source: General industry information, Target, McDonald’s, The TJX Companies, CNBC, September 7, 2020, The National Retail Federation, August 11, 2020.
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16 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020BOPIS and Curbside Become Critical for Some…
While Others Thrive Without It
“ Curbside pickup and BOPIS are key to providing the best
“
shopping experience, at the customer’s convenience and
choice.
“ Buy online and pick up in-store, we continue to look at
what others do. We continue to scratch our head a little
“
bit. It's not that we'll never do it but it's not on the agenda
– Jonathan Ormerod, for this week.
Vice President of Gap stores – Richard Galanti,
CFO of Costco
“ We continued to see very strong growth in our online
shopping channels, Buy Online Pick-Up In-Store, next-day
delivery and ship to home. In particular, our Buy Online “ “ We know that some other retailers are offering these
“
services. We also know those offerings don't always
translate into positive results.
Pick-Up In-Store offering grew rapidly at 4x the growth rate – Tara Miller,
of the ship-to-home options. – Bill Rhodes, Marketing Director for Trader Joe’s
CEO of AutoZone
Source: AutoZone, Gap, Costco, Business Insider, April 27, 2020.
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17 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Holiday Shopping
~$997
What consumers
expect to spend on
holiday shopping,
only $50 less than
in 2019
Over 50% of consumers plan to spend some of the
money saved on travel expenses…on holiday shopping
Source: National Retail Federation, October 21, 2020.
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18 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Rise of the “Digital Holiday”
Then Now
60% 34%
consumers planning to purchase holiday expected growth in U.S. holiday
items online (primarily to avoid crowds) season e-commerce sales
“ Retailers need to ensure their e-commerce capabilities are up to the task for
the holiday season, with detailed visibility into demand changes and focus on
”
seamless experiences and fulfillment efficiency.
– Brooks Kitchel,
Managing Director of Accenture Strategy, Retail
Source: Deloitte, Salesforce.
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19 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020New Changes Coming to Holiday Retail
Shopping by
Appointment
Extended 1
More Week!
Extending Black Friday offers Managing throughput Same-day, BOPIS and
over several weeks curbside delivery
• Home Depot offering "Black Friday" • Best Buy is testing a ship-from-store
deals for two months 62% hub model
of consumers may shop at a physical
• Tanger's early-season sale kicked off store via shopping appointment • Bed Bath and Beyond rolled out
on November 1st same-day delivery services
Source: General industry information, Accenture.
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20 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Travel and Leisure
A desire to travel ...is being replaced by
internationally… secluded / local destinations
Traditionally, iconic Of U.S. travelers stating that the COVID-
Then structures, historical 40% 19 pandemic has made them rethink their
destination choices
Now
monuments and
natural wonders were 71% Of U.S. travelers are looking at domestic
travel destinations, up from 58% last year
preferred destinations
47% Of travelers are considering in-state road
trips for their next holiday
Road trips preferred over flights:
• Hitting the road in vacation pods
• School on the road for “schoolcations”
Source: General industry information, World Travel & Tourism Council.
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21 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020Travel – Hotels vs. Airlines
US consumers are increasingly returning to hotels, but not traveling via plane nearly as much as historically.
US Hotel Occupancy Rate US Airline Traffic
Hotel occupancy rate TSA traveler throughput (YoY)
70% 0%
-10%
60% -20%
Increasing -30%
50%
occupancy rates
-40%
Slight improvement, but
-50% traffic flow remains tepid
40% -60%
-70%
30% -80%
-90%
20%
-100%
4-Jan 6-Feb 10-Mar 12-Apr 15-May 17-Jun 20-Jul 22-Aug 24-Sep
1-Mar 1-Apr 2-May 2-Jun 3-Jul 3-Aug 3-Sep 4-Oct
Source: STR, TSA.
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22 © 2020 Fiserv, Inc. or its affiliates. 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2020A Latent Desire to Travel Remains
Singapore Airlines Finnair Qantas
Grounded planes double Selling Business Class Flights to nowhere for those
as pop-up restaurants meals in grocery stores with nowhere to go
Source: General industry information, Gulf News, October 27, 2020.
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Cash Usage at the Point of Sale
Americans are hoarding cash because of Cash Usage Decrease1 (14-day moving average)
Covid-19
Quartz
917 bps ↓ decrease in cash usage
Cash Is History. How to Profit From the since the start of 2020…
Digital-Payment Future. but appears to be
bouncing along the bottom
Barron’s
Will The Pandemic Spell The Real Death
Of Cash?
11-Jan
27-Jan
15-Mar
31-Mar
18-May
19-Jun
21-Jul
2-May
5-Jul
12-Feb
28-Feb
3-Jun
16-Apr
22-Aug
23-Sep
6-Aug
7-Sep
PYMNTS.com
Source: Fiserv. 1. Measured as U.S. cash transactions as a percent of total at Clover merchants.
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