Value-seekers drove 2024’s retail trends and dead ends
Value was fashionable in 2024.
Shoppers and restaurant goers in the US were picky about where and how to spend their money as they struggled with high housing and food prices.
Affluent customers traded down to Walmart and Aldi. Diners opted for fast food or cooking at home instead of sit-down restaurants. Department stores struggled as buyers shopped online or at cheaper chains like H&M.
Residents have also moved away from buying furniture or invest in expensive renovations, choosing to freshen up their homes with cheap items such as window frames and candles.
These shifts will change the purchasing and dining landscape in 2024. As of December 20, Coresight Research tracked 48 retail companies bankruptcies in the US, compared to 25 in the same period a year ago. And this year, at least 22 restaurant chains have filed for bankruptcy, the most since 2020, according to BankruptcyData, a company that tracks the records.
Here are some of the trends — and dead ends — that The Associated Press has been tracking in 2024:
WALMART
The the country’s largest retailer usually shines during difficult times like Shoppers are turning to the discounter for groceries, which make up 60% of Walmart’s total sales. And just like during the Great Recession of 2008, Walmart saw households with incomes of $100,000 or more make up a larger share of its customer base. But this time, business leaders believe they can keep those customers because they have expanded and added online services more stylish clothes and mannequins.
AMAZON
Online juggernaut Amazon leaned into it his reputation as a destination for deals that will appeal to bargain-hungry shoppers. It is in November launched Amazon Haula new, low-cost store with electronics, clothing and other products for under $20. And the company said July’s Prime Day event was due in record sales. But Amazon could face headwinds in the coming year threatened rates on products from China and labor unrest in the US
FAST CASUAL NECKLACES
It was a good year for restaurant chains, among others Shake Shack that are a step up from fast food, but still offer good value. Cava, which specializes in fresh Mediterranean dishes, said sales rose more than 33% in the first nine months of this year thanks to the rapid construction of new restaurants. Chipotle took some heat of value-conscious diners on smaller portions, but withdrew customers after retraining employees to ensure “consistent and generous” portions.
JEANS SELLERS
The wide-leg jean silhouette – the “it” style that quickly replaced bootcut and skinny jeans – drove sales growth across many different retailers this year. Macy’sAbercrombie & Fitch, Levi Strauss, Gap and Stitch Fix were among those citing the trend as a big sales booster in recent months. Price-conscious shoppers can get them at Walmart for $29. At the high end, Gucci had wide-leg versions for $1,200.
MCDONALD’S
The year didn’t start well McDonald’s. The the company’s turnover fell as inflation-weary customers opted to eat at home instead of grabbing fast food. But a $5 meal deal introduced in June helped draw lower-income customers back to stores. McDonald’s extended the agreement until the end of this year and said more value will come in 2025. The fast food giant is working to get customers back after a fall E. coli outbreak Linked to raw onions in Quarter Pounder burgers sickened at least 104 people in 14 states.
GOAL
Target’s cheap, chic fashion and home decor have long been a big draw, but… the chain faced challenges by 2024. Unlike Walmart, Target is more reliant on discretionary items like apparel because less than a quarter of its sales come from food and beverage. It has always battled the perception that it is more expensive, and analysts say its merchandise has been in disarray lately. Still, Target attracted a big crowd Black Friday with exclusive Taylor Swift products.
STERBUCKS
Starbucks had a tough year. Orders are becoming increasingly complex, with thousands of ways to customize drinks. This leads to long lines and incorrect pick-up times on the mobile app. New offering such as coffee with olive oil did not attract customers, who also grew tired of Starbucks’ high prices. Starbucks has hired a new CEO, Brian Niccolin the fall until help turn things around. But labor disputes, which led to strikes in December, the company could continue to hurt into 2025.
LEGACY RESTAURANTS
Decades-old chains threw in the towel in 2024 and succumbed to increasing competition, changing dining patterns and large portfolios of outdated restaurants. Red Cancer, TGI Friday and Buca di Beppo have all filed for bankruptcy protection and closed dozens of locations. A slimmer one Red Lobster later left bankruptcy under new ownership, but it remains to be seen whether older chains can turn around years of declining sales.
BIG TICKET ITEMS
At the height of the coronavirus pandemic, American consumers took advantage of low interest rates incentive benefits to renovate their homes and make other major purchases. But last year, they withdrew. That was a challenge for retailers such as Best buy, the country’s largest consumer electronics chain, which posted lower device sales, home theaters and gaming equipment. Home Depot and Lowe’s also reported lower sales of high-end items, particularly from discretionary kitchen and bathroom remodeling projects.
Department stores
Department stores, especially those that cater to middle-income shoppers, have struggled to retain customers as many turn to online shopping or fast-fashion retailers. One of the worst performers: Wisconsin-based Menomonee Falls Kohl’swhich reported revenue declines for the eleventh consecutive quarter this year. Outgoing CEO Tom Kingsbury recently admitted to merchandising mistakes, including scaling back fine jewelry, popular store-label brands and small sizes. Customers will see those categories return next year.
Macy’s said it would happen closes 150 stores of the same name in three years and open 15 more expensive Bloomingdale’s. Luxury Northstreamon the other hand, had a better-than-expected fiscal year, thanks in large part to rising sales at its discount Nordstrom Rack stores.