Tag: landscape

LandScape Segments Fueling Top Growth Markets

Let’s explore the groups responsible for driving economic vitality in the top growth markets in the United States

LandScape Segments Fueling Top Growth Markets

Let’s explore the groups responsible for driving economic vitality in the top growth markets in the United States

Earlier in 2021, we released our “Top Growth Markets” annual report. This report lists the 26 strongest markets in the United States. In those markets, there are segments of the population that are fueling this growth. We dive into the top 10 markets and determine which segments are responsible for their growth.

What are STI: LandScape™ segments?

STI: Landscape™ is a lifestyle segmentation product that allows a marketer to identify their customer profile from 72 predetermined segments and to pinpoint their location across the U.S. All 72 segments are sorted into 15 categories. Lifestyle segments are determined by race, household type, age, income, and many other factors. Knowing customers’ unique lifestyle attitudes has numerous applications including site selection, marketing, merchandising, and so on. 

Knowing what type of customer is in a market, and which ones are growing in an area, is a valuable insight into any untapped potential.

Segments Fueling the Top Markets

In the top 10 of the top markets report, there were a few segments that stood out. The first one was the Sitting Pretty segment. This segment appeared 6 times out of the 50 chances it got. The Sitting Pretty segment falls under our Urban Cliff Climbers category which are high-density neighborhoods that are mostly filled with families that work hard for their well-earned living. They’re a strong representation of the “working class.” 

The segment that had the second-highest number of appearances is the Sublime Suburbia segment which appeared 5 times. This segment falls under the Married in the Suburbs category which includes 30-something suburbanites enjoying the fruits of the high-quality suburban lifestyles. They earn very good incomes and they mostly consist of married couples with children.

The segment with the third-highest, and our final segment spotlight, is the Legacy Years segment which appeared 4 times. Legacy years falls under the Specialties category in LandScape which are unique segments that don’t quite fit any other category. These neighborhoods generally host people that range in age of older 50s to early 60s.

As you follow along with the list, use this guide to help you better understand what type of neighborhoods are helping these markets grow. You can also click on each segment to get a more detailed definition. Reach out on the chat or here for detailed descriptions of all 72 segments.

The Segments:

Austin, TX – The highest growth market from the 2021 report is Austin! The area referenced in the report comprises Travis, Hays, and Williamson counties.

The segments fueling the Austin growth are ranked as follows:

  1. Sitting Pretty
  2. Land Barons
  3. Los Solteros
  4. Los Padres
  5. Pastoral Vistas

Boise, ID – coming up second in the fastest-growing markets is Boise! The counties encompassing this market are Ada, Boise, Payette, and Canyon county.

The segments fueling the Boise market are:

  1. Kindred Spirit 
  2. Sitting Pretty 
  3. Couples with Capital 
  4. White-Collar Status 
  5. Sublime Suburbia
Myrtle Beach, SC – still remaining in the top 5 fastest growing markets is the vacation spot, Myrtle Beach. This market includes Horry county.
 
The segments fueling the Myrtle Beach market are:
  1. Sitting Pretty
  2. Legacy Years
  3. Doublewides
  4. Pastoral Vistas
  5. Sublime Suburbia

Charleston, SC – the second market in South Carolina claiming its spot on this list is Charleston. The counties included in this market are Charleston, Dorchester, and Colleton county.

The segments fueling the Charleston market are:

  1. Sublime Suburbia
  2. Great Generations
  3. Couples with Capital
  4. Regents
  5. Hard Hats and Hair Nets

Phoenix, AZ – In the middle of a desert climate is the growing Phoenix market. The market includes Maricopa county.

The segments fueling the Phoenix market are: 

  1. Sitting Pretty
  2. Educated Earners
  3. Los Trabajadores
  4. American Knights
  5. Los Solteros

Lee, FL – Southwest Florida is experiencing healthy growth along the coast from tourism and industry. This market is only comprised of Lee county.

The segments fueling the Lee market are:

  1. Golden Heritage
  2. Hard Hats and Hair Nets
  3. Legacy Years
  4. Stately Suburbs
  5. Suburban Singles

Orlando, FL – Central Florida claims a second spot for the sunshine state in our fastest top growth markets. The counties included in this market are Orange, Sumter, Lake, Marion, and Hernando county.

The segments fueling the Orlando market are: 

  1. Great Generations
  2. Sublime Suburbia
  3. Golden Heritage
  4. Legacy Years
  5. Gainfully Employed

Northwest Pinal, AZ – Arizona received rapid growth in its markets this past year. The only county considered in this market is Pinal County.

The segments fueling this market are:

  1. Kindred Spirits
  2. White-Collar Status
  3. Hard Hats and Hair Nets
  4. Sitting Pretty
  5. Legacy Years

North Dallas/Fort Worth, TX – The DFW metropolitan area is the 4th largest metro area in the United States. Even with that status, the more northern area of the metro is experiencing some of the biggest growth in the country. The counties included in this market are Denton, Collin, Hunt, and Rockwall.

The segments fueling this market are:

  1. American Knights
  2. Sitting Pretty
  3. Great Generations
  4. Country Villas
  5. Sublime Suburbia

South Nashville – The last top growth market to be discussed will be the southern part of Nashville. The county included in this market is Davidson county.

The segments fueling this market are:

  1. Standing Tall
  2. Apprentices
  3. Still Standing
  4. Hard Act to Follow
  5. Suburban Singles

Want to know the definition of all the 72 segments?

Get the LandScape Data Dictionary

Recerational Equipment, Inc. (REI)

REI Accelerates New Store Openings with PopStats and LandScape

Recerational Equipment, Inc.

REI Accelerates New Store Openings with PopStats and LandScape


It would be easier for Recreational Equipment Inc. to use another data provider’s dataset because the company that creates their sales forecast models uses it. However, Curt Newsome, REI’s real estate research and strategy manager, said, “I don’t care. I want to use PopStats and LandScape.”

He prefers PopStats and the LandScape neighborhood segmentation dataset for two main reasons: “PopStats is high-quality data and the company is accessible. If I have a question about the data, I can call and get an answer. The team there is very accessible and supportive. I don’t get shuffled to people who don’t have answers. In fact, they often give me more detail than I can absorb.”

“That’s important to me because I’ve worked with lesser quality data and it’s a case of ‘you get what you pay for.’” Curt added: “… data isn’t just a sideline for them. It’s their core. They know their methodology inside and out. That’s why they have the best reputation in the business.”

Quality data that he can depend on is critical to Curt’s research success, in particular, because REI only opens a few new stores each year. As a result, they have to be in the exact right locations.

“Our store location history has gone through many phases, including having no strategy whatsoever and letting real estate brokers decide where we’ll open stores. Now, we’re in the ‘age of enlightenment,’ where we open new stores based on both the science of analyzing revenue potential and the art of our real-world experience.”

In particular, one of the organization’s goals is to make REI better known outside of the West Coast, where it originated. More than a third of REI stores are in California, Oregon, and Washington. However, the company has since expanded into new markets like Jacksonville, Fla., Kansas City, Mo., and Columbus, Ohio. Along with new locations, the company also began considering new store concepts and a separate strategy for more flagship locations.

STI: LandScape™ Correlates with REI Customers

Today, Curt relies on both PopStats and LandScape to scout new territories for new stores and assess the status of existing stores. “Our process begins with segmenting our target markets using LandScape, so we can create our forecast models. It’s our critical first step because REI’s customer profiles are extremely segmented in comparison to most other retailers.”

“LandScape segments do an incredible job of correlating to our ideal customer segments,” said Curt. “In fact, the 72 segments’ correlations are so meaningful to REI that the company will ignore a lower population count in a market if it finds a large enough population of its ideal segments.

“LandScape allows us to perform a unique calculation to understand a market with different demographic qualities,” notes Curt. “That’s why it’s become one of the key building blocks in our models when we are researching trade areas where we don’t already have stores.”

Before applying LandScape data to its research, REI processed a year’s worth of transactional data — about one million records — including every sale and every return. It geo-tagged each data point. That showed them where members live, where members shop, and what they buy.

By mapping that data against the retailer’s dominant cluster data, REI was able to assign a score for all 72 segments in LandScape on the segments’ propensity to shop at REI. That allows the company to, simply stated, assign a score to any geographic area and gauge how likely REI is to be successful there. “It’s just as important to know all the segments that score low as to know all of the segments that score high.”

About 15 segments in LandScape deliver the highest probability of being REI customers. However, Curt stresses: “That doesn’t mean that we’ll only put stores where those consumers live. There are many other factors that we consider as well.”

Among the other factors, we are looking at alternative sites where there is no residential customer base. Instead, it’s a place that people travel to for outdoor recreation, like Conway, New Hampshire, and Dylan, Colorado. “Since we’re running out of standard places to open new stores, we’re expanding our search into alternative store locations and types,” explained Curt.

Applying Art and Sciene to Trade Area Analysis

After forecasting its customer segments, Curt moves onto trade area analysis, relying on PopStats to compile relevant data on each trade area’s demographic characteristics. “The purpose of this analysis is to determine if a strategically validated relationship exists between the site’s attributes and our ideal store performance.”

REI’s site analysis includes three typical scenarios:

  1. Model Validation – In a normal trade area, “we track the prediction using variables such as trade area capture rates, sales per population, and total sales per household.”
  2. Increase Forecast – Some markets need a manual boost in estimates for a variety of reasons, such as Burlington, Vermont. “Not surprisingly, REI’s capture rate is very high there,” noted Newsome. “Almost everyone is a potential customer. Plus, we get a bump from the local university.”
  3. Decrease Forecast – If a market looks different demographically or has a lower population, Newsome will manually lower the forecast. “For example, in Salem, Oregon we decided to open a smaller store. Today, it’s a good steady performer.”

So how accurate is REI’s new market analysis processes? “We haven’t measured the raw model yet, but we’ve opened about 30 new stores using this methodology. We’ve only under predicted by about three percent of the time, which is great compared to the industry standard of 15 percent.”

Interestingly, in REI’s over 80-year history the company has rarely closed a store. But in 2015 the company closed its first one and has relocated a couple of stores since then. Newsome is so confident with his current research process that he says: “If we had the model we have now when he opened that now-closed store, we never would have opened it in the first place.”

Backed by trade area research it can trust, REI plans to continue opening new stores at a pace of anywhere from two to 12 per year.

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REI Campaign

Birchwood Resultants

Birchwood Resultants Beats Chain Average with STI: PopStats™

Birchwood Resultants

Birchwood Resultants Beats Chain Average with STI: PopStats™

In 2015, La Madeleine, the popular Country French café bakery chain, decided to make two significant changes to its business operation, including an updated store design, opening new stores, and expanding into new regions. To achieve these goals, La Madeleine called real estate modeling company Birchwood Resultants to conduct its research.

In 2015, La Madeleine, the popular Country French café bakery chain, decided to make two significant changes to its business operation, including an updated store design, opening new stores, and expanding into new regions. To achieve these goals, La Madeleine called real estate modeling company Birchwood Resultants to conduct its research.

To ensure its research produced the ideal results for La Madeleine, Birchwood Resultants called on STI: PopStats and STI: LandScape datasets. The consumer research and real estate modeling company knew it could depend on this data to deliver the demographic accuracy its customers demand.

“La Madeleine is a very successful, long-running bakery-café chain, predominantly in the Southwest region,” stated Bill McClave, co-owner of Birchwood Resultants, along with co-owner Lissy Bethmann. “With a new remodel program, they wanted to move into new regions beyond their stronghold in the southwest to broaden and deepen their appeal to their target customers.”

STI: PopStats™ and STI: LandScape™ Support La Madeleine’s Expansion and Upgrades

To help the restaurant chain determine which stores to remodel first and where to open new stores, Birchwood Resultants created a new set of real estate analytic models. The company also identified the chain’s brand-critical consumers and created a profile that represented the vast majority of its customers.

With the new models and customer profiles in place, Birchwood Resultants conducted its market analytics in three major steps:

  1. Using Landscape, they evaluated all 210 U.S. DMAs for their alignment with La Madeleine’s targeted brand critical consumer profile.
  2. Then they mapped La Madeleine’s highest priority DMAs for the trade areas that have the highest densities of La Madeleine’s ideal brand-critical customers.
  3. The final phase involved modeling new sites identified in the field to build out the targeted trade areas.

So far, the research has pointed La Madeleine to several ideal new locations and remodels for the restaurant chain. For example, it identified an optimal new location in a Houston, Texas market. “Today that store is beating the chain average,” said Mr. McClave.

Data Accuracy is the Key to Market Research Success

Birchwood Resultants speaks highly about the accuracy of PopStats and LandScape data. Particularly because as a real estate modeling company, it has faced the same problems experienced by every other location-focused company — population data estimates have higher variance the further they get from the decennial U.S. Census. As a result, most population counts become less accurate and less dependable every year until the next Census.

Referring to his experience, Bill said, “It’s easy to have accurate population counts the first year after the Census. But thereafter, traditional estimates deteriorate every year.”

Accuracy is the main reason Birchwood Resultants began using PopStats several years ago and continues to depend on it today. “We’ve tested PopStats against other vendors’ population data and it’s extremely accurate,” noted Bill. “PopStats is a very solid database to use in building real estate models.

The company also gains a significant advantage when using lifestyle segmentation in the real estate models it builds. “Understanding a company’s ideal consumer lifestyle is an absolutely critical step in identifying consumer pockets within trade areas,” noted Lissy. “When you look at correlation, everything pales in comparison to consumer lifestyle segmentation.”

Bill concurs. “Alignment with consumer profiles is a must-have. It gives us a much higher correlation to brand performance than demographic data alone because it groups people based on how they live their lives. The ideal scenario in all of our market research projects is to have both PopStats and lifestyle segmentation powering our research models,” concluded Bill.

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