For nearly a year, community leaders from around Grand Forks have been on a hunt for better consumer data — part of a bigger plan to chart out the best path forward for the local economy.
Now that the data is finally here, though, local leaders are set to use it in ways they never anticipated. The new information — purchased from the Texas-based firm Buxton — offers critical insights into the slow-motion damage the global coronavirus pandemic is inflicting on North Dakota. Leaders now see a way to start predicting tax revenue shortfalls and measuring how effectively they’re managing economic recoveries.
That data offers a close look at foot traffic to local businesses, and collected by tracking anonymous cellphone data to show how that traffic changes over time. In the case of the coronavirus, comparing 2020 foot traffic around Grand Forks bears a sharp contrast to what local residents were doing last year.
“It all depends on what type of business you’re in,” said Barry Wilfahrt, who leads East Grand Forks/Grand Forks Chamber of Commerce. He points out that businesses directly affected by government closure orders — like bars, restaurants, hair salons and the like — have taken a nosedive in traffic. By contrast, though, Wilfahrt points out that traffic to local restaurants spiked on Feb. 22, the day of the Kiss concert at the Alerus Center — an argument in favor of those large community events, he said.
But there are other, surprising results to glean from the data, too, that often shed light on the complex economies of local communities and intricate consumer behaviors. For example, information shared with the Herald shows that traffic to stores that sell building materials and home improvement supplies is up — perhaps an indication, UND economist Dave Flynn said, that people simply have more time to focus on those projects.
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“You’re facing the crack in the wall, you’re facing the same paint,” Flynn said. “You’re facing whatever it is that you weren’t able to get to that you were before.”
But there are other interesting insights, too, like increased foot traffic to grocery stores in Fargo and Minot and Dickinson compared to last year — while Bismarck and Grand Forks attendance is down. An increase in traffic might come for obvious reasons, like stocking up amid the pandemic. But lower foot traffic could mean the same thing, Flynn said: people in those places might be making fewer trips as they buy more.
“I think the data highlights one thing and one thing only, and that is this foot traffic measure, and where you’re seeing the foot traffic and where you’re not seeing the foot traffic,” Flynn added. “Here’s the added issue though: it doesn’t really get at a spending measure.”
The data is the result of a long-running pursuit of traffic data by five local groups: the local chamber, the cities of Grand Forks and East Grand Forks (the latter through its Economic Development Authority), the local Convention and Visitors Bureau, and the regional Economic Development Corporation. The total cost on the project is $90,000 — $50,000 to purchase the data and $40,000 in costs to analyze it.
The data was not expected to be current, and had been described as “historical” prior to this month — giving local leaders insight into recent, but not present-moment, consumer traffic in the community. Wilfahrt said Buxton’s business has evolved in the meantime, though, and that local leaders gained access to current, up-to-the-moment data — in addition to their original purchase — because the North Dakota Department of Commerce is also a client of Buxton and is working with similar data through the same analyst: Mark Schill, a Grand Forks consultant with Praxis Strategy Group.
Asked about privacy concerns, both Wilfahrt and Schill defended the use of the data, arguing that it only comes anonymously from users’ cellphones who have opted into data collection (Buxton’s website does not go into detail on its data collection methods, but does offer an email portal for persons who do not want their personal data sold).
“They're tracking locations of devices, but it's not tracked to a particular person,” Schill said. "In terms of our use — our view is, we want to use the best data out there that helps our local businesses."
The result of the pandemic’s economic impact is hard to foresee, but the degree of damage done to local sectors will hinge almost entirely on the nature of the businesses. Flynn points out, for example, that car dealerships could see sales made up later.
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Bars, on the other hand, almost certainly will not.
“That’s the kind of thing we have to have a very, very serious concern about,” he said. “While I could certainly think that certain segments of the population will be likely to go out a little more often once these distancing restrictions are relaxed, I also think there are some who will not go out right away ... once things are ‘safe’ by whatever their arbitrary standards are.”
And even though it’s a simple takeaway, Schill points out that foot traffic is the lifeblood of local business — oftentimes synonymous with revenue.
“A lot of these local, regional operators that depend on foot traffic for their businesses depend on foot traffic significantly,” he said. “And it's very tough to do so when your business is put under immediate stress out of nowhere.”
