Tanger CEO Stephen Yalof announced the outlet shopping center operator experienced increased traffic and sales in June and July driven by international and domestic tourism tied to the World Cup. The company, which operates shopping centers in eight of the 11 host cities for the tournament, saw sales rise approximately 5% for the year and athletic brands perform strongly amid World Cup excitement. Yalof attributed the growth to the influx of World Cup tourists seeking authentic American shopping experiences at value prices, combined with rising domestic travel due to elevated oil prices and current geopolitical conditions.
Tanger Reports 5% Sales Increase Driven by World Cup Traffic
Yalof told CNBC on Wednesday that the company saw traffic and sales move together during the World Cup period. "Traffic drives sales. Traffic and sales always move together," Yalof stated. "For the year, we're up about 5% sales-wise, which is pretty substantial." The CEO explained that World Cup tourists sought a "real American experience," including dining at Chick-Fil-A and listening to American music, with many of these options located within or adjacent to Tanger centers. "What we add to the mix is that value shopping experience, particularly in our outlet centers, which give these customers the opportunity to shop American brands like Polo and Michael Kors and Kate Spade and Coach and Nike, and buy that product at the best possible price," Yalof added.
Company Captures Domestic Tourism Growth Amid Rising Travel Costs
Yalof said the company saw increased domestic traffic as more Americans chose to travel within the country due to rising oil prices and the current geopolitical macroenvironment. The CEO noted that Tanger centers include retail, food and beverage, and entertainment, leading customers to come for one experience and stay for others. "That's what's going to keep us and make us top of mind when these people come back or when they go and they tell their friends about the wonderful experience they had when they came and visited," Yalof said. On a call with analysts, Yalof added that strength in the current movie business and box office also helped drive traffic. "People are coming early to enjoy the shopping, staying late and enjoying the dining," Yalof said.
Tanger Announces Strong Second-Quarter Financial Results
Tanger reported strong second-quarter results on Tuesday afternoon, citing strength in "enhanced marketing and traffic-driving initiatives across our portfolio." The company prepared to leverage summer World Cup traffic to build "long-term customer loyalty" for its products and brands, according to Yalof. "We knew when you get these new visitors that come for a huge magnet event like World Cup, you've got one opportunity to introduce them to your brand, and then hopefully they become a great ambassador for the brand if they have a great experience," Yalof told CNBC.
FAQ
What drove Tanger's traffic increase in June and July?
Tanger CEO Stephen Yalof stated the company saw traffic increase in June and July due to international and domestic tourism tied to the World Cup. The company operates shopping centers in eight of the 11 host cities for the tournament.
How much did Tanger's sales increase during the World Cup period?
Yalof told CNBC that for the year, Tanger's sales were up about 5%, which he described as "pretty substantial." He noted that traffic drives sales and the two metrics always move together.
