NAPA — To better understand both resident and visitor impact on the local Napa economy, a group of regional developers commissioned the Buxton Company, a leading customer analytics firm based in Ft. Worth, Texas, to help identify Napa’s major retail and restaurant customers, determine where they come from and the value they deliver to local businesses and the city itself.
The partnering firms, led by the Gasser Foundation, own and develop real estate and want to know that how various demographic categories differ in spending patterns and retail preferences as they plan future projects in three specific locations — the downtown and Oxbow area, the Trancas Street corridor and areas included in the Gasser Foundation Master Plan.
This information can also help the City of Napa’s Economic Development Division understand which areas are prime for new projects, as well as which new and existing retail businesses would be a match for the profiles of dominant psycho-graphic segments of the resident population as well as those from out of town.
There are some 22 significant demographic (and psycho-graphic) segments within the study area. These are groups of residents with different average incomes, discretionary incomes and those in varying age groups.
For example, one of these categories is consumers ages 51–65 known as those with “Full Pockets, Empty Nests” and comprises 54,000 households with average incomes of $87,000 a year and discretionary incomes of $17,500 annually.
“Knowing this information helps planners better identify the types of retail stores and restaurants that are a match for the dominant segments living in the region,” said Joe Fischer, principal, with Fischer Financial Partners and a consultant to the Gasser Foundation.
“But resident groups like this are only half of the story. Visitors account for a major share of those contributing to the economic vitality of the Napa area, and their wants and preferences have to be taken into consideration.”
The third consideration is how well current retailers capture household purchases, and if there are other retailers that would be an even closer demographic fit who could be enticed to locate in Napa.
Once potential retailer profiles are identified among firms not currently within Napa today, engagement letters and information packages can be sent to the showing market demand for what they offer.
This proprietary study is part of a new market development strategy designed to encourage new retail growth, while also placing emphasis on existing business retention.
“Rather than let development evolve on its own, this proactive approach involves an analysis of current local market, its consumers, retailers and out of town visitors to compare and match a prospective retail and restaurant tenant list with the desires of residents and visitors utilizing similar offerings,” said Lisa McCay, vice president of sales with the Buxton Company.
During the study period beginning last May and ending in December, participating developers had access to Buxton’s retail recruitment expertise. It also enabled them to utilize the consultant’s exclusive relationship with VISA to fully understand Napa’s visitors, their spending habits and impact on today’s and tomorrow’s retail economics.
Key factors examined in this study included determining average visitor drive time to/from the trade area, an assessment of retail site offerings, and the development of a retail match list that — taken together — produce a retail area’s unique thumbprint. The City of Napa’s thumbprint was matched to a database of over 5,000 retailers.
The primary Napa trade area was found to be within a 15-minute drive time; with a secondary trade area extending outward within a 25-minute drive time. Results show that more than 50 percent of those shopping in Napa live within a 10-mile radius.
VISA cardholder spending records for the approximately 15 households within Napa Zip Code+4 areas 94558 and 94559 revealed the average spending for these groups and which retailers and restaurants they frequented.
Some 63 percent of VISA charges during a 12-month period were visitor-generated, and 49 percent of these visitors were primarily from San Francisco, Oakland and San Jose Zip Code areas.
The study looked at 11 major store and purchase types, along with 49 minor store types.
Napa has a psycho-graphic purchase composition of eight dominant demographic segments — each segment represents at least three percent of Napa’s population.
The study also identified areas of leakage in each focus area, as well as estimated areas of surplus. Leakage refers to the amount of money being spent outside of the Napa area.
A surplus indicates that more local capacity for sales exists in Napa among some retail categories than current demand can satisfy. More information is still to be obtained regarding surplus categories.
Buxton plans to analyze leakage and surplus data, plus the eight dominant demographic and psychographic codes, to custom tailor retail “pursuit packages” targeting specific retailers.
“Tools such as these help developers and city planners chart a course for a region by taking many more variables into consideration. We’re analyzing the results of this study to see how the development process can accelerate the local economy, capture more revenue, and giving residents and visitors alike access to the types of retailers and restaurants they want to see in Napa,” Mr. Fischer said.
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