Coronavirus: Fitness, home improvement may rebound quickly, data suggests

Placer.ai VP of Marketing Ethan Chernofsky joins Yahoo Finance’s Zack Guzman to discuss how certain sectors could see a surge post-coronavirus.

Video Transcript

ZACK GUZMAN: --look at some of the other industries impacted by all of this too-- you guys also track fitness and home improvement sectors trying to weigh what's going on with those. We've seen a lot of gyms hit hard, as-- some have even faced bankruptcy across the country, when you think about all of their guests not being able to come in and use the gyms-- a lot of them canceling. So what are you seeing on the gym front?

ETHAN CHERNOFSKY: I think this is a really interesting sector to keep an eye on. And there's two indicators that we have that the fitness space as a whole could rebound fairly well. And the first is, when you look at providers Dick's Sporting Goods, or Nike, or Lululemon, or anyone selling sporting equipment or athleisure wear, they tended to be stronger far longer than other apparel or similarly oriented retailers.

And that gives us this indication that people didn't want to stop working out, or being fit, or staying healthy during this period. The other indication is, when we looked at previous crises-- and obviously, nothing is comparable exactly to what we're going through now-- but we can try to glean some consumer behavior patterns. So Hurricane Harvey hitting in Austin-- we actually saw gyms see a second peak in the end of the year, when normally, gym traffic peaks in Q1 and then goes down the rest of the year until we get our New Year's resolution period in late December, early January.

And so that idea that there could be this secondary peak is something that is very interesting for a sector that we've all been couped up. We've all probably been-- after we went to the wholesaler and bought up all the food we want to have stocked at home, maybe we're going to get excited about going to the gym at a time of year when normally, that trend would be faded off.

ZACK GUZMAN: Yeah. Or maybe it could weigh on restaurant visits too. So many of those are desperate for traffic to come back there, but when you look at it, the last thing to discuss here-- home improvement stores-- also one of those things you wouldn't necessarily expect to see a boost in traffic during a global pandemic, because you can put some of these things off. What about that sector here?

ETHAN CHERNOFSKY: We were equally surprised. And I think there were two factors that came into play when we analyzed the space, and the first is March, April, May are the high points for Home Depot, Lowe's, and the rest of the players in the home improvement sector as they look for do-it-yourself projects and more. There is this element, though that we're stuck at home. These are considered essential retailers.

Hey, can we fix up that part of the house that we haven't gotten to? Or can we paint the room that we've promised we're going to do for six months now? And then you add to that this idea, again, of this almost inevitable economic downturn-- do-it-yourself companies tend to do better during those periods anyway, because we do say, hey, let's fix this up, as opposed to buying something new, or let's try to do this ourselves, instead of getting a contractor. So there is not only an orientation towards performing better than the norm now, but they may be well positioned also for the months that are to come.

ZACK GUZMAN: All right, there you go, Ethan Chernofsky saying that maybe, once we get out of this, some of these stores might be able to hang on and then some. But thank you so much for bringing us the data, and I appreciate you breaking it down.

ETHAN CHERNOFSKY: Thanks so much for having me. I really appreciate it.