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Receive a presentation on an analysis of trade area data collection methods and their role in supporting a data-driven economic development strategy in Farmers Branch.
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REQUESTOR:
Mayor Pro Tem Tina Bennett-Burton
BACKGROUND:
At the request of Mayor Pro Tem Bennett-Burton, staff conducted research on trade area data collection methods to assist with economic development efforts related to business acquisition and retention procedures. Trade area data helps the City understand customer demographics, shopping patterns, and market trends.
There are three primary methods for defining and analyzing retail trade areas: the customer-origin (Walmart) method, the Census-based method, and cell phone mobility data.
1. Transaction - Based/Customer-Origin (Walmart) Method: This method uses actual transaction data - such as ZIP codes collected at the point of purchase - to map shoppers’ home locations. Major retailers (e.g., Walmart and grocery anchors) often use this method internally to evaluate store performance.
Strengths:
• Highly accurate representation of real customer behavior
• Reflects actual spending patterns
• Useful for evaluating the performance of existing businesses
Limitations:
• Only available for existing businesses
• Does not provide competitor visitation data
• Require retailer cooperation
2. Demographic Radius/Census-Based Method: This method relies on publicly available demographic data (population, household income, age distribution, daytime population, etc.) within a defined geographic radius.
Strengths:
• Cost-effective
• Useful for early-stage site evaluation
• Appropriate for recruitment marketing materials
• Supports retail leakage analysis
Limitations:
• Assumes consumers shop near home
• Does noHowt measure actual visitation behavior
• May overstate or understate true trade capture
3. Location Analytics/Cell Phone Mobility Method: This method uses aggregated and anonymized mobile device data to track visitation patterns to specific locations.
Strengths:
• Captures real-world traffic and cross-shopping behavior
• Identifies competitor visitation patterns
• Useful for validating new site feasibility
• Measures frequency and dwell time
Limitations:
• More costly
• Does not directly measure spending
• Requires careful interpretation
The most defensible and comprehensive trade area analyses incorporate multiple data sources rather than relying on a single method. Mobility data, transaction data, and demographic analytics each provide distinct insights. When layered together, they reduce risk and improve the City’s ability to support both recruitment and retention efforts.
The appropriate mix depends on:
• Whether the business is existing or prospective
• The industry sector (retail, restaurant, medical, office, etc.)
• Whether the goal is recruitment, retention, incentive evaluation, or redevelopment planning
DISCUSSION:
Trade area analytics can be directly applied to Farmers Branch’s economic development strategy in several meaningful ways.
First, in business recruitment, demographic and mobility data can be used to identify retail gaps and demonstrate unmet demand within the City. Leakage analysis can quantify spending that residents are directing to surrounding communities, providing a strong data-backed narrative when engaging prospective retailers or developers. Mobility data can further validate that Farmers Branch attracts regional visitors, not solely resident-based spending, strengthening the City’s recruitment position relative to neighboring jurisdictions.
Second, in business retention and expansion (BRE) efforts, transaction and visitation trends can help staff identify performance shifts before they result in closures or vacancies. Data-driven discussions with existing businesses allow the City to proactively address concerns, support expansion opportunities, and better understand trade draw challenges. This strengthens the long-term stability of the commercial tax base.
Third, trade area analysis supports incentive evaluation and fiscal responsibility. When reviewing potential economic development agreements, data can help validate projected customer draw, assess cannibalization risk, and support return-on-investment modeling. Incorporating objective analytics enhances the transparency and defensibility of Council decisions.
Fourth, trade area data can inform corridor redevelopment and capital investment planning. Understanding cross-shopping patterns and traffic flow between commercial nodes (such as Josey Lane, Valley View, Mercer District, and other retail centers) can guide infrastructure improvements, placemaking investments, and redevelopment prioritization. This alignment ensures that the economic development strategy complements the City’s broader strategic planning and budget preparation efforts.
As the City transitions from strategic planning into the upcoming budget cycle, integrating trade area analytics into the Economic Development work program can provide measurable performance benchmarks, targeted recruitment strategies, and data-supported policy decisions.
The City of Carrollton uses demographic and mobility analytics to guide redevelopment of aging commercial corridors, evaluate the impacts of transit-oriented development, measure trade-area overlap, and prioritize infrastructure reinvestment. By quantifying trade draw and corridor performance trends, Carrollton strengthened redevelopment strategies and supports data-driven investment decisions. For Farmers Branch, similar tools could enhance evaluation of DART-adjacent development opportunities, monitor shifts in corridor performance, and support redevelopment initiatives with objective, market-based evidence. Integrating these analytics into the Economic Development work program would establish measurable benchmarks, strengthen recruitment strategy, and support informed policy decisions as the City advances from strategic planning into the upcoming budget cycle.
Staff will present the strengths and limitations of each data collection method and discuss potential implementation options, including cost considerations and recommended integration strategies tailored to Farmers Branch’s economic development objectives. Staff will be available to answer any questions and receive direction from Council.
DISTRICT:
Citywide
FISCAL IMPACT:
Not anticipated at this time. If the City Council decides to move forward with this approach, the costs associated with implementing this item will be budgeted and submitted for review and approval in accordance with the City’s policies.
ATTACHMENT(S):
1. Presentation