Dollar Tree Attracts Higher-Income Shoppers Amid Economic Pressures

NEW YORK, NY – Dollar Tree is experiencing a significant increase in customer traffic, with three million more households shopping at its stores in the three months ending Nov. 1 compared to the same period last year, according to CEO Michael Creedon.

Approximately 60% of these new customers earn over $100,000, while about 30% belong to middle-income households earning between $60,000 and $100,000. The remaining customers earn under $60,000. Creedon noted that this trend indicates a shift in consumer behavior as higher-income households are increasingly shopping at Dollar Tree.

“Today, we serve an increasingly broad spectrum of shoppers, from core value-focused households to middle-income families who are making deliberate choices about how and where they spend,” Creedon stated. He added that the data shows Dollar Tree is not just a store for those in financial trouble.

Creedon explained that affluent customers are choosing Dollar Tree as they seek more budget-friendly options due to rising costs. Meanwhile, lower-income households are relying on the store more than ever as economic pressures lead consumers to cut back on spending.

Average spending among lower-income customers grew more than twice as fast as that of higher-income customers during the same three-month period. Creedon aims to foster loyalty among new, affluent customers, who tend to spend more per trip.

He noted, however, that while higher-income households currently spend less on average per visit—a reflection of their earlier stage in relationship with the brand—their purchase frequency shows potential for growth.

This trend is not unique to Dollar Tree. Other discount retailers like Dollar General and Walmart are also seeing an influx of higher-income shoppers looking for ways to stretch their budgets due to inflation.

On a recent earnings call, Creedon reported that customers making over $100,000 accounted for approximately 75% of Dollar Tree’s market share gains in the latest quarter.