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Consumer confidence in the UK: Leisure

The Deloitte Consumer Tracker Q3 2019

The Deloitte consumer confidence index fell to -9 per cent in Q3 2019, one point lower than in the previous quarter and two points lower compared to the same period a year ago. Confidence is now at a level last seen in Q4 2018 and below the Deloitte Consumer Tracker’s long-running average.

Leisure spending continues to rise

According to our research, people are continuing to favour experiences over goods. Wage increases and low inflation gave consumers more spare cash to spend on discretionary categories especially those in the leisure sector. Our data shows that spending is up year on year in most of the leisure categories except in the holiday category where spending is slightly lower compared to the same period a year ago. However, with a net spending reading of -1, net spending in the holiday category remains close to positive territory.

Leisure spending in the last three months by category

Our leisure sector analysis also shows that net spending was up year on year in 9 out of 11 leisure categories. While spending on holidays was slightly lower than in Q3 2018, spending on both small and big-ticket experiences rose compared to the same period a year ago. For example, not only spending was up by five points on eating out, a category considered more habitual, but spending also increased by five points in the culture and entertainment category where costs are more substantial, including for example the cost of theatre or concert tickets. Our findings also show strong levels of spending in the betting and gaming category and this despite tightening regulations. While there was growth in online betting and gaming, the betting shops also showed some growth. Indeed, some betting companies revised their profit forecasts in August as their shops performed better despite restrictions based on the fixed odds betting terminals.

Leisure spending in the next three months by category

Spending on leisure will continue to be on consumers’ agenda for the last quarter of 2019. The spending intention data for Q4 2019 is higher compared to the same period last year in almost all categories and especially in the eating out category. However, leisure businesses need to keep a close eye on how the consumer fundamentals perform over the coming months, especially businesses in the habitual, small-ticket leisure categories where spending can rapidly contract if consumers’ circumstances change.

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