Consumers dine out and boost leisure sector in referendum aftermath
31 October 2016
- Consumers spent more or the same in every leisure category in Q3 compared to Q2, according to Deloitte research;
- Eating out has seen the largest quarterly rise in spending, followed by culture and live sport;
- Short term uncertainty could see Q4 leisure spending falling in many categories.
Spending in the UK leisure sector has remained strong in the third quarter of 2016, and has increased in most categories, according to Deloitte, the business advisory firm.
In research published today, Deloitte found that, during the three months to September, leisure consumers spent more or the same in every leisure category compared to the previous quarter. Spending on eating out, in restaurants, pubs and cafés, saw the biggest quarterly rise in spending, increasing by three percentage points from Q2, and six percentage points since Q1.
Spending on culture and entertainment also increased, by two percentage points, since the second quarter of 2016. Attending live sporting events has seen a similar uplift in spending. Betting and gaming, drinking in pubs and bars, and spending in coffee shops have all seen increases of one percentage point in the last quarter.
With Q3 consumer confidence rising by three percentage points to a five-year high, the gap between leisure and retail spending continues to narrow as consumers keep prioritising spending on experiences, such as holidays and days out, rather than goods and services.
Simon Oaten, partner for hospitality and leisure at Deloitte, comments: “Given the political uncertainly in the immediate aftermath of the EU referendum, it is reassuring to see that the leisure sector has performed well and remained resilient.
“A key reason for the sector’s robustness is due to the growth of habitual leisure spend over the last few years. Leisure, whether in or out of the home, is now part of the daily routine for the vast majority of UK consumers.”
A winter of discontent?
Looking ahead, UK leisure consumers are less optimistic about their spending intentions in the next three months. Going to the gym and culture and entertainment are the only leisure categories that consumers will likely see an uplift in spending in the fourth quarter, while spending on drinks in pubs and bars will likely remain flat.
Consumers reported that they are likely to reduce spending on eating out in the next three months, down seven percentage points from the previous quarter. In keeping with the time of the year, short and long hotel and holiday breaks will also likely see a decline in spending, falling by nine percentage points.
Oaten concludes: “The health of the leisure sector is a good barometer of the UK’s economic prospects: consumers need sufficient disposable income to justify spending on non-essential leisure activities. Favourable economic conditions, including low inflation, unemployment and interest rates, have encouraged consumers to spend on leisure. Leisure spending will therefore react according to how these economic fundamentals change in the coming months.”
Notes to editors
In this press release references to Deloitte are references to Deloitte LLP, which is among the country's leading professional services firms.
Deloitte LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu Limited (“DTTL”), a UK private company limited by guarantee, whose member firms are legally separate and independent entities. Please see www.deloitte.co.uk/about for a detailed description of the legal structure of DTTL and its member firms.
The information contained in this press release is correct at the time of going to press.
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