“Austerity fatigue” boosts UK venues

People are starting to increasingly frequent bars, clubs and restaurants in the UK, leaving the on-trade well placed to capitalise on “austerity fatigue”, according to latest figures.

The Zolfo Cooper Leisure Wallet report, the biannual barometer of the leisure industry, revealed that the frequency of visits to leisure establishments has increased despite average spend-per-visit continuing to drop.

The increase in visits is seen across the board – the first time any increase has been seen in the three main areas of leisure spending examined by the Leisure Wallet since launching in summer 2010.

While consumers’ frequency-of-visit is increasing, spend-per-visit continues to decline, in line with falling incomes across the country.

Over the last year the national average household income across a sample of 3,000 consumers fell by £640 to £30,584.

In total, 48% of those surveyed said their disposable income had decreased while just 6% reported an increase.

Despite this, however, visits are on the rise, suggesting a behavioural shift and recognition by consumers that if they spread their leisure spend, they can start going out rather more regularly rather than sit at home.

Paul Hemming, partner at Zolfo Cooper, said: “Consumers are increasingly aware that the economy is experiencing a prolonged trough not a dip, and that wages and growth will not be rising dramatically any time soon.

“The data in the Leisure Wallet shows that people are now starting to adjust to these changed circumstances.

“After at least two years of virtuous belt-tightening, they are fed up of being stuck indoors by an austerity curfew and are now beginning to venture out more often.

“Even though consumers continue to keep close watch on their spending, this is good news for operators with strong propositions because ultimately no leisure business can survive without customers coming through the door.”

Over the last year drinkers have increased their visits to pubs and bars to an average of 4.6 visits a month from 4.3 visits a month in summer 2011 – and visits are up even on the 4.5 visits a month reported in the Leisure Wallet this time last year.

Spend-per-visit continues to decline, however, and has now dropped below £15 for the first time since the Leisure Wallet began measuring consumer spending 18 months ago.

The current national average is now £14.69 per visit, a drop of 2.6% or 39p since the previous Leisure Wallet Report and a decrease of 9.5% (£1.55) from a year ago when the figure was £16.24.

Restaurants have experienced a marginal increase to 2.6 visits a month, up from 2.5 a month for the previous two reports.

Unsurprisingly in a sector that has seen such widespread use of vouchers, spend-per-visit continues to decline and currently stands at £15.90.

This is down 3.2% from last summer’s total of £16.42 and down 8% from a year ago when it stood at £17.28.

The difference between the London market and the rest of the UK is illustrated by the fact that Londoners spend at least £200 more over a year than people in any other region.

Unsurprisingly, Londoners are the biggest spenders per visit on £19.32, compared to the East Midlands on £12.76.

The situation facing nightclubs remains grim, with the average spend-per-visit across the country dropping to £24.04, a full £2 decline (7%) from the summer.

This new low represents a 12.4% decrease from 12 months ago when the figure was £3.39 higher at £27.43.

If there is a glimmer of good news for the sector, it is that frequency of visit, which dropped to 1.9 visits a month a year ago, and remained at that level in the summer, has now crept up slightly to 2.1 visits a month – an increase of 10.5% from a small base.

Hemming added: “It may seem strange to be talking about positives when spending continues to decline but the fact that visits are up across the board suggests consumers have now recognised that they can still afford to go out regularly and enjoy themselves provided they spend a bit less on each night out.

“For operators, this more budgeted approach to leisure still presents opportunities to cross-sell and up-sell, and more people coming through the doors shows that operators’ sales initiatives and marketing plans are starting to work.”