Consumers are set to prioritise eating and drinking out in their spending after lockdown, but remain cautious about longer term financial impacts of the pandemic.
Those are among the headlines in the third of CGA’s new Consumer Countdown to Reopening Series reports, from new consumer research revealing how consumers are likely to allocate their disposable income when hospitality reopens from 12 April.
It shows that pubs, bars and restaurants will be high on people’s agenda, with 29% of GB consumers planning to spend more there over the next 12 months than they usually would. It puts hospitality ahead of international holidays (26%), domestic holidays (25%), clothing (22%) and home improvement (19%) in the list of priorities for spending.
Well over three quarters (78%) of consumers anticipate eating and drinking out the same as or more often over the next year as they did in 2019. The number planning to visit more often (39%) is nearly twice as high as those planning to cut their frequency (22%).
Confidence about safety is rising too. CGA data collected between 26 February and 15 March shows the number of people feeling confident about visiting venues has increased by 12 percentage points since early January.
However, the Consumer Countdown to Reopening research sounds a note of caution about the longer term effect of COVID-19 on the UK’s spending. It shows that three quarters (74%) of the population remain concerned about financial implications, though this is down from a peak of 85% in April 2020. Numbers worried about finances have overtaken concerns around the health of friends and family (73%) and personal health (68%) for the first time since the start of the pandemic.
These concerns do not appear likely to compromise spending just yet though. Just over half (52%) of GB adults do not expect their disposable income to change in the next 12 months, and there are more expecting it to increase (23%) than to decrease (17%). More than half (57%) of consumers now feel optimistic about the next 12 months, compared to just 16% who feel pessimistic. Nevertheless, nearly half (46%) say they will be looking to save money—a reminder that a safety-first approach will still be in play.
It’s good to see that consumers have a big appetite for eating and drinking out again after so long at home, and encouraging that the On Premise is so high up their list of priorities despite a lot of competition for their cash,” says Rachel Weller CGA’s head of consumer research and marketing.
“But while some people will be spending freely, significant numbers are still anxious about their safety, the future of the economy or both. Operators and suppliers will need to balance some very different motivations after lockdown, and make a careful assessment of the role of value in particular.”