Tourism Trends Sharon Orrell March 2016

£18.1

£45.1

£19.1

Tourism Spend in England 2014 (£bn)

Domestic Overnight Domestic Day Trips Inbound

Source: GBTS 2014, GBDVS 2014, IPS 2014

In 2014, tourists spent just over £82bn in England

The Regional Picture

Leicestershire Spending c.

£750m

The Market Context

-0.5

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

5.5

From inflation to deflation A halt in inflation has helped boost household budgets

Meanwhile wages have grown faster than inflation for first time since 2007

Source: Oxford Economics 2015

0%

2%

4%

6%

8%

10%

12%

1990

19

91

1992

19

93

1994

19

95

1996

19

97

1998

19

99

2000

20

01

2002

20

03

2004

20

05

2006

20

07

2008

20

09

2010

20

11

2012

20

13

2014

20

15

2016

20

17

2018

20

19

2020

20

21

2022

20

23

2024

CPI and Wage growth, % change year on year

Earnings

CPI

1.00

1.15

1.30

1.45

1.60

£/Euro Exchange Rate

Source: Oanda

Exchange rate continues to make European holidays more affordable for UK residents – and the UK less affordable for Eurozone residents

15% 17% 18% 17% 19% 20% 24% 24% 25% 25% 27% 25% 27% 18% 19% 17%

47% 52% 50% 52% 53% 51%

54% 52% 51% 53% 52% 55% 52% 51% 53% 52%

28% 22% 19% 14%

16% 20% 16% 17% 15% 13% 13% 10% 10%

13% 15% 16%

10% 9% 13% 17% 12% 9% 6% 6% 9% 8% 8% 10% 11% 18% 13% 15%

Attitudes to the Recession 2008-2015

It hasn't affected me, and I'm not worrying It hasn't affected me, but I'm concerned

It's affected me a little It's seriously affected me

Feelings about the downturn – the profile of a recession

Source: VisitEngland Staycation Research

51%

38%

10

15

20

25

30

35

40

45

50

55

Easter 2012

June 2012

July 2012

Sept 2012

Nov 2012

Jan 2013

Apr 2013

July 2013

Sept 2013

Nov 2013

Jan 2014

Apr 2014

Jul 2014

Sept 2014

Nov 2014

Jan 2015

June 2015

Sept 2015

Nov 2015

Jan-15

Tourism Business Confidence about Next 2-3 Months % "Very Confident"

Accommodation Attractions

…and businesses are more confident as well

The Headlines

5

10

15

20

25

30

35

40

45

50

55

Apr

-06

Jul-0

6 O

ct-0

6 Ja

n-07

A

pr-0

7 Ju

l-07

Oct

-07

Jan-

08

Apr

-08

Jul-0

8 O

ct-0

8 Ja

n-09

A

pr-0

9 Ju

l-09

Oct

-09

Jan-

10

Apr

-10

Jul-1

0 O

ct-1

0 Ja

n-11

A

pr-1

1 Ju

l-11

Oct

-11

Jan-

12

Apr

-12

Jul-1

2 O

ct-1

2 Ja

n-13

A

pr-1

3 Ju

l-13

Oct

-13

Jan-

14

Apr

-14

Jul-1

4 O

ct-1

4 Ja

n-15

A

pr-1

5 Ju

l-15

Domestic Tourism in England – Rolling 12 Month Trend Trips (m)

2015 has seen differing domestic overnight trends by trip purpose

Source: GBTS

Holiday

VFR

Business

YTD

+5%

+10%

0%

52 52 51 60 55 58 58 57 53 54

45 45 46 39

36 37 36 37 39 42

0 10 20 30 40 50 60 70 80 90

100

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Domestic Holidays Overseas Holidays

Trips (m) Numbers of Domestic / Overseas Holidays Taken by GB Residents

Source: GBTS / International Passenger Survey

(est based on YTD)

How are Brits changing their holiday taking?

0

10

20

30

40

50

60

70

80

1989 1990 1991 1992 1993 1994 1995 1996 1997 1998

Domestic and Overseas Holidays 1989 - 1998

Overseas holidays UK Holiday (Pure Holiday + VFR Holiday)

Food for thought - what happened after the last recession?

Source: UKTS / IPS

Recession

-0.4

5.3

C2DE

C1

AB

2015 (est.) vs 2006 Change in Trip Volumes (m)

Social Grade

The changing domestic holiday in England – 2006 - 2015

-2.6

Source: GBTS

69% 66% 71%

0%

10%

20%

30%

40%

50%

60%

70%

80%

18-34 35-54 55+

‘I like to find bargains, even when I don’t need to save the money’

NB: “discretionary thrift” is a habit that’s likely to stay with us

“This is habit forming, rather than just a blip. For younger

people, a significant proportion of their life has been spent in

this climate - it’s seen as weird to pay over the odds”

Gavin Flynn, Senior VP, IHG

Source: Trajectory / VE Trends Research

Wealth Health

Thoughtless

Spendthrifts

‘In the know’

Flair Care

Earn Discern

…and the recession hasn’t just brought about a change in the amount people spent

-0.4

5.3

C2DE

C1

AB

2015 (est.) vs 2006 Change in Trip Volumes (m)

Social Grade

3.4

0.3

-1.5

55+

35-54

16-34

2015 (est.) vs 2006 Change in Trip Volumes (m)

Age

-2.6

Source: GBTS

The changing domestic holiday in England – 2006 - 2015

Source: ONS Population prospects

65-79s +11.2%

80+ +19.2%

Under 18s +10%

18-34s +1.2%

35-49s -3.4%

50-64s +10.5%

More younger people

More older people (NB – baby boomers are now retiring – a different mindset than previous generations!)

Fewer ‘squeezed middle’

UK population change 2013-2020

The population is becoming older

Source: ONS Population prospects

65-79s +11.2%

80+ +19.2%

Under 18s +10%

18-34s +1.2%

35-49s -3.4%

50-64s +10.5%

More younger people

More older people (NB – baby boomers are now retiring – a different mindset than previous generations!)

Fewer ‘squeezed middle’

UK population change 2013-2020

...though the current baby boom will also have an impact

Source: ONS Population prospects

65-79s +11.2%

80+ +19.2%

Under 18s +10%

18-34s +1.2%

35-49s -3.4%

50-64s +10.5%

More younger people

More older people (NB – baby boomers are now retiring – a different mindset than previous generations!)

Fewer ‘squeezed middle’

UK population change 2013-2020

...piling pressure on the squeezed middle

And remember…families aren’t what they were

-0.4

5.3

C2DE

C1

AB

2015 (est.) vs 2006 Change in Trip Volumes (m)

Social Grade

3.4

0.3

-1.5

55+

35-54

16-34

2015 (est.) vs 2006 Change in Trip Volumes (m)

Age

-0.7

1.2

1.4

Seaside

Countryside

City / Large Town

2015 (est.) vs 2006 Change in Trip Volumes (m)

Destination Type

-2.6

Source: GBTS

The changing domestic holiday in England – 2006 - 2015

3

3.1

3.2

3.3

3.4

3.5

3.6

3.7

3.8

3.9

4

Apr

-06

Jun-

06

Aug

-06

Oct

-06

Dec

-06

Feb-

07

Apr

-07

Jun-

07

Aug

-07

Oct

-07

Dec

-07

Feb-

08

Apr

-08

Jun-

08

Aug

-08

Oct

-08

Dec

-08

Feb-

09

Apr

-09

Jun-

09

Aug

-09

Oct

-09

Dec

-09

Feb-

10

Apr

-10

Jun-

10

Aug

-10

Oct

-10

Dec

-10

Feb-

11

Apr

-11

Jun-

11

Aug

-11

Oct

-11

Dec

-11

Feb-

12

Apr

-12

Jun-

12

Aug

-12

Oct

-12

Dec

-12

Feb-

13

Apr

-13

Jun-

13

Aug

-13

Oct

-13

Dec

-13

Feb-

14

Apr

-14

Jun-

14

Aug

-14

Oct

-14

Dec

-14

Feb-

15

Apr

-15

Jun-

15

Aug

-15

Domestic Holiday Trips in England Average Length (Nights)

Holiday trips are generally getting shorter

“It doesn’t feel right spending too much on holiday just now”

It means we can make most of a long weekend …and means we can have more short holidays rather than longer ones

Source: GBTS

Last minute bookings make it hard for businesses to plan ahead – but offer opportunities to capture spontaneous trip takers

Source: GBTS: All holidays with firm booking

11%

26%

14%

20%

11%

18%

61%

36%

Longer Breaks (4+ nights)

Short Breaks (1-3 nights)

Period between accommodation booking and domestic holiday

7 days or less 2-3 weeks About a month 2 months or more

www.visitengland.com/biz

Domestic Consumer Trends Sharon Orrell March 2016