A Consumer Demand-Side Perspective for the Hospitality Sector in the UK

Main Photo: The weekly report produced by BVA BDRC, available to THPT subscribers

Date: May 2020

Location: UK HQ, with 170 staff in offices in London, Washington DC, Singapore, Beijing, Jakarta, Sydney and Cape Town. With BVA, the combined organisation has close on to 1,000 staff, revenues of over €185m and 20 offices in 11 countries, with a strong global reach.

Who: Dr Crispian Tarrant, Chief Executive, BVA BDRC…..Cris has been engaged with the hospitality sector for more than 30 years providing a consumer perspective on the industry. As well as measuring the nature of demand and the changing dynamics of the customer journey, much of his professional work has been concerned with the development of hotel brands and their influence in the industry.

What Are They Doing: During the coronavirus pandemic BVA BDRC is undertaking a weekly UK tracker of consumer sentiment, with a focus on the travel, leisure and hospitality sectors.

His Thoughts: Ahead of the celebrations for the 75^th Anniversary of VE Day the latest BVA BDRC consumer sentiment survey data, collected 4^th– 5^th May, sees the overall national mood nudge back up to 6.7, equaling the high recorded two weeks previously.

There is a growing divergence between when people think they will travel again on holiday in the UK as compared to going on an international trip.  With the easing of the lockdown set to be slow and gradual, for the next 6 months at least increasingly we anticipate an emerging theme will be to stay local and support local businesses.

• For the first time in 7 weeks of tracking, more people think the worst is now behind us than think the worst remains ahead of us. The plurality (43%) believe that things are going to stay the same over the next few weeks.
• Confidence in the government’s handling of the crisis strengthens slightly for the second consecutive week, with the 2:1 ratio of those confident to those not confident being maintained.

  On financial mindsets we record the most positive results so far, with 43% indicating either that they are either one of the lucky ones or at least alright – reasonably confident that the crisis will not affect their finances. The demographic make-up of this group is varied, but older people with no children at home are amongst those most likely to fall into these more fortunate categories.

• Despite the clear recovery in national mood and confidence, our expectations of when life will return to normal continue to move backwards. Fewer than 3 in 5 (59%) now believe that life will have returned to something close to normal by the end of 2020, down from 86% a month ago.
• For domestic tourism (including UK holidays) and visitor attractions, it appears very much a holding pattern as we await updates from the government on what a lifting of lockdown may look like, with little change in anticipated lead-time to the next booking. Significant differences continue to exist between different categories of attraction, with country parks and scenic areas seen as more viable destinations for a day out within the next 3 months. At the other end of the spectrum, people typically do not expect to be visiting theme parks for over 6 months from now.

  There is slightly better news for hotels, with lead-times shortening. For context though it is only 16% who expect to book a hotel room in the next 3 months, but this is as high at it has been in over a month.

  For international leisure, the picture remains gloomy, with anticipated lead-times to planning / booking overseas holidays if anything moving backwards.

  Meanwhile, the way consumers spend their downtime continues to evolve: an actual majority of the population (61%) now play video games – at least to some extent. More than 1 in 10 of us have started playing video games since the beginning of the crisis. A majority of those who now consider themselves to be ‘gamers’ say that their habit is helping them to ‘stay sane’ during the lockdown period!

• The free to download Wave 7 report is set for publication on Monday 11^th May https://www.bva-bdrc.com/products/tracking-consumer-sentiment-on-the-impact-of-covid-19/
• In addition to the core UK consumer sentiment report BVA BDRC now also has a comparable consumer sentiment report for the US market and within the UK it has published more detailed sector reports for the visitor attraction, travel and hotel markets (using data from waves 1-6 of the series).

THPT Comment: Cris is well respected spectator on the ins and outs of the UK hotel industry. He founded BDRC in 1991 as a market research and advisory group and invited the French BVA group to come in as majority shareholder in 2018.

Download the Report: from BVA BDRC direct, free of charge

The Hotel Property Team (THPT) are a small group of highly experienced business professionals. Between us, we provide a range of skills and experience which is directly relevant to those involved in the hotel property market.

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