Tue 11th Apr 2023 - Cost-of-living crisis is catching up with spending habits on a night out Cost-of-living crisis is catching up with spending habits on a night out: The cost-of-living crisis is catching up with spending habits on a night out, as consumers adopt a more budget conscious mindset when it comes to their social habits, according to new research. The latest Rekom Night Index, the bellwether quarterly report for the late-night leisure industry, found more than three quarters (77.3%) of Brits said the cost-of-living crisis has cut down the number of times they go on a late night out. As part of this, the index found a 38.6% increase in students saying they have a fixed budget for going on a late night out, which they don't exceed. When asked in what ways socialising budgets are being cut, the most popular response among all respondents was to pre-drink at home more (35.1%). This was followed by cutting down on spending in advance of a night out (32%), which has increased by 6% since last the survey in October. The poll also revealed lower consumer confidence levels for the late-night leisure sector, as total night out spend increased once again, this time by 2% to £74.91 (October 2022: £73.36). In February 2023, going out to relieve day to day pressures and stress, and to share the experience on social media were both higher priorities compared with October 2022. When deciding where to go on a late-night out, pricing was the most important factor for respondents (39.4%) compared with three months ago, when the majority of respondents said it was where their friends are going (47.7%). The index also revealed changes in consumers' going out patterns, which it said could indicate a long-term behavioural shift. Nights out are getting longer, with the average night lasting for four hours 51 minutes, having increased from four hours 35 minutes in October 2022 and four hours 17 minutes in March 2022. According to the report, Saturday is the most popular day of the week to go out, with 66.8% going out on this day, followed by Friday (64.2%) and Thursday (17.9%). For students, Friday is the most popular day of the week to go out with 70.6% choosing this option. 2022, proving the effect the cost-of-living crisis is having across all elements of the high street across both the day and night-time economies. Regarding spend breakdown on a night out: pre-drink spend decreased by 0.3% to £13.17 (October 2022: £13.21), food spend increased by 4.6% to £17.12 (October 2022: £16.34), transport spend increased by 1.1% to £13.54 (October 2022: £13.39), entry fee spend increased by 11.8% to £11.49 (October 2022: £10.13), while drinks in venue decreased by 3.6% to £19.59 (October 2022: £20.29). At the same time, daytime spend in preparation of a night out decreased by 0.5% to £16.16 (October 2022: £16.24). The index also showed that men spend more than women on a night out (£76.93 compared with £73.93), 45 to 54-year-olds spend the most, at £79.23, while 18 to 24-year-olds spend the least, at £72.47. The main reasons for going out among respondents are unchanged since October 2022, with the top reasons being: time with friends (58.9%), to celebrate an event/occasion (29.8%), dancing/exercising (26.1%), to enjoy shared experiences (25.4%), and meeting new people (24.7%). Peter Marks, chairman of Rekom UK, said: “It is completely natural – and expected – that people are changing their spending habits as a result of the cost-of-living crisis. Inflationary pressures are currently impacting every sector, so these survey results come as no surprise. However, it's also worth noting that no matter what the economic outlook is, people will always prioritise good value and will make changes in their everyday lives to accommodate that. The hospitality and late-night leisure industry should remember that a good night out is just as relevant as it always has been, and if you can consistently provide a value offer, a good atmosphere, and quality experience, businesses will remain resilient. While the cost-of-living crisis has meant that people are going out less, on the upside, we're seeing that when people are out, they are out for longer, indicating that they want that ‘big night out’ experience. It's also interesting to see that students are migrating to the behaviour of the overall market as they are increasingly likely to choose weekends for their nights out. However, we would suggest that if students are prioritising pricing when deciding where to go out, it's worth considering the cheaper midweek nights on offer. Nevertheless, these behavioural differences prove that businesses need to be adaptable and responsive to changing market conditions. We know that it's more important than ever to invest in good quality propositions that appeal to the right target audience and attract the repeat customer. That's why we're investing in our cluster strategy – creating hubs across towns and cities in the UK where we can own the night out from start to finish. Cardiff is where our first cluster of venues is based, where we have a variety of bars and clubs that cater to our wide array of guests. What's more, we were pleased to see from the survey that Cardiff was revealed as the city where people are going out more than the national average, at around 2.5 times a week, proving that people are drawn to the big night out offering.” Rekom UK features in the Propel Turnover & Profits Blue Book, the latest version of which will be released on Friday (14 April). Its turnover of £97.8m for the year ending 31 December 2022 is the 67th highest in the database. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email jo.charity@propelinfo.com to upgrade your subscription.