Leisure venues’ role as a ‘third place’ has been much missed by consumers during their closure due to COVID-19. 64% of those who have taken part in any out-of-home leisure activity since the start of the pandemic say they missed being able to socialise at these venues, while 47% missed having a change of scenery.

Consumers are now deprived of these things once again as new lockdown measures have come into force in early January 2021. With the government warning that the eventual easing of the lockdown is likely to be a gradual one, out-of-home leisure operators such as restaurants, pubs and live entertainment organisers will be heavily restricted and under immense pressure during the first half of 2021.

Even once restrictions are relaxed, the uncertain economic climate and the risk of high unemployment pose further threats to operators as people will show caution when making discretionary purchases.

Although pent-up demand for in-person visceral experiences will drive consumers to live music concerts and festivals, theatres, gyms and restaurants, digital access will also remain in the longer term. The future of leisure will be a hybrid of online and offline experiences that seamlessly bridge the gap between in-person attendance and consumption at home.

• The impact of COVID-19 on the UK leisure market and consumer behaviour.

• Participation in out-of-home leisure activities since venues reopened.

• Most missed features of leisure venues when closed.

• Attitudes towards emerging brand innovations, such as at-home experiences and outdoor concepts.

COVID-19: Market context

The first COVID-19 cases were confirmed in the UK at the end of January, with a small number of cases in February. As the case level rose, the government ordered the closure of non-essential stores on 20 March.

A wider lockdown requiring people to stay at home except for essential shopping, exercise and work ‘if absolutely necessary’ followed on 23 March. It wasn't until 15 June that non-essential stores were allowed to reopen, followed by pubs, restaurants, hotels and hairdressers on 4 July, and many beauty businesses on 13 July.

By September, it had become clear that the UK was at the start of a second wave, and social distancing measures were intensified. Continued increases in infection numbers led to Wales implementing a two-week national lockdown from 19 October, England announcing a full month-long lockdown from 5 November and Scotland introducing a new five-level system of coronavirus restrictions.

Despite these restrictions, however, case numbers continued to increase, and after a brief relaxation for Christmas Day, a full national lockdown was announced on the evening of 4 January. There is no defined end date for the lockdown: the legislation presented to Parliament extends to 31 March, but Boris Johnson has said that he hopes that schools will be able to re-open after February half term.

The UK’s vaccination programme started on 8 December, and with both the Pfizer-BioNTech and the Oxford-AstraZenica vaccines licenced for use in the UK, the government aims to offer a vaccine to 15 million people by mid-February.

Much of this Report was prepared in December 2020, before the announcement of the January lockdown, and when the extent of the vaccine rollout was less clear.

However, the content was reassessed and, where necessary, adjusted on 6 January, in order to ensure that our analysis and our forecast expectations still hold true.

Our core assumptions on the path of the pandemic had always included an expectation of severe disruption to markets and consumers’ lifestyles well into 2021, with a strong likelihood that the virus would still be with us even into 2022. Although the second wave of infections and subsequent lockdown puts us towards the negative end of our initial expectations, these developments are still broadly consistent with our previous assumptions.

Similarly, Mintel had factored in the likelihood that an effective vaccine would be available from early- to-mid 2021. The licensing of the Pfizer-BioNTech and Oxford-AstraZenica vaccines puts us slightly ahead of that assumption, but the challenge associated with rolling out a new vaccination programme to millions of people means that our previous assumptions are still broadly consistent with the new reality.

Economic and other assumptions

Mintel’s economic assumptions are based on the Office for Budget Responsibility’s central scenario included in its November 2020 Fiscal Sustainability Report. The scenario suggests that UK GDP will have fallen by 11.3% in 2020, recovering by 5.5% in 2021 and 6.6% in 2022. GDP isn’t expected to return to pre-COVID levels until Q4 2022. The central scenario has unemployment peaking at 7.5% in Q2 2021.

The current uncertainty means that there is wide variation on the range of forecasts, however, and this is reflected in the OBR’s own scenarios. In its upside scenario, economic activity returns to pre-COVID-19 levels by Q4 2021. Its more negative scenario, by contrast, would mean that GDP doesn’t recover until Q3 2024.

The second wave of infections and subsequent lockdown means that the short-term prospects for the country are consistent with the OBR’s negative scenario, but this needs to be balanced against the fact that the vaccine rollout is ahead of even the OBR’s central scenario. Medium- to long-term, then, we are still basing our forecasts and market analysis on the OBR’s central economic scenario.

This Report covers the UK leisure industry.

Mintel’s market size is based on consumer expenditure within the following sectors:

• Eating/drinking (including dine in and takeaway/home delivery): including restaurants, coffee shops, sandwich shops, roadside catering, hotel catering, pubs/bars, nightclubs

• Health and fitness activities: sports participation, private health and fitness clubs and public leisure centres/swimming pools

• Live entertainment: music concerts and festivals, performing arts and spectator sports

• Gambling: land-based gambling and online gaming and betting

• Other leisure activities: visitor attractions, cinemas and tenpin bowling.

Other leisure markets/activities are discussed throughout this Report such as competitive socialising concepts (eg escape rooms, crazy golf).