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Leisure Industry Overview - UK - December 2009

ISSUES IN THE MARKET
Main issues:
Definition
Abbreviations
FUTURE OPPORTUNITIES
Tuning in to older consumers
The demise of mass marketing?
MARKET IN BRIEF
Value slips in 2009 but still a near-£70 billion industry
Pubs/bars, restaurants and gambling dominate
Cultural leisure outperforms the rest of the market…
… while family leisure struggles as secondary spend takes a hit
GDP and consumer confidence recoveries falter?
The shadow of unemployment still looms
Recession increases emphasis on value
Population trends to benefit youth-oriented leisure most
Legislative burden grows…
… as overheads increase adds to operators’ worries
Private equity – the rise and fall…
… as pre-packs and debt-for-equity swaps become more prevalent
INTERNAL MARKET ENVIRONMENT
Key points
Trends in leisure participation
Figure 1: Trends in leisure activities, 2005-09
Eating out retains appeal
Cinema prospers in recession
Pub/bar drinking on the wane
Theatres and concert-going boosted
Culture on the up
Theme parks continue to expand appeal
Clubbing loses its shine
Leisure centres serving youth and families
TV boosts zoos and wildlife parks
Live sports slide
Tenpin hit by downturn
Young affluent profile for health clubs
Legislation and regulation
Planning
Out-of-town developments slow to a trickle
Town centres greater efficiency…
… but don’t suit everybody
Overhead increases
Staff
Figure 2: Trends in the National Minimum Wage compared to the retail price index, 2004-09
Food and utilities
Figure 3: Trends in food prices compared to all retail prices*, 2004-09
Figure 4: Trends in utility prices* paid by non-domestic consumers, 2004-09
Business development trends
The rise of private equity
Figure 5: Examples of private equity ownership in the leisure industry, December 2009
Sale and leaseback popularity on the wane
The rise of the phoenix or ‘pre-pack’ from the ashes…
… while debt-for-equity swaps give lenders unwelcome exposure to the leisure industry
BROADER MARKET ENVIRONMENT
Key points
The ‘R’ word
Figure 6: Trends in selected areas of discretionary expenditure, at current and constant prices, 1989-94
Figure 7: Trends in quarterly GDP change, 2004-09
Figure 8: GDP, PDI, consumer expenditure and savings, at constant 2004 prices, 2004-14
Consumer confidence dips again after recent increases
Figure 9: Trends in consumer confidence, 2008-09
Unemployment plays on consumers’ minds
Figure 10: UK unemployment rates (seasonally adjusted), 2004-09
Figure 11: UK unemployment rates, by age band (seasonally adjusted), June-August 2009
Figure 12: Agreement with statements about changes in employment situation in past year, July 2009
Recession increases emphasis on value but service quality still paramount
Figure 13: Agreement with statements about impact of recession on leisure behaviour, July 2009
Population trends set to benefit youth-oriented leisure most
Figure 14: Trends in the age structure of the UK population, by gender, 2004-14
Figure 15: Forecast adult population trends, by lifestage, 2004-14
Figure 16: Forecast adult population trends, by socio-economic group, 2004-14
Figure 17: UK household sizes, 2004-14
MARKET SIZE AND SEGMENTATION
Key points
Industry value slips in 2009
Figure 18: Value of the UK leisure* business, 2004-09
Figure 19: Trends in value of UK leisure business, 2004-09
Pubs and restaurants dominate
Figure 20: Value of the UK leisure* business, by segment, 2004-09
Gambling now part of mainstream
Figure 21: Value of the UK leisure* business, by segment, 2009
The winners and losers: long-term
Figure 22: Growth rates for leisure* industry sectors, 2004-09
The winners and losers: short-term
Figure 23: Growth rates for leisure* industry sectors, 2008-09
COMPANIES AND PRODUCTS
Key points
 MAJOR PLAYERS
Luminar Group Holdings plc
Figure 24: Luminar Group Holdings plc – financials, 2005-09
Figure 25: Luminar Group Holdings plc, sales by brands, 2007/08 and 2008/09
Merlin Entertainments Group Ltd
Figure 26: Merlin Entertainments – key financials 2007-08
Figure 27: Merlin Entertainments revenue and visits, by business segment, 2007 and 2008
Odeon Cinemas
Figure 28: Odeon and UCI cinemas group – key financials 2004-08
The Rank Group plc
Figure 29: The Rank Group – key financials 2004-08
Figure 30: Performance of The Rank Group’s businesses in the UK, 2008
Figure 31: Performance of The Rank Group and its businesses in the UK, H1 2009
Tate Gallery
Figure 32: Tate Gallery – key financials 2005-09
Virgin Active
Figure 33: Virgin Active – key financials 2004-08
JD Wetherspoon plc
Figure 34: JD Wetherspoon plc – key financials 2005-09^
Whitbread plc
Figure 35: Whitbread plc – pub restaurant key financials 2005/06-2008/09
Figure 36: Costa Coffee – key financials 2004/05-2008/09
Zoological Society of London
Figure 37: ZSL Group – key financials 2004-08
LEISURE PARTICIPATION
Key points
Figure 38: Frequency of activities at leisure time, July 2009
A nation of Lotto players
Eating and drinking feature heavily in leisure portfolios
Video games: An opportunity for leisure operators?
Cinema very popular but small proportion go regularly
Accessibility the key for public leisure centres
Cultural leisure is an occasional activity
Live sport like Yorkie: Not for girls?
Bingo’s narrow appeal
Age: as an influence on leisure participation
Figure 39: Regular participation in leisure activities, by age, July 2009
Figure 40: Most popular regular leisure activities, by other regular leisure activities, July 2009
Figure 41: Next most popular regular leisure activities, by regular leisure, July 2009
Figure 42: Other regular leisure, by regular leisure activities, July 2009
THE IMPACT OF THE RECESSION ON LEISURE
Key points
Figure 43: Spending intentions towards leisure activities in coming year, July 2009
Pubs/bars
Restaurant or pub
Cinema-going
Public leisure centres
Private health and fitness clubs
Theatre-going
Bingo
Nightclubs
Museums and galleries
Live sports events
Betting shops
Lottery (Lotto)
Video games
Tenpin bowling
Music concerts/festivals
Zoos and wildlife parks
Theme parks
FACTORS INFLUENCING LEISURE CHOICE
Key points
Figure 44: Factors influencing the choice of leisure venues visit regularly or occasionally, July 2009
Choosing a restaurant or pub to eat in
Choosing a pub/bar to drink in
Choosing a cinema
Choosing a public leisure centre
Choosing a health and fitness club
Choosing a theatre
Choosing a bingo club
Choosing a nightclub
Choosing a cultural venue
Choosing a live sporting event
Choosing a betting shop
Choosing the Lottery (Lotto)
Choosing video games
Choosing tenpin bowling
Choosing music concert/festivals
Choosing zoo/wildlife parks
Choosing a theme park
LEISURE HABITS
Key points
Figure 45: Statements on leisure time and visiting leisure venues, July 2009
An eye for a deal…
… but customers still expect good service
Brand values important for a third
Spend, particularly secondary spend, being cut back
Other recession-driven behaviours impacting on leisure
Four in ten unaffected by recession
LEISURE TARGETING OPPORTUNITIES
Key points
Activities people have cut back on already
Figure 46: Spending intentions – number of leisure activities already cut back, July 2009
Figure 47: Spending intentions – number of leisure activities already cut back, by type of activity, July 2009
 TARGET GROUPS
Figure 48: Leisure industry target groups, July 2009
Recession-hit (58% of internet users aged 16+ or 22.9. million adults)
Recession-resistant (38% of internet users aged 16+ or 15.0 million adults)
Disinterested (4% of internet users aged 16+ or 1.6 million adults)
Recession-resistant most likely to eat out
Figure 49: Regular activities undertaken in leisure time, by target groups, July 2009
APPENDIX – LEISURE PARTICIPATION – DETAILED DEMOGRAPHICS
Figure 50: Most popular leisure activities, by demographics, 2009
Figure 51: Other leisure activities, by demographics, 2009
Figure 52: Most popular regularly participated in activities, by demographics, July 2009
Figure 53: Other regularly participated in activities, by demographics, July 2009
Figure 54: Least popular regularly participated in activities, by demographics, July 2009
Figure 55: Most popular occasionally participated in activities by demographics, July 2009
Figure 56: Other occasionally participated in activities, by demographics, July 2009
Figure 57: Least popular occasionally participated in activities, by demographics, July 2009
Figure 58: Least popular activities (not participated in during the last year), by demographics, July 2009
Figure 59: Second least popular activities (not participated in during the last year), by demographics, July 2009
Figure 60: Third least popular activities (not participated in during the last year), by demographics, July 2009
Figure 61: Leisure activities least likely to be participated in, by demographics, July 2009
Figure 62: Leisure activities second least likely to be participated in, by demographics, July 2009
Figure 63: Leisure activities third least likely to be participated in, by demographics, July 2009
APPENDIX – THE IMPACT OF THE RECESSION ON LEISURE – DETAILED DEMOGRAPHICS
Figure 64: Spending intentions towards drinks in pubs/bar in the coming year, by demographic sub-group, July 2009
Figure 65: Spending intentions towards eating out at a restaurant or pub in the coming year, by demographic sub-group, July 2009
Figure 66: Spending intentions towards going to cinema in the coming year, by demographic sub-group, July 2009
Figure 67: Spending intentions towards using a public leisure centre in the coming year, by demographic sub-group, July 2009
Figure 68: Spending intentions towards using a private health and fitness club in the coming year, by demographic sub-group, July 2009
Figure 69: Spending intentions towards going to the theatre in coming year, by demographic sub-group, July 2009
Figure 70: Spending intentions towards going to a bingo hall in the coming year, by demographic sub-group, July 2009
Figure 71: Spending intentions towards going to night club in the coming year, by demographic sub-group, July 2009
Figure 72: Spending intentions towards visiting a cultural venue in the coming year, by demographic sub-group, July 2009
Figure 73: Spending intentions towards attending live sports events in coming year, by demographic sub-group, July 2009
Figure 74: Spending intentions towards going to a betting shop in the coming year, by demographic sub-group, July 2009
Figure 75: Spending intentions towards playing Lotto in the coming year, by demographic sub-group, July 2009
Figure 76: Spending intentions towards playing video games in the coming year, by demographic sub-group, July 2009
Figure 77: Spending intentions towards going to tenpin bowling in the coming year, by demographic sub-group, July 2009
Figure 78: Spending intentions towards going to music concerts/festivals in the coming year, by demographic sub-group, July 2009
Figure 79: Spending intentions towards visiting a zoo/wildlife park in UK in the coming year, by demographic sub-group, July 2009
Figure 80: Spending intentions towards going to a theme park in the coming year, by demographic sub-group, July 2009
APPENDIX – FACTORS INFLUENCING LEISURE CHOICE – DETAILED DEMOGRAPHICS
Figure 81: Factors influencing the choice of eating out at a restaurant or pub, by demographic sub-group, July 2009
Figure 82: Factors influencing the choice of drinking in pubs/bar, by demographic sub-group, July 2009
Figure 83: Factors influencing the choice of going to the cinema, by demographic sub-group, July 2009
Figure 84: Factors influencing the choice of using a public leisure centre, by demographic sub-group, July 2009
Figure 85: Factors influencing the choice of using a private health and fitness club, by demographic sub-group, July 2009
Figure 86: Factors influencing the choice of going to the theatre, by demographic sub-group, July 2009
Figure 87: Factors influencing the choice of going to a bingo hall, by demographic sub-group, July 2009
Figure 88: Factors influencing the choice of going to night club, by demographic sub-group, July 2009
Figure 89: Factors influencing the choice of visiting a cultural venue, by demographic sub-group, July 2009
Figure 90: Factors influencing the choice of attending live sports events, by demographic sub-group, July 2009
Figure 91: Factors influencing the choice of going to a betting shop, by demographic sub-group, July 2009
Figure 92: Factors influencing the choice of playing Lotto, by demographic sub-group, July 2009
Figure 93: Factors influencing the choice of playing video games, by demographic sub-group, July 2009
Figure 94: Factors influencing the choice of going to tenpin bowling, by demographic sub-group, July 2009
Figure 95: Factors influencing the choice of going to music concerts/festivals, by demographic sub-group, July 2009
Figure 96: Factors influencing the choice of visiting a zoo/wildlife park in the UK, by demographic sub-group, July 2009
Figure 97: Factors influencing the choice of going to a theme park, by demographic sub-group, July 2009
APPENDIX – LEISURE HABITS – DETAILED DEMOGRAPHICS
Figure 98: Most popular statements on leisure time and visiting leisure venues, by demographic sub-group, July 2009
Figure 99: Next most popular statements on leisure time and visiting leisure venues, by demographic sub-group, July 2009
Figure 100: Most popular statements on leisure time and visiting leisure venues, by regular leisure activities, July 2009
Figure 101: Next most popular statements on leisure time and visiting leisure venues, by regular leisure activities, July 2009
Figure 102: Other statements on leisure time and visiting leisure venues, by regular leisure activities, July 2009 (continued)
Figure 103: Most popular statements on leisure time and visiting leisure venues, by occasional leisure activities, July 2009 (continued)
Figure 104: Next most popular statements on leisure time and visiting leisure venues, by occasional leisure activities, July 2009 (continued)
Figure 105: Other statements on leisure time and visiting leisure venues, by occasional leisure activities, July 2009 (continued)
Figure 106: Most popular statements on leisure time and visiting leisure venues, by activities at leisure time – not in last year, July 2009 (continued)
Figure 107: Next most popular statements on leisure time and visiting leisure venues, by activities at leisure time – not in last year, July 2009 (continued)
Figure 108: Other statements on leisure time and visiting leisure venues, by activities at leisure time – not in last year, July 2009 (continued)
Figure 109: Number of activities already cut back on, by demographics, July 2009
APPENDIX – LEISURE TARGETING OPPORTUNITIES
Figure 110: Statements on leisure time and visiting leisure venues, by target groups, July 2009
Figure 111: Target groups, by demographic sub-group, July 2009

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