Spending in the hospitality sector decreased month on month in May, according to AIB.
Despite the decrease in hospitality sector spending last month, summer spending is here, according to the AIB Spend Trend for May 2023. Health & beauty and hardware average daily spending both rose by 8%, homeware by 4%, and clothing by 3%, as people make for the outdoors, splash out on sunscreen, and get their wardrobe beach ready.
We’re heading for the beaches, as the coastal counties from Donegal to Louth all saw average daily spending increases, bar Sligo, which remained unchanged when compared to April. From Mayo down to Cork, all counties saw average daily spending increases. Meanwhile, the central country spine of Monaghan, Westmeath, Offaly and Tipperary all saw average daily spending decreases.
Despite the 1% increase in overall average daily spending, there were decreases in spend in the hospitality sector, compared to the previous month, but this could be attributed to May having one less weekend than April this year. Of the ten sectors analysed, grocery continues to account for the highest spend, but it remained flat when compared to April. However, compared to May 2022, it increased by 9%, year on year, among the same group of customers, as the cost of living continued to rise.
Electronics and airline travel both showed increases of 2% in average daily spending.
The data was compiled from approximately 70 million debit and credit card transactions in store and online during May 2023 and has been anonymised and aggregated.
Spend Trend May 2023 (All Data Points Compared To Previous Month, Unless Otherwise Stated)
- An average daily-spend increase in health & beauty (8%), hardware (8%), homeware (4%), clothing (3%), airline travel (2%) and electronics (2%) shows that people are preparing for the summer holidays and enjoying the good weather.
- There are decreases in average daily spend in drinking places (-12%), hotels (-10%) and restaurants (-6%), however, this could be attributed to May having one less weekend than April this year.
- However, the May bank holiday saw spend in restaurants double, compared to the previous Monday (24 April), as well as spend in drinking places tripling and hotels increasing by over a third (37%).
- There is an increase in average daily spend on hardware (8%) and homeware (4%). This suggests that people are getting into gardening and outdoor living as the weather improves.
- In particular, the 55-64 (12%) and 65+ (16%) age groups had the highest increases in hardware average daily spend.
- Men spent 43% more on hardware than did women.
- The biggest increases in homewares start at the 35-44 age group (5%), corresponding to a higher number of homeowners over 35 than under 35.
- Longford (21%) had the biggest increase in hardware average daily spend. Kerry (11%) and Roscommon (16%) had the biggest increases in homeware average daily spend.
- Overall, there was a 3% increase in clothing average daily spend, however, under-25s had an 11% increase, which may be due to younger people buying new summer wardrobes.
- There was an 8% increase in health & beauty average daily spend.
- The coastal counties from Donegal to Louth all saw an increase in average daily spend, except for Sligo, which was unchanged.
- West (to the sunny south-west) is best? From Mayo down to Cork, all counties saw average daily spending increases.
- While coastal counties prospered, the central country spine of Monaghan, Westmeath, Offaly and Tipperary all saw decreases.
Statement By Head Of SME Banking At AIB
Speaking about the data, John Brennan, head of SME Banking at AIB, said, “The data shows us some emerging summer spending habits, as people are spending more on health & beauty, hardware and homeware. May saw a slight increase in spend from April, despite having one weekend less, and while grocery spend was flat, month on month, it increased by 9%, when compared with May 2022, for the same group of customers, which is further evidence of the rise in the cost of living.
“Our comprehensive data spans a great range of society, and it’s interesting to note that older people had the biggest increase in hardware spend, while younger people had the highest increase in clothing spend. We can also see a spread from inland to coastal areas. This information is important for businesses, so they can analyse the data and react to ongoing trends, allowing them to plan for the summer months and ensure they can best support their customers and offer them the services they want.”
© 2023 Hospitality Ireland – your source for the latest industry news. Article by Dave Simpson. Click subscribe to sign up for the Hospitality Ireland print edition.