TOURISM INTELLIGENCE UPDATE NUMBER 5 – MARCH 2016

This is the fifth intelligence summary produced for Shakespeare’s England. On an ad-hoc basis we will provide the most up to date data from a number of different sources. This provides feedback to you on the state of the industry for different markets, from which you can see how well your business is performing.

If you are able to share any intelligence with us, it will help in building a picture of how well the area is doing.

For further information about this summary, please contact Simon Purfield, Consultation & Insight Manager at Stratford District Council on 01789 260118 or email him at simon.purfield@stratford-dc.gov.uk

This update contains:- 2016 Forecast and Latest Trends Dashboard- Overseas Visitors / Overseas Travel by UK Residents- Domestic Tourism- Day Visits Market- Accommodation Occupancy Rates- Tourism Economic Impact Assessment

2016 FORECAST & LATEST TRENDS DASHBOARD

The VisitBritain forecast for the volume and value of inbound tourism is issued in December each year.Our forecast for visits for the full year 2015 is 35.4m visits, an increase of 2.8% on 2014. Our forecast for spending by visitors in 2015 is £22.0bn, a 0.7% increase on 2014.Our forecast for 2016 is for 36.7 million visits, an increase of 3.8% on 2015; and £22.9bn in visitor spending, an increase of 4.2% on 2015.A number of economic assumptions underpin these forecasts. The Eurozone economy is expected to continue to grow at a moderate pace in 2016, perhaps fractionally stronger overall than in 2015. The US economy is expected to grow at a similar rate as it did in 2015.The wider global economic outlook remains uncertain. In 2015, the Chinese economy slowed, the Eurozone saw a period of deflation, the oil price continued to fall and some major emerging markets experienced recession. In 2016, a number of emerging markets are expected to continue to see weak growth although China and India are assumed to be among the world’s fastest-growing economies.Exchange rates have been volatile in recent years. These not only colour value perceptions of destinations but affect visitors’ budgets. In 2015, the pound rose in value against many major currencies, one reason we expect spending to have grown at a slower rate than visit numbers. For the 2016 forecast, the Euro is assumed to be broadly stable against the Pound in 2016 while the US dollar is expected to appreciate slightly.Interest rate policy decisions affect exchange rates as well as the broader macroeconomic picture. We expect the Bank of England to raise its base rate during the second half of 2016.The global price of oil fell in late 2015. This is an important indicator as it not only affects the cost of transportation but real disposable incomes for consumers around the world. At the time the forecast was produced the oil price was above $45/barrel; if the oil price remains much below $40 throughout 2016 then this would boost disposable incomes for visitors from many, though not all, markets.2016 will not see a major international sporting event held in Britain (aside from those held annually), unlike in many recent years. However, it will be a big year for the arts with a number of Britain’s musical and literary legends celebrating significant anniversaries and milestones in 2016, including the 400th anniversary of Shakespeare's death and the 100th anniversary of Roald Dahl’s birth. Adding to a year of art and culture, 2016 will also see the opening of new galleries, performances and productions: the National Museums of Scotland will open ten new galleries; the new Tate Modern will open in June; the highly anticipated play ‘Harry Potter and the Cursed Child’ debuts in July.It is assumed that there will be no unforeseen major events that significantly disrupt travel to Britain, e.g. related to geopolitics, health scares or natural disasters. Events in late 2015 underline that geopolitical / security developments remain a risk.There are both upside and downside risks for 2016. Recent currency volatility and the uncertainties in forecasting the value of Sterling against major currencies, as well as volatility in the inflation rate in recent years, means that the forecast range for spending is greater than that for visits.

OVERSEAS VISITORS

Headline Results for the UK

Visits:

The UK recorded 2.52 million inbound visits in December 2015, 4% more than in the final month of 2014. Although these results are still provisional, early indications are that 2015 was another record breaking UK visits year – which follows the strong results of 2014. During the twelve months of 2015, UK visit levels were 4% higher than in 2014 at 35.8 million. Indeed, this is the sixth consecutive year the UK has welcomed a year on year increase in visit numbers and in 2015 there were 6 million more visits than there were just five years ago in 2010.

Spending:

Overseas visitors spent £1.74 billion while in the UK during December 2015, 1% more than in December 2014 and a new December spending record. This strong December result completes the picture for 2015 and therefore inbound visitor spending during 2015 was £21.8 billion, in line with the record breaking results of 2014. It should be kept in mind that this data is provisional with the Office for National Statistics due to release final full year data later this year. With the IPS reporting provisional visits and spending to the UK for 2015 it is clear that the average spend per visit has fallen, compared to 2014. The average spend per visit during 2015 was £609, 4% lower than in 2014. Inbound spending growth has been affected by the exchange rate, with the pound strong against many major currencies, and also by the low rate of inflation seen in 2015.

Results by journey purpose for the UK

Holiday visits posted an 8% increase in December 2015, compared to December 2014 and a new December record of 0.78 million visits. Over the medium term any monthly fluctuations compare to 2014 were smoothed out so holiday visits to the UK in the last three months of 2015 were 2.75 million – 2% up on the same period last year. During 2015, the UK welcomed a record 13.69 million holiday visits, 1% more than the previous record set in 2014.

Visits to friends and relatives (VFR) increased 5% in December 2015 compared to December 2014, with 0.83 million visits. VFR visits finished 2015 7% above 2014 levels at a record 10.45 million. In addition, 2015 was the first year where there were two months when VFR visits topped 1 million – July and August.

During December 2015, business visits were down 3% compared to December 2014. Although business visits in the last three months of 2015 were down marginally compared to the same period of 2015, the year ended with business visits 6% above 2014 levels (8.74 million). With strong month on month results throughout the year, business visits have shown signs of recovery during 2015, finishing just 1% below recent record levels set in the mid 2000’s.

Miscellaneous journey purpose visits are a combination of a wide range of different journey purposes, including (but not limited to) short term study, looking for work, shopping, attending a sports event and many more. Compared to December last year visits to the UK for miscellaneous purposes were 11% up on December last year at 0.29 million visits and in the three months to December 2015 were .87 million (25% more than the same period of 2014). Visit numbers in this category tend to fluctuate each month compared to the same month last year – during 2015 the month on month changes ranged from -19% to +74%, but even so, miscellaneous visits finished the year 5% up on 2014 results.

Results by world region for the UK

Visits from EU15 markets were up 5% in the last month of 2015 compared to December 2014 at 1.45 million. Following strong results in October, visits from these high volume UK markets

reached 4.89 million in the three months to December 2015 – a record three months to December. During 2015, there were 19.89 million visits to the UK, a calendar year record and the best every rolling twelve month period.

Visits from Other EU markets fell 7% in December 2015, compared to a strong December 2014. Despite posting declines in both November and December 2015, visits to the UK from Other EU markets have recorded strong year on year growth in the same year. There were a record 4.12 million visits to the UK from these markets during the 2015 calendar year - 15% more than in 2014.

Visits from Rest of Europe reported the biggest decrease this month compared to December 2014 – down 8% on results from the last month of 2014. Noticeably visits to the UK from the Rest of Europe are also down in the last three months (9%) and rolling 12 month period (8%) and therefore the only global region to finish 2015, behind 2014 results. The UK saw visit numbers from several individual markets in this region decline in the first nine months of 2015, compared to the first nine months of 2014, including Russia, Norway and Switzerland.

Visits to the UK from North America were up 12% in December 2015 at 0.22 million visits. Combined visits from Canada and the USA were 8% higher in the twelve months to December 2015 compared to the previous year. While positive territory, these results still fall short of the record highs recorded in the first year of this millennium.

Rest of World visits were up 11% in December 2015, compared to the same month in 2014. With particularly strong month on month results for the majority of 2015, visits in the twelve months of 2015 were 6% higher than the levels seen in the same period of 2014. Indeed, visits to the UK from the combined Rest of World regions finished 2015 at a record 5.62 million.

In the rolling year to December 2014 the provisional number of visits from high volume EU15 markets such as Germany and Netherlands were 7% up compared to the year before at 19.8 million visits.  At 3.7 million visits from North America are up 4% on a year ago, while the number of visits from regions of the world outside Europe and North America remain strong at 5.3 million. 

Definitions

EU15 - Austria, Belgium, Denmark, France, Finland, Germany, Greece, Irish Republic, Italy, Luxembourg, Netherlands, Portugal, Spain and Sweden.

Other EU - Bulgaria, Cyprus (South), Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia and Slovenia. Note that Croatia has been included in the ‘Other EU’ category since it joined in July 2013, before July 2013 this group was labelled as A12.

Rest of Europe – European countries outside the EU (including Russia, Norway and Switzerland). Before July 2013 Croatia was also included here, but from July 2013 appears in Other EU.

North America - Canada (including Greenland and St Pierre et Miquelon), USA (including Puerto Rico and US Virgin Islands).

Rest of World – Countries outside Europe and North America (Africa, Asia, Central America, Middle East, Oceania, South America)

VFR - Visiting Friends and Relatives

Miscellaneous visits - includes those for short term study, to attend sports events, for personal shopping, health or religious purposes, accompanying others and many more.

Overseas Travel by UK Residents (National Trends)

UK residents took 13.41 million visits abroad in the last three months of 2015 – 10% more than the same time last year. UK residents spent £7.56 billion between October and December 2015, (in nominal terms) up 9% on the same period in 2014.

Between October and December 2015, UK residents took more visits abroad across all major journey purposes monitored. While holiday visits grew 9%, business visits were up 14% on the same period last year while visits to friends or relatives grew 9%. Miscellaneous visits increased by a larger proportion, up 26%.

Visits by UK residents to Europe rose 13% during the three months to December 2015 compared to the same time in 2014, with visits to EU15 countries growing by 13% and to Other EU destinations by 6%. North America visits rose by 2% while visits to Rest of World remained in line with 2014 results.

DOMESTIC TOURISM

GB TOURISM

Headline Results for England - July to September 2015

Comparing July to September 2015 with the same period in 2014, there was a 6.19% increase in trips from 29,063 million to 30,861 million in England. Bed nights were up 4.02% in the same period and expenditure up 4.45%.

Average length of stay (July to September 2015) fell by 2.04% from 3.42 to 3.35 nights; with spend per night at £64 the same as before. Spend per trip fell from £219 to £215

Comparing the twelve month period, 2013-14 and 2014-15, trips in England rose almost 5%, bed nights by almost 6% and expenditure by over 7%.

Length of stay was 2.93 up from 2.90, average spend per night was at £66, up a £1 and average spend per trip stood at £193 up 2.2% on 2013 to 2014

DAY VISITS MARKET

TOURISM DAY VISITS SUMMARY – December 2015

The volume of day visits in Great Britain in the three months to December 2015 fell by -6% when compared with the same period last year, falling to 366.1 million.

The value of those visits also decreased, by -4% during the same period at £13.3 billion.

Year to date, volume fell by -4% to 1.5 billion, while the value of visits remained flat at £53.9 billion.

Looking at England, the volume of day visits declined by -7% in the three months to December 2015 at 315 million visits, and value fell by -3% to £11.4 billion, compared to the same period in 2014.

For the year to date the volume of day visits in England has declined relative to the same period in 2014 by –4%, to 1.3 billion, while the value rose by +3% to £46.4 billion.

3+ Hour Day Visits Summary

The volume of 3+ hour day visits in Great Britain decreased by -3% for the three months to December 2015 at 627 million visits versus the same period in 2014.

The value of these visits remained flat for the three months to December 2015 against the same period last year at £19.0 billion.

In the period January to December volume was down by -3% to 2.5 billion 3+ hour visits, while the value increased by +1% at £73.4 billion.

In England, volume fell by -4% in the three months to December 2015 compared to 2014, falling to 534 million. The value of these visits remained flat at £16.1 billion.

Year to date volume in England declined by -3% at 2.1 billion 3+ hour visits, while the value rose by +3% to £62.3 billion.

ACCOMMODATION

SUMMARY FOR THE 2014 TOURISM ECONOMIC IMPACT ASSESSMENT

SHAKESPEARE’S ENGLANDThe key results of the Shakespeare’s England Economic Impact Assessment for 2014 are:

9.94 million trips were undertaken in Shakespeare’s England – 9.06 million day trips, and approximately 0.88 million overnight visits.

The overnight trips account for a total of 2.475 million nights in the area.

During their visit to Shakespeare’s England, tourists spent approximately £508 million. On average, about £42.33 million is spent in the local economy each month.

The 9.94 million trips that occur in Shakespeare’s England account for a total value of tourism to local business turnover of £635 million, and supporting in the region of 11,150 jobs, both for local residents and from those living nearby. Approximately 8,732 direct tourism related jobs are supported with an additional 2,418 non-tourism jobs dependent upon multiplier spend from tourism.

The information for the Tourism Intelligence Quarterly comes from various sources.