News

United in Olympic Fever

London, 2 August 2012 The 27 million who tuned into the opening ceremony in the UK clearly did so with a glass in their hand - spend on drink on Visa cards increased 8.3% from the same week the previous year (up from £30.4m in week 30 2011 to £32.9m week 30 2012).

The UK got well and truly into the Olympic Spirit as the greatly anticipated Opening Ceremony created the perfect reason for a get together with friends and family - sales on Visa cards of food and drink in the UK increased 7.3% year on year (up from £1.22 billion in week 30 2011 to £1.31 billion in week 30 2012) and 4.0% week on week (up from £1.26 billion in week 29 2012 to £1.31 billion in week 30 2012).

The first weekend of events has also inspired a sporting appetite with sales at sporting goods shops on Visa cards up 10.2% week on week (up from £44.2m in week 29 2012 to £48.7m in week 30 2012) and 6.2% year on year (from £45.9m in week 30 2011 to £48.7m in week 30 2012) according to the Visa London 2012 Games Spend Tracker*.

Spending by international visitors in the UK on Visa cards totaled £445.3 million during the week. Retail (up 4.2% year on year) was among the biggest beneficiary, indicating that international visitors were keen to enjoy the shops ahead of the final countdown to the Opening Ceremony on Friday.

Visitors from the USA continue to dominate the international spend league table, spending £54.6 million in the UK last week, which accounts for 12.3% of all international spend. However, spend by Japanese visitors increased 19% week on week, with a total spend of £32.5 million in the UK (compared to £27.3 million last week), placing them second in the international spend table this week.

While China only appears 14th in the international spend table, they continue to spend one of the highest amounts per transaction, with an ATV of £203.04, alongside other high spenders: UAE (£181.24), Hong Kong (£134.89) and Singapore (£134.83).

Headlines for weekly consumer spending on Visa in the UK – (week 30) period 23rd - 29th July 2012:

International Spend

  • £445.3 million spent by international visitors in the UK
  • Retail, Services and Entertainment sectors among the biggest beneficiaries of international spend, accounting for 27.5% (£122.5 million), 19.2% (£85.5 million) and 13.7% (£61.0 million) of total international spend in the UK on Visa cards respectively

  • Spend on Visa cards in the retail sector is up 4.2% year on year among international visitors to the UK
  • Visitors from the USA account for 12.3% of total international spend (£54.6 million)
  • Average transaction value among international visitors is £57.86 but visitors from some countries are greatly exceeding this: China (£203.04), UAE (£181.24) and Hong Kong (£134.89)

Domestic Spend

  • Domestic consumer spending on Visa cards in the UK during the week commencing 23rd July was £7.0 billion
  • Consumer spending is up 2.0% week on week on the same comparable period**
  • Spend on food and drink shows the largest week on week increase of 4.0%, with hotels and restaurants up 1.8%**
  • Average Transaction Value is £40.96
Week 30
(Previous Week in Parentheses)
Total Spend
(£m)
Percentage of Total International Spend at UK Merchants - week 30 Average Transaction Value (ATV) - week 30
1. United States of America (1) £54.6 12.3% £58.29
2. Japan (3) £32.5 7.3% £94.62
3. France (2) £26.5 5.9% £52.27
4. Italy (4) £25.2 5.7% £45.29
5. Australia (5) £22.6 5.1% £52.54
6. Republic of Ireland (7) £20.7 4.6% £65.18
7. Spain (8) £19.9 4.5% £41.44
8. Germany (6) £19.7 4.4% £49.42
9. Canada (9) £15.0 3.5% £64.00
10. Sweden (10) £15.0 3.4% £28.04

Commenting on the findings, Dr. Steve Perry, Commercial Director at Visa Europe said:

“After seven years The Games have finally started and the UK is celebrating with Olympic parties, as evidenced by the Visa spend data which shows a 7.3% increase in sales of food and drink in the UK. Our data also shows that sporting goods shops are showing an increase of 10.2% week on week, 6.2% year on year, so The Games are also creating a sports appetite with UK consumers.

“Visitors here to enjoy the sport are also contributing significantly - with international spend on Visa in the retail sector increasing by 4.2% on the same week last year."

**Individual Spending Intentions during the London 2012 Games

The latest findings on domestic spend from the Visa London 2012 Games Spend Tracker complement separate online research into spending intentions amongst GB adults aged 18-64 during the Games Period.  

Figures compiled by Markit from their Household Finance Index on behalf of Visa show that respondents are expected to enjoy the Games by spending more on Food & Drink, with 15% of those surveyed forecasting a rise compared to just 3% a reduction (giving a net balance of +12.2%). Positive forecasts are found across the nation, although it is those based in Greater London that are most likely to spend more, with a net balance of +24.2% of respondents in the capital anticipating to raise expenditure on Food & Drink during the Games. Those in the capital look set to back The Games with spending in a range of other sectors with predicted rises in spending on Travel & Recreation (net balance +10.7%) and Eating/Drinking Out (net balance +11.3%). Both of these figures are well above of the national average.

Respondents are also anticipating an increase in spending on Travel & Recreation in the UK (balance of +5.2%) and Eating/Drinking Out (balance of +3.1%). However, increases in spend will be at the cost of reductions in others with spending on Household Goods (net balance of -13.7%) and Clothing & Footwear (net balance -7.3%) expected to be scaled back during the Olympics. Respondents expect the overall net impact of the Games on their domestic spending to be broadly neutral.

Categories GB spending intentions (net balance) Greater London spending intentions (net balance)
Food & Drink 12.2% 124.2%
Clothes & Footwear -7.3% -6.5%
Household Goods -13.7 -18.3
Travel & Recreation 5.2% 10.7%
Eating / Drinking Out 3.1% 11.3%

However, particularly eye-catching is the way The Games are set to embraced by young people, with those respondents in the 25-34 age bracket the most upbeat regarding expenditure for Food & Drink (net balance +21.5%), Travel & Recreation (net balance +18.5%) and Eating/Drinking Out (net balance +16.4%).

Dr Steve Perry, Commercial Director at Visa Europe continues: "The spending intentions figures we have seen suggest that day-to-day considerations have been put on hold with consumers looking to make the most of The Games. DIY and the purchases we associate with the Household Goods category are on the back burner in favour of entertaining around the Olympics as evidenced by expected increased to Food and Drink sales. The capital’s restaurants and bars look set to record a couple of excellent weeks of trading with domestic consumers getting behind The Games."

*How the Visa London 2012 Games Spend Tracker is created

The Visa London 2012 Games Spend Tracker tracks both domestic and international spending in the UK during Games Times.

**These domestic  spend figures are based on spending on all Visa debit, credit and prepaid cards which are used to make an average of over 1.9 billion transactions every quarter and account for £1 in £3 of all UK spending. For domestic based indicators – which are based on card issued to UK households – the spending data are adjusted (where applicable) for a variety of factors such as refunds, cash back, card issuance, changing consumer preferences to pay by card, and inflation. These adjustments mean these data are distinct from Visa Europe’s business performance and are done so with the aim to provide a robust indicator of real UK consumer expenditure.

For international data, spending on all Visa debit, credit and prepaid cards from outside the UK is taken into account. The numbers are not adjusted for any of the aforementioned factors. Therefore direct comparisons with indicators of domestic spend should not be made; the international data should be viewed as indicative of trends in international spending patterns in the UK during the London 2012 Games. 

Visa at The Games

Visa has been a global sponsor of the Olympic Games since 1986 and the Paralympic Games since 2002 and celebrated its 25th anniversary as a global sponsor last year. Visa implements and manages the entire payment infrastructure at every Games Time venue. London 2012 will be the first Olympic Games where visitors can choose not to pay with cash but instead to make contactless payments with either their contactless card or a suitable NFC-enabled mobile phone.

**About Individual Spending Intentions during the London 2012 Games

The data related to the Household Spending Intentions during the London 2012 Games is derived from a special question that was asked by Ipsos MORI as part of the regular monthly Markit Household Finance IndexTM (HFITM) survey.

Ipsos MORI interviewed 1500 adults aged 18-64 across Great Britain (of which 204 were resident in Greater London) from its online panel of respondents. Interviews were conducted online between 13th-16th July 2012. A representative sample of adults was interviewed with quota controls set by gender, age and region and the resultant survey data weighted to the known GB profile of this audience by gender, age, region and household income. Ipsos MORI was responsible for the fieldwork and data collection only and not responsible for the analysis, reporting or interpretation of the survey results.

Respondents were asked to answer the following question:

The Olympic Games will take place this summer, from 27th July to 12th August.  For each of the following, please can you indicate whether you personally expect to spend more, less, or about the same as usual during this period?

  1. Food and drink shopping
  2. Clothing and footwear shopping
  3. Household goods (such as TVs and home entertainment systems)
  4. Travel and recreation in the UK
  5. Eating/drinking out at restaurants, bars, pubs etc.

After stripping out those responses that signalled “don’t know” or “not applicable”, net balances were calculated by taking the percentage of respondents that indicated higher spending intentions from those that signalled lower intentions. 

About Visa Europe

In Europe, there are 445 million Visa debit, credit and commercial cards. In the 12 months ending September 2011 those cards were used to make purchases and cash withdrawals to the value of €1.7 trillion. 14% of consumer spending at point of sale in Europe is with a Visa card, and almost 80% of that is on Visa debit cards.

Visa Europe is owned and operated by more than 3,700 European members and was incorporated in July 2004. Visa Europe is independent of global Visa Inc., with an exclusive, irrevocable and perpetual licence in Europe, while both companies operate to ensure global interoperability. As a dedicated European payment system Visa Europe is able to respond quickly to the specific market needs of European banks and their customers - cardholders and retailers - and to meet the European Commission’s objective to create a true internal market for payments.

Visa enjoys unsurpassed acceptance around the world. In addition, Visa/PLUS is one of the world’s largest global ATM networks, offering cash access in local currency in over 200 countries.

For more information, visit http://www.visaeurope.com/