Predictions for the UK leisure industry in 2020
What about Brexit?
Brexit has caused difficulties and challenges for the Leisure industry in 2019 and will continue to do so in 2020. It’s set to be another challenging year, particularly for the spa and beauty sector where growth is highly likely to be held back somewhat by the lack of qualified staff available due to the changing working laws in the UK. Although the Government response is to push more employers, including those leisure providers in the UK, to invest in bringing on and nurturing home-grown talent, it’s probably an unavoidable fact that there will be staff shortages in the leisure industry this year. The rise in apprenticeship provision has helped but demand will likely outstrip supply for the foreseeable.
Any downturn in the economy brought about by a hard Brexit will hit consumers and spending will likely fall on items which are considered to be a luxury, so start working on positioning your offering as one of life’s essentials if you want to survive the turmoil that leaving the EU is likely to generate.
This year will bring a couple of major sporting events which are sure to get more people involved, particularly in the more obscure sports – yes, it’s the Olympic Games time again! This year it’s Tokyo’s turn to play host and it’s happening from late July. It’s also Euro 2020 time in international football. To mark 60 years of the tournament, rather than one country hosting all the games, 12 cities across Europe are sharing the games out, but the final will be right here in London on the 12th July.
Pile on top the usual tennis fever that hits around near Wimbledon time and the regular golf, cycling, and running events and it’s sure to be a busy one for those of us working in leisure, health & fitness especially.
But what do we think will be the big leisure trends in 2020?
Further blurring of the lines between wellness, fitness, and self-care
For more people, it’s no longer about going to the gym to do some bodybuilding or going to a spa for a quick facial. It’s now about a more holistic wellness experience; visiting a spa or a gym is for working on all aspects of wellness, including physical and mental health, and seeing exercise and therapies as a way of improving both mind and body. Wellness retreats are increasing in number as more people are wanting to spend longer on developing their overall health and wellness rather than just hitting the gym for a quick hour after work.
Veganism has taken off hugely over the last couple of years and 2020 will see further growth. With a concern both for the planet’s resources and the positive impact of clean eating on the human body, more and more people are turning to animal-free diets. If your leisure facility isn’t catering to vegans, then you could be missing out on a huge chunk of the market.
The conscious consumer
Industry and media momentum has seen customer appetites evolving in recent years driven by concerns for the environment, animal welfare and health. This has forced operators to re-evaluate menus and innovate with previously unloved ingredients such as jack fruit and banana blossom, catering to a perceived rise in vegan and flexitarian consumers.
The shift towards a more conscious consumer will continue to grow and operators will need to evolve their offerings to stay ahead of the competition in 2020 without alienating the quiet majority for whom other factors (cost, familiarity of offering) are just as important. Whilst Greggs developed a customer and media frenzy with their vegan sausage roll earlier this year, they kept their meat options on sale too – innovation is key but not at the expense of your core market.
2020 will see further developments into this arena, no doubt, with spending on wearable tech as a whole predicted to rise throughout 2020.
As wearable tech gets smaller and more integrated (gone are the days of walkie-talkie sized pedometers!) the more uses will be found for them in the fitness industry especially. You can already link an app or a FitBit to your home virtual assistant, and with the popularity of home VAs expected to explode this year, the use of fitness apps won’t be limited to only the serious health fanatics among us. Expect your children and your own nan to get excited about how many steps they’ve done today!
In-home technology will continue to grow in 2020 – did you know you can even box from In-home technology will continue to grow in 2020. With more and more technologies available, your gym better provide something that tempts people out of their homes and training with you. The question for the health and fitness side of the leisure market is, therefore, what does your facility provide which in-home technology does not?
Increased convenience of health & fitness
Wellness hotels are on the increase. While a lot of hotels already have a gym for guest use, wellness hotels take this one step further. With more discerning clientele demanding more from their stay at a hotel than ever before, expect to have to offer a large range of fitness, health and wellness (think mental health, general wellbeing) focused activities, clinics, talks and classes
In what’s always been a competitive market, lately, it seems like ‘fitness hotels’ might just have the edge in what’s likely to be a difficult 2020 for the industry.
The average UK family commits 22% of its weekly budget to leisure spending. This may not seem like a large figure but is almost double what British homes spend on housing each week. The consistent level of consumer spending over the years has provided a foundation for the sector to grow at around 2-3% per annum.
From a macro perspective, the sector is cyclical with high exposure to UK discretionary spend and skewed towards mid-cap companies with a high domestic UK consumer bias.
The sector has evolved over the last 10-15 years and whilst not facing the same structural headwinds as the Retail sector, it is having its fair share of disruption and change as consumer preferences and spending habits evolve. Added to this is the current uncertainty in the economy caused by a lack of clarity and direction surrounding Brexit and the impact this could have on consumer spend, food input costs and tourism/travel.
Despite the macro uncertainty, the last 24 months has shown UK consumers are increasingly spending more time and money on frequent, habitual activities such as gym memberships, dining out, trips to the theatre or cinema, cultural experiences, home entertainment, socialising in bars and cafes, and a wide variety of live sporting events.
Effectively low-ticket categories are proving broadly resilient, with consumers searching for experiences – rather than ownership of goods – with their disposable income.
The hospitality industry relies on the hard work and support of its people to deliver memorable experiences to its customers, with motivated and knowledgeable staff now seen as “table stakes” for successful brands.
Combine the effect of Brexit, which has made the UK less appealing to European workers, with a shift in Millennial and Gen Z workers who crave purpose and community from their jobs and it’s clear that employers need to continually refine the way they motivate and engage with staff. For example, Dishoom’s scheme to donate meals for every order in its restaurant resonates with socially conscious staff. They also take a number of their hospitality team to India to learn more about the culture in which they work. Expect businesses to invest more in their staff in 2020 both to fend off rivals and ensure they are motivated to deliver a memorable experience to their customers.
Ultimately, to survive and thrive in 2020 you’re going to have to put some effort into both your staff and your customers – create a name for yourself as a great employer to work for, and that positivity will spread over into your customer base.