Consumer Spending Frenzy During World Cup

The 2010 World Cup in South Africa has drawn hundreds of thousands of spectators

and hundreds of millions of supporters are tuning in worldwide, obviously it is bringing huge revenue for tourism in SA but the impact on economies in other countries is even greater. The British are set to spend the most during the month long event with an estimated 2 billion to being spent on everything from TVs to takeaways.

Even when inflation and economic growth are taken into consideration, the huge increase is primarily down to the World Cup despite some of the other sporting events occurring this summer. Data from MINTEL suggests that more than 60% of the UK population will increase their leisure spending over the 5 week period.

Despite the increase in VAT, there is an overall 6% rise in consumer spending during the 5 weeks of the competition. Crowds of people are watching the matches in pubs and bars, causing an increase in consumption of food and alcohol during off peak times when these businesses are usually quiet. Many pub and bar owners claim that a big 3pm match can attract the same crowd as a busy Friday or Saturday night and with several matches per day this is generating substantial profit.

For the last year, prices have been heavily reduced and stores have been promoting television sets using the world cup as the main focus for the purchase. In the last year the average price of a high definition television has reduced by over 50% and many retailers are offering promotions like a full refund if England wins the World Cup or money off every time they score. DSG, the parent company that owns Dixons and Curry's announced a 63% increase in profit on this time last year, they attribute this solely to the increase in demand for large televisions.

Beer and snack food has been at the centre of a supermarket price war, dropping the price of beer as low as 43p per pint. Takeaways have also benefited from the world cup with many people ordering in during half time rather than wasting precious match minutes in the kitchen, Chinese, Indian and other ethnic takeaways have been popular but more sports fans are choosing food to share such as Pizzas.

by: Tom Doerr

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