British retailers, pubs, hotels and restaurants are all hoping for a boost in sales prompted by the coronation of King Charles III on Saturday after three years of subdued consumer demand.
The Centre for Retail Research estimates that total spending on coronation-related street parties, souvenirs and from foreign tourists will amount to more than £1.4bn this weekend, compared with a little over £400mn during the late Queen’s platinum jubilee in June last year.
But consumers are also feeling the squeeze from the soaring cost of living. Just a third of Britons will spend on activities during the coronation bank holiday weekend, with one in 10 consumers planning to purchase food and drink for hosting friends or family and only 8 per cent planning to spend money on drinks out at bars and pubs, according to recent research from Barclays.
“People don’t have a lot of discretionary spend, so they can’t afford to be spending on non-essentials,” said Tash Van Boxel, a retail analyst at GlobalData. More than half of respondents to a GlobalData survey said the cost of living would affect their celebrations.
While the coronation weekend is expected to boost annual footfall by 4 per cent across all UK retail destinations, it is still forecast to be 8 per cent lower than last weekend, another UK bank holiday, when “consumers enjoyed the warmer weather and the longer daylight hours”, said Diane Wehrle, director at MRI Springboard, a provider of retail shopper traffic data. The weather this weekend is forecast to be more stereotypical for a British bank holiday: damp and dull.
The food and grocery sector is the most likely to benefit from the coronation, according to Van Boxel. Both Simon Roberts, chief executive of J Sainsbury, and Kathryn Turner, food product development director at Marks and Spencer, are planning for customers to buy more than normal.
“Across Christmas and Easter, we saw that despite cost of living pressures, families were looking for a reason to celebrate and to make occasions special. We’re seeing that same sentiment with the coronation so far,” said Turner, who added that M&S had sold more than half a million tins of commemorative shortbread and coronation tea caddies in total so far.
Sainsbury’s has sold 143.3 miles of bunting, which would be enough to stretch from Buckingham Palace to Sheffield. Fizz sales are up 128 per cent year on year, with prosecco and crémant being particular favourites. Sales of Nyetimber, an English sparkling wine, are up 600 per cent year on year as customers buy British for the coronation weekend, according to the supermarket chain. Meanwhile, Tesco opened its own pub in London in honour of the coronation, serving customers for two days only.
Pubs that made it through the pandemic have suffered from supply-chain disruption and surging food inflation following the war in Ukraine. They now face high energy bills that threaten to eradicate all their profits.
Emma McClarkin, chief executive of the British Beer and Pub Association, warned of impending pub closures “in the thousands”. That means the forecast boost of £71mn, or 17mn extra pints, for pubs this weekend cannot come soon enough.
“I hope everybody uses this moment to support their local pub because we’re in a very difficult and precarious situation,” said McClarkin.
Going to the pub still represents an affordable way to celebrate. “People still see the importance of the pub, for socialising and for community,” said Nick Mackenzie, chief executive of Greene King, a pub group that is marking the occasion with its Coronation Golden Ale. The company expects to sell a quarter of a million pints of the new beer, which is on sale until May 14.
Mackenzie added: “By no means do I think it’s going to be a very quick return to normal. I think it’s going to be a little bit of time before things get easier for the customer.”
Hotel chains are also capitalising on the celebrations. Premier Inn expects 17 per cent of Britons to head to London. Simon Ewins, the hotel chain’s managing director, reported some of its hotels near the coronation route “selling out in minutes”.
The Lanesborough, one of London’s most prestigious hotels, which is only a stone’s throw from the coronation procession route, is welcoming delegations, royal families and some heads of state for the event. The hotel is also hosting a photo exhibition of the royal family.
“With Covid not too far behind us and Chinese tourists starting to branch out [to Europe] only a little while ago, the coronation is a great advertisement for London,” said Stuart Geddes, managing director of The Lanesborough.
Average hotel room rates in London for Saturday are £277, up 10 per cent from the actualised price for the same date last year. That is still cheaper than recent royal events: the average actualised pricing for hotel rooms during the platinum jubilee weekend in June 2022 was £280, and £344 during September’s state funeral of Queen Elizabeth II, data from OTA Insight shows.
One hotel data provider executive said: “The Queen was a global figure and her popularity will never be rivalled by anyone, probably not even by the King,”
Additional reporting by Laura Onita and Oliver Barnes in London
Source: Economy - ft.com
