A new Roy Morgan study into the spending habits of Aussies has found that we’re increasingly spending our hard-earned on experiences (holidays, eating out, gambling etc) over discretionary spends (clothing or home furnishings.)
In the financial year to June 2016, as a nation we spent $137 billion on leisure and entertainment and $105 billion on discretionary purchases.
The graph below shows what we spent our cash on, with clothes the clear winner at almost 55 per cent. Please note the graph includes both in-store and online purchases.
However, as the graph below reveals, the gap between spends on entertaining ourselves over discretionary spending appears to be widening.
When it came to leisure spending, Aussies spent $77 billion on going out (restaurants, movies, concerts), $43.5 billion on entertaining at home (ordering in take-away or dinner parties with friends), while gambling took up a large chunk of cash at $16.8 billion.
Commenting on the study, Roy Morgan Research CEO, Michele Levine, said: “The fact that Australians are spending more on ‘experiences’ (leisure activities outside the home) and less on ‘things’ (discretionary commodities) is one of the most striking findings of Roy Morgan Research’s latest retail-focused State of the Nation report. It also poses a challenge for retailers selling discretionary commodities.
“As mentioned above, nearly 55% of Australians buy at least one item of clothing in an average four weeks, which equates to an annual spend of $25.1 billion – under a third of what we spend on going out in a year! What’s more, the amount Australians spend on going out has increased by 38% over the last seven years, while our clothing spend has increased by 20%.
“Of course, this doesn’t mean retail is dead: just that it needs to adapt to this growing desire for experiences and entertainment. Incidentally, the State of the Nation report reveals a year-on-year increase in the number of Aussies visiting bricks-and-mortar stores (an additional 90 million visits to retail outlets in the last financial year), which suggests that many retailers are already working to provide customers with an in-store experience that goes beyond the transactional. Naturally, converting this experience into sales is crucial…”