Where visitor spend clusters within UK cities
Visitor spend is mostly in city centres. Understanding this fact, in combination with the few exceptions to this rule, will be key in the ongoing debate over tourism taxes.
Visitor spend is mostly in city centres. Understanding this fact, in combination with the few exceptions to this rule, will be key in the ongoing debate over tourism taxes.
Centre for Cities’ recent report – Spending time: The role of the visitor economy in UK cities – used novel credit card transaction data to evaluate the nature of the UK’s visitor economy. It found that domestic visitor spend is focused in just a few places: both across different cities and within them. This blog explores the latter point in more depth.
City centres are the main visitor spending hotspot. Figure 1 uses the report’s credit card transaction data to show that in almost all UK cities, visitor spend is more concentrated in the city centre than local spend. 80 per cent of Liverpool’s visitor spend is in the city centre, while only 29 per cent of its local spend is. There are a handful of outliers – Crawley and Luton are skewed by their airports, while Wigan and Birkenhead are affected by their proximity to Liverpool or Manchester city centre – but these are exceptions that prove the rule.
What about hotspots outside the city centre? One thing that seems to get visitors to go beyond the city centre is football stadiums. Across all 63 primary urban areas non-city centre neighbourhoods with Premier League (or Scottish Premier League) football stadiums received over two times more visitor spend than the average non-city centre neighbourhood.
The effect of this can be seen in Figure 2 which shows the distribution of visitor spend within Manchester PUA. Visitor spend is still concentrated heavily in the city centre but 12 per cent of all visitor spend in Manchester is around Old Trafford, outside the city centre. This makes it the neighbourhood with the second highest share of visitor spend.
Source: Fable Data, Automaticknowledge
Another thing that draws visitor spend beyond the city centre, is out of town retail parks. A good example of somewhere this is the case is Warrington.
Warrington might not be seen as a traditional visitor economy, but it does have an above-average share of spend from visitors – mainly day visits. A strong retail offer in the north western edge of town appears to be what is attracting in visitor spend. The numbers are skewed slightly by relatively low city-centre visitor spend but Warrington’s north western shopping district accounts for 43 per cent of tourist purchases. This area contains an Ikea and a large M&S that act as a regional draw.
Source: Fable Data, Automaticknowledge
The spending data show that most visitor spend within cities is heavily focused in the city centre. But it also shows that football stadiums and large retail parks can encourage visitor spend beyond the inner city.
These patterns matter for the ongoing conversation around creating a tourism tax in England – as has long been in place in other European countries, is now possible in Scotland and soon will be possible in Wales. Visitors are disproportionately attracted to city centres because of the amenities that are there, and any tax levied will also likely be largely generated by the centre of town. If taxes are introduced, this raises the question of where the receipts are spent. It will be unsurprising if there are calls to spend it on services across a city. But if the aim of it is to help pay for the costs of running the visitor economy, it should be reinvested largely in city centres, in most cities.
To see where visitors spend their money in your city, we have created a useful tool that maps visitor vs local destinations to help policy makers see where their visitor economy is focused:
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