Liverpool boasts the UK’s number one night-time economy, according to a new study by Square. Our research, which analysed spending across some of the UK’s liveliest cities such as London, Bristol, Liverpool and Birmingham, found that the UK’s capital of pop music also boasts its most effervescent nightlife.
Here, we look at what our most recent findings tell us about consumer behaviour and how those working in the restaurant, cafe, bar, pub and nightclub space can take advantage of the night-time economy’s post-pandemic growth.
Liverpool accounts for 40% of night-time in-person payments
It has been, as the Beatles aptly put it, a hard day’s night. But despite the ongoing cost-of-living crisis, reduced retail spending and consistently sluggish growth, our research reveals year-on-year post-pandemic growth in the night-time economy.
This signifies that while consumers are willing to cut down their retail spending as the cost of essentials rises, there is one area where they refuse to compromise – a good night out. Numerous studies show that despite our poor national productivity, Brits are working harder than ever. It makes sense, then, that we should want to use our disposable income to play hard, too.
In our study, the residents of Liverpool accounted for a 40% share of in-person payments made between 7pm and 4am in the first half of 2023. Britain’s second city, Birmingham came in second with 37%, while London came in at third place with 35%.
A powerful till system with fully integrated POS and payments
How to make the most of the nightlife demand
Despite the generally sluggish economy and the cost of living crisis, our study shows that there is clearly an appetite for spending on memorable after-work experiences, even if consumers are spending less on retail therapy.
Let’s take a look at some ways in which service industry businesses can capitalise on the consistent growth of the night-time economy.
Stay in touch with your customers
A 2021 study by Adobe reveals that consumers spend more with brands that they trust. But building that trust means developing a relationship that goes beyond your walls. Stay in touch with customers by incentivising them to provide their contact details. This will enable you to deliver personalised discounts and coupon codes, exclusive vouchers, or perhaps a treat on their birthday, all through their email or SMS inbox.
This communication is reciprocal, too. It creates great opportunities to conduct market research, empowering you to better tailor your offering to the needs of your customers.
Incentivise excellent service
You’ve already invested in a great team. With a little incentive, they could be delivering better service, working more efficiently and generating greater revenues. Great service means that customers will keep coming back for more. It also means higher tips and a happier, more incentivised workforce.
In a recent conversation with Liverpool-based hospitality business L-Live, we learned that Square Terminal’s real-time reporting made it easy to identify the bar staff who had generated the most revenue in a day or week. This enabled the customer to identify and celebrate outstanding achievement by naming the staff member of the day or week.
Use cross-selling to improve AOV and value for money
The year-on-year growth of the night-time economy may buck current economic trends, but this doesn’t mean that consumers are not cost-conscious. While they may be willing to spend their money, they also want to ensure that they’re getting good value in return.
This is where cross-selling can prove remarkably useful for businesses. Creating compelling set menus, wine and food pairings or drink and snack offers can improve average order value and drive revenue while also giving the customer a sense of value for money that builds customer loyalty.
Don’t neglect the introverts!
Not everyone likes to wind down after a hard day’s work by hitting the town. For many, a relaxing night out means a tasty takeaway and snuggling on the sofa to enjoy a film. The socially anxious, introverts and the exhausted should still be able to experience your restaurant food from the comfort of their own homes.
This opens up new revenue streams and allows your business to garner customers who may not necessarily feel inclined to visit you on-site. It can also encourage existing customers to spend more with you. So the customer who joins you for a Friday night out may also satisfy their craving for your food on a busy Wednesday.
Rethink your pricing strategies to find the perfect balance of value and profit
As established above, just because consumers are willing to spend some of their hard-won disposable income on a night out does not mean they aren’t looking for good value. By re-examining their pricing strategies, businesses may be able to find the perfect balance between delivering value for money to clients and stabilising their net profits.
For instance, if you originally used competitive pricing strategy to create parity with other businesses like yours you may find that your competitors have increased their prices in the current inflationary climate. However, there may be sufficient margin to beat competitors on price while still maintaining profitability.
Want to see how Square POS can help your business make the most of the growth in the night-time economy? Get in touch today!
Contact our sales team to learn more about how Square could help your business.