1 00:00:05,730 --> 00:00:08,940 Michael Thompson: Welcome to the Fear & Greed Business Interview. I'm Michael Thompson. 2 00:00:09,059 --> 00:00:13,259 Michael Thompson: Easter is a marquee event on the retail calendar. Obviously 3 00:00:13,259 --> 00:00:15,630 Michael Thompson: there's a big focus on food. You've got big family 4 00:00:15,630 --> 00:00:17,968 Michael Thompson: meals, you've got plenty of Easter treats, and that sees 5 00:00:17,969 --> 00:00:20,610 Michael Thompson: a spike in spending. But of course, the four- day 6 00:00:20,610 --> 00:00:24,750 Michael Thompson: long weekend also means a perfect occasion for DIY projects 7 00:00:25,140 --> 00:00:28,080 Michael Thompson: and obviously for travel. So I wanted to take a 8 00:00:28,080 --> 00:00:31,020 Michael Thompson: quick look today at what we are actually spending money 9 00:00:31,020 --> 00:00:34,169 Michael Thompson: on, what it means for retailers, and then, in turn, 10 00:00:34,229 --> 00:00:37,318 Michael Thompson: what it means for the broader economy. Fleur Brown is 11 00:00:37,320 --> 00:00:41,430 Michael Thompson: Chief Industry Affairs Officer at the Australian Retailers Association. Fleur, 12 00:00:41,430 --> 00:00:42,570 Michael Thompson: welcome to Fear & Greed. 13 00:00:42,960 --> 00:00:43,739 Fleur Brown: Thanks, Michael. 14 00:00:44,460 --> 00:00:48,540 Michael Thompson: Just how important is the Easter long weekend? I mentioned 15 00:00:48,540 --> 00:00:51,809 Michael Thompson: that it is a marquee event for retail, but how 16 00:00:51,809 --> 00:00:56,130 Michael Thompson: does it rate and compare to say Christmas and Boxing 17 00:00:56,130 --> 00:01:00,000 Michael Thompson: Day and Valentine's Day? I'm assuming Valentine's Day is kind 18 00:01:00,000 --> 00:01:02,429 Michael Thompson: of another big one as well, and the more recent 19 00:01:02,429 --> 00:01:04,500 Michael Thompson: arrival I suppose, as well, of Black Friday. 20 00:01:05,099 --> 00:01:08,249 Fleur Brown: Yeah, absolutely. Look, they're all very important, as you say, 21 00:01:08,250 --> 00:01:12,420 Fleur Brown: that we call them seasonal events in retail, and all of the ones you 22 00:01:12,450 --> 00:01:16,350 Fleur Brown: mentioned are important for retailers to plan for, and definitely 23 00:01:16,350 --> 00:01:19,530 Fleur Brown: they see an absolute spike in business at that time. 24 00:01:19,709 --> 00:01:24,030 Fleur Brown: The really big one is Christmas and that holiday spending 25 00:01:24,030 --> 00:01:28,199 Fleur Brown: season. Everything pales to insignificance beside that, but East is 26 00:01:28,199 --> 00:01:31,830 Fleur Brown: definitely well up there. We are looking at spending about 27 00:01:31,830 --> 00:01:37,199 Fleur Brown: 18 billion across the country for Easter. It's significant not 28 00:01:37,200 --> 00:01:40,499 Fleur Brown: only because of the celebrations attached to it, but also 29 00:01:40,500 --> 00:01:44,099 Fleur Brown: it's the last holiday before our winter. So a lot 30 00:01:44,099 --> 00:01:46,770 Fleur Brown: of people are trying to sneak in a trip, some 31 00:01:46,770 --> 00:01:49,950 Fleur Brown: DIY as you mentioned, and you look at it as 32 00:01:49,950 --> 00:01:53,070 Fleur Brown: quite a focused period of holiday making for that reason. 33 00:01:53,790 --> 00:01:56,370 Michael Thompson: Fleur, I mentioned those three categories in the intro. There 34 00:01:56,370 --> 00:01:58,679 Michael Thompson: was the DIY projects that you just mentioned, the holiday 35 00:01:58,679 --> 00:02:02,279 Michael Thompson: travel, and Easter food and chocolate. Now, research that you 36 00:02:02,280 --> 00:02:05,160 Michael Thompson: have put out from the Australian Retailers Association and from 37 00:02:05,160 --> 00:02:08,700 Michael Thompson: Roy Morgan suggests that we are going to spend, that's 38 00:02:08,700 --> 00:02:13,169 Michael Thompson: a huge figure, $ 18 billion, across those categories. How does 39 00:02:13,169 --> 00:02:15,780 Michael Thompson: it compare broadly to previous years? 40 00:02:16,620 --> 00:02:20,699 Fleur Brown: Look, it's fairly similar to last year, but with some 41 00:02:20,700 --> 00:02:24,150 Fleur Brown: little peaks and troughs within the different categories of spending. 42 00:02:24,660 --> 00:02:27,690 Fleur Brown: So in saying that it's fairly similar to last year, 43 00:02:27,690 --> 00:02:30,210 Fleur Brown: of course, you've got to factor in price inflation into 44 00:02:30,210 --> 00:02:33,060 Fleur Brown: that. So when it comes to what retailers are actually 45 00:02:33,480 --> 00:02:37,770 Fleur Brown: making in a profitable sense, they're having to deal with 46 00:02:37,770 --> 00:02:41,190 Fleur Brown: a whole lot of increased costs of doing business within 47 00:02:41,190 --> 00:02:44,070 Fleur Brown: that. So look, overall, it's not a bad result at 48 00:02:44,070 --> 00:02:48,150 Fleur Brown: all, considering the kind of economic situation that we're in 49 00:02:48,150 --> 00:02:52,410 Fleur Brown: Australia. Lots of belt tightening, there's a six- month lag 50 00:02:52,410 --> 00:02:55,860 Fleur Brown: effect with interest rate pressures that we're still feeling when 51 00:02:55,860 --> 00:02:58,649 Fleur Brown: it comes to consumer spending. So a pretty good result. 52 00:02:59,369 --> 00:03:02,430 Michael Thompson: That is actually really quite good when you consider that 53 00:03:02,430 --> 00:03:05,160 Michael Thompson: there was research out this week, the ANZ- Roy Morgan 54 00:03:05,160 --> 00:03:08,010 Michael Thompson: Consumer Confidence Survey, and it shows that confidence is up 55 00:03:08,250 --> 00:03:12,450 Michael Thompson: slightly, but I think it was 21% of Australians say 56 00:03:12,450 --> 00:03:15,839 Michael Thompson: that their families are better off financially than this time 57 00:03:15,839 --> 00:03:19,470 Michael Thompson: last year compared to I think 52% or thereabouts that 58 00:03:19,470 --> 00:03:22,110 Michael Thompson: say their families are now worse off. So that does 59 00:03:22,110 --> 00:03:24,600 Michael Thompson: actually seem quite good then. If we are still spending 60 00:03:24,600 --> 00:03:27,690 Michael Thompson: roughly the same amount as we were then last year, 61 00:03:28,080 --> 00:03:32,280 Michael Thompson: does these concerns over the cost of living crisis push 62 00:03:32,280 --> 00:03:35,610 Michael Thompson: spending down typically, heading into a period like Easter, or 63 00:03:35,789 --> 00:03:37,800 Michael Thompson: is it the fact that Easter comes around once a 64 00:03:37,800 --> 00:03:41,160 Michael Thompson: year, it is a one- off, people are still going 65 00:03:41,160 --> 00:03:43,350 Michael Thompson: to be getting together with their families, they're still going 66 00:03:43,350 --> 00:03:46,050 Michael Thompson: to be giving those gifts and things at Easter. Is 67 00:03:46,469 --> 00:03:49,049 Michael Thompson: there an element of, " You know what? It's a one- 68 00:03:49,049 --> 00:03:50,310 Michael Thompson: off. We will keep spending." 69 00:03:51,000 --> 00:03:55,800 Fleur Brown: We've definitely seen a trend towards experiences and Australians wanting 70 00:03:55,800 --> 00:03:59,190 Fleur Brown: to spoil themselves and others because they've earned it with 71 00:03:59,190 --> 00:04:02,400 Fleur Brown: all the pain and suffering that everyone's been through over 72 00:04:02,400 --> 00:04:06,000 Fleur Brown: the last few years. So that sort of sentiment continues, 73 00:04:06,330 --> 00:04:11,280 Fleur Brown: but within a reality check of the absolutely budget- conscious 74 00:04:11,459 --> 00:04:15,000 Fleur Brown: focus that we have. Of course, not everyone's dealing with 75 00:04:15,510 --> 00:04:17,490 Fleur Brown: the interest rate rises when it comes to a mortgage. 76 00:04:17,490 --> 00:04:19,860 Fleur Brown: Some people have paid off their mortgages, a fairly healthy 77 00:04:19,860 --> 00:04:23,729 Fleur Brown: percentage of the population, but then there's that segment that 78 00:04:23,730 --> 00:04:29,729 Fleur Brown: are dealing with increased rental or mortgage interest rate, and 79 00:04:29,730 --> 00:04:33,359 Fleur Brown: that's definitely affecting spending. But it is counterbalanced by the 80 00:04:33,360 --> 00:04:36,779 Fleur Brown: fact that people want to, yes, continue to spoil themselves 81 00:04:36,779 --> 00:04:39,599 Fleur Brown: and others. We definitely see that come to play during 82 00:04:39,599 --> 00:04:43,378 Fleur Brown: events, family events in particular like the holiday period. 83 00:04:43,980 --> 00:04:45,808 Michael Thompson: Stay with me, Fleur. We'll be back in a moment. 84 00:04:45,809 --> 00:04:56,639 Michael Thompson: I am speaking to Fleur Brown, Chief Industry Affairs officer at the 85 00:04:56,639 --> 00:05:02,699 Michael Thompson: Australian Retailers Association. Food is obviously a big one, particularly 86 00:05:02,700 --> 00:05:05,639 Michael Thompson: at this time of year. And anecdotally, when I was 87 00:05:05,639 --> 00:05:07,890 Michael Thompson: young, when I was working in a supermarket, it was 88 00:05:07,890 --> 00:05:10,799 Michael Thompson: always the case that the biggest day of the year, 89 00:05:10,800 --> 00:05:13,860 Michael Thompson: the busiest day of the year when the shopping trolleys 90 00:05:13,860 --> 00:05:16,859 Michael Thompson: would be lined up the aisle, it wasn't Christmas Eve, 91 00:05:16,860 --> 00:05:19,200 Michael Thompson: it wasn't leading into New Year's or anything like that. 92 00:05:19,259 --> 00:05:23,549 Michael Thompson: It was the Thursday before Good Friday. It was always 93 00:05:23,609 --> 00:05:26,220 Michael Thompson: massive. And then Good Friday is kind of synonymous with 94 00:05:26,220 --> 00:05:29,099 Michael Thompson: lines out the door of fish and chip shops and 95 00:05:29,100 --> 00:05:32,820 Michael Thompson: traffic jams around fish markets. So clearly, the demand is 96 00:05:32,820 --> 00:05:35,100 Michael Thompson: really quite heavily concentrated. 97 00:05:35,790 --> 00:05:38,669 Fleur Brown: Well, it's kind of embarrassing to turn up for an 98 00:05:38,670 --> 00:05:42,089 Fleur Brown: Easter feast without hot cross buns or the required amount 99 00:05:42,089 --> 00:05:44,370 Fleur Brown: of chocolate and Easter eggs. And of course, this panic 100 00:05:44,370 --> 00:05:47,220 Fleur Brown: that sets in because sometimes they literally do sell out. 101 00:05:47,580 --> 00:05:50,160 Fleur Brown: So yeah, it's a bit different to Christmas in that 102 00:05:50,160 --> 00:05:53,010 Fleur Brown: sense where you've got a little bit more scope to 103 00:05:53,010 --> 00:05:55,589 Fleur Brown: choose what you're going to turn up with. 104 00:05:55,949 --> 00:05:58,619 Michael Thompson: And then the seafood demand as well. And we're spending 105 00:05:58,619 --> 00:06:01,469 Michael Thompson: more this year on chocolate. That spend is up quite 106 00:06:01,470 --> 00:06:04,410 Michael Thompson: significantly based on the figures. Why is this? 107 00:06:05,310 --> 00:06:09,150 Fleur Brown: There's probably a lot that goes into that. Prices have 108 00:06:09,150 --> 00:06:12,389 Fleur Brown: increased in certain areas, particularly if you're looking at imported 109 00:06:12,389 --> 00:06:16,589 Fleur Brown: chocolate for example, so that can come into play. There 110 00:06:16,589 --> 00:06:19,650 Fleur Brown: was someone who did a whole analysis piece on all 111 00:06:19,650 --> 00:06:22,589 Fleur Brown: of the different factors that go into chocolate pricing, and 112 00:06:22,860 --> 00:06:27,988 Fleur Brown: it certainly has been a challenging period for chocolates. That's 113 00:06:27,990 --> 00:06:30,779 Fleur Brown: coming into play there. Look, I would also hazard a 114 00:06:30,779 --> 00:06:33,960 Fleur Brown: guess, I'm no psychologist, but chocolate's a great... 115 00:06:34,559 --> 00:06:35,849 Michael Thompson: It's a comfort food. 116 00:06:35,849 --> 00:06:41,430 Fleur Brown: Comfort food, mood enhancer, stress factor. That's definitely part of 117 00:06:41,430 --> 00:06:43,200 Fleur Brown: it. I think we saw the same trend through the 118 00:06:43,200 --> 00:06:44,039 Fleur Brown: pandemic too. 119 00:06:44,040 --> 00:06:46,979 Michael Thompson: So it's a combination then of the comfort food. Everyone's 120 00:06:46,980 --> 00:06:49,439 Michael Thompson: kind of going for the chocolate, but also we're seeing 121 00:06:49,440 --> 00:06:53,459 Michael Thompson: these pressures, the price pressures on chocolate and the ingredients 122 00:06:53,459 --> 00:06:55,650 Michael Thompson: are going to it coming from overseas as well. So 123 00:06:55,650 --> 00:06:57,660 Michael Thompson: it's combining. We still need it and we're willing to 124 00:06:57,660 --> 00:06:58,080 Michael Thompson: pay more for it. 125 00:06:58,081 --> 00:07:01,979 Fleur Brown: And we will have our chocolate. Yeah, Australians are amongst the top 126 00:07:01,980 --> 00:07:04,889 Fleur Brown: chocolate consumers in the world, actually. I don't have that 127 00:07:04,889 --> 00:07:06,630 Fleur Brown: data point in front of me, but I've definitely seen 128 00:07:06,630 --> 00:07:07,140 Fleur Brown: the studies. 129 00:07:07,650 --> 00:07:10,200 Michael Thompson: I don't think anyone's going to question you on that 130 00:07:10,200 --> 00:07:15,330 Michael Thompson: one. That's almost guaranteed. The other interesting point I saw 131 00:07:15,330 --> 00:07:17,940 Michael Thompson: from the research was that a third of Australians are 132 00:07:17,940 --> 00:07:22,049 Michael Thompson: going to use the long weekend for DIY. I'm assuming 133 00:07:22,050 --> 00:07:25,500 Michael Thompson: this is what happens every year. How much are we spending? 134 00:07:25,950 --> 00:07:30,600 Fleur Brown: Yeah, look, we've definitely seen a DIY trend through the pandemic, and 135 00:07:30,600 --> 00:07:33,300 Fleur Brown: it's nice to see that that's sort of continuing that 136 00:07:33,300 --> 00:07:37,500 Fleur Brown: kind of nesting aspect. Certainly, the Easter weekend is a 137 00:07:37,500 --> 00:07:41,790 Fleur Brown: trigger because it's that last holiday period before winter really 138 00:07:41,790 --> 00:07:43,889 Fleur Brown: sets in. So if you're getting outdoors, getting into the 139 00:07:43,889 --> 00:07:45,689 Fleur Brown: garden, that sort of thing's a good time to do 140 00:07:45,690 --> 00:07:49,980 Fleur Brown: it. We're looking at about 7. 8 million Australians projected 141 00:07:49,980 --> 00:07:53,160 Fleur Brown: to take on do- it- yourself projects this Easter. So 142 00:07:53,160 --> 00:07:56,730 Fleur Brown: to give you some dimension to that, about 10% of 143 00:07:56,730 --> 00:07:59,309 Fleur Brown: those are spending above $ 2, 000. So that would be 144 00:07:59,309 --> 00:08:03,659 Fleur Brown: the really more significant project category. Everyone else is looking 145 00:08:03,660 --> 00:08:09,270 Fleur Brown: at an average spend of about $ 852 per individual, and 146 00:08:09,270 --> 00:08:13,170 Fleur Brown: that's just down a touch from last year. So we 147 00:08:13,170 --> 00:08:16,019 Fleur Brown: are probably talking about a nice coat of paint, some 148 00:08:16,020 --> 00:08:19,740 Fleur Brown: gardening, a bit of fencing for that kind of spend. 149 00:08:22,379 --> 00:08:25,560 Michael Thompson: There's probably other stories behind these statistics as well that 150 00:08:25,560 --> 00:08:28,080 Michael Thompson: all of a sudden if you've got 7. 8 million people 151 00:08:28,080 --> 00:08:30,630 Michael Thompson: saying that they're going to be doing DIY over the 152 00:08:30,630 --> 00:08:32,880 Michael Thompson: four days of the long weekend. I would love to 153 00:08:32,880 --> 00:08:36,270 Michael Thompson: see the corresponding increase in ambulance call outs and hospital 154 00:08:36,270 --> 00:08:39,389 Michael Thompson: visits across this period as well, because it would have 155 00:08:39,389 --> 00:08:39,959 Michael Thompson: to be there, right? 156 00:08:39,959 --> 00:08:42,450 Fleur Brown: Like the Christmas tree hazards when you're putting up some lights. Yeah. 157 00:08:42,840 --> 00:08:46,500 Michael Thompson: Oh yeah. Yeah. Now travel is the other big one, and 158 00:08:46,500 --> 00:08:50,130 Michael Thompson: we have mentioned this. There's a big jump in spending 159 00:08:50,130 --> 00:08:53,759 Michael Thompson: on overseas travel. It seems suggesting that there is that 160 00:08:53,759 --> 00:08:56,580 Michael Thompson: certain kind of portion of the population that is somewhat 161 00:08:56,580 --> 00:08:58,590 Michael Thompson: immune to these cost- of- living pressures. 162 00:08:59,129 --> 00:09:03,480 Fleur Brown: Yes. It's combined with this sort of built- up pressure 163 00:09:03,480 --> 00:09:06,240 Fleur Brown: to travel overseas with a lot of people putting off 164 00:09:06,240 --> 00:09:11,249 Fleur Brown: those trips in recent years, due to COVID, just due 165 00:09:11,250 --> 00:09:14,219 Fleur Brown: to being more conservative about travel generally. And so what 166 00:09:14,219 --> 00:09:16,679 Fleur Brown: we're seeing is the return of some of that desire 167 00:09:16,679 --> 00:09:21,570 Fleur Brown: for international travel. So about 9. 6 billion being spent 168 00:09:21,570 --> 00:09:24,360 Fleur Brown: on Easter travel, and that's up about 500 million on 169 00:09:24,360 --> 00:09:28,740 Fleur Brown: 2023 or about 5%. A lot of that is being 170 00:09:28,740 --> 00:09:31,590 Fleur Brown: spent on overseas trips at the expense of domestic spending 171 00:09:31,590 --> 00:09:34,559 Fleur Brown: and overseas trips naturally are more expensive. So that sort 172 00:09:34,559 --> 00:09:38,429 Fleur Brown: of explains some of those numbers. So around 4. 4 173 00:09:39,120 --> 00:09:43,350 Fleur Brown: million Australians, or 20% of the population aged over 18 174 00:09:43,770 --> 00:09:47,609 Fleur Brown: plan to take a holiday over the Easter period, and 175 00:09:48,420 --> 00:09:53,730 Fleur Brown: that's sort of divided between their own state, interstate, and overseas. 176 00:09:53,970 --> 00:09:56,580 Michael Thompson: Yeah, and as you say, that is at the expense of 177 00:09:56,580 --> 00:09:59,340 Michael Thompson: the domestic travel, which isn't great news, I would imagine, 178 00:09:59,340 --> 00:10:03,569 Michael Thompson: for local tourism operators and local retailers that rely on 179 00:10:03,570 --> 00:10:06,360 Michael Thompson: that school holiday and public holiday boom. 180 00:10:06,840 --> 00:10:13,380 Fleur Brown: Yeah, absolutely. Look, it's understandable that we're seeing that shift for the reasons we've just mentioned, but it is not 181 00:10:13,380 --> 00:10:17,880 Fleur Brown: to be underestimated that that will create an impact in 182 00:10:17,880 --> 00:10:21,929 Fleur Brown: Australia, because through that pandemic period, that was really part 183 00:10:21,929 --> 00:10:26,309 Fleur Brown: of the thing that saved many retailers and hospitality operators 184 00:10:26,309 --> 00:10:28,590 Fleur Brown: was the fact that people weren't spending on international travel. 185 00:10:28,590 --> 00:10:30,929 Fleur Brown: So that does have to be considered, but at the 186 00:10:30,929 --> 00:10:33,750 Fleur Brown: same time, we've also got more than a million people 187 00:10:34,110 --> 00:10:37,199 Fleur Brown: in the country now than we had a year ago, 188 00:10:37,200 --> 00:10:39,659 Fleur Brown: so that they are also bolstering our spend. 189 00:10:40,380 --> 00:10:44,880 Michael Thompson: One last question about travel. School holidays. What does that 190 00:10:44,880 --> 00:10:49,290 Michael Thompson: do to spending? Because about half the country has school 191 00:10:49,290 --> 00:10:52,708 Michael Thompson: holidays aligning with Easter and the Easter long weekend, the 192 00:10:52,710 --> 00:10:54,929 Michael Thompson: other half is delayed for a week or two. Does 193 00:10:54,929 --> 00:10:58,349 Michael Thompson: that then mean that you see this travel spend spread 194 00:10:58,349 --> 00:11:02,130 Michael Thompson: out more and it essentially becomes almost a month of 195 00:11:02,250 --> 00:11:02,939 Michael Thompson: boom time? 196 00:11:03,389 --> 00:11:07,679 Fleur Brown: Absolutely. You would see that, but then there's quite a 197 00:11:07,679 --> 00:11:10,800 Fleur Brown: lot of evidence that people are also looking to travel 198 00:11:10,800 --> 00:11:13,679 Fleur Brown: within their own state if they're traveling domestically, and that 199 00:11:13,679 --> 00:11:17,190 Fleur Brown: may just be because it's not a super long break. 200 00:11:17,670 --> 00:11:20,070 Fleur Brown: Not everyone's going to take the school holiday period. They 201 00:11:20,070 --> 00:11:22,440 Fleur Brown: might just sort of look at the Easter break itself. 202 00:11:22,920 --> 00:11:26,520 Fleur Brown: So it does create a staggered effect, as annoying as 203 00:11:26,820 --> 00:11:28,470 Fleur Brown: those different dates are. It definitely helps spread the money. 204 00:11:31,740 --> 00:11:34,800 Michael Thompson: It does make it very, very complicated, particularly if you're trying 205 00:11:34,800 --> 00:11:38,490 Michael Thompson: to plan things and trying to coordinate across state lines. 206 00:11:38,490 --> 00:11:40,590 Michael Thompson: It does get a little bit tricky. Fleur, thank you 207 00:11:40,590 --> 00:11:42,059 Michael Thompson: very much for talking to Fear & Greed. 208 00:11:42,449 --> 00:11:43,440 Fleur Brown: Thanks so much, Michael. 209 00:11:43,800 --> 00:11:46,588 Michael Thompson: That was Fleur Brown, Chief Industry Affairs Officer at the 210 00:11:46,590 --> 00:11:50,100 Michael Thompson: Australian Retailers Association. This is the Fear & Greed Business Interview. 211 00:11:50,340 --> 00:11:52,620 Michael Thompson: Join us every morning for the full episode of Fear & 212 00:11:52,710 --> 00:11:55,139 Michael Thompson: Greed Daily Business News for people who make their own 213 00:11:55,139 --> 00:11:57,598 Michael Thompson: decisions. I'm Michael Thompson. Have a great day.