New Research Quantifies Brexit Impact on Irish Exports and Tourism From Changing UK Consumer Behaviour
New research quantifies Brexit impact on Irish exports and tourism from changing UK consumer behavior.
29% of UK consumers say they are buying more British goods since the Brexit vote. This is a worrying statistic for Irish-owned companies since 44% of their exports go to the UK.
At the same time, 14% of UK consumers say they will take fewer holidays abroad which could have a potential €200m impact on the Irish tourism industry.
Simon-Kucher & Partners’ Irish Director, Alan Kelly, discusses new research from October 2018 highlighting areas of concern for Irish businesses in the countdown to Brexit.
Simon-Kucher has been tracking UK voters’ views on Brexit and its impact on consumer behavior since the referendum.
As expected, UK consumers are buying more British products after the Brexit vote. It’s an increasing trend with 29% of UK consumers now indicating they have purchased more British goods (versus the 24% seen 6 months ago). The majority of this increase is coming from Leave voters, increasing from 29% to 35%.
Buying more British goods means buying less imported goods from countries like Ireland. The UK accounts for around 17% of all Irish exports, but that figure leaps to 44% when foreign-owned firms are excluded. So any decrease in UK spending on Irish goods could create serious challenges for Irish-owned businesses. On the whole, Ireland’s exports are the most exposed to Brexit of any EU country, and particularly the agri-food sector.
Simon-Kucher also found that 14% of British holiday-makers plan to take fewer holidays abroad as a result of Brexit, compared to 11% stating the same 6 months ago.
“Staycations are slowly increasing in appeal to British holiday makers. This is bad news for the Irish tourism industry and could cost Irish businesses almost €200m in lost revenues” commented Alan Kelly.
British visitors account for nearly 40% of all visitors and 25% of all tourism revenues in Ireland so any significant decrease in the number of British visitors would be a blow for the industry.
You can already start to see the first signs of this shift. Visitors to Ireland from the UK have been decreasing as a percentage of total visitors since the Brexit vote in 2016.
What can be done?
Irish travel and tourism businesses will need to rebalance their marketing efforts to make sure they’re attracting visitors from other key source markets. At the same time, they should make sure their value proposition & customer experience also fit changing customer demographics.
“There are 3 kinds of companies: Those who ‘make things happen’, those who ‘watch things happen’, and those who wonder ‘what happened’? It’s important that Irish businesses take action to find profitable commercial strategies in order to survive and thrive in the post Brexit world” says Kelly.
Alan Kelly is a Director with Simon-Kucher & Partners, a global consulting firm with more than 1,200 professionals in 38 offices worldwide focusing on TopLine Power®. Founded in 1985, the company has more than 30 years of experience providing strategy and marketing consulting and is regarded as the world's leading pricing advisor.
The research was conducted directly by Simon-Kucher & Partners in November 2016, April 2017, October 2017, April 2018 and October 2018. The panel was arranged by Lightspeed Research and respondents were weighted to match a UK representative data sample. Number of respondents: November 2016: 1,060; April 2017: 756; October 2017: 966; April 2018: 1,008; October 2018 1,051
 Finance Department “UK EU Exit: Trade Exposures of Sectors of the Irish Economy in a European Context” September 2017
 Central Statistics Office
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