Vaping had one of the biggest jumps in discretionary spending in the last year, according to ANZ data. Photo / Getty Images
Vaping had one of the biggest jumps in discretionary spending in the last year, according to ANZ data. Photo / Getty Images
Swimming pools, live theatre and ticket agencies, vape shops and duty-free outlets are a few shining lights for Kiwi spending in the last month, while data from Worldline released today showed December broke spending records.
Data from Worldline released today showed core New Zealand retailers in Worldline’s payment network set a spending record last year, with retail spending excluding hospitality at $36.8 billion, up 3.8 per cent on the previous year.
But Worldine data showed the average transaction size in 2023 was $51.10, down 1.5 per cent on 2022, suggesting shoppers were more careful with their spending last year.
Worldline NZ chief sales officer Bruce Proffit said the lower average transaction value went against a trend of rising consumer prices, but people were spending more often.
ANZ’s New Zealand merchant and card spending data showed spending in December was flat on last year, with 2.5 per cent growth compared to a 2.6 per cent rise in spending in the previous period.
ANZ chief economist Sharon Zollner said tourism was a “relative bright spot” in a year of subdued spending and discretionary income.
Tourism spending was up to 4.7 per cent last month, up from 4 per cent growth last December, with the biggest jump in spending at duty-free stores (up 56 per cent).
Zollner said car rentals in December were considerably stronger than last December, while spending at travel agencies and tour operators continued to fall, reflecting the demand for outbound travel.
Vehicle rentals and tourist attraction spending rose 14.9 per cent and 13 per cent last month, while luggage, leather and fur spending took the biggest hit (down 14.5 per cent).
ANZ chief economist Sharon Zollner said spending at travel agencies and tour operators continued to fall, reflecting the demand for outbound travel.
ANZ showed Kiwis are also spending more on interior decorating, with spending on new builds or major renovations still muted, but spending on home furnishings up 7.6 per cent on last year.
Swimming pools had the biggest jump, up 9.9 per cent, while roofing and sheet metal spending was down 21.2 per cent.
Discretionary spending through ANZ took a hit, down 0.9 per cent in the last year, but live theatre and vape spending had a positive result.
Live theatre and ticket agencies had a 16.9 per cent jump in spending on last year. Vape stores and massage, health and beauty outlets followed close behind, with spending up 16.5 per cent and 14.1 per cent respectively.
Among the biggest losers in discretionary spending according to ANZ were costume hire (down 3.3 per cent), jewellery stores (down 10.6 per cent) and art dealers, galleries and antiques stores (down 16.8 per cent).
Zollner said alcohol spending had the usual December spike but seasonally adjusted spending was still flat, down 1.4 per cent on last year.
Clothing experienced subdued spending as household spending power dropped, which ANZ’s data showed was down 6 per cent.
Grocery and convenience store spending was smaller in comparison but still had a 7.7 per cent jump on last year, while direct-to-consumer spending had the steepest drop (28.5 per cent), followed by camera and photo supplies (down 11.1 per cent).
In line with ANZ’s findings, Proffit said Worldline data showed ”there was also a tendency towards more spending at food and liquor stores (up 8.0 per cent for 2023) but less in other retail sectors, such as clothing and footwear (down 0.1 per cent) and across a range of hardware, garden and furniture stores (down 6.2 per cent)”.
Miscellaneous retail spending was up slightly (3.1 per cent), while “the Covid knitting boom has been consigned to history books”, Zollner said. However, ANZ data showed art and craft supply spending rose 2.1 per cent on last year.
Spending at tent and awning shops had the biggest increase, with a whopping 37.2 per cent rise on last year, followed by agricultural product spending.
Worldline spending reached $3.84b in December, up 0.4 per cent on December 2022, which Proffit said was a “weak” result.
“We previously reported a rising spend, seasonally and annually, ahead of Christmas Day, but the annual growth rate was weak in December overall, especially in the last week of the month, which saw spending fall below year-ago levels, including on Boxing Day,” he said.
Worldline also showed dataconsumer spending across core retail reached $674m in the first seven days of 2024, up 4.5 per cent on the same period last year, but Proffit said it’s still too early to tell if this is positive news for retailers.
“While it is promising for retailers to see that consumer spending has picked up slightly in the first week of 2024, this is too short a time period to make definitive inferences about how trends will continue in the coming months,” Proffit said.
The data is sourced from ANZ-issued card spending and spending from retailers who bank with ANZ. Worldline data comes from payments through the company’s payment networks.
Alka Prasad is an Auckland-based business reporter covering small business and retail.
