Taylor Swift and Beyoncé concerts boost local economies
Some economists credit Taylor Swift and Beyonce’s superstar tours for boosting local economies.
BEYONCE told us that girls run the world. This summer, she and Taylor Swift seemed to prove it.
Both Beyonce’s “Renaissance” and Swift’s “Eras” tours have become cultural phenomena that have swept across social media and are poised to shatter real-world records. “Eras” could top US$1 billion in sales, making it the first concert in history to cross that mark. Some estimates suggest that Beyonce’s world tour could gross even more than that by the time it wraps in October.
It is the latest – and some economists think final – iteration of the “revenge spending” trend that took hold after the pandemic, in which people shifted their spending away from goods and toward experiences. Swift and Beyonce fans have been shelling out on everything from secondhand tickets that cost more than a flight to Europe to fancy fingernails to match the singers’ wardrobe.
While event spending overall is still just recovering to pre-pandemic levels, the marquee concerts this summer are spurring a lot of consumption.
The survey company QuestionPro estimates that Swift’s concert could generate some US$4.6 billion in economic activity in North America alone, taking into account both stadium capacity and people’s reported spending plans on things like tickets, merchandise and travel. That would be roughly on par with the revenues the Beijing Summer Olympics generated in 2008, after adjusting for inflation. Beyonce’s shows are expected to spur US$4.5 billion in spending, based on a separate QuestionPro survey.
It isn’t just tickets that have motivated people to open their wallets. They are staying in hotel rooms, buying elaborate outfits, spending on flashy manicures and attending sideline parties that are generating business and boosting spending in host cities.
Shade Hotel, in Manhattan Beach, California, held a Swift pre-party where guests sported costumes, wore Swift-themed temporary tattoos and sipped on a signature “Lavender Haze” cocktail, a reference to one of the most popular songs on her latest album. Both the hotel and its neighbors reported surging demand that pushed up room rates and sold out many properties.
Boxie Studio in Los Angeles, which offers small photo studios of carefully curated backdrops for social media, was selling tickets that allowed visitors to film TikToks or snap Instagram shots in rooms that mirrored Swift music video sets. Props included the red scarf made famous by the song “All Too Well” and an “I love you” sign like the one that a lovelorn Swift flashed at her next-door neighbor in one 2009 music video.
Knock-on effects from the concerts have drawn the attention of national economic authorities: Sweden’s statistics agency said that Beyonce’s tour helped to fuel inflation there, and a Federal Reserve survey of business contacts reported that Swifties had bolstered hotel revenues in the Philadelphia region.
While concert-related spending has not been concentrated enough to show up clearly in national data in the United States, some think it could help to slightly improve the odds of a gentle cool-down instead of an abrupt stop to economic activity. The events are keeping consumers active during a summer when shrinking savings might have otherwise slowed their spending.
“I think Taylor Swift is great for the soft landing,” said Brett House, an economist at Columbia Business School. He noted that the concerts were evidence of what is often called “revenge spending”: a shift toward paying for experiences after heavy spending on goods during the pandemic.
“The Beyonce tour, the Eras tour, are the latest installation of that phenomenon,” he said – and possibly the tail end as consumers exhaust pandemic savings and return to more normal patterns. “It might be that Taylor Swift and Beyonce timed their tours perfectly.”
The concerts have become a big boost for local tourism, as the Fed report said. Airbnb reported that Cincinnati was the platform’s top trending destination for July 4 weekend travel – beating out places like Mykonos island in Greece and the Amalfi Coast in Italy. The Ohio city hosted Swift that weekend.
The shows have also driven broader consumer spending in cities like New York, where searches for lounges, aestheticians and nail technicians in the week leading up to Beyonce’s performance in East Rutherford, New Jersey, saw triple-digit percentage increases compared with the year before, according to an analysis by Yelp. Concertgoers were also booking their hair and nail appointments weeks out.
Raven Voorhees, the owner of Free Edge Beauty Studio in Brooklyn, New York, said she spent the month of July doing nails for clients attending Beyonce concerts in cities like Philadelphia; Nashville, Tennessee; and East Rutherford, New Jersey. Her clients requested nails that aligned with the theme of the Renaissance tour: lots of silver, metallic, gold and sparkle.
“It’s boosting business,” Voorhees said. “We’re talking about someone who’s paying about US$60 max for her service to now US$150 because she’s doing a new set, she’s getting the works, all of the nail art – and then, even after that, having to come back and having to do it again.”
In a survey fielded for The New York Times, QuestionPro found that about 50% of Swift fans used regular income to buy tickets and outfits, while 9 per cent used savings built up during the pandemic. A bigger share used savings amassed before or after the public health crisis or relied on family help. Just a small share – 4 per cent – borrowed money to afford the tickets.
Beyonce fans also funded tickets heavily out of their income and spent US$1,800 on average for the concert.
Many companies have figured out how to capitalize on the hype. Before Beyonce’s New Jersey appearance, Circle Line Cruise – a New York staple known for ferrying tourists around Manhattan – transformed into a dance floor where boat riders learned the Renaissance concert choreography. The 78-year-old cruise line has been trying to find ways to attract new customers and give locals a reason to step on board, said Alexis Melendez, Circle Line’s marketing director.
The event, which took place the Thursday before Beyonce’s MetLife performances, sold out. The three-level cruise ship held about 300 people who had paid US$25 for the two-hour ride where attendees grooved to a DJ playing Beyonce’s 30-year discography and followed directions from dance instructor Byron Freeman.
Circle Line doubled the amount of bartenders, who were making US$16 Beyonce-themed cocktails with names like “Alien Supermarg” and “Rum the World.”
In Southern California, companies also seized on Swift’s concerts at SoFi Stadium to host branded activities. Truly LA, a venue showcasing the hard seltzer brand, hosted a friendship bracelet-making event on the sidelines of Swift concerts.
Swifties wear and trade the jewelry as a reference to a lyric in a song from Swift’s latest album in which she instructs listeners to “make the friendship bracelets, take the moment and taste it.” The events, which took place Aug. 2 and Aug. 3, also encouraged attendees to trade their bracelets while listening to Swift and consuming specialty seltzer drinks.
With thousands of people descending on stadiums across the country, transportation to the summer’s big concerts also became an enterprise.
The founders of Foolonia, a New York-based event company founded in 2019 that focuses on providing inclusive spaces and unique outings, decided to offer group transit to Beyonce’s concert in New Jersey. The entry fee was US$100 and included Beyonce trivia, giveaways like official tour merchandise and enough space to practice dance moves.
“Have we done a party bus before? No! But that’s what we do,” said Riley Wilson, a co-founder of the company. “We do divergent experiences.”
And in Southern California, public transit stayed open late to ferry concertgoers. “We’re enchanted that Taylor Swift fans have given a big boost to public transit across the United States this year – and we’re looking forward to spending our midnights with many of you very soon,” Los Angeles County’s Metro system punned on its website – referencing Swift’s song “Enchanted” and her recent album “Midnights.”
Spending on the concerts may partly be taking the place of other events, vacations and consumption in general this summer: About half of respondents in both the Swift and the Beyonce QuestionPro surveys said they would cut back elsewhere to afford the experiences, with many reporting that they were eating out less or skipping unnecessary entertainment.
Many attendees made it clear that having fun at the tours would be their priority.
“People are looking to experience a fun and groundbreaking way to celebrate their identity, to celebrate music,” said Ozzie Henderson, a co-founder of Foolonia and a Beyonce fan who started putting together his concert outfit since she announced her tour. “They’re investing their money in a great experience.” THE NEW YORK TIMES