The arrival of a high-profile pop star can cause a mini-economic boom in specific cities, towns, or regions. Today, fans spending on travel, hotels, food, and leisure activities reveals the intersection between consumer emotions and capitalism. Beyoncé's tour of Sweden was even blamed for having driven up inflation last year.1
Last summer the music industry provided a glimpse into other facets of the economy, such as pent-up demand, and high levels of consumer spending.
The state of the US economy is already rocky, and while still at historically high levels, inflation has tapered. Yet, last summer the music industry provided a glimpse into other facets of the economy, such as pent-up demand, and high levels of consumer spending. This, however, is not a new concept. Large portions of the spending for Olympic stadiums have been justified by expected local economic benefits. And the surge in activity has been well documented from European soccer championships to royal weddings.
Swift’s Eras Tour could generate up to $5 billion in economic impact – larger than the GDP of 50 countries.[3]
A survey company, QuestionPro, estimated that Swift's Eras Tour is projected to generate close to $5 billion in economic impact – larger than the GDP of 50 countries.3 This is encouraging, suggesting that people are still willing to spend on the right goods and services.
Hotel and lodging
There's also a pronounced correlation between the influx in hotel bookings and tour dates. One study estimated that Swift's Tour has generated around $208 million in US hotel room revenue.4 This represents massive spikes in growth that most cities have not seen since the onset of the pandemic. Philadelphia, despite its overall slowing recovery in tourism, saw its strongest month for hotel revenue in May – which just so happened to be when Swift's Tour rolled in for three consecutive nights. The Federal Reserve Bank of Philadelphia specifically highlighted the concert's positive impact.5
Travel and tourism
Pent-up demand following the pandemic has seen consumers splashing out in search of fresh experiences, such as live entertainment and travel. It's no wonder that Swift's Tour has managed to provide such a healthy financial boon to the US economy. And with her fame knowing no borders – having already stretched onto the big screen, streaming services, and of course, NFL stadium suites – it was no surprise to see the tour had added an international leg; recently completing South America, and soon to kick off in Asia, Australia, and Europe.
When it was announced that Swift's Eras Tour was going global, the list of venues did not include New Zealand. However, Air New Zealand said it experienced a ‘Swift surge’, with people rushing to book flights to Australia, where she is scheduled to perform in February. The airline had to add 14 more flights to accommodate 3,000 additional people.6
Are we out of the woods?
One of the big questions for the global economy is whether consumers will continue to spend in the face of rising geopolitical tensions, higher-for-longer interest rates, joblessness, and market volatility. Though one-woman economic tailwinds Taylor Swift and Beyoncé give cause for optimism.
Economic uncertainty? Fans have shown that they can shake it off.
1 "Beyoncé shows blamed for fueling inflation in Sweden." NBC News, Jun. 2023. https://www.cnbc.com/2023/06/16/beyonc-shows-blamed-for-fueling-inflation-in-sweden.html
2 "Taylor Swift Isn't Just an Entertainment Giant. Her Sold-out Tour Is Supercharging Local Economies Too." Fortune, Jun. 2023. https://fortune.com/2023/06/07/taylor-swift-eras-tour-chicago-hotel-booking/
3 "Generating $5 billion, the Taylor Swift The Eras Tour has an Economic Impact Greater than 50 Countries." GlobeNewswire, June 2023. https://www.globenewswire.com/en/news-release/2023/06/08/2684710/0/en/Generating-5-billion-the-Taylor-Swift-The-Eras-Tour-has-an-Economic-Impact-Greater-than-50-Countries.html.
4 "Taylor Swift impact grows to $208M in U.S. hotel room revenue." STR, Aug. 2023. https://str.com/data-insights-blog/taylor-swift-impact-grows-208M-in-us-hotel-room-revenue
5 “Swiftonomics, or the Smart Business Choices Taylor Swift Makes That Affect the U.S. Economy.” Northeastern Global News, Aug. 2023. https://news.northeastern.edu/2023/08/11/taylor-swift-economy-impact/
6 "It's Taylor Swift's Economy, and We'e All Living in It." The Wall Street Journal, Jul. 2023. https://www.wsj.com/arts-culture/taylor-swift-taylornomics-concert-eras-tour-local-economy
7 "Tours by Taylor Swift and Coldplay fuel Singapore’s tourism." Bloomberg, October 2023. https://www.bloomberg.com/professional/blog/tours-by-taylor-swift-and-coldplay-fuel-singapores-tourism/
8 "Tourism’s great ambassador: Cue, Taylor Swift." Travel Weekly Asia, November 2023. https://www.travelweekly-asia.com/Travel-News/Trade-Shows-and-Events/Tourisms-great-ambassador-Cue-Taylor-Swift
AA-080224-173933-1