Not only was the summer of Babenheimer, Beyoncé, and Taylor Swift fun, it was good business (and big business, too). But now, Morgan Stanley is warning in an analyst note that winter is coming.
Morgan Stanley economist Sarah A. Wolfe estimates that the two tours and the Barbenheimer contributed to the U.S. third quarter, which includes the summer spending months. ) economic growth brought about $8.5 billion in revenue. She warns that when the windfall disappears, so does the accompanying 2% increase in consumer spending, which raises the question: Are the ardent American consumers, often female-led? The only factor averting the long-predicted recession?
Against the backdrop of constant warnings from economists and Wall Street that a recession is coming, early post-pandemic “revenge spending” will culminate in the summer of 2023 as a bona fide pop culture phenomenon. Pappenheimer” internet jokewhich soon becomes marketing strategyPit Christopher Nolan’s Oppenheimerthe tragic godfather of the atomic bomb, against Greta Gerwig Barbie, It’s a decidedly feminist blockbuster with a sexy tale of medieval dolls exemplified by patriarchy.
In music, fans have flocked to Beyoncé and Taylor Swift’s big tours — stars so famous they have entire online shows dubbed “The Beyhive” and “The Swifties.” Army – they often perform in the same venue. Instead of splitting their loyalty, consumers choose to hang out as much as possible.National Association of Theater Owners explain At least 200,000 people bought tickets to watch Barbie and Oppenheimer On the same day — and on opening day.
“‘Pappenheimer’ is two films, not one,” said Paul Dergarabedian, Comscore’s senior media analyst and film industry expert. “If you’re a fan, it’s going to be an event that benefits both films in a way that hasn’t been done before.”
Meanwhile, Taylor Swift’s tour totals topped $1 billion for the first time. By the time Beyoncé’s tour ends on Oct. 1, her hotel count could surpass that figure. The Swift tour, in particular, has been such an economic shock that the Federal Reserve Bank of Philadelphia found that the months of her concerts were the region’s first since the start of the pandemic.
“Competition is a good thing,” Dergarabedian said of why this level of competition is good for everyone involved. “They’re a way of capturing the imagination of people everywhere because it’s more than the sum of its parts.”
All these options for doing things on summer nights attracted huge consumer spending last quarter, and the U.S. economy won’t be able to make up for that once box offices and concert venues close later this summer.
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Looking at the pop culture landscape, Morgan Stanley’s downbeat forecast sees U.S. consumer spending contracting by about 0.6% next quarter. With consumer spending the heartbeat of the services-centric U.S. economy, the decline of these giants could have far-reaching economic consequences.
Morgan Stanley argues that live entertainment and movie theaters, which normally make up only a small portion of overall consumer spending, have been so unusual and lucrative this summer that they provided a one-off boost to the economy that couldn’t be helped. Replacement. Movie theaters and live entertainment “had to have large swings to affect overall economic activity. And they did,” the note read.
Morgan Stanley estimates pappenheimer It grossed about $900 million at the U.S. box office in July and August. Add to that food and beverage sales of about $1.4 billion, and assuming about $15 per person, that brings the total to $2.3 billion. Foreign ticket sales (strictly counted as US exports) over the same period were estimated at $1 billion. These don’t count in overall consumer spending figures because they’re bought by foreign moviegoers, but they do count in GDP.
The two music tours had a wider impact on the wider economy. In addition to ticket prices (disregarding exorbitant resale prices) and deals, concert goers often book hotels and flights to see shows in major destinations. All told, Morgan Stanley estimates that Taylor Swift fans spend an average of $1,500, while Beyoncé fans spend an average of $1,800. Total spending on these tours in the third quarter amounted to $5.4 billion.
Now that the economic knock-on effects of a historic summer in the entertainment industry are coming to an end, economists will have to consider whether people will find another unexpected trend — pop culture or otherwise — to spend their money on.
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