Swiftonomics aka Taylor Swift's impact on U.S. retail and the economy: can she save Australia next?
Illustrations by Emily Sabens/The Washington Post
In the world of music, few artists have left an unforgettable mark on both the industry and the economy quite like Taylor Swift. With an unmatched blend of talent, business acumen, and an unwaveringly devoted fan base (aka “Swifties” – which is believed to be made up of approx. 518.996 million followers across her social media platforms), Swift's influence extends far beyond the charts. In this article, we will explore the multifaceted impact of Taylor Swift on U.S. retail and the broader economy, the ripple effect on small town businesses, and the intriguing prospects for Australian retailers and tourism as her Eras Tour prepares to descend upon the Land Down Under in February 2024.
Part 1: Taylor Swift's Impact on U.S. Retail and the US Economy
Swiftonomics: The Taylor Swift Effect
Dubbed "Swiftonomics" or "Taylornomics," Taylor Swift's remarkable success isn't confined to her music career. Her Eras Tour, which spans 146 concerts across 19 countries in 2023 and 2024, is making waves in terms of ticket prices, fan attendance, and revenues. The sheer scale of Swift's concerts is nothing short of impressive, with approx. 72,459 fans attending each concert in the first American leg of the tour, culminating in an average ticket price of US$456. It was also reported that the average concert goer spent about US$720 more than their budget for a total average of US$1,327.74, including expenses such as tickets, outfits/costumes, merchandise, food & drink, and travel. Global News Wire has predicted that “if the current spending pace continues through the end of the tour, The Eras tour will have generated an estimated $5 billion in economic impact, more than the gross domestic product of 50 countries.”
So, yes, whilst the economy seeks to win dollar game, the real winner here is Swift, who stands to make as much as $4.1 billion from the Eras Tour, according to estimates from Peter Cohan, an associate professor of management at Babson College.
Boosting the Local Economies
Swift's influence doesn't stop at her own financial success (taking home around 85% of earnings). The power of the Swift phenomena has shown to positively affect tour cities and the livelihoods of many people, beyond ticket resellers. The influx of visitors attending her concerts has resulted in an increase in spending on hotels, restaurants, transportation services, and local retail businesses. Sources estimate that Swift's performances can inject millions into local economies. In the heart of a slowing tourism recovery, Taylor Swift's concerts in various U.S. cities brought unexpected economic relief. Notably, in Philadelphia, where hotel revenues skyrocketed, the Federal Reserve Bank of Philadelphia reported "Despite the slowing recovery in tourism in the region overall, one contact highlighted that May was the strongest month for hotel revenue in Philadelphia since the onset of the pandemic, in large part due to an influx of guests for the Taylor Swift concerts in the city."
Supporting the Gig Economy and Crew Compensation
Taylor Swift's business decisions go beyond boosting her personal wealth. She is not only a talented performer but also a smart businesswoman. Her costs include expenses like staging, costumes, venues, crew compensation, and revenue sharing with songwriters. She is known for her generous treatment of her crew, distributing $55 million in bonuses to everyone involved in her tour, from backup dancers to sound technicians to truck drivers. This unprecedented act of generosity serves as a testament to Swift's disruptive force in the music industry.
Source: Mat Hayward/tas23 | Getty Images Entertainment | Getty Images
Part 2: Taylor Swift's Potential Impact on Australia
With Taylor Swift's Eras Tour heading to Australia in February 2024, it's an exciting moment for Australian retailers and the broader business community. The anticipation is palpable, and the economic impact could be profound.
As we explore the potential opportunities for Australian businesses, it's essential to keep in mind the lessons we've learned from the U.S. experience. The influence of Taylor Swift and her Eras Tour can translate across borders, offering a blueprint for how Australian retailers can capitalise on this phenomenon.
1. Catering to Swifties: The most important lesson is to cater to Swift's massive fan base. Australians are known for their enthusiasm, and retailers should tap into this market by offering Taylor Swift-themed products, promotions, and experiences. Whether its merchandise inspired by her albums, themed menus, or Swift-themed events, businesses can create a Taylor Swift buzz that resonates with fans.
2. Collaboration: Just as we’ve seen in the US, Australian retailers can collaborate to create a memorable experience. Joint promotions and themed events across various businesses can draw fans and enhance the overall experience.
3. Cinematic Experience: With the movie version of the Eras Tour having recently hit Australian theatres, cinema chains and businesses should prepare for the rush of fans looking to relive the magic on the big screen. Special promotions and events can add an extra layer of excitement to the cinematic experience.
4. Digital Engagement: In the digital age, leveraging social media and online marketing is crucial. Create engaging content related to the tour, contests, and exclusive offers to keep fans excited. An active online presence will ensure that Australian businesses make the most of this iconic event.
5. Hospitality and Tourism: With an influx of fans expected for the tour, opportunities for hotels, airlines, and hospitality businesses in Australia will be abundant. Like their U.S. counterparts, Australian hotels and airlines should anticipate an increase in bookings, and restaurants and bars can create Taylor Swift-themed menus to attract Swifties. (It’s already been reported that Air New Zealand is put additional flights on into Sydney and Melbourne to cater for the Swifties travelling across the Tasman.)
Source: The Wall Street Journal
Taylor Swift's influence on U.S. retail and the broader economy is undeniable, as she continues to smash records, increase revenues, and elevate the overall concert experience. Her impact goes far beyond the music industry, benefiting small town retailers and local economies wherever her tour takes her. As Swift's Eras Tour heads to Australia in February 2024, the Australian retail and tourism industries should seize this opportunity to cater to the vibrant and passionate Swiftie community, ensuring a memorable and profitable experience for fans and businesses alike.
As the rumours circulate that Taylor Swift's concerts may have played a role in preventing a recession in the U.S., the anticipation of the economic boost her tour could bring to Australia is indeed a fascinating prospect. With "Swiftonomics" in action, one thing is certain: Taylor Swift's influence is a force to be reckoned with, and it's showing no signs of slowing down.