The value of retail spending amongst consumers in Dublin increased but at a slowing pace in Q3 2023.
The latest MasterCard SpendingPulse™, produced on behalf of the four Dublin Local Authorities, shows the index for total retail sales in the Capital reached 149.7 (100=Q1 2014) in the quarter, up by 0.9% QoQ and 3.7% YoY (both SA). The QoQ growth rate was the weakest since Q1 2021 and likely reflects a maturing in the post-pandemic recovery phase, combined with the impact of high inflation rates on disposable incomes.
Household Goods spending was the only segment in which meaningful growth was seen in Q3. Expenditure on such goods – which typically consist of higher value ‘white products’ – grew by 0.7% which was largely in line with previous quarters. Spending on Necessities and Discretionary goods was stable in the quarter. Entertainment spending, which had recovered at sharp rates since the end of the pandemic era, was also stable in the quarter (-0.1% QoQ).
Expenditure via online platforms expanded by 1.9% QoQ. This was the highest rate of growth since the tail end of the pandemic in Q1 2022, and highlights the continued momentum in eCommerce spending.
Despite the modest slowdown in growth in the Capital, the expansions were higher than recorded QoQ (+0.4%) and YoY (+3%) across Ireland. The YoY growth in Dublin in Q3 was primarily driven by the Entertainment sector (+11.3%) which is largely related to the post-pandemic recovery where spending in the sector was still subdued in Q2 2022. Expenditure via eCommerce platforms also expanded at a strong rate YoY in Q3 (+6.3%); the most robust rate since late 2022 and continuation of an exceptional run of growth which stretches back to when the series began in 2015. Spending on Necessities such as groceries stood at 4.2% YoY in the quarter. Household Goods and Discretionary expenditure also supported growth in the quarter as spending in these categories expanded, albeit at slowing respective YoY rates of 2.5% and 1.9%.
Mastercard SpendingPulse: Total Spend
UK & US Tourists Drive Spending Growth, but Concerns Persist
UK and US visitors contributed significantly to expansions in Dublin tourist spending of 2.5% QoQ and 13.4% YoY (both SA) in Q3. The QoQ growth recorded over the summer period was the weakest in three quarters and signals concerns for the tourism sector, especially as the reduced VAT rate for tourism and hospitality was discontinued in early September. The Chinese market had the largest growth rate in Q3 2023, increasing by 27.6%. The UK market was also a strong performer with a growth rate of 10.9% marking a radical turnaround from a contraction of 13.8% in the previous quarter. Spending from the US market, an integral element for tourism in Dublin and across Ireland, continued to show positive signals with 6% QoQ growth. The French and German markets were of greater concern in Q3 with respective contractions of 22.8% and 7.3% QoQ.
Mastercard SpendingPulse: Dublin Tourist Spend
“Overall retail sales growth in Dublin as well as across Ireland decelerated slightly in Q3 2023 versus Q3 2022. In Dublin, the Entertainment sector had been seeing large growth rates recovering from the pandemic dating back to Q2 2021. The growth rates in the sector are normalising as we move away from the deep declines experienced during the pandemic.”
MICHAEL MCNAMARA, GLOBAL HEAD OF SPENDINGPULSE, MASTERCARD
SpendingPulse™ is provided by MasterCard Advisors and produced in conjunction with Grant Thornton on behalf of the four Dublin Local Authorities to report on national and Dublin retail sales performance. Data is seasonally adjusted but is not adjusted for inflation. MasterCard SpendingPulse™ does not represent MasterCard financial performance.
