Without a doubt, 2023 has been the year of Taylor Swift. From ticket sales to travel bookings, the pop star's recording-breaking Eras tour encouraged a new wave of consumer spending resiliency. Yahoo Finance’s Josh Schafer highlights Swift's economic impact this year and what early 2024 could look like in a "Swift Economy."
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Video Transcript
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SEANA SMITH: No question about it, it has been the year of Taylor Swift. She has dominated the news and pop culture since the announcement of her "Eras Tour" broke Ticketmaster at the end of 2022. Now, since then she has broken sale records, boosted the economy, and also brought a new demographic to the NFL. We're going to be spending the next hour taking a deep dive into the impact that she has had on the economy, on marketing, and more. Joining us now for the next hour, we have Yahoo Finance senior reporter Alexandra Canal.
ALEXANDRA CANAL: So excited.
SEANA SMITH: It's so much to talk about here. I think I would have been-- I was surprised by how much focus has been spent on Taylor Swift. It seems like everyone has been talking about her. Jay Powell, like we just had in our package, even mentioned the impact or didn't dismiss the impact that she has had on the economy.
ALEXANDRA SMITH: Yeah, you just think about the local economies too from the flights to the tickets to the merch. I know multiple people that traveled far and wide to go to this concert multiple times. The touch points that she has is just remarkable and it seems like you can't really replicate it. This is the pop star of our generation.
And we think about the girl summer that we had not just with the "Eras Tour" but also Beyonce's "Renaissance Tour," the "Barbie" movie, that helped boost GDP in the third quarter. In fact, "Fortune" estimates that the tour could generate $4.6 billion in US consumer spending. And that's just the "Eras Tour" alone.
And it comes at this perfect time where people want to get out there. The pandemic, people were at home. Now, live events is where it's at. And in this era, no pun intended, of inflation, the consumer is supposedly pulling back on their spending. That's not happening with TSwift.
BRAD SMITH: Well, see, here's the thing, in the experience economy, that has been, and as you mentioned, it's movie-going, Barbie. It's concert going, Beyonce, Taylor Swift. And it requires a great deal of execution to make sure that you're getting the omnichannel approach correct for all of these, whether it's in the movies, whether it's for the concert goers as well, and selling merchandise at every single turn here, and then also making sure that you stay in the news with a potential relationship as well for Taylor Swift and Travis Kelce. And so all of this considered here, I have never defined myself as a Swiftie. But I will say on a business mindset approach, I am a little bit more Swiftie adjacent at this point because of the execution--
SEANA SMITH: That's big.
ALEXANDRA SMITH: Swiftie adjacent.
BRAD SMITH: --that we've seen come forward.
ALEXANDRA CANAL: OK, there we go. And you mentioned the news multiple times Taylor Swift has been mentioned. The most unlikely place that Taylor Swift has popped up this year has been in financial news.
Yahoo Finance reporter Josh Schafer is here with every time Taylor's name was mentioned in that context. And Josh, I know you're a big Swiftie. You volunteered yourself for this segment, so give us a breakdown.
JOSH SCHAFER: Yeah, Ali. I mean, candidly, I'm not that big of a Swiftie. But even I haven't even been able to ignore her this year because she's been in our news. She's been in financial news really throughout the summer.
So if we take a look at a timeline of when we started seeing Taylor Swift, we know that "Eras Tour" really started in the spring. So then it trickles into economic data into the summer. She was mentioned in the Fed Beige Book.
Moody's called out Taylor Swift. There was a question to Fed Chair Jerome Powell about the Taylor Swift impact. And then Morgan Stanley highlighting at the end of the summer that the end of the "Eras Tour" is going to mean slower consumption.
So I want to dig in a little bit as far as what we saw in different aspects of this. If you take a look at what the Fed Beige Book actually had to say about Swift, they wrote, "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." And then if you fast forward to what Moody's reported, you'll see Moody's highlighting the impact that we saw for hotels in different cities. So all the way to the right there is the average revenue for room in the total US growth. But look at the cities that Swift was in, look at Newark, look at Philadelphia, look at Boston, massive increases on those days when Taylor Swift was there.
And then this one was my personal favorite because we had the summer of Swift. Then at the end of the summer Morgan Stanley comes out and says seriously for Q4, you should be worried about not having Taylor Swift. Now, this is combining Taylor Swift and Beyonce, also Barbenheimer.
But you can see, we were looking at 1.9% growth there. And then actually potentially going negative in Q4 from what Morgan Stanley had projected back in August when you take out Swift, Beyonce, Barbenheimer. So without that girl economy, without that girl power economy that we talked a lot about over the summer, we might not have seen the resilient US consumer that has kept us out of a recession.
BRAD SMITH: Josh, one performer being called out this many times by economic studies, I mean, how common is that if we were looking at it from a historical perspective here?
JOSH SCHAFER: Brad, it is not common. So I talked to several economists when I was reporting on different stories about this over the summer and just simply said, is this normal? And Tom Simons over at Jefferies, who's been in the industry for about 15 years, said absolutely not. And one thing that we, sort of, came to a conclusion on is maybe Taylor Swift is our way of understanding the resilient consumer in the US economy and what the story was over the summer.
When we think about what the economic story has been for the US, it has been people willing to spend on services, willing to spend on experiences, and willing to spend up on once in a lifetime experiences. And it seems like that's what Taylor Swift got out with this "Eras Tour." She was the perfect epitome of people being willing to spend on a once in a lifetime opportunity to see all these eras come together, to trade the friendship bracelets, to really have a moment and a concert that we haven't seen before.
And so Taylor Swift really was a microcosm of the resilient US consumer. And I think that's why us and finance news were attracted to it. I think that's why people in the NFL have been attracted to it. Everyone loves talking TSwift. She speaks to everyone and she's certainly spoken to us in finance news over the last six months or so.
BRAD SMITH: All right, Josh, my friendship bracelet to you is on the way from Etsy. It's in the mail right now, I've been told. All right, stand by for that--
