Driving sales in a recession

4th May 2012, by Aimie Truffas

On 25th April, figures released by the Office for National Statistics showed that Britain’s sluggish economy experienced negative growth for the second quarter in a row. By definition this now means we are experiencing a double-dip recession - the first since 1975 - and the worst economic period during the last 100 years. 

When the figures were released, construction was named as the big disappointment, after shrinking 3% in Q1. However, on closer inspection, marginal growth in the services sector - a sector that represents nearly three quarters of the economy - may be more responsible for the disappointing figures. 

The economy seems to be stuck. It’s not hurtling downwards, at least, or soaring upwards, but is staying flat and will likely stay that way for a while. All in all, this means that although the news is not great, it could be much worse. The danger is that these figures will damage consumer confidence at a time when we should be encouraging spending. As a result, now, more than ever, connecting with consumers and developing meaningful relationships to generate spending is important, not just for businesses but for the economy.

It’s not all bad news, though. The IPA Bellwether survey, published on the 19th April, gave us some welcome good news. It revealed that business confidence is the highest it’s been for two years. Although businesses remain cautious, marketing spend is on the up - so looking forward, we can remain optimistic that this confidence is a sign of better things to come, double dip or not.

All signs point to the fact that NOW is the time to think differently about your brand and your communications.

Even the most difficult sectors can outperform during a recession with the right approach. Positioning and customer engagement were key when we were brought in to turn around premium health club brand Esporta and prime them for sale. In an undifferentiated market we repositioned them as the club for a healthy, balanced lifestyle. To engage consumers we took on a common enemy for potential gym-goers and developed a ‘Changes for Good’ programme, moving away from quick fixes towards a balanced programme of exercise, relaxation and helping people to maintain healthy lifestyles. We then launched ‘Resolution Amnesty’  encouraging people to submit broken resolutions to receive a free guest pass, allowing them to turn resolutions into lasting, healthy changes. This broke all records during a recession and increased membership by over 7,000 in just a matter of weeks.

More importantly, we turned the business around, into one that sold to Virgin Active for a sizeable profit less than 6 months later – all without touching the spend of Esporta’s competitors.

We achieved this thanks to one principle, which is paramount in a recession. To succeed, you need to outthink and act smart. Insight and commercial drive are essential. It’s no longer about throwing money at your brand and consumers. To this end, we have created a toolkit of proven key methods, honed over the past three years and geared to driving sales within a recession. With a focus on acquisition and retention, it’s these strategies that are producing outperforming results. 

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