What’s in it for me ? marketing in tough times

The most irresistible proposition is one that offers plenty of alternatives, allowing the customer to tailor a purchase to personal preferences.
The effects of recession on consumer spending
Here in the UK the current recession has been declared a record breaker. Through force of circumstance, or simply concern over what the future holds, according to research commissioned by our national tourist agency Visit Britain, over three quarters of the population have reined in their spending and become a lot more careful about what they spend their money on. Even the minority who still have plentiful financial resources (and around 13% of the UK population fall into this category), are taking advantage of the situation, and driving a hard bargain on major purchases.
Inevitably the downturn has moved the goalposts for businesses involved in the visitor economy too. A BBC Radio 4 report recently announced that the ratio of savings to earnings had risen to it’s highest level for some years, after plummeting towards negativity during boom times. when credit fuelled spending had almost outstripped earnings. Looking into the future, The Banking Times this week reported on consumer research from KDB, which showed over half (56%) of Britons intending to cut their borrowing. and almost half (45%) intending to bolster their savings, (with the young particularly in favour of saving), in the coming months.
Consequences for UK tourism
The consequence of all this is that discretionary spending is likely to shrink further, and as a result, like other sectors competing for consumer spending, businesses involved in hospitality tourism and leisure in the UK are all going to have to continue to fight hard to maintain ‘share of wallet’ not just this winter, but into the New Year as well. It’s a good time to be bargain hunting!
The latest bulletin from Visit Britain, looking at the outlook for UK tourism, makes fairly gloomy reading for the industry in the short term. Earlier in the year, their research (with Olive Insight) into UK consumer behaviour during the recession, examined the extent to which people have been cutting back on different types of expenditure over the past year, taking snapshots every few months to monitor the evolving situation, and specifically its effect on trips and travel away from home.
It found that although expenditure on holidays and breaks from daily routine is relatively resiliant as a category of consumer spending, almost half of the UK population are cutting back on the amount they’re spending, although few are sacrificing holidays and breaks altogether.
What remains clear, is that irrespective of whether the recession affects you personally or not, is that the people who are spending are looking out for a deal, and getting into price comparison in a big way. Haven’t you noticed all the TV ads for price comparison websites recently?
Reasons why people are still spending
Here are some of the reasons why people are spending on trips and breaks away from home:
- it can be a necessity
- show off to friends
- escape from stress
- a treat to reward yourself for hard work
- celebrate a special occasion
- spend time with family
- enjoy the comfort of the familar
- make the trip of a lifetime
Why busnesses are ‘going the extra mile’
There’s often a lot at stake when people are planning a trip. The interests of many different people may need to be satisfied, so there can be a lot of planning and emotional commitment involved in getting it right before money can change hands.
People often start by researching their options online. Any business serious about marketing in the current economic environment, needs to put some thought into dangling a choice of propositions in front of every customer or prospect. Speaking for myself, I know it’s a lot more difficult to turn down everything when presented with an attractive choice of options at various price points, than it is to make a simple yes or no decision on one item. Market traders the world over take full advantage!
Incidentally, leather gloves in a wonderful choice of colours similar to the ones shown in my picture above, can be found at Sermoneta, 51 Burlington Arcade, just off Piccadilly, near the Royal Academy in the West End of London.
Countering objections
It’s perfectly reasonable for people considering spending a significant amount to have genuine doubts about whether a purchase is right for them. Busineses can tackle this by anticipating and countering objections, and being ready to serve up a simple list of answers to ‘frequently asked questions’ during live encounters or online. It’s not in anyone’s interest, however, for people to feel that they’re being put under pressure.
A picture can speak a thousand words. Photography can help bring an experience alive, and can help bring a business a wider audience when published on photo sharing sites such as Flickr, which can link back to the originating website. I also believe there’s a good case for accommodation providers and visitor attractions to start thinking about other ways of making the most of digital technology. This can be in the form of 360 degree views of guest rooms, videos good enough to become popular on You Tube, audio podcasts, blog publishing, or soliciting user generated reviews.
Ordinarily a business might find it a simple matter to persuade people to book and pay full price, by providing information about location, facilities, prices, and how to book. However when times are tough, many people are looking out for ‘deals’. So what types of deal are most effective in securing incremental business? Visit Britain’s research has identified four types of proposition offering maximum appeal, and I have to admit that they work with me!
The top 4 propositions
- Enhancing offer. Covers added value propositions of all description, such as treating a guests to a room upgrade, or offering an annual pass for the price of a full price day ticket to a visitor attraction.
- Enabling offer. This puts something attractive within reach, allowing people to purchase something at a value for money price, that they feel couldn’t otherwise afford. Examples include 2 for 1, 3 for 2, and similar offers of all description. Often combined with psycholological price points (£9.99; £99; £999 etc.)
- Stimulating offer. This is usually wrapped up around special events, and may offer privileged access, VIP treatment etc. These types of offer are not usually possible for people to organise themselves, so price comparison is made impossible.
- Self Justifying offer. Appeals to people celebrating special occasions, or living life in the fast lane, who seek pampering, or a reward for hard work when they take time off or time out. Propositions of this type usually involve indulgence and luxury, and can vary from private dining to spa days, retreats, or unique activities offering an adrenaline rush.
Promoting offers
Businesses dictate where their offers are promoted. Most are sensibly ring fenced with an expiry date, and fair and reasonable terms and conditions, such as validity dates, to prevent abuse or over redemption.
Online media can provide an inexpensive choice of distribution channel, and many businesses choose to publicise their best offers only on their own website. If you’re someone on the look out for offers, individual business websites are a good place to look; but in addition many destination websites feature an ‘offers’ section for consumers. If a wide choice of propositions and a range of price points are what you’re looking for, destination websites can be a convenient place to find your way to offer originators, so it makes sense for businesses to use this as an additional promotional channel. Local district tourism officers can usually provide information to businesses about the marketing options available on websites they’re involved with.
Many destination sites are highly ranked by search engines, with those offering intuitive navigation and search functions, allied to clickable links through to business websites where people can check things out in more detail, usually have the highest traffic volumes. Many also showcase selected businesses with the aid of paid for ‘enhanced listings’ and image galleries, which further encourage click throughs to individual websites. Inspected and graded businesses that publish availability and offer booking online can also find their offers picked up and publicised regionally, and even nationally on premier sites like Enjoy England and Visit Britain.
You may have heard about the EU Package Travel Directive, which helps provide security for consumers. It defines the responsibilities of operators in relation to pre-arranged ‘packages’ offered at an inclusive price, involving a combination of two or more of the following elements: transport, accommodation, or other services, that account for a significant proportion of the package. This shouldn’t put businesses off from submitting offers. There’s a summary of the regulations on the website of the Association of British Travel Agents, and the website of the European Tour Operators Association also carries information. However if in any doubt about regulatory matters, businesses should always seek professional legal advice. Business Link is a useful source of free advice and support for businesses in the UK
I’m looking forward to the marketing challenges that the New Year is going to bring!
Until next time..





