The UK has avoided falling into recession. For now.
But government forecasts predict that the country will experience a recession at some point in 2023. This means that now is the time to prepare.
On the 10th March, Haines McGregor hosted a webinar exploring How to Manage your Brand through Recession. The session, led by Jamie Holtum – Strategy Partner at Haines McGregor – featured:
- Rachel Roberts, Ex Global VP of Sustainability at Beam Suntory
- Jonathan Gatward, Director & Co-Founder of The London Essence Company & Wisehead Productions
- Stephen Robertson, Chair at Retail Economics & Ex Director General at the British Retail Consortium
Jamie Holtum kickstarted the session. “How can brands survive – and flourish – in recession? Whilst the UK has been told it’s not in a recession, consumers across the world feel like they are. Food inflation is above 15%. Global wages are being squeezed. Energy prices continue to rise. People are making choices, habits are forming – and brands must adapt.”
LEADING BY EXAMPLE
The panellists opened the discussion by identifying brands which have succeeded through challenging economic headwinds.
Rachel Roberts pinpointed Target’s ability to play a defined role in consumers’ lives. “They are the go-to store for every single event, be it Mother’s Day or Halloween. And when times are tough, these events become increasingly important. In a world of uncertainty, Target represents reliability, consistency and certainty.”
Jonathan Gatward discussed how Jimmy Choo’s strong purpose, coupled with an enhanced accessibility focus, keeps the brand on track. “Jimmy Choo grew 50% between 2021-22. ‘Choo Sketch’, a competition where consumers could design the next range of footwear, was an effective way to connect with the brand’s communities and provide a creative outlet. It also donated 100% of profits to ‘Women for Women’.”
Stephen Robertson highlighted how JD Sports cultivates good relationships with its customers. “JD Sports has been resilient and wise about its brand. It understands and defines its core customers, and is very clear how it offers great value. Not through price discounting – buy through the authority and exclusivity of its products.”
THE ART OF STABILITY
Jamie moved the conversation on. “Brand positioning is a lever that can be pulled to change perception. But surely if your positioning is good enough, desirable enough and culturally relevant, there’s no need to panic – right?”
“We need to make sure we’re relevant and responding appropriately – but that can be dangerous if it’s a knee jerk reaction,” Rachel noted.
Stephen argued that brands must understand the difference between attitude and behaviour. “It’s behaviour that counts. Once you understand your customers’ behaviour you see a huge difference between the reports on what consumers believe about green issues for instance, and how these attitudes actually impact where they spend.”
“Our first job as marketeers is to measure behaviours and not attitudes. Because it is behaviours which collect pound notes.”.
DEJA VU...
This isn’t the first time brands and marketers have faced recession in recent memory.
“Looking back can help us move forward,” Jamie Holtum pointed. “So – what can we learn from the 2008-09 crisis?”
Stephen argued that recessions shouldn’t automatically signal budgetary cuts like so many did in 08/09 – and that for many consumers, spend won’t shrink. “Over 27% of consumers aren’t worried about the way the economy is going to go in the next 12 months. If those are your customers, you can afford to be bolder.”
“Furthermore, if brand owners are busy cutting costs, now may be the best time to win new users. Don’t dismiss the idea of growth through recession. Brands should be thinking about these choices, rather than immediately batting down the hatches.”
Jonathan agreed. “When your competitor goes quiet, that’s when you double down. Recession makes good businesses strong. As soon as it bites, most weaker competitors fall away. That’s what we learnt from 2008”
WORDS FROM THE WISE
As the session drew to a close, Jamie posed a simple question to the panel. “If you’re a brand facing these economic headwinds – what would your words of wisdom be?”
Rachel emphasised the importance of tweaks versus wholesale change. “You’ve spent huge amounts of brainpower developing your fundamental positioning. That’s still relevant and true – don’t throw it out. Work out how to flex moving forward. Stay open to learning so you really understand your future consumer needs.”
Stephen argued that brands “can change the tone without changing the brand.”. There are still opportunities to connect with new consumers through brand values, and not get sucked into a race-to-the-bottom on price.”.
Jonathan agreed with this focus on value. “With the cost of living crisis, every single brand owner has had to deal with record levels of inflation. But my advice to marketers is to keep focused on the value your brands add – especially when the rest of the boardroom is concentrated on price.”
To learn more about Haines McGregor and speak to Jamie directly, email jamie.holtum@hainesmcgregor.co.uk
