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Forget the ‘Credit Crunch’: 3-year marketing study reveals the ‘Austerity Effect’

April 14, 2011

UK consumers are less likely to respond to marketing messages than they were a year ago, as austerity measures triggered by government cuts begins to kick in, according to a new consumer survey.

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The data, from the British Marketing Survey, indicates that some sectors could be expected to get 40% fewer customers in the coming months, as purse strings tighten around the country.
The British Marketing Survey began collecting data on response to marketing channels in March 2008. The survey is ongoing, with data collected every month by face to face interviews of a representative sample of the British Population.
In addition to revealing who has responded to which channels, the data also identifies who recalls receiving each channel, who finds which channel acceptable and who is prepared to respond to each channel in the future. The constant tracking of this data through 37,000 interviews in the last three years provides a detailed knowledge base covering the relationship between the consumer and the marketing industry through a difficult period.
First the ‘Credit Crunch’ now ‘Austerity’
The effect of the 2008 economic crisis can clearly be seen from the chart, but we can also see a distinct annual response cycle. The early indicators for the start of the 2011 cycle appear to be more extreme than the last three years – the start of the ‘Austerity’ effect?
The downward trend in the number of people responding to marketing during 2008 and into late 2009 was only interrupted by a ‘seasonal’ upturn during the Christmas period. 2010 showed signs of recovery but there is a much steeper fall in the first quarter 2011 than 2010. This would seem to be the effect of austerity measures – a diagnosis backed up by the data we collect on financial optimism which has fallen significantly.
The survey data shows that the number of people who think their financial situation will worsen over the next three months has risen by 75% year on year to March.
In addition, the March 2011 figures from our Commercial Sectors section show some big declines in the number of people likely to make purchases. Some sectors can anticipate over 40% fewer customers in the coming months.
The ‘Devil’ is in the ‘Detail’
While overall figures provide a useful backdrop to the market, it is only by looking at individual marketing channels and business sectors by segments of the population that real business insight can be obtained.
Different sections of the population are affected to different degrees by the ‘austerity’ measures, and things are further complicated by changes in the way that people choose to receive information and to shop. All this adds up to a business environment which requires careful monitoring of up to date data.
The British Marketing Survey collects data every month on 18 marketing channels, not only who has received and responded to each one but also who find each channel acceptable and would respond to it. This data is overlaid by which of 23 commercial sectors they receive marketing from, which sectors are acceptable and which sectors consumers are likely to make purchases from.
The British Marketing Survey is conducted as part of The British Population Survey.
Full details of the Survey, including free access to the analysis software complete with the database for the whole of 2008, is available from www.thebps.co.uk

Uncategorized Christmas, government, marketing, UK

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