The Wise Marketer recently reported the rise in coalition marketing as a sales promotion technique. Sales promotion has become more prominent in the last year in a blanket effort to get people  to spend their money less cautiously. It has become important to reward consumers for their loyalty so that they continue to spend money at a time when people are trying to cut back. Encouraging reluctant consumers to spend money continues to be the number one priority for brands at the moment and sales promotion is a proven way to do this. We are at the point where now it is an essential tool to remain competitive, particularly on price.

Sales promotion through consumer incentives and brand coalition is not a new or reactionary concept dreamt up as a recession solution. This has long been the bread and butter of companies such as The Rocket Marketing Group who put companies together in loyalty and membership programmes/ discount clubs and create rewards for staff or consumer incentives. The lure of big brands working together can be a powerful solution for potential rewards and an attractive consumer incentive whatever the state of the economy. All the current climate has done is to highlight the importance of sales promotion to consumers, making it now essential for all brands.

The ideas of brand coalition are the principles that loyalty and rewards programmes or discount clubs and consumer incentive rewards were built on. With loyalty and membership programmes/ discount clubs a member joins a club and then becomes eligible to redeem discounts at various retailers. The joint venture of big and small brands work to validate each other and produce a community of customer centric brands that members become loyal to because they can rely on them to understand their needs/ interests. These loyalty and membership programmes or discount clubs can be categorised to target certain markets such as entertainment, home & garden or white-labelled to match particular brands who want to sell the clubs as non-core products and earn incremental revenue.

The idea of high profile sales promotion has now become an integral part of the consumer shopping experience, so it likely to continue in some guise or other even as the economy improves.

Contact Us to discuss the possibilities of developing consumer incentives and brand coalition solutions through loyalty and membership programmes or discount club for your brand.

Despite the recession there are still a number of companies, across a range of industries that are experiencing profit growth. We should be celebrating these successes and not let our focus be consumed by the negative stories. Recession is almost certainly a time for change, but not necessarily failure. Brands may have to adapt to reflect how people are spending; like Waitrose, which recently introduced a lower priced range to their traditionally high-end selection of products, to encourage profit growth.

This change from Waitrose came days before, supermarket Morrisons reported in its preliminary results for 52 weeks ending on the 1st February 2009 that like for like sales were up 7.9%; proving that value is currently an important issue for supermarket shoppers. Chief Executive, Marc Bolland, said: “Our focus on fresh food and value appeals to shoppers everywhere and provides a strong platform to take Morrisons from national to nationwide.”

This, it seems is a theme that unsurprisingly repeats itself across many areas, not least entertainment. As people are watching the pennies, cheaper entertainment seems to be an easy way for people to cut back. This is good news for companies such as Cineworld, which operates 75 cinemas. The company has just released its figures showing that sales for the year rose by 4.4%.

On this, Chairman, Anthony Bloom commented: “Movies have an enduring appeal and a visit to the cinema is relatively low cost when compared with other forms of leisure and entertainment.”

Operating in a similar sphere, LOVEFiLM.com, Europe’s largest online DVD & games rental service and entertainment has also had a phenomenal year achieving success during recession: “40 per cent increase in memberships since the credit crunch began. Now renting over 3 million DVDs per month from a catalogue of nearly 70,000 unique titles, the latest figures reveal further proof that for Britons, staying in is the new going out.”

Commenting on the recent success during recession of LOVEFiLM CEO Simon Calver said: “This is further evidence of what another great year it’s been for us. Given the uneasy economic climate, we’re thrilled that customers increasingly recognise LOVEFiLM as the affordable and accessible entertainment option. Coupled with our recent acquisition and integration of the Amazon DVD rental business in the UK and Germany, we are looking forward to what the next year brings.”

A few other success stories include KFC announcing the creation of 9,000 jobs, McDonald’s sales increasing by 7.6 per cent in the final quarter of 2008, Cadbury announcing a 30 per cent annual profit growth as consumers turn to chocolate treats during the recession – and the list goes on.

This small selection shows the success of businesses offering cheaper options and reflects the way people are choosing to spend their time. For the average Briton adjusting to the difficulties of a recession may mean spending less, but that doesn’t have to mean enjoying life any less. Value brands and cheaper entertainment options are the obvious choice for consumers, so how can every other business align themselves with value brands to ensure steady trade, without damaging the brand’s values?

Businesses such as LOVEFILM and Cineworld have capitalised on marketing their brands through loyalty and membership programmes, which give members further discounts and build loyalty at a time when the public are looking for extra value. But these clubs are also a way that brands such as Virgin Experience Days and Theatre Tokens can offer customers discounts and drive sales without devaluing their usually more expensive products.

The Rocket Marketing Group has a range of products that offer businesses a way to tap into the discount market. These products include The Entertainment Club, The Midweek Dining Club, The Big Savings Club and The Home and Garden Club.