How did you find business conditions this year?
Responses to this question will always cover the scale from Extremely Difficult to Extremely Good but in previous years it has always been clear that there is a trend one way or another. Our industry is either thriving or struggling.
The graph this year is much flatter than normal. 35% of respondents reported a year that was worse than average while 38% reported having a year that was better than the middle range of ‘OK’.
There will always be differences in how individual businesses cope with particular economic conditions but the suggestion here is that the economy was even more volatile than usual and companies could move quickly from doing well to being in crisis and, of course, vice versa.
The cost of living crisis, rising energy prices and the fluctuations in the housing market have certainly resulted in an unstable economy in which to do business.
What had the biggest influence on your business this year?
Over the last few years we have added Brexit, Covid, the Cost of Living crisis and Energy costs to the list of possible influences. That says a lot about the world we have been living in.
The weather continues to be hugely influential and our industry continues to be one that is ‘solar powered’ with a hot, dry summer driving business in a way that nothing else does.
What comes as no surprise is that the cost of living and energy costs are clearly seen to be having the biggest affect this year. Over 72% see spiralling energy costs as influencing how their business performs.
One respondent simply says, ‘Hot tub sales dropped due to increased running costs.’
Another sees that, ‘The current Ukraine and Gaza conflicts are not helping global stability which also filters down into economic confidence.’ Increasingly, the problems that affect our businesses are global ones. The world has become a smaller place.
One respondent says that he sees, ‘General unwillingness to part with money, with many wishing to delay till 2024 in the hope they can have more faith in their own finances.’
Undeniably, what this means is that energy saving technology and sustainable installations will become the industry norm with saving on running costs coming at the top of all our customer’s wish lists, from retrofit to new build.
Would you describe most of those sales as being at the top-end of the market, budget conscious or somewhere in between?
And here we find an anomaly. With all the economic pressures and concerns regarding costs, we might expect to see that a percentage of the market would be looking for budget products but, from these responses, it seems not.
Now, of course there are people looking for budget installations and retrofit products, but perhaps not as many as we might think.
Two things may be at play here. The wealthier individuals in the country have not been hit that hard by the recent economic challenges. The rich still have money.
The other is perhaps down to the value that people see reflected in their wet leisure choices. Pools, spas and saunas are all seen as an investment in health and wellbeing at a time when those things are valued particularly highly.
This isn’t to say that people have money to throw around, but they will spend on the right product.
What marketing and advertising do you do for your business?
When things change slowly it can sometimes be difficult to realise that they actually change at all. The forms of When things change slowly it can sometimes be difficult to realise that they actually change at all. The forms of advertising and marketing that make up this chart and the relative amount of importance each one is given seem to be exactly what you might expect.
For the world of today, it is. But if you go back ten years, the picture is very different.
In 2013, 80% of businesses had a website but other than that, marketing was split almost equally between traditional media and the digital world.
The same number of businesses used social media, then still in its infancy, as used local press. Newsletters were just as likely to be posted through a letterbox as delivered by email.
Now look at 2023 and almost five times as much weight is put behind digital marketing as is put behind traditional media.
And what marketing do you think works best?
‘Word of mouth’ is always the top answer here and that is true this year just as it was ten years ago.
No matter how good your website or engaging your content, no matter how clever your advertising or impactful your show-stand there is something irresistible about word of mouth. The simple thought that people like your business so much that they tell all their friends is a very appealing one.
And so it should be. Testimonials, whether on line or over a pint at the pub, are probably one of the most persuasive forms of marketing that there is.
Then there is SEO. Will Google recommend you?
As the biggest gateway to the Internet, Google stands head and shoulders above the rest. That might be simply as a search engine or as a media channel for Google AdWords and pay per click. ‘Google by a mile, its where the purchase journey starts,’ says one respondent.
Seen as almost as important as a website, social media is the new giant of digital marketing,
Respondents are saying. ‘Social media & direct email marketing to target our customer base.’
Interestingly, some respondents saw their customer service as a marketing tool. Which, of course it is. ‘Providing an outstanding service at a competitive price.’
But sometimes the old ways are the best. ‘Shows and exhibitions are the best way to get out to the public whilst showroom footfall is low.’
Then we ask, ‘How do you expect business conditions to be next year?’
Over the course of all of the surveys we have seen one trend that remains true each and every year. Respondents expect next year to be pretty much like this year. But as we have already seen, it’s not easy to say what this year was actually like. With business conditions so unpredictable and choppy this year, our expectations for next year aren’t clear. The overall picture that the responses paint is that next year will be ‘OK.’ There will be good and bad.
And that is probably true, particularly if we look at the reasons that have been given for that outlook.
Some people are finding that they are too busy and their challenge is ‘Finding time to carry out the work requested by loyal customers.’
Some see broader issues. ‘ The energy crisis still and cost of living.’
How those broader issues impact on our industry. ‘People thinking tubs cost loads to run and then are simply put off.’
Some of the insights the survey data has shown can be seen clearly in the real world. The cost of living & energy prices will affect customer spending in the lower & middle markets.
Respondents point out that a general election during 2024 will only add to economic uncertainty.
These external business pressures are added to with internal challenges such as staff retention, which has been a recurring problem for the last three or four years now, and finding new staff with the appropriate skills and qualifications.
Which market trends are your customers following?
Eco friendly and energy saving products top the list here. Almost 75% of customers are looking to save money or save the planet. That surely comes as no surprise.
The next highest score is 56% and that is for top-end and luxury products.
In these challenging times, however, it does come as a slight surprise that budget priced products sit at the bottom of the list with a score of only 36%.
People are looking for value for money more than they are looking to simply save money.
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