Partner Article

Recession-proofing, retro-style

Marian Shek examines a number of business who are going retro in a bid to cut through the downturn.

In April 2011, Experian reported that the strength of UK’s SME community improved slightly, with only 0.1 per cent becoming insolvent – 0.55 per cent fewer than the same period in 2010.

But the story for North East businesses is less positive. The North East had the highest rate of SME business failure at 0.15 per cent, up from 0.13 per cent in 2010.

However, a certain type of North East business is bucking the trend to survive the harsh climate – thrive, even. Some start ups are finding that “retro” branding could be the way to recession-proof their businesses.

One success story is Cindy Bettcher’s fifties-style ice cream parlour, Lickety Split. Since launching in July 2009, with only four employees, it has become the main attraction on the redeveloped Seaham Harbour seafront. Customers come from across the region, often queueing out the door on weekends and sunny days. Coming up to its third birthday, it now employs 22 staff, is already in profit and an extension is planned to increase the capacity and keep up with demand.

Cindy explains that “retro” was not part of her original business idea: “I wasn’t sure whether to do retro or whether to do ultra-modern. But I thought, if I was going to an ice cream parlour, I’d want to go to a retro one.”

Two years of market research convinced Cindy that she had hit upon a niche market – the nearest retro ice cream parlour she found was in Scotland. She was so confident that she launched at the height of recession. “Everybody tried to talk me out of it, but I needed to do it there and then.” Her gut instinct proved right. With cash being tight, people still wanted an affordable treat – a need ice cream comfortably fulfills.

Few ice cream parlours can say they are as popular as Lickety Split. The managing director of Beckleberry’s, Lickety Split’s ice cream supplier, even came to Cindy to find out how they can improve ice cream sales at their own parlour in the Metrocentre.

So what’s the secret? “I think it’s just the feel of the place, the atmosphere,“says Cindy, “because we like our staff to be happy. We like them to speak to customers, we like them to engage in conversation and I think people feel welcome.”

Another retro-style venture hoping to weather the tough economic climate is Old Cinema Launderette in Durham. Launched in August 2011 by husband and wife Richard, 50, and Kathy Turner, 49, it is not your typical Dot Cotton-style launderette.

As well as washing machines, it has a small café area, a children’s dress up nook, and is unashamedly retro-inspired, from its décor through to its marketing and Art Deco-style branding by Ollie & Moo Creative.

Richard and Kathy did not start out with retro in mind. “The first thing is, it is a launderette,” says Richard. “We do drycleaning, we do ironing, we do alterations, you can come and do your own washing or you can leave your washing.”

The retro theme evolved as they researched into the building’s history as – you guessed it – a cinema. It opened as the Crescent Cinema in 1928, and later became the Rex Cinema during the forties and fifties. Now, the walls are decorated with posters from cinema’s golden era, old washing powder boxes and adverts, and original lobby cards from films shown there.

The history of the cinema may be woven into the business – the four washing machines are named Douglas Fairbanks, Bette Davis, Cary Grant, Grace Kelly – but it is a thoroughly modern business. Richard, under his alias Mr Wishy Washy, is an unrepentant online social networker, and there is free wifi for customers.

In a more unlikely development, it has also become the quirkiest music and poetry venue around – fuelled by Richard’s love of music – with a capacity of around 35. This aspect of the business has managed to create some buzz around the launderette. “Durham’s a cathedral and university city, so people here are generally interested in culture. From a business point of view, just having a normal launderette wouldn’t have worked; it wouldn’t have brought in enough revenue,” Richard explains. “So we had to evolve, diversify and see what the current climate is in the business world.”

Being diverse in their business model is a smart plan for success, but Richard and Kathy have not lost sight of the basics. “We want to build a good quality service that is friendly and professional, for people who would come back again and again,” Richard says. Trends by their nature go in and out of fashion – is it a risky strategy to build your whole brand on the trend for retro? “Retro is quite cool and trendy at the moment. But retro is yesterday, so if that comes and goes as a fashion thing, we’re still in an old cinema and that is part of our brand,” adds Richard. For these businesses, tapping into the retro trend may have been serendipitous, but it was also good business sense during a recession. Joanna Feeley, from trend forecasters and consumer behaviour experts Trend Bible, explains: “This trend began in the food industry, with the revival of familiar or nostalgic products as a result of the uncertainty and threat of the recession. Nostalgia is a safe bet in a recession as people feel worried and look to comforting, familiar activities and products to make them feel safe.”

However, it is not just the harking back to a bygone era that attracts customers. “After over a decade of supermarket culture dominating retail, people seem to like small, characterful ventures with a back story,” says Joanna. “In a recession, anything that makes customers smile or feel happy is gold dust!”

So for small businesses, retro alone is not recession-proof, unless it is done conscientiously and with lashings of personality. Tapping into nostalgia is an easy way to connect with consumers, who also appreciate novelty and, when a certain era is perfectly evoked, attention to detail. But for the entrepreneurs behind Lickety Split and Old Cinema Launderette, “retro” certainly does not equal instantaneous success. A strong brand identity is enough to bring the customers in, but it is the old-fashioned values that keep them coming back: good quality, hard work and service with a smile.

This was posted in Bdaily's Members' News section by Marian Shek .