With Stoke back in the Second Division for the first time since 1963 morale around the area was low and was not helped by a poor start to the season away at Mansfield Town. George Eastham was sacked in January 1978 and Alan A'Court took over as caretaker manager. Unfortunately for A'Court he was in charge of just one match which was one of the most infamous in the club's history, a 3–2 defeat at home to non-league Blyth Spartans in the FA Cup. Alan Durban was appointed manager and his new signings brought life back into the squad and guided Stoke to a respectable 7th position.

With Mr T.Degg now Chairman and the club in the Second Division, with little or no money at his disposal and rumblings that Peter Shilton wanted to leave the picture was far from rosy.George Eastham, who was now given the managers job on a permanent basis sold veteran John Mahoney to Middlesbrough for £130,000. Into the club came experienced midfielder Howard Kendall from Birmingham City for £165,000, full-back Alec Lindsay from Liverpool, Paul Richardson from Chester City and David Gregory from Peterborough United. These new arrivals would go on to have mixed success at Stoke.

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