Caution Returns for UK Marketers

UK marketing budgets were down a fraction in Q2 amid uncertainty regarding the economic outlook, according to the latest IPA/BDO Bellwether survey published today. Budgets for Internet marketing were however revised upwards.

Around 20% of companies reported a downward revision, while fifteen percent reported an increase. The IPA (Institute of Practitioners in Advertising) says business confidence has dipped with positive sentiment the lowest for a year, but that budgets were being trimmed at a much slower rate than at the height of the recent downturn.

Researched and published by Markit Economics on behalf of the IPA and sponsored by accountants BDO LLP, the Report is based on responses from a panel of around 300 UK marketing professionals.

2010 marketing spend is still expected to increase versus last year, but less than anticipated at the start of 2010. The IPA says the latest findings suggest the UK economy 'is now entering a phase of slower growth'.

Main media budgets were revised down in Q2, against a small rise in Q1, and budgets for the 'all other' category which includes market research in a motley grouping with PR, events and others, were also down, while sales promotion budgets dropped more than any time in the last twelve months. Only two categories saw upward adjustments: direct marketing and the Internet.

Rory Sutherland, IPA President and Vice-Chairman of Ogilvy Group UK, comments: 'That we are seeing a more cautious approach to marketing spend compared to Q1 is not surprising due to the uncertain nature of our economy at the moment, and in the wake of the recent budget. However though this indicates a less optimistic picture than previously thought for this year, marketing spend is still set to increase.' Steve Williams, IPA Media Futures Group Chairman and Chief Executive of OMD Group, says that when results are viewed 'in tandem with a very positive 'Internet' spending assessment... the complete picture continues to look strong year-on-year'.

First published on the 17th July 2000, the Bellwether has reached its tenth anniversary, and this issue features a special supplement by leading industry contributors. Web site: www.ipa.co.uk .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.