Record Optimism for UK Marketers - but Not MR, Yet

Marketing budgets in UK companies are moving upwards more strongly than at any time in the last nine years, according to the latest 'Bellwether' report by advertising body the IPA. Breaking down results however reveals that market research is the one sector still in negative territory.

The report is based on survey responses from marketing professionals in 300 UK-based companies, chosen from the top 1000 by revenue, providing regular quarterly information on trends in their marketing activities. Questionnaires are dispatched to companies in the final three weeks of each calendar quarter.

Index figures are calculated by deducting the proportion of respondents reporting or predicting decline from the proportion reporting or predicting growth. Some 26.0% reported a rise in budgets in Q4 of 2023, while only 11.3% reported cuts, giving a net balance of +14.7%, up from 5.3% the previous quarter. This represents a run of eleven quarters in which this figure has been positive, the longest since 2018, and looking to the immediate future, preliminary budget setting suggests 2024 will be a strong year for UK marketing executives, despite some forecasting a recession for the beginning of the year.

Breaking down the results by sub-category, Events continued its post-Covid rebound with the strongest rise (+15.9%) while direct marketing broke its previous record with a net balance of +12.6%, up from +4.3% in Q3. Expansion was less dramatic in PR (net balance of +1.9%, down from +4.0), main media (+1.9%, down from +7.4%) and sales promotions (+1.4%, from -1.5%). Market research however was one of two categories, alongside 'other', with a negative net balance (-5.0%, from -1.5%).

Looking at likely total marketing budgets for 2024/5, based on preliminary budget setting data, 44.5% of respondents forecast expansion, vs only 15.1% cutting back, for a net balance of +29.4%. However - again - budget cuts were slightly more likely to be on the cards for market research, with a net balance of -1.0%.

Other questions revealed that respondents are somewhat more bullish (+12.6%) about growth prospects for their own companies, compared to three months earlier, but remain concerned (-12.7%) about the outlook for their sector as a whole.

IPA Director General Paul Bainsfair said of the findings: 'Despite the challenging economic climate, this quarter's upbeat Bellwether findings show that companies are heeding the evidence that continuing to advertise through the tough times can help maintain brand loyalty and protect the long-term health of their brands'.

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.