Marketing at a Turning Point

The latest CIM (Chartered Institute of Marketing) Marketing Trends Survey in the UK shows a major upward revision to planned sales growth. At the same time, however, confidence that these plans can be achieved has dropped back close to its lowest ever level.

The survey is consistent with the view taken of the economy that it is starting to change gear but that recovery will be patchy.


The latest survey shows planned sales growth at 4.8 per cent sharply up from the 3.0 per cent growth planned 3 months ago. The new plans are the most optimistic recorded since Spring 2001. But these stronger predictions follow a period where performance has been well below expectations -- actual sales growth for the respondents over the past 12 months had fallen to 0.1 per cent from 3.5 per cent. This is easily the lowest level ever recorded.

In the circumstances, confidence in achieving these plans has fallen back. The Confidence Index, which had bounced back from 83.9 to 91.4 last Winter, has now fallen back to 84.9, its second lowest level ever. Not surprisingly companies are holding their marketing spend down and playing safe by keeping costs down - even though their own predictions indicate rising levels of activity.

'This Spring survey seems to indicate that the economy may be starting to improve but that the respondents would like more evidence before they believe it. Meanwhile marketers are keeping their marketing spend under tight control - the forecast increase in spend is close to the lowest ever. This mix of caution with some areas of expected expansion is typical of an economy at a turning point,' says Douglas McWilliams, Economic Adviser to The Chartered Institute of Marketing.

Perhaps surprisingly against the background of weak demand and uncertain prospects, the respondents predict that they will continue to raise prices, especially in the service sector. Whether these planned price increases will be achievable is, however, another matter.

All articles 2006-22 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.