By Max Clarke
Marketing budgets are down among UK companies for the third consecutive quarter as businesses attempt to protect their profit margins in the face of continued economic uncertainty.
Confidence among the UK’s marketing businesses has consequently fallen to its lowest level in more than 2 years, according to the latest Bellwether report carried out by the Institute of Practitioners in Advertising and BDO.
“The economy is going sideways and this seems to be the way it is going in the advertising marketplace too,” says Nicola Mendelsohn, IPA’s President. “The decline in confidence doesn't augur well, but is not surprising amidst a continuing climate of concern surrounding the financial and political outlook both at home and internationally.”
Internet advertising continues to grow, though the rate of growth hit its lowest level in the same period. Sales promotion budgets saw the greatest downwards pressure on the figure, suggesting the increased uncertainty is forcing a change in marketing tactics across the industry.
“But,” continued Mendelsohn, “we should take some comfort from the fact that the rate of budget trimming is at its lowest in three quarters, and that there are advertisers maintaining spend nevertheless. "
Andy Viner, Head of Media, BDO LLP also commented on the results: “Marketing spend has proven to be a good barometer of the economy in recent years. The latest IPA/BDO Bellwether report signifies renewed caution from marketing executives as corporates continue to monitor discretionary expenditure to protect profit margins and strengthen balance sheets. Marketing budgets have now been revised downwards for the third consecutive quarter albeit at a slower rate, providing further evidence that the outlook will be tougher and more subdued for the remainder of the year, even when compared to previous forecasts only a few months ago.
Join us on