Warc, 17 July 2014
LONDON: Optimism continues to grow among the UK's marketing
community as the latest IPA Bellwether Report shows budgets being revised up
for the seventh successive quarter.
The quarterly Bellwether Report, researched and published by
Markit Economics on behalf of the IPA, draws on data from a panel of around 300
UK marketing professionals. For the second quarter of 2014 there was a net
balance of 15.2% of companies registering an increase in budgets, this figure
being calculated by subtracting the percentage reporting a downward revision
from the percentage reporting an upwards revision.
Spending on internet marketing was revised higher than any
other Bellwether category and to the sharpest degree for a year (a net balance
of +14.7%). Within this, search recorded a net balance upward revision of
+12.9% which, although marginally lower than Q1 (+13.9%), extended the current
run of growth for this sector to five years.
Main media advertising was not far behind, recording a net
balance upward revision of +11.5%. This was only fractionally below the first
quarter record of +11.7%.
Other Bellwether categories to record modest growth included
events (+7.8%), direct marketing (+4.0%), PR (+3.9%) and sales promotion
(+3.0%). The 'other' category was flat while market research was the only one
to see a downturn (-2.4%).
"The extent to which business confidence has shown continual
improvements over the past year is remarkable, generating a major inflow of
investment in marketing," according to Chris Williamson, chief economist
at Markit and author of the Bellwether Report.
"This year's budgeted spend, which was already set higher
than last year, has been revised up again in the second quarter, setting the
scene for a bumper year," he said.
The report also revealed widespread optimism about the
financial prospects for individual companies (+37.5%) and for the industry
generally (+33.0%). The Bellwether's own predictive model forecast a 6.1%
increase in adspend for the year, well up on the first quarter's 4.7%
projection, although this would slow to 3.8% in 2015.
Paul Bainsfair, IPA Director General, added that the upbeat
report "reinforces the advertising sector's significant contribution to
the £71.4bn value added (GVA) that the creative industries generate".
The latest edition of Warc's monthly tracker of marketer
sentiment, the Global Marketing Index, is due for release next Thursday. The UK
Expenditure Report, released last week by the Advertising Association and Warc,
put UK adspend growth at 6.0% this year, rising to 6.7% in 2015.
Data sourced from IPA; additional content by Warc staf
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