The report, which has been conducted on a quarterly basis since Q1 2000, revealed a net balance of 12.3 per cent of companies registering an increase in budgets during Q3 2013. That compared to +7.3 per cent in Q2 and was a fourth consecutive reading above zero.
The net balance is calculated by subtracting the percentage reporting on a downward revision from the percentage reporting an upward revision.
Respondents to the survey sighted improved economic conditions and business revenues that in turn offered a platform for increased marketing investment.
Q3’s survey indicated that confidence for companies regarding their own financial prospects had grown to the greatest degree in eight-and-a-half years, with the net balance of firms becoming more optimistic reaching +49.2 per cent (up from +27.6 per cent in the previous quarter).
The improvement in wider economic conditions was noted as a factor supporting optimism. This was borne out by the latest figures regarding industry financial prospects. The respective net balance hit a level of +35.4% (up from +6.1 per cent in the previous quarter) and was also a series record high.
These positive trends mean an increase in GDP forecasts for 2013. Real UK ad spend growth is now projected to be 2.4 per cent in 2013 and 3.6 per cent in 2014.
These positive trends mean an increase in GDP forecasts for 2013. Real UK ad spend growth is now projected to be 2.4% in 2013 and 3.6% in 2014.
By sector, online saw budgets raised up to a greater degree than any other category (+11.7 per cent net balance). Within internet advertising online search and SEO spend were also revised up (+7.7 per cent net balance). Main media advertising saw a second successive period of growth; the strongest since Q3 2010 (+3.4 per cent net balance).
In contrast, direct marketing (-3.4 per cent), events (-1.1%), market research (-3.0 per cent) and PR (-1.7 per cent) saw falls, presumably indicating that spending on these is being diverted online.
IPA director general Paul Bainsfair (left) says: “This latest Bellwether report will provide a welcome boost to our industry, building on last quarter’s results. It indicates that companies are beginning to move forward away from the recession and that the UK economy is on the rise again. This optimism will send a continued upbeat message to the advertising industry and the wider economy”.