Brexit? What Brexit?
The latest IPA Bellwether report into marketers’ spending plans (300 of them) in Q4 2016 shows that 12.9 per cent actually increased budgets despite widespread fears/predictions that the vote to leave the EU and, in all likelihood the Single Market, would derail British business and advertising and marketing with it.
Compounding this upbeat performance 27.6 per cent of Bellwether respondents said they were planning to increase their spending in 2017. Rather bizarrely Bellwether compiler Markit is forecasting a 0.7 drop in adspend in 2017, citing continuing Brexit uncertainty, a slowdown in consumer expenditure and rising inflation.
Most main media had a decent Q4 2016 with print, in long term decline, the main weakness.
Nobody really knows how leaving the EU and Single Market will impact British business – much depending on whether the growls from other European leaders and EU bureaucrats actually come to anything. At the moment the UK is benefiting from continued membership of the Single Market plus a 17 per cent fall in the GBP, boosting exports substantially.
IPA director general Paul Bainsfair says: “After a year of well-publicised doom and gloom, Bellwether provides some welcome positive news. With marketers revising their budgets up yet again, the industry ends the year on a high. Furthermore, it is reassuring that despite the slight fall in adspend predicted by Bellwether in 2017 due to Brexit negotiations, growth is forecast for both 2016 and 2018.”
IHS Markit senior economist Paul Smith who compiles the reports says: “The Q4 2016 Bellwether survey provides a fascinating account of the impact on marketing activity of a currently humming UK economy contrasting with the uncertain Brexit-dominated prospects to be faced in the coming months.
“With company sales growth being underpinned by firm UK household spending, marketing budgets continued to be driven higher in the fourth quarter of 2016 and a number of companies are seeking to maintain growth with some taking advantage of the weak pound to promote their goods and services to a foreign audience.
“However, with inflation set to rise in the coming months and erode purchasing power, plus the continued uncertainty created by the Brexit vote, it remains to be seen whether momentum can be sustained into the heart of 2017.”
Come on Paul lighten up, it might never happen.