The UK may or may not be in recession or about to enter one as another six months of Brexit misery beckons but marketers seem to be trying to keep their end up.
The latest IPA Bellwether Report from IHS Markit shows that the net balance of marketing executives reporting upwardly revised budgets increased to +8.7 per cent in Q1 2019, up from a +0.0 per cent reading for the final quarter of 2018. This is the highest growth since Q3 2017. Around 21.6 per cent of panel members observed spending growth, compared to 12.8 per cent registering budget cuts.
The best performing category in the survey was internet, which saw its net balance jump from +2.1 per cent to +17.2 per cent. A renewed drive for big-ticket advertising campaigns was also apparent during the opening quarter of 2019, with main media marketing returning to growth (+5.2 per cent from -6.2 per cent).
Events was the third and final Bellwether category to register expenditure growth (+3.4 per cent from +2.6 per cent). Events now seem to be a significant weapon in many marketers’ armoury.
Forecasts for 2019 as a whole are still subdued however.
IPA director general Paul Bainsfair says: “This sharp increase following Q4 2018’s flatlining signals that UK marketing budgets have received a much-needed kiss of life in an economy gripped by Brexit uncertainty. The smart marketers realise that to grow their businesses, they must invest in them, particularly in mass reach, long-term media.”
IHS Market’s Joe Hayes, author of the report, says: “A return to growth in marketing budgets during the opening quarter of 2019 may come as a surprise given the uncertainty that shrouds the UK political and economic climate has only built further since the previous Bellwether Report. However, some companies began to show a determination to step up brand-building and protection in these challenging times, taking a pro-active, yet defensive approach in the face of business belt-tightening and weakening consumer confidence.
“That said, cautious undertones were still apparent in budget plans for the 2019/20 financial year, with panellists providing only modest growth expectations in available marketing spend. In fact, the outlook was the most subdued since 2009.”