UK marketing budgets expand for first time in 18 months – IPA Bellwether Report
Total UK marketing budgets expanded for the first time since Q4 2019 and to the sharpest extent since Q1 2019 in the second quarter of 2021, according to the latest IPA Bellwether Report. Financial prospects at company and industry level also remain firmly in positive territory and adspend forecasts are revised higher for 2021, as businesses began to prepare for a strong economic recovery.
A net balance of +6.0% of surveyed companies expanded their total marketing budgets during the second quarter. Just over one-in-five (21.2%) panellists registered growth, compared to 15.2% that reported a decline. This was the first time since the fourth quarter of 2019 that total marketing expenditure had been revised up. Furthermore, it was the sharpest increase since the beginning of 2019 and a notable contrast to the net balance of -11.5% of firms last quarter that had recorded spending cuts. The latest results bring to an end a five-quarter sequence of continual cuts to overall marketing spend.
Revisions by media category
Three categories of marketing spend recorded upward revisions during Q2. Public relations led the upturn with a net balance of +1.8% of firms growing their expenditure in this space (up from -8.0% in Q1). The key segment of marketing, main media, also recorded growth in the second quarter. A net balance of +1.3% of businesses raised their main media budgets (up from -8.2% previously). Within main media, video (+4.2%, from +3.3%), audio (+1.1%, from -9.0%) and other online advertising (+11.0%, from 0.0%) all grew, while published brands (-6.1%, from -22.2%) and out of home (-7.5%, from -24.1%) budgets were downwardly revised.
IPA director general Paul Bainsfair says: “These positive results mark the end of five quarters of continuous cuts. For revisions to UK marketing budgets to bounce back so quickly and strongly, following their nadir at the height of COVID-19 restrictions in Q2 2020, is very welcome news and corroborates our Bellwether prediction for a V-shaped recovery. As the vaccination rollout continues at pace and UK plc gears itself up for growth, we encourage companies to ramp up their advertising to make the most of post-lockdown, pent-up consumer demand.”