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 staff