LONDON: Optimism among UK marketers remains buoyant as the latest IPA Bellwether Report reveals budgets have been revised up for the eighth consecutive quarter.
The Q3 2014 IPA Bellwether Report, researched and published by Markit Economics on behalf of the Institute of Practitioners in Advertising, has shown a net balance of +12.6% of companies registering an increase in budgets.
Although this figure was lower than +20.4% recorded in Q1 and +15.2% in Q2, it still marked two years of continuous growth for UK marketing budgets and was the third highest level in the survey's history.
"The third quarter upward revision to marketing budgets was the third largest recorded since the survey began in 2000, exceeded only by the upward revisions already seen in the first two quarters of the year," said Chris Williamson, chief economist at Markit and author of the report.
"This represents a remarkably positive picture of companies gaining confidence about the economic outlook as the year has progressed, ploughing more money into budgets that had already been set higher at the start of the year.
"At this rate, 2014 is panning out to be the best year for growth of marketing spend in the survey's 15-year history."
Spending on internet marketing was again revised higher than any other Bellwether category and stood at +14.5% in Q3, fractionally down from +14.7% in Q2.
Within this, search recorded a net balance increase of +9.4%, which despite being the lowest since the Q4 2013 survey, still meant there have been positive results over 21 successive quarters.
Spending on main media advertising was not far behind, recording a net balance upward revision of +9.2%, down from +11.5% in Q2.
Other Bellwether categories to record growth included events (+7.8%), direct marketing (+2.1%) and PR (+1.0%), but there were budget reductions for sales promotions (-1.1%), market research (-1.7%) and other (-4.7%).
The survey also reported a net balance of +38.6% of companies indicating they had grown more optimistic about their own financial prospects (up from +37.5% in Q2) and for the wider industry (+30.4%, down from +33.0% in Q2).
The results, coupled with other encouraging data about the UK economy, led the Bellwether to predict adspend growth of 7.0% in 2014, although it expected adspend to fall to 3.8% in 2015 because of an increased chance of higher interest rates.
Commenting on the report, IPA director general Paul Bainsfair, said: "Two years of continuous investment in marketing budgets, coupled with sustained confidence, has enabled the industry to innovate and diversify, and crucially, to drive business growth."
Data sourced from IPA; additional content by Warc staff