A good second quarter but Bellwether flags coming problems | WARC | The Feed
You didn’t return any results. Please clear your filters.
A good second quarter but Bellwether flags coming problems
Total UK marketing budgets continued to grow at a solid pace in Q2 2022, according to the latest IPA Bellwether Report, but the stormclouds are gathering as companies’ financial prospects deteriorate and ad spend forecasts are revised downwards.
In Q2, around a quarter (24.2%) of surveyed companies raised their total marketing expenditure while 13.4% registered budget cuts. At +10.8%, the resulting net balance remained in solid positive territory, but indicated a slight slowdown in growth when compared to the opening quarter of 2022 (+14.1%).
- Events was a key driver of total marketing activity growth. At +22.2% (up from +18.7% previously), this was the strongest-performing Bellwether category by a considerable margin; the new "living with COVID" normal has given companies the confidence to plan face-to-face events.
- Public relations was the only other Bellwether category to record growth in Q2, strengthening from the start of the year (net balance of +3.7%, from +0.6%)
- Main media was flat at 0.0%, down sharply from +9.4%, although there were notable differences within that:
- Growth was much slowed in other online (+4.4%, from +18.6%) and video advertising (+0.8%, from +9.0%).
- Audio (-16.4%, from -8.5%) and out of home (-15.9%, from -4.6%) saw downturns deepen, while published brands moved from positive to negative territory (-2.6%, from +1.3%).
- Direct marketing also stagnated while sales promotions (-0.7% vs. +8.0% previously), market research (-6.5% vs. -3.5% previously) and other marketing activities not already accounted for (-8.3% vs. -0.9% previously) all dragged on total expenditure.
The outlook is negative
Compared to three months ago, survey respondents became more pessimistic towards their industry-wide financial prospects, with a net balance of -26.7% of companies more downbeat overall, compared with -3.6% in Q1. Similarly, respondents were increasingly pessimistic regarding their own-company performance (-9.5%).
“Brands must tread carefully with their upcoming communications and avoid appearing out of touch. Those that are seen to be working for the benefit of their consumers will no doubt be looked upon more favourably, and the creative industry has a responsibility to support them with that” – Jeremy Hine, CEO, MullenLowe Group UK.
Sourced from IPA
Email this content