IPA Bellwether Report: Marketing budgets reach two-year high – but should you stick or twist?

Now in its 26th year, the IPA Bellwether Report remains one of the most definitive pulse-checks for the UK marketing industry. After total budgets flatlined in the final quarter of 2025, the marketing sector entered 2026 with a degree of trepidation. With geopolitical issues continuing to unsettle global markets and energy costs fluctuating, many expected a period of budget consolidation and uncertainty.

Instead, the IPA’s Q1 report reveals a bullish start to the year. UK companies are not just maintaining their presence; they are actively increasing their investment to stay front-of-mind and strengthen brand equity.

So, what do marketing leaders need to know? Which categories are driving this growth, and is the industry focused on short-term reactive fixes to market conditions or toward long-term strategic revenues?

10 key takeaways to help guide your decision-making

1. Total marketing budgets surge

After a stagnant Q4 2025 (0.0%), total marketing budgets saw a fresh rise in Q1 2026, with a net balance of +7.3% of respondents reporting increased spend. This represents the strongest upward revision in nearly two years. 

2. Events lead the charge

Face-to-face engagement is back in a big way. Events emerged as the top-performing category with a net balance of +14.7%, a huge leap from the +1.4% recorded in the previous quarter, as brands prioritise direct relationship-building. 

3. Main media returns to growth

Interestingly, main media advertising (TV, radio, etc.) returned to growth for the first time in a year. The net balance climbed to +4.5%, its strongest revision since Q3 2023, signalling a renewed appetite for large-scale brand-building on traditional media channels.

4. Video marketing bounces back

Within main media, video was a standout performer. After dipping to -5.0% in late 2025, it rebounded to +5.7% in Q1 2026, as marketers reinvest in visual storytelling and other online advertising.

5. PR hits five-quarter high

Public Relations budgets were revised upward to a net balance of +6.0%, the highest figure in five quarters. This suggests a growing focus on reputation management and trust-building in an era where authentic content and earned visibility are paramount. It also reflects a broader recognition of PR’s growing role in shaping how organisations are discovered, interpreted, and content shared by AI-driven large language models. 

6. Direct marketing and sales promotions turn positive

Both categories moved back into growth territory. Direct marketing rose to +3.6% (from -4.3% in Q4), while sales promotions reached +2.7%, as brands balance brand-building with tactical lead generation. 

7. Adspend forecasts upgraded

Reflecting this renewed confidence, the adspend growth forecast for 2026 has been revised upward to 2.5% (compared to the previous forecast of 1.5%), with further momentum expected through 2027 and 2028. 

8. Traditional media still under pressure

Despite the overall rebound, some sectors remain in decline. Out-of-home (-11.3%), published brands (-8.5%), and audio (-3.4%) continue to see budget cuts, though the rate of decline in audio and OOH is slowing. 

9. Own-company confidence improves

It’s interesting to see that marketers are feeling better about their own firms’ prospects. Optimism regarding own-company financial prospects rose to a net balance of +0.6%, a dramatic recovery from the -19.0% low recorded just three months ago. 

10. Fragile industry-wide sentiment

While company confidence is up, industry-wide sentiment remains cautious at -21.0%. While still pessimistic, this is a five-quarter high, indicating that while the mood has improved, the broader economic outlook is still viewed with a steady hand. 

CIM's view on the findings

To understand the practical implications of these findings, CIM spoke to the media (Marketing Week, Campaign, Performance Marketing World, New Digital Age) and discussed the factors and trends steering the industry at this difficult time.

Reflecting on the Q1 results, CIM's Chief Executive, Chris Daly, emphasises the importance of strategic consistency:

"What we are witnessing is the marketing industry maturing in its response to volatility. Instead of a 'knee-jerk' retreat, brands are doubling down on high-engagement channels like events and video to maintain their competitive edge.

"The rise in main media spend is particularly heartening. It suggests that the lesson has been learned: you cannot 'discount' your way to long-term success. As we move through 2026, those who can blend the agility of performance marketing with the enduring power of brand-building will be best placed to capitalise on this recovery."

Final thoughts

The Q1 2026 Bellwether Report signals a welcome shift in sentiment, but it’s clear these gains are hard-won. In a time of fluctuating energy costs and global instability, marketing budgets are no longer being granted on potential; they are being earned through proven performance.

Marketing leaders are responding to economic pressure with a potent blend of ambition and discipline, channelling spend into high-impact, measurable areas like events, sales promotions, advertising, PR and media. By prioritising relationship-building over reactive tactics, the sector is ensuring that marketing remains a critical engine for revenue growth and retention, rather than a line item to be cut.

However, the gap between company optimism and industry-wide caution serves as a vital reminder. To turn this short-term bounce into a long-term strategy, your internal capabilities must match the increasing complexity of the market.

Resilience should also not be confused with complacency. With the marketing sector as complex and fast moving as ever, now is the time to invest in the skills and team structures that anchor brand health in commercial value. The mandate for 2026 is clear: stay agile, stay disciplined, and ensure that every pound invested today builds the equity required for tomorrow.

For more information: https://ipa.co.uk/news/bellwether-report-q1-2026