Research: Marketing budgets rising
Marketing budgets have increased at the strongest rate since 2017
The latest IPA Bellwether Report for Q2 2021, released today makes positive reading for CIM members.
Marketing budgets have increased at the strongest rate since 2017, the first time in three years with successive quarters of growth, as the restrictions around the pandemic ease.
The report’s findings are drawn from a panel of 300 UK marketing professionals from across key business sectors, drawn primarily from the nation’s top 1,000 companies.
Thoughts on the sector as a whole:
- CIM’s own CMO 50 research found recently that the vast majority of in-house marketing leaders (71%) believe that the COVID-19 pandemic has had a positive impact on the perception of their brand. More than twice the proportion (52%) believe that the marketing sector is stronger than five years ago with only 20% believing it was weaker
- This trend is echoed in the IPA Bellwether report which found that 37.5% (versus +34.6% previously) of companies were more optimistic about their financial prospects - a level of optimism not seen since Q1 of 2015
- Around 48% of firms expect stronger growth than they did three months ago, compared to just 11% who were less optimistic
The key take aways are:
- Budgets having increased to their highest level in four years
- Ad spend expected to grow sharply in 2022
- Organisations registered a net balance +12.8% regarding increasing their budgets in Q3, more than doubling last quarter's +6%
- 6% recorded higher spending compared with 12.8% that reported budget cuts
- Ad spend set to grow by 6.2% next year, but could return to normal by 2023 (2.4%) and 2024 (1.7%)
Breakdown of budget revisions:
- ‘Big-ticket’ marketing saw the highest growth in Q3, +8.6% from +1.3% in Q2
- Direct marketing, which posted +5.6% from +0.7%
- Video increased with a net balance of +12.6% from 4.2%
- Online had a net balance of +10.6%
- Audio (+6%) and publishing (+5.2%)
- Out of home was the only main media to record a budget cut, with 11.9% reducing spend, resulting in a net balance of -2.0%.
- Direct marketing had the strongest upward budget revision for 11 years with a net balance of +6.8%
- Market research (+0.7%, from -9.6%)
- PR continued to err on the side of caution posting budget reductions of -3.2% from -24.7%
The long term view:
- The report concludes that growth in both GDP and ad spend should normalise from 2023, with the forecasts being: 2023 (2.4%), 2024 (1.7%) and 2025 (2.9%)
For more information on the report visit the IPA website here
To download the CIM CMO50 report click here
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