UK Marketing Budgets Remain Elevated, Study Shows

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18th July 2014 16:46 - Financial Services

UK marketing budgets have increased for the seventh consecutive quarter, according to a survey conducted by Markit Economics and IPA.

The study – also known as the Bellwether report – questioned 300 UK-based companies to investigate marketing trends for the second quarter (Q2) of 2014.

Around one sixth (15.2%) of the companies surveyed said they had increased their advertising budget in Q2 of this year – the second highest reading in the survey’s 14-year history, and second to only quarter one (Q1) of 2014 – which recorded a mark of 20.4%.

Internet marketing, which allows firms to target specific clientele in a cost effective manner, incurred the greatest level of upward revision in Q2 (14.7%), ahead of main media advertising (11.5%).

Events (7.8%), direct marketing (4%), PR (3.9%) and sales promotions (3%) also recorded moderate growth. Market research, however, suffered downward revision (-2.4%).

The study also revealed that firms expect to continue raising their marketing budgets in the future, mainly due to increased optimism both within their own company and the industry as a whole.

According to the survey, the UK economy is forecast to grow 3% this year.

Paul Bainsfair, Director General at IPA, said: “The latest Q2 Bellwether Report is an upbeat one, both for marketing budgets and companies’ financial prospects.

“It demonstrates that companies are capitalising on the positive economic climate to drive business growth, sending out a positive message to our industry and to the UK at large.”

Chris Williamson, Chief Economist at Markit, added: "Marketing spend is surging higher as companies remain upbeat about the future. The extent to which business confidence has shown continual improvements over the past year is remarkable, generating a major inflow of investment in marketing.”

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