Some 26% of marketers surveyed in the first quarter this year believe the financial prospects for the UK advertising industry are set to improve; in the previous quarter, it was just 10%.
But this renewed confidence is not reflected in increased spend, with direct marketing budgets revised down 3.2% and main media (advertising etc) down 2.7%.
Perhaps not surprisingly, given the IIAB recent study which claimed online spend is set to reach £5bn this year, Internet (up 7.8%) and search (up 4.7%) were the only sectors which recorded a rise. The resultant net balance sees a 1% (up from 0.6% in Q4) overall.
Chris Williamson, chief economist at Markit and author of the Bellwether, said: “Companies’ views on their financial prospects have risen to the highest for two years, but the brighter outlook has yet to be fully reflected in plans for marketing spend.
“Although current marketing budgets were revised higher for the third consecutive quarter, the increase was only marginal. Furthermore, although companies have set their marketing budgets higher for 2012-13 on average, they have started 2012 with the most cautious approach to spending for three years.
“This perhaps reflects a more pragmatic approach to budget setting, given that initial increases in budgets were steadily revised away in the past two years, as weaker than expected sales caused firms to cut marketing costs. However, with the coming year seeing events such as the Olympics, Diamond Jubilee and Euro 2012, it is likely that the year will again see an increase in marketing spend.”
Online advertising spend hits £5bn
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