British companies sharply raised their marketing budgets in the first quarter, extending the trend to four-and-a-half years, as their financial prospects improved, results of a survey by IHS Markit showed Wednesday.
The survey also showed that adspend is likely to grow by 0.6 percent this year, in contrast to the previous forecast for a 0.7 percent decline. The revision is based on the expectation that the economy is set to expand at a solid pace this year despite an expected slowdown in the first quarter.
The quarterly IPA Bellwether survey of about 300 British companies showed that 26.5 percent of panelists reported an increase in marketing activity against
14.7 percent of the survey panel that recorded a reduction. Marketing budgets were increased for a seventeenth successive quarter.
Budget spend growth on internet picked up to the highest in just under four years. Main media also attracted a strong increase in budget during the first quarter, continuing the recovery after a marked decline in the third quarter of last year. Direct marketing budgets increased the most in two years, following stagnation in the previous quarter.
The survey also showed that marketing executives are confident regarding growth in budgets from present levels over the coming financial year. Exactly 41 percent of those surveyed expect to record an increase in their overall
marketing budgets versus about 15 percent that forecast a fall.
Though indicative of a marked degree of confidence, notably year ahead expectations continue to lag those seen prior to the start of the global financial crisis in 2008, the survey said.
The survey also showed an improvement in company financial prospects during the first quarter. Over 32 percent of the survey panel indicated positive
financial prospects, compared to under 19 percent that indicated a fall.
That said, confidence around wider industry business prospects remained inside negative territory for a fifth successive quarter.
"The Q1 2017 Bellwether survey paints a picture of a solidly growing UK economy, with companies continuing to show a willingness to commit increased
resources to marketing and capitalize on current positive sales trends," IHS Markit economist Paul Smith said.
"But perhaps reflective of the relative limbo we find ourselves in ahead of the start of negotiations between Britain and the EU, degrees of confidence
remain historically low and marketers continue to note plenty of threats to the outlook."
by RTT Staff Writer
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