The Bellwether found that there was a net balance of -7% of marketing executives in favour of reducing their spending on market research in the second quarter, up from -10.5% in the prior quarter.

Decreases in market research were noted by around 11.6% of panellists, while only 4.7% of firms reported a rise on the quarter.  

The latest results contradicted previous projections for 2025/26, where a positive net balance of 3.3% of Bellwether panellists projected an increase for the year.

Bill Doris, vice-president analytics, Europe, Middle East and Africa at EssenceMediacom and IPA Media Research Advisory Group chair, said: “While market research budgets saw a modest decline this quarter, the rate of reduction has slowed significantly this quarter compared to earlier in the year. This improvement comes as overall marketing budgets expand at their fastest pace in a year and business confidence continues to build.

“Forecasts for 2025/26 point to growth in market research investment, the first positive outlook in three years, highlighting the sector’s vital role in driving strategic marketing decisions.” 

Despite the news about market research budgets, UK marketing budgets reversed previous declines and bounced back in the second quarter of the year.

A net balance of 5.5% of panellists reported a rise in their total marketing budgets for the second quarter of 2025, an improvement from -4.8% in the prior quarter and the most significant rise since the second quarter of 2024.

Underlying data indicated that 22.7% of panellists registered a rise in marketing budgets, compared to 17.2% reporting a reduction in their budgets.  

Sales promotions and direct marketing performed the best in the latest Bellwether, with respective net balances rising from 8% in Q1 to 9.4% in Q2 for the former and from 9% in Q1 to 9.1% in Q2 for the latter.  

Marketing budgets also rose for events and public relations, although both recorded a slight decline in their respective net balances, from 5.4% in Q1 to 3.9% in Q2 and 3.4% in Q1 to 2.7% in Q2 respectively.

Budgets for the main media category remained unchanged on the quarter at 0%, albeit an improvement on the previous quarter’s net balance of -6.7%.

At a company level, 21.9% of panel members had increased optimism compared with three months ago, just shy of the 24.9% indicating pessimism.

Although the resulting net balance remained in sub-zero territory for the fourth consecutive quarter, it improved significantly from the first quarter of the year, reducing from -12.9% to -3%. 

In contrast, industry-wide financial prospects were more downbeat, despite edging up from the previous quarter’s -37.4% to -26.2%. Specifically, 36.9% of firms were less upbeat towards financial prospects than they were three months ago, overshadowing the mere 10.7% that were more positive. 

Forecasts for advertising spend in 2025 have been revised down from 1.3% to 0.7%, but 2026 is expected to see a recovery with spending growth to hit 1.6%. 

Paul Bainsfair, IPA director general, said: “Looking at the broader picture, we welcome the news that UK companies have revised their marketing spend upwards in Q2.

“This uptick in marketing investment not only contributes to the overall health of the UK economy but, for businesses with the foresight to invest strategically, it can also lead to significant growth and competitive advantage.”

Rachel Macey, managing director at Kantar Media TGI UK and Europe, said: “It’s encouraging to see the rebound in marketing budgets. However, there’s a risk that marketers are chasing short-term wins through direct tactics over long-term brand building based on research and insight. 

“It’s also worth noting that while spending on online media has gone up, other types of media saw significant cuts. That means non-digital media need to work harder and smarter to prove how they can add unique value and engage audiences in ways that support digital-first media strategies.” 

Mike Follett, chief executive and founder at Lumen Research, commented: “While rising budgets are a positive sign of confidence, brands must question whether flatlining spend on main media is wise.

“Channels such as TV and DooH are some of the best places to build brand recall & awareness. With uncertainty prevailing, these channels are critical to long-term brand building. So instead of pulling back from these channels, marketers must optimise them with the best quality insights to engage audiences with the highest impact.”