The Bellwether data found that 15.2% of panellists reported cutting back on their market research expenditure, while 8.3% upwardly revised their budgets over the course of the quarter, resulting in market research budgets recording a net balance of -6.8%, compared with -7.0% last quarter.

However, the study found that companies’ projections for the 2025/26 financial year had market research as an area of prospective growth, with a net balance of +3.1% of respondents expecting an increase in spend on research.

Marketing budgets are in positive territory overall, according to the quarterly report, with a net balance of +3.6% of UK companies revising their marketing budgets up in the third quarter of the year. However, this slightly decreased from +5.5% in the second quarter.

The research found that 22.3% of panellists reported an increase in their total marketing expenditure in the third quarter of the year, while those indicating a reduction was lower at 18.7%.

Events and direct marketing saw the biggest increases in budgets, followed by public relations, while main media budgets were unchanged for a second consecutive quarter.

The data also found that Bellwether respondents (primarily marketing directors or similar from around 300 UK-based companies) felt more optimistic about their own company’s financial prospects, compared with the second quarter of the year.

Over a quarter ( 25.7%) of respondents were more optimistic about their financial outlook, marking the first time since the second quarter of last year that the net balance was positive, as it slightly surpassed the 22.8% who expected a deterioration. 

Respondents’ views of their industry’s financial prospects were less positive, with a net balance of -24.0%. While this represented the highest optimism recorded in three quarters, it still suggested pessimism regarding the financial outlook of their industry more broadly. Just over a third of respondents ( 33.9%) foresee an industry-wide decline, whereas only 9.9% expressed optimism.

The 2025 Bellwether forecast for advertising spend remains unchanged at 0.6%, below the predicted long-term trend rate of around 2%. The IPA’s analysis pointed to the challenging UK business climate, high payroll expenses, domestic policy and geopolitical uncertainty, inflationary pressures and elevated borrowing costs.  

Paul Bainsfair, IPA director general, said: “Q3 results in recent years have shown a note of caution, perhaps unsurprisingly, given their timing just ahead of the Autumn budget. That said, it’s encouraging to see the net balance remain in positive territory. Even in a tough economic climate, businesses clearly continue to recognise the value of advertising.

“What’s particularly interesting is that new analysis of IPA data reinforces the strong link between budget and business growth. The message is simple: to drive meaningful results, advertisers need to think big. Big marketing budgets, broad reach and high exposure. Scale really does matter, which is why investing in big, brand-building media remains so important.”

 Maryam Baluch, economist at S&P Global Market Intelligence and author of the Bellwether Report, said: “UK marketing budgets rose further in the penultimate quarter of the year, providing further encouraging news after a soft beginning of the year. 

“Most notably, the latest Bellwether data reveals renewed optimism regarding financial prospects at the company level, with respondents expressing positivity for the first time in five quarters. Despite ongoing economic challenges, this shows that businesses have adapted by seeking out new opportunities for growth.”

The quarterly Bellwether Report, produced by the IPA (Institute of Practitioners in Advertising) is based on a questionnaire survey of around 300 UK-based companies that provide quarterly information on trends in their marketing activities. Companies participating on the survey panel include a variety of advertisers in terms of market sector and geographical location. Respondents are primarily marketing directors or similar. Questionnaires are dispatched to companies in the final three weeks of each calendar quarter.