NEWS11 April 2013

UK MR budgets up in Q1, says IPA’s Bellwether

Financials UK

UK — Market research budgets in the UK were revised up on balance in the first quarter of 2013, according to the latest Bellwether Report from the Institute of Practitioners in Advertising.

A net 1.3% of respondents reported an increase in research spend in the first three months of the year, which supports anecdotal evidence from several agency CEOs that circumstances have improved following a difficult Q4.

(Research-live’s sister site, Research Jobfinder, has also passed 1,000 current vacancies for the first time, suggesting rising demand for research services – Ed.)

PR and internet marketing were also up, however events, sales promotion, main media advertising, direct marketing and other marketing categories showed a net decline in budgets.

Overall marketing budgets were flat, with a net balance of 0.1%, compared to 1.1% in Q4 and -5.5% in Q3. More than a third of marketing executives are planning to raise their 2013 budgets, compared to 23% who are anticipating cutting back. However the planned increases in budgets are “modest” compared to pre-financial crisis levels, says report author Chris Williamson (pictured), chief economist at Markit.

“The hope among many companies is that increased sales and marketing activity will drive business growth, but firms will need to see convincing signs that demand and profits are improving in the coming months to prevent business confidence falling again and marketing budgets from being revised down as the year proceeds,” said Williamson.

A predictive model used by Bellwether to forecast ad spend performance points to a likely fall of -0.3% this year. Figures published today by Warc, however, predict an inflation-adjusted growth rate of 0.7%.