The improved mood among British businesses has led to growth in all marketing areas, including events, direct marketing, sales promotions, main media advertising, market research and PR, according to the Institute of Practitioners in Advertising (IPA) Bellwether Report.
The report detailed a 17.2% net increase in the number of companies increasing their events budgets, leading the pack, with direct marketing – including direct mail, emails, and telemarketing – recording the second-largest at 8.9%.
“In line with the brightening economy, decreasing levels of inflation and a new government, this quarter’s Bellwether Report reveals real vim and vigour regarding UK companies’ marketing spend intentions,” said Paul Bainsfair, the IPA’s director general.
“As we know, advertising is a real lever for growth for companies and so it is great to see them capitalising on these developments.
While the report celebrated a return to growth in the UK economy, following the brief recession at the end of 2023, it noted “headwinds” to recovery.
Elevated borrowing costs, dwindling government financial support and persistently high food and energy prices were all listed as dampening factors that would restrict economic growth and household spending.
And while the upwards revision to advertising budgets is a positive sign, the report said, S&P Global Market Intelligence – on which the IPA report is based – showed a real-terms flatline in 2024’s overall ad spend compared to 2023.
Even a flat rate of inflation-adjusted ad spend is better than expected, however. In Q1 2024, overall spend had been expected to fall by half a percentage point – and from 2025, S&P has predicted ad spend growth of 1.2%, 1.7%, and 1.9% for 2025-27.
Richard Aldiss, IPA chair for England & Wales, said: “It's great to see not only a continuation but also a strengthening of the optimism we observed in Q1’s Bellwether Report.
“The upturn in main media advertising budgets [up 3.5%] is particularly encouraging. While uncertainty undoubtedly remains, brands and marketeers are gaining confidence from economic and market indicators, rightly viewing this as an opportunity to invest for growth.”
The overall picture of positivity for the marketing industry is more complicated for printers, with strong variance between individual marketing segments.
For all of the growth in available budget for direct marketing – around 19.3% of surveyed companies said they had increased their budget – economic uncertainty has continued to hit marketing in published brands, where those cutting budgets outweighed those increasing them 15.7% to 9.4%.
Out of home advertising remains stable, with no net change.
