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Is the latest Bellwether telling us anything new?

Published on Thursday, 24th January 2013
Marketing budgets rose by just over 1 per cent during the final quarter of 2012, reflecting a small increase in optimism among clients, according to the latest IPA Bellwether Report.

To summarise the press release, the latest Bellwether report shows that  Marketing budgets rose by just over 1 per cent during the final quarter of 2012, reflecting a small increase in optimism among clients. On top of that 17 per cent of clients reported an increase in total spend compared with 16 per cent reporting cuts, the net balance was 1.1 per cent, not much you may say but this is the highest figure since the third quarter of 2013 and compares with a 5.5 per cent decline in the third quarter of 2012 and a 0.6 per cent rise during quarter four in 2011.

It’s no surprise that internet spend continues its rise but in other areas budgets are flat or, for below the line, cut and marketers are continuing to be pessimistic. But a future winner is adspend where growth is expected to accelerate to a 4.6 per cent rise in 2017.

Nicola Mendelsohn, the IPA president has said : "Advertisers have a growing sense of cautious optimism about their own financial prospects."

But perhaps there is a lot more to this than is immediately obvious.

We took the view of a some of our colleagues at Bristol Media working in the sector.

Jonnie Galvin-Wright, Marketing Sector Head Bristol Media and Director (Strategy) Ontrac Creative Marketing

Despite the slight optimism this latest survey suggests we should not kid ourselves things are back on course. But it’s the adspend growth that really stood out to me. Maybe it’s just over optimism following the additional budgets that were ploughed in to the UK’s year of festive fun in 2012. Maybe it is inclusive of higher internet adspends too. But there is something else going on. It shows perhaps an on-going shift in media splits that’s beginning to remind us all of what advertising is here to do – recession or no recession.  With increasing fragmentation and channelling of media through the internet, marketers understand that the big story and the big idea still needs to be told. There is still no better place than advertising to change perception, start a story and immediately build awareness, despite the increasing power of the internet and social media.  Of course that also means that planners and marketers have to yet again show  mastery across all channels to show the sum of the parts but advertising is starting to define its role better in the marketing mix.

Tom Dunkerley, Managing Director, Sift Media

Cautious optimism, is fair reflection on the outlook of the majority of our clients in 2013. We'll all have to work-harder, spend-wiser and prioritise effectively to achieve good growth.  Insight, driven by technological advancement, continues to provide a greater understanding on customer/prospect behaviour, driving confidence that advertising can provide the fuel for real ROI - hence the improved outlook.

Online and social will continue to grow in importance, with the best ROI coming from a blended, multi-channel approach. However, a big trend and potential conundrum for marketers, will be forming solid plans to maximise mobile/tablet engagement - a growing trend across our B2B audiences, with 15% of all traffic coming via a mobile or tablet device in 2012. By 2017, we expect significant growth and advancement in the mobile advertising space, a key playground for the future.

Fraser Bradshaw, MD Saint Nicks and Bristol Media CEO

'I think that the Bellwether report comes as little surprise to most people.  We are still trading in a difficult economic environment and GDP stagnated throughout last year.  We can take some optimism from the prediction that 2013 budgets will rise to be higher than 2012. 

Fêting this nominal growth in ad-spend is still a cautionary tale, as other sectors, such as PR and Events continue to feel the challenges of budget trimming.  The outlook by 2015 is far stronger, so setting good foundations now will provide a better yield in two years time.

For those who are still a ‘single discipline’ creative business, the challenges will remain the same.  For those who have embraced change, made genuine staff and technology investments over the last 5 years and are now digitally and socially active, the future looks brighter.  We see a re-mapped global economy, new technologies (or 'old' technologies applied in new ways) and some new business models emerging, which pose a real and exciting opportunity for the industry.'