Marketing budgets in UK revised up marginally in Q4 2015
Evidence from marketing executives suggests that companies were facing a dilemma of trying to provide support for sales and revenue growth against a desire to strengthen cost controls.
These opposing forces means the headline net balance from the survey, which measures revisions to current marketing budgets, slid to an 11-quarter low of +0.5% in Q4 2015. This is down from +4.4% in Q3 2015.
Broadly similar proportions of companies recorded an upward revision (20.4%) to marketing budgets as signaled a fall during Q4 2015 (19.9%).
The marked slowdown in budget growth seen in the second half of 2015 has coincided with a softening in the rate of UK economic expansion which was viewed as a key factor behind a heightened caution amongst clients and marketing executives with regard to their budgets in Q4.
Nonetheless, by remaining above neutrality, growth has now been recorded for 13 successive quarters, thereby further extending the unprecedented period of expansion in marketing budgets recorded by the 16-year-old survey.
Despite subdued overall budget growth, panelists signaled an ongoing desire to invest in the digital marketing space. Latest data showed that internet marketing budgets were again raised, with the respective net balance at +6.9% (Q3: +7.8%).
Main media advertising (+1.1%) also recorded some growth, extending the current period of expansion to two years, while there were some marginal gains seen in PR (+0.6%) and events (+0.6%).
However, declines were registered elsewhere, led by a sharp reduction in ‘other’ (-12.1%), sales promotions (-7.7%), market research (-7.3%) and direct marketing (-1.7%). ■