Marketing budgets in UK rise in Q3
Around 21% of the survey panel recorded an upward revision to marketing budgets during the latest survey period.
With 11% of companies recording a cut to their marketing budgets, the resulting net balance of +9.9% was notably down on Q2’s +13.1% and the lowest reading since the first quarter of 2016.
The perceived advantages of cost and return of digital marketing were noted as key in driving budget growth for internet – and thereby total marketing – during the third quarter of 2017.
Latest data showed that a net balance of +17.0% of companies increased their internet budgets, lower than the previous quarter’s decade high of +22.7%, but nonetheless indicative of healthy expansion.
Reflective of a longer-term shift, there were reports that internet marketing budgets had been increased at the cost of reduced spending on traditional print media advertising.
Within internet, marketing budgets related to search/SEO rose to a greater degree as signalled by the respective net balance improving to a seven-anda-half year high of +16.3% (Q2: +15.6%).
Mobile advertising also rose to a stronger degree in Q3 (net balance: +5.8%, from Q2’s +3.0%).
Other Bellwether categories to enjoy positive net balances during the third quarter included events (+9.4% versus +2.1% for Q2) PR (+7.2% from +2.1% in Q2) and ‘other’ (+2.3% from Q2’s -2.6%).
Some companies commented that attendance at local events, conferences and trade shows were beneficial due to the greater opportunity afforded to them of closer and direct engagement with customers.
Perhaps reflective of ongoing uncertainty and generally slower sales growth in the third quarter, main media advertising was unchanged (net balance: 0.0%, down markedly from +9.8% in Q2 2017).
Given the strong performance of internet, which forms part of the wider main media advertising category, the latest survey data subsequently implied a subdued performance for advertising related to ‘big-ticket’ areas such as cinema, TV and radio.
Stagnation of marketing budgets was also seen in the sales promotion and direct marketing categories during the third quarter (net balances of 0.0% were registered).
That said, in both cases, no change in marketing budgets was a relative improvement following notable reductions seen in the preceding quarter (Q2 net balances were -10.7% and -4.7% respectively).
Posting a net balance of -2.4% (Q2: -6.2%) market research was the only Bellwether category to register a net reduction in spending during Q3. ■