THE PROPORTION of British firms boosting their marketing budgets has jumped to a level not seen since before the recession, according to a closely-watched survey released today.
Growing optimism in businesses is fuelling higher amounts of cash that can be put aside to promote goods and services, IPA’s Bellwether survey says.
Over a fifth of companies (22 per cent) reported an upward revision to their marketing budgets for the second quarter of the year, while only 15 per cent said that they have trimmed their marketing budgets.
The resulting net balance – shown at plus 7.3 per cent in the report – is the highest since the third quarter of 2007, before the UK economy began to contract in 2008.
“This is very encouraging,” said IPA chief Paul Bainsfair. “With the upward revision of marketing spend in quarter two the highest for almost six years. Companies are beginning to shake off the cloak of recession and are becoming more confident in the economy.”
The survey of marketing professionals showed confidence at its highest level since the third quarter of 2009.
A positive net balance of 27.6 per cent of companies are confident regarding their financial prospects, a considerable jump from the positive balance of 16.8 per cent recorded in the first three months of the year.
Chris Williamson of Markit, which compiles the data, said that it bodes well for the UK economy as a whole.
“With marketing spend a key barometer of the health of the economy, not only is GDP growth likely to have accelerated in the second quarter, but the Office for Budget Responsibility’s official forecast of 0.6 per cent economic growth this year is all of a sudden starting to look overly pessimistic,” said Williamson.
The report also reveals that momentum is not fading for internet marketing. Budgets in this sub-sector grew in the second quarter according to a net balance of 17.4 per cent of respondents – sharply up from a balance of 8.9 per cent in quarter one, and the highest number since the start of 2010.