Online ad spend up for first time since 2008- Bellwether

14/10/2009

UK ad spend may be bottoming out, with spending on traditional media advertising falling by the smallest amount for the past six quarters and online ad spend showing its first increase since 2008, according to a new survey. The IPA/BDO Bellwether survey for the thrid quarter of 2009 indictes that British companies' spending on advertising fell for the eighth quarter in succession in the third quarter, but the reduction in budgets was the smallest seen for a year. Online ad spending showed an increase for the first time since H1 2008, the survey found.

14/10/2009

The Bellwether survey by the Institute of Practitioners in Advertising and accountants BDO said the proportion of respondents reporting a decline in marketing budgets fell to 28 percent, against 13 percent reporting a rise.

The resulting -15 percent balance compares with -28 percent in the second quarter and -42 percent at the height of the financial crisis in the fourth quarter of last year.

The slowing rate of decline was attributable to a steep improvement in business confidence, the authors of the survey said.

Respondents' degree of optimism about their financial prospects was the strongest since the final quarter of 2006, with 47 percent seeing improved prospects.

IPA president and Ogilvy Group vice chairman Rory Sutherland said: “Whilst companies are still understandably wary, the report reveals a strong rise in business confidence and the suggestion that GDP may well have risen in Q3. It will be interesting to see whether the rise in internet spend will presage an upturn in other categories.”

The retail and travel and entertainment sectors saw increased spending, with the steepest falls seen in financial services, other non-governmental services, IT and computing and industrial sectors, the report said.

The Bellwether report by Markit surveys around 300 UK-based companies out of the top 1,000 from a broad range of sectors and locations.

Read the full IPA report here.

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