The latest IPA Bellwether Report reveals a continued upswing in UK marketing spend throughout Q1 2024, marking a trend of growth since Q2 2021. This rise is attributed to an improving economic landscape, with the UK poised to emerge from recession and facing diminishing inflationary pressures.
In Q1 2024, nearly a quarter of surveyed companies increased their marketing budgets, outpacing those who reduced spending.
Notably, the events category experienced a record expansion, emphasising a strong interest in face-to-face customer engagement. Direct marketing and sales promotions also saw growth, albeit at a slightly moderated pace. However, main media advertising faced a slight decline, signaling cautiousness toward large-scale advertising campaigns.
Looking ahead to the 2024/25 financial year, finalised budget plans indicate a positive outlook, with a substantial portion of businesses intending to increase marketing expenditure. Events are projected to see the most significant budget growth, followed by direct marketing and main media advertising.
Despite overall optimism, some sectors like market research and miscellaneous marketing activities are expected to experience budget contractions, reflecting a continued focus on cost-saving measures.
While sentiment towards industry-wide financial prospects has improved, challenges such as ongoing supply-chain issues and strong wage pressures persist, potentially impacting businesses’ spending decisions in the near term. However, forecasts suggest a bounce-back in adspend from 2025 onwards, driven by lower inflation and borrowing costs, leading to more robust economic expansion.
Viewpoint from Hunterlodge’s CEO
Rob Hunter, CEO at Hunterlodge, views the sustained growth in UK marketing spend as a positive indicator for agencies like Hunterlodge. He notes that the continued expansion reflects growing confidence among businesses in the post-recession recovery and underscores the importance of strategic marketing efforts in driving customer engagement and business growth.
Hunter emphasises the significance of the events category’s record expansion, highlighting the enduring appeal of face-to-face interactions. He believes this presents opportunities for agencies to innovate and attend more and more networking and industry events.
“Regarding the projected budget increases for the 2024/25 financial year, it’s more important than ever for agencies to demonstrate their value proposition and strategic expertise to clients. We must stay agile and adaptable in responding to ever evolving market dynamics, leveraging data-driven insights and emerging technologies to drive ultimate payback for our clients marketing investment.”
