Corporate marketing budgets have been revised downwards for the next few months, according to the latest Bellwether Report, published last week by the Institute of Practitioners in Advertising.
While the quarterly report shows that Internet marketing and sponsorship grew from 1.5 per cent to 2.5 per cent of marketing budgets, it states: “Companies reported that their total marketing budgets for the current financial year (2000) had been revised down on average during the third quarter – the first downward revision recorded by the survey since data were first collected at the start of the year”.
On the positive side, 55 per cent of the companies surveyed which were setting new total marketing budgets for the next financial year, reported that expenditure had been set higher for 2001 than for this year. A decline in this figure was reported by 19 per cent of businesses.
“We believe that the advertising sector is a key leading indicator of the future state of the UK economy,” says IPA president Rupert Howell.
The report suggests the revision is in response to higher than average spends at the start of the year. It estimates that UK marketing expenditure last year was worth between £20-35bn, of which Internet marketing was worth £500m.
“Attention will focus on the level of claimed and intended Internet spend. It’s astonishing how quickly it’s grown. In 1999 commercial radio accounted for 5.5 per cent of all marketing expenditure and the Internet spend is well on the way to half that level,” says IPA director of marketing strategy, Hamish Pringle.