City analysts are calling for more information from marketers on their advertising expenditure, according to the results of a survey published by the Institute of Practitioners in Advertising (IPA), in which city workers have struck out against the “veil of secrecy” which often shrouds marketing activity.
The survey, conducted by Populus, polled the views of 50 city analysts from five key sectors: automotive, FMCG, telecoms, alcohol, and financial services, about their views of marketing, advertising and promotions.
The survey found that one third of the analysts polled regard the relative importance of intangible assets, such as brands and good will, as “highly” or “enormously” important, and, when asked to put a percentage estimate on the importance of intangibles, on average those polled said 42%.
When questioned over the significance of non-financial measures of performance, 40% of analysts polled by Populus said that they rarely or occasionally refer to non-financial measures. However, the reason for this was largely because of a lack of information, seen by analysts as a barrier to the inclusion of such data.
The survey also highlighted the call for greater transparency about marketing expenditure, with 4 in 5 of the analysts surveyed stating that they thought that marketing expenditure was at least in some part a “black hole” when attempting to predict or analyse the performance of a company.
The call for openness is not a new one. IPA President David Pattison, worldwide chief executive of PHD Network, called on agencies to put ‘the business’ back into the advertising business in his inaugural address, stating that the industry needs to be more financially open and learn to “speak the language of business”.
He said: “It would appear that the financial community is struggling to identify what advertising is, it just seems to be a budget item to them. Financial transparency is on the way for all of us in marketing. We believe by embracing transparency and using business-based language the marketing community would help itself within the financial community. The views of the analysts in our research seem to tie in with this.”
The IPA recently published its latest quarterly Bellwether report, complied by NTC research, covering the first quarter of 2005 and signaling slower growth for marketing, compared to the strong performance it enjoyed in 2004.
The report showed that current marketing budgets were revised up for the sixth consecutive quarter, but that growth was not as strong as seen in previous quarters (see Q1 2005 Bellwether: Slower Growth Period Ahead).
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