Companies taking part in the Institute of Practitioners in Advertising (IPA)’s Bellwether report have revealed that their total marketing budgets for the current financial year had, on average, been revised down during the third quarter. This is the first time a downward revision has been recorded since data was first collected at the start of this year. 19% of companies also recorded a decline in total marketing budgets for 2001, while 55% of all companies setting new total marketing budgets for the next financial year reported that their expenditure had been set higher than this year.
One area where spending is on the increase for this year is new media. The report found that internet marketing has risen from 1.5% of total marketing budgets during the second quarter, to 2.5% during the third quarter. The number of companies allocating 5% or more of their budgets to internet marketing has also risen, from 8% during Q2 to 14% in Q4.
“Attention will focus on the level of claimed and intended internet spend.” said Hamish Pringle, director of marketing strategy at the IPA. “It’s astonishing how quickly it’s grown. In 1999 commercial radio accounted for 5.5% of all marketing expenditure and the internet spend is well on the way to half that level.” The report estimates that last year expenditure on internet marketing was around £500 million.
The Bellwether report surveys around 300 UK-based companies via questionnaire to establish their advertising and marketing activities. The first report was released in July for the second quarter of the year, following a pilot exercise in the first quarter. The next report will be published on 15 January 2001.
