Bellwether Report: Marketing budgets reduced at slower rate in Q4

Of the firms surveyed, 35% see improved prospects, consistent with growing confidence in the ongoing economic recovery. Budgets for 2010 have also been set higher on average compared to 2009 spend.

The fourth quarter saw internet advertising budgets revised up for the second period running.

At the start of this month, Enders Analysis forecast a 6.9% increase in internet advertising in 2010, with newspapers, magazines and television all expected to experience downturns.

The Bellwether report also found that direct marketing budgets were revised up for the first time since Q2 2007. Marketing spend was revised down across sales promotion, ‘all other’ (below-the-line such as PR), and main media but at a slower rate than the previous quarter. Although main media saw the sharpest reduction it was the least marked for seven quarters, the report found.

Andy Viner, head of media, BDO LLP: “The survey results are good news for the marketing services sector. After nine consecutive quarters of reduced marketing spend, it appears that the rate of decline is at its slowest in nearly two years. There are a number of indicators to demonstrate that confidence is returning, with companies being upbeat about their own sectors and their corporate performance.

“Marketing budgets in 2010 are now set to grow, with companies re-thinking their budget allocation, for example, the spend in areas such as online advertising are due to increase significantly. Unsurprisingly, companies are continuing to seek cost effective and flexible options where the return on investment can be measured.”