IPA Bellwether: industry reaction

It’s very encouraging to see the strongest increase in marketing spend in six years in the latest Bellwether report. It’s not surprising there’s predicted to be increased investment in digital, because it’s such a highly measurable and cost effective marketing route that’s also evolving at an incredible rate.

However, we shouldn’t discount direct marketing, even though it’s showing such a low predicted rate of spend. There’s no doubt it can be expensive, with many customers accessing many different channels; however, many of its disciplines are highly measurable.

Talk of spend in different media is something of a red herring for those brands serious about ensuring a constant and engaging brand journey – one that builds a profitable and rewarding relationship with consumers. The next evolutionary step in the marketing process is the move towards omni-channel.

Therefore, brands need to personalise the customer journey across all of the media routes their target audience digests, regardless of touch point, to demonstrate they understand each individual customer. This makes brands feel human and consumers special, thereby creating a valuable, mutually rewarding long-term relationship between the two.

There has been a seismic shift in confidence levels with 43% of companies ‘more confident’ compared to just 16% stating that they were pessimistic. This mirrors a turning point in the general economic outlook as the UK claws its way out of a bleak financial period.

As expected, digital marketing continues to drive the growth, and increased attribution and tracking techniques are enabling businesses to invest with more confidence. The correct formula of measurement tools allied with insights applied intelligently by media planners are exposing return on investment more accurately than ever before, right across the digital landscape.

There has never been a more exciting time to be involved in the industry and the diversity of growth in ad spend highlights this.

Today’s IPA Bellwether report indicates confidence is up after what has been a tough economic climate for businesses to operate in, with 2013 expected to be the most successful in terms of marketing spend and wider economic growth since the recession began.

With an upward revision of marketing spend by 22 per cent it is clear that companies are taking advantage of the renewed confidence of the economy by opting for more aggressive sales and marketing stances. This can only be welcomed news for businesses across the country.

Increased confidence combined with the value-centric culture cultivated during the downturn has led businesses away from the pre-recession thinking of London agency at all cost. Instead the agency landscape has levelled and work will be won and lost on merit and not geography.

Today’s Bellwether report brings a welcome tonic for agencies but continues to underline the lack of diversity in where media spend is being funnelled. While most channels experienced an increase, the traditional channels such as direct marketing (up 0.8%), PR (up 3.4%) and main media advertising (up 1.9%) continue to pale into insignificance against the growth of the internet and its 17% increase.

This underlines the fact that online communications remain a desirable channel for brands and marketers alike, but especially given the sheer scope of options available whether it is mobile, display, online video, or a newer phenomenon such as native advertising.

The upward revision in internet marketing budgets show the continued rise in sophistication from clients towards the medium. There has never been a time in digital’s history where clients have been actively pursuing the medium with such vigour and understanding of its role and place within the marketing mix.

The rise of mobile devices acting as the connective tissue within marketing plans will further fuel digital’s growth.

With this plethora of options available it’s really is no surprise to see the internet as the engine that drives the increasingly optimistic outlook for 2014. There is a real sense of momentum gathering for the industry and while it may seem that the focus is solely on the internet, we would expect to see the increased confidence that it offers filtering into other categories as the recovery continues.

The challenge for our industry is to ensure that we recognise the wants and needs of the client, and make sure the relevant channel and media mix is used to deliver truly effective campaigns.

While marketing budgets are increasing, consumers are still overwhelmed by brand choices and messages. Therefore there is a greater need than ever for agencies to offer campaigns that combine both creativity and precision to influence the evolving consumer at the right moment, with the right message, in the right place along their purchase decision journey.

The methods that worked five years ago are no longer successful today. This means developing tools that enable marketers to gain insights into their consumers’ behaviour and build predictive models that identify where along the path to purchase are the most important points of influence so they can build a meaningful relationship between the consumer and the brand and ultimately drive purchase decisions.

Marketing communications today runs the risk of becoming too much like project management, and we believe it has to fundamentally change – with every big idea anchored in and informed by data to deliver effective and intelligent communications.