UK Marketing Recession Is Finally Over, Says CIM Study
Confidence among Britain’s marketers has reached one of its highest ever levels and those in the business are certain the recession has finally come to an end, revealed a new survey from the Chartered Institute of Marketing (CIM).
The study, based on the views of nearly 100 senior marketing professionals across a range of sectors, said that marketers are putting their money where their mouth is, as growth in marketing spend is expected to nearly double to 5.8%. Those surveyed said that sales growth is also expected to be up this year, growing by 9.2%, spurring CIM’s ‘confidence’ factor up to 98.3 – the third highest level ever recorded.
Three-quarters of those that took part in the survey said they see their sales plans as realistic or expect to exceed expectations.
Douglas McWilliams, economic adviser to the CIM and chief executive of the Centre for Economics and Business Research said: “Investment in marketing lubricates the economy and makes it more flexible, as well as creating the opportunities for longer term growth through the development. The latest survey results are therefore especially encouraging as a sign that the UK economy is returning to rude good health.”
Today, further weight was added to the CIM survey by the The Advertising Association, who announced that advertising expenditure for the first quarter of 2004 had grown by 4.8% to reach £3.6 million, the strongest growth since the end of 2002 (see UK Ad Spend Increases By 4.8% In First Quarter Of 2004).
The latest Bellwether report also painted a positive picture for the coming months with further growth of marketing spend indicated for the financial year. Almost 50% of the companies surveyed said they plan to increase their budgets this year, compared to just 15% reporting a decline for the period (see Recovery Slowly Gathers Pace For UK Advertisers).
The consensus of recent forecasts compiled by MediaTel INSIGHT, further echoes the findings of the CIM report, which suggests that UK advertising expenditure will increase by 3.9% in 2004 and by 4.9% in 2005, as shown below.
| LATEST UK ADVERTISING GROWTH FORECASTS | |||
| 2003 | 2004 | 2005 | |
| Advertising Association (03/04) | 2.5 | 3.2 | – |
| Initiative Media (02/04) | 2.2 | 4.2 | – |
| Interdeco/Ad Barometer (10/03) | 1.1 | 3.3 | – |
| Mediaedge:cia (10/03) | 3.0 | 5.0 | 6.0 |
| Merrill Lynch (02/04) | 1.0 | 3.0 | 5.8 |
| Universal McCann (12/03) | 3.0 | 5.5 | – |
| ZenithOptimedia (12/03) | 1.1 | 3.2 | 2.9 |
| Average | 2.0 | 3.9 | 4.9 |
| * Display revenue only | |||
| Source: As above/compiled by MediaTelINSIGHT | |||
Remaining on the cautious side, global finance and advisory group, Merrill Lynch, said last month that it expects the advertising market in Europe to remain ‘less vibrant’ in 2004 but to expect ‘greater pick up’ in 2005. On the other hand, Merrill Lynch expects a greater performance from the US advertising market this year compared to Europe but next year due to the tough comparisons being created by the Presidential Elections and the Olympics US figures may look less upbeat when compared to 2004 (see Europe To See Ad Market Pick Up In 2005).