News Focus: Spend - Trend towards BTL activity sees ATL budgets dwindle

by Melanie May, Direct Response 26-May-06

Brands are increasingly investing in below-the-line (BTL) advertising at the expense of above-the-line (ATL) in a quest for measurable results in an uncertain marketplace.

According to some of the industry's leading players, DM's accountability is one of the key drivers for the rise in BTL activity, coupled with an increasing use of online channels.

As a result, while overall marketing spend is suffering, according to the latest Bellwether Report for Q1 2005, growth in direct marketing budgets is projected to outpace that of all others over the next year.

"If you're trying to get your budget past your finance director, clearly being able to say that you will be able to see what's happening is important," said Rosemary Smith, managing director at RSA Direct and deputy chair of the DMA.

Whether or not brands are making a permanent shift towards more BTL activity is a moot point however. "There is a definite shift away from media advertising towards DM and online," said Amanda Phillips, managing director of Proximity London and chair of the Institute of Practitioners in Advertising's Direct Marketing Futures Group. "While forecasts indicate this trend will continue, whether it is permanent remains to be seen."

Recent research by data intelligence firm Datalytics showed that 37 per cent of respondents have increased their DM activity this year. According to Stuart Broughton, Datalytics managing partner, companies are after more for their money. "You're able to do more accountable activity with BTL, and this lends itself to an uncertain market."

According to the Bellwether Report, total marketing budgets were revised down for the fourth consecutive quarter in Q1.

- 'Marketing budgets are static but they have to achieve more' - Stuart Broughton, managing partner, Datalytics

- 'BTL will increase but won't ever totally replace ATL' - Rosemary Smith, managing director, RSA Direct, and deputy chair of the DMA

- 'It seems unlikely that spend on ATL will ever fully recover' - Amanda Phillips, managing director, Proximity London and chair, IPA Direct Marketing Futures Group.