Bellwether positive on 2007 marketing spend

by Nicola Clark, Marketing 18-Jul-07

Marketing spend is rising at its fastest rate for seven years, according to the latest Bellwether Report, with internet spend driving the growth.

Internet advertising experienced the strongest gain in the second
quarter of 2007 and now accounts for an estimated 6% of all marketing
spend; one in five companies now allocates at least 10% of its total

marketing spend to the internet.

Spend on direct marketing was also predicted to increase, with companies
planning the biggest upward revision for a year.

However, the quarterly Bellwether contrasts with a July report from
WPP's GroupM, which claimed that the industry is relying on the internet
for most of its growth and that traditional media will underperform the
economy in the long term.

GroupM warned that TV ad expenditure will experience zero growth in 2007
and 2008, partly because of TV's weakening reach among the
under-35s.

It added that advertising within national and regional newspapers will
be down 2.1% and 3.3% year on year respectively.

The GroupM report revealed 'measured' internet revenue growth is showing
signs of slowing, pointing to the fact that the market is almost
saturated; the growth of social networking, where it is harder to
advertise, is also having an impact.

The Bellwether Report was generally optimistic in its forecasts, with
predictions that business confidence will increase based on evidence
that 24% of companies are reporting a lift in marketing spend against
15% recording a decrease. The report noted that budget trimming had been
most widely reported in the industrial and utilities sectors.

- Leader, page 25.