Bellwether report shows decline in marketing budgets slowing
LONDON - The latest quarterly Bellwether report says business confidence is improving, with marketing budgets falling at a slower pace than the previous quarter.
The Bellwether statistics for the second quarter show that the rate of downward revisions to marketing budgets has slowed for the second quarter in a row since the record amount of revisions in the fourth quarter of 2008.
This quarter, only 10% of companies surveyed revised up their 2009 marketing budgets while 38% reported a reduction, giving a balance of -28%.
All marketing sectors suffered downward revisions, with internet search marketing proving the most resilient, getting off most lightly with a 5.4% fall and media dropping 18.4%.
The 'all other' category, which covers events and PR, but not sales promotion, direct marketing and internet, recorded a fall of 23.8%.
The report warns that with 2009 budgets having been set lower than 2008 at the start of the year, the downward revision to those budgets in Q2 raises the risk of marketing spend falling in 2009 even more than in 2008, which saw the first annual fall in the survey's history.
However, the report showed the return of optimism among marketing executives about their companies' financial prospects.
This score showed a positive reading for the first time since the first quarter of 2008.
Rory Sutherland, IPA president and vice-chairman of Ogilvy Group UK, said: "To anyone optimistically inclined, the April Bellwether seemed to signal the bottom of the market, and the new report suggests that the worst is over."
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