2014 marketing budgets set higher as brands invest for growth
Many of the UK’s biggest brands are planning to spend more on marketing to boost sales in 2014 as optimism among companies about their prospects grows in line with improving forecasts for economic growth.
The latest Bellwether report, a quarterly survey of 300 senior marketers from the UK’s top companies and a respected barometer of confidence in the industry, finds brands starting 2014 feeling considerably more confident than they were a year ago.
The IPA backed report found a net balance of 25.8 per cent of companies planning to increase their marketing budgets year on year in 2014 – the highest balance registered since before the 2008 financial crash and up markedly on the 13.5 per cent that expected to see an increase when asked at the start of 2013.
Upward revisions to spend stem from the continued confidence marketers have in the prospects for their companies and industries. A net balance of 47 per cent were more optimistic about the outlook for their own employers, while a balance of 35.4 per cent thought their peers were set for improved performance – both consistent with the record balances registered in the last Bellwether report.
The report comes amid better news about the UK’s economic prospects. According to thinktank the National Institute of Economic and Social Research, the economy grew by 1.9 per cent in 2013, the best return since 2007. Fiscal watchdog The Office for Budget Responsibility expects economic growth to be 2.4 per cent over 2014.
Chris Williamson, chief economist at Markit and author of the Bellwether says the report paints an “upbeat picture”.
“One of the most encouraging signals from the survey is the indication that companies are feeling more confident about investing in growing their businesses, advertising to build brands, supporting new product launches and taking the plunge in being more aggressive about boosting revenues.
”This increase in risk appetite should add to the sustainability of the economic recovery and represents a great start to the year.”
Elsewhere, Bellwether found a net balance of 11 per cent reporting marketing spend increased in fourth quarter of 2013, down slightly on the record 12.3 per cent registered in the third quarter.
Bellwether’s positive outlook chimes with the Advertising Association’s recent upward revision of its 2013 and 2014 ad spend forecasts. Spend is expected to grow to £17.8bn and £18.8bn respectively, AA said earlier this month.
The picture of increased confidence among marketers also mirrors that seen by the Chartered Institute of Marketing in its latest Confidence Monitor.