IPA Bellwether Report – 2020 Q322 Oct 2020 10:11
Marketing budgets continue to contract markedly amid negative impact of COVID-19
Total marketing budgets continue to contract
sharply, albeit at a softer rate than in Q2
? Coronavirus pandemic leads to sharp declines in adspending across all monitored categories
? Sentiment towards both industry-wide and own-company financial prospects remains in negative territory, but moves towards stabilisation
? Economic forecast points to a marked decline in UK marketing budgets this year, followed by a
robust recovery in 2021
The latest Bellwether survey indicated that a net
balance of -41.0% of panellists saw their marketing budgets cut in the third quarter (up from -50.7% in Q2). The result represented the second-quickest decline since the survey’s inception in 2000, only superseded by the reduction in the second quarter of this year. In the latest survey period, over half of respondents (52.6%) recorded a decrease in budgets from three months ago, compared to only 11.6% that
saw an increase.
“With UK businesses continuing to adjust to a ‘new normal’ amid the coronavirus pandemic, marketing budgets remained under severe pressure in the third quarter of 2020. The broad-based decline across all types of marketing budgets highlights the negative impact that the public health crisis is continuing to have on business conditions. Unsurprisingly, events remained the hardest-hit category, with social distancing measures limiting the viability of such spending, although reductions in every other monitored area were also substantial. Looking forward, if the UK can avoid another large-scale coronavirus outbreak and achieve a smooth exit from the European Union, we should see an improvement in economic conditions as firms learn how to better operate in this new business environment.”
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