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Industry reacts to IPA Bellwether Report for Q4 2023

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Following the release of the latest IPA Bellwether Report, which revealed that marketing budgets increased sharply in Q4 of 2023 despite continuing economic uncertainty, industry leaders have been quick to respond…

Patrick Reid, Group CEO, Imagination

“The latest Bellwether report reveals a resilient marketing landscape in the UK. Total budgets are on the upswing, marking the most significant jump since 2014. We are excited to see the events sector taking centre stage, boasting a +15.9% surge – the highest in almost two years. As we’re seeing again this year with our clients, events stand out as the only category to score a higher net balance than other online marketing, underscoring brand’s growing commitment to creating impactful in-person experiences.

“With +17.8% of companies planning an increase in events marketing budgets for 2024/25, the momentum shows no signs of slowing down this year. This showcases the ability to navigate and thrive in an ever-changing landscape, with experiences proving resilient as a key part of the evolving marketing mix for brands.”

Sarah Sanderson, managing director of TGI at Kantar Media

“The IPA’s new report is a welcome sign of growing optimism as marketing budgets are revised up to their strongest level in nearly a decade. Brands are being bullish and backing their conviction through proactive, long-term investment – despite the challenging headwinds.  Reflecting this trend, our TGI data shows signs of renewed consumer optimism, with audiences showing an uptick of 5 percentage points in advertising engagement since last summer, alongside other indicators of increased positivity across recent years.

“However, it’s important that the sector remains vigilant. With elections coming up and the threat of expanding global conflict, volatility is still on the horizon which makes the role of sound market research even more crucial.  It’s vital that businesses stick close to the changing moods, attitudes and motivations of their target audience.  If you’re spending big as a marketer, good research that gives a 360 picture of your customer is an absolute necessity to ensure you can spot opportunities in a tight market and drive profitability.”

Matt White, VP EMEA at Quantcast 

“Q4 is always the busiest time of the year for consumer spending, with Black Friday closely followed by the festive season meaning there’s a captive audience for advertisers to target. England making it to the final weekend of the Rugby World Cup had a significant impact on advertising spend in October too, so it’s no surprise to see that ad spend increased again to close out 2023.

“The focus now turns to Q1 2024, as Google begins to phase out third-party cookies. This signal loss in the ‘cookieless era’ will undoubtedly cause a rush as advertisers that have relied on third-party data for targeting have to adapt. It’s likely this step-change will result in an increase in spend as advertisers explore new avenues to target the entire internet, rather than just users of Google Chrome.

“While cookieless will impact advertising plans significantly in the first half of this year, teams will already be planning for later in the year too – especially major sporting events such as UEFA Euro 2024 and the Paris Olympics, which will ensure a bumper summer.”

Anthony Pey, Head of Marketing Effectiveness, Medialab

“The latest Bellwether findings should not come as a shock. It’s noted that during times of hardship, there is an increased focus on measuring the effectiveness and efficiency of all elements of the marketing mix. This has resulted in increased adoption of test & learn budgets, as well as techniques such as econometrics and Marketing Mix Modelling, which has provided clients with evidence of marketing as a force for growth and has illustrated the ROI it delivers. All essential information for business casing and budgeting.

“This evidence, combined with an improved outlook for the year ahead, are clearly making a strong case for investment and growth.”

Laura Lane, Head of Marketing UK&I at HubSpot 

“Marketers’ resilience offers encouragement in the new year as the post-peak slowdown takes place and as long-term strategies are finalised. For now, allocating budget to tools such as AI will ensure brands can personalise content and uncover data insights that prioritises removing any friction in the customer journey. After all, enabling brands to have the loudest voice in what is an incredibly crowded – and competitive – business environment is not enough if the customer cannot see long-term value in the relationship.”

Elliott Millard, Chief Strategy and Planning Officer, Wavemaker UK

“The economic outlook is bad, but the marketing outlook is good. The outlook for the category is bad, but the outlook for my business is good. There are real tensions in the Q4 Bellwether Report. It feels like a window into an industry defined by divergence. The macro category sentiment is negative, but the belief in their own business is positive.

“With around 12% of marketers reducing budgets, this is not a uniform direction but is at least a clear indicator of a trend. However, it is when we look at the detail of investment that a more interesting picture emerges. The big drivers of increased spend in Q4 were events and direct marketing with PR and sales promotion also contributing. This feels like a clear indicator that getting in front of consumers is becoming critical, that credible earned media is essential and that the cost of living crisis has not yet ended. 

“As ever, those shifts are happening because of the wider consumer landscape and this year that will be defined by increasing disruption through deep fake AI content that will be particularly prevalent politically in a year where nearly 50% of the world will be voting. That focus on real-world connections is often true for communities facing uncertain times – we seek unifying experiences, so the brands that deliver these are the brands that will win.”

Ric Hayes, Group Strategy Director, SocialChain

“Marketers seem to be showing signs of ‘cautious optimism’ as they recognise the challenges they face in their categories yet back their brands to win. They’re moving away from stringent cost-saving measures, but also taking a step back from long-term growth tactics like advertising in favour of placing their bets on direct marketing for quicker results.

“Considering this mindset and the varying results seen in mainstream media, marketers should look at a more innovation-led approach focused on testing techniques across a range of channels, including newer platforms.

“This approach isn’t just about seeking out opportunities for immediate gains; it’s also about identifying and investing in new effective ways of connecting with customers during the latter half of 2024. That’s when the economy is expected to bounce back, potentially offering fertile ground for these diversified approaches to flourish.”

Andy Stevens, Executive Chairman, GOA Marketing 

“The surge in online advertising (up by 13.2%) and direct marketing (up by 12.6%) underscores a dependency on digital channels, and shows brands are taking a proactive approach to navigating economic challenges. And rightly so – 2024 will be punctuated by challenges (think data deprecation, antitrust regulation and privacy protection).

“Companies are evidently prioritising strategic marketing investments to bolster their position, demonstrating a commitment to innovation and adaptability. This means we can expect organisations to reduce their reliance on big tech and leverage independent technologies instead, to help them maintain agility and strategic foresight in the, let’s face it, financial horror show that this country faces.”

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