marketing budget growth slows in Q4 2021

Marketing budgets increased for the third consecutive time in the fourth quarter of 2021, according to the latest IPA Bellwether report.

The survey of the UK’s top 1,000 companies found that 20.1% of respondents increased their budgets and 14% reduced them, giving a net balance of +6.1%.

However, this is a slowdown from Q3 2021, when 12.8% of respondents increased their budget.

The report’s forecast for annual growth in advertising spending has therefore been lowered from 6.2% to 5.2%.

Such caution is due to three factors, according to the Bellwether authors: new coronavirus variants, such as Omicron; supply chain disruption throughout 2021; and price inflation due to the latter.

Paul Bainsfair, chief executive of the IPA, said these factors could still induce “further oscillations”. However, he added: “The key for companies to overcome these fluctuations will be, where possible, to invest in the longer term and in brand building media. As the evidence proves, brands that continue to invest in their marketing during the toughest times come out on top.”

Looking ahead to the next year, brands are trying harder than ever to understand their customers. Market research was the best performing category this quarter, with a net balance of 7%.

This is the best performance for market research since the category began being tracked by the Bellwether report over nine years ago. This is also a strong increase since the third quarter report, when the net balance was +0.7%.

Talk to Countryside, Richard Robinson, Managing Director of Intermediate Oystercatchers, said: “Brands and agencies must anticipate staff and skills shortages by learning how to emerge from the crisis and matching their intention with the optimal partnerships for profitable growth. . “

Direct marketing comes in second place (+3.8%), followed by advertising in the main media (+3.1%). Within mainstream media, there was growth in video and online, but cuts in published brands, audio and outdoor advertising.

Sarah Bauman, chief executive of VaynerMedia, said it was “great to see” the expected growth. However, she added that companies should be cautious in their optimism.

“We would be unwise to assume that this growth in mainstream media advertising is guaranteed – the key is to stay focused on consumer-centric and culturally relevant work where we can get the cheapest attention – and to focus relentlessly on business results.”