IPA Bellwether: Marketing Budgets See Biggest Growth Since 2014

Despite the gloomy financial climate, the latest IPA Bellwether report suggests a relatively promising outlook for the ad industry: in Q4 2023, marketing budgets saw their biggest growth since Q2 2014.

Just over a quarter of panelists saw total marketing budgets increase in the final quarter of last year, which is over double the number who registered cuts (11.3%). Among the sub-categories of marketing, events was the best-performing, generating a positive net balance of +15.9%. Direct marketing grew by 12.6%, while main media marketing saw an increase of 1.9%. Only two of the report’s seven categories saw a budget decrease: market research (-5%), and other (-6.4%).

Marketers showed a more bullish attitude towards growth prospects compared to the previous quarter, but difficulties linger. Paul Brainsfair, IPA’s director general, notes feedback reporting companies pricing their goods and services more competitively in an attempt to gain market share, indicating a tough trading environment.

What can we take away from these findings? And how should marketers proceed in the current climate? We asked some industry experts for their weigh in.

The latest figures paint an optimistic picture

The latest IPA Bellwether report provides an optimistic picture, with companies planning to increase investment in their brands as they ride out the current economic storm. However, one budget area that is predicted to decline is research, which may be a false economy, since marketing budget increases must be fully justified. Campaign measurement should therefore remain a key element in 2024 budgets, allowing companies to learn from their past activities and optimise for future success.

Anette Hallgren, chief customer officer, Brand Metrics

To sustain video growth the industry must focus on video-first, user-friendly ad placements

It's not all doom and gloom, quite the contrary - slightly over one quarter (26.0%) of panelists saw total marketing budgets rise in the fourth quarter of 2023, more than double the proportion registering cuts (11.3%). And just as exciting is that video also enjoyed a positive quarter, with the respective net balance coming in at +6.6%, up from +0.9% and the highest reading for three quarters. Video growth has now been recorded over three consecutive years, and to both sustain this (and drive effective, meaningful results) the industry must focus on video-first, user-friendly ad placements.

Holly McCann, Product Manager Creative, Picnic