Marketing budgets fell towards end of 2009
The latest Bellwether report has cast doubt on the confidence of UK businesses in the UK economy. The survey, which is well respected in the marketplace, confirms that the final quarter of 2009 saw marketing budgets across the UK fall to a two-year low. This would seem to be at odds with hopes that the UK economy has left the recession behind in the final quarter of 2009 and moved back onto the growth path. So what does this mean?
There is no doubt that marketing budgets will lag any recovery in the UK economy with businesses unwilling or unable to invest significantly until they see an upturn in business turnover. However, the fact that 25% of companies reduced their marketing budgets in the final quarter of 2009 against just 18% who increased their investment is a concern. Weak balance sheets will obviously have an impact upon future investment because many companies have been hard hit by the downturn and need to consolidate and replenish their coffers.
It is worth monitoring comments from the likes of WPP, one of the largest advertising agencies in the world, to see signs of recovery in marketing spend and business investment. As we approach a potential upturn in the UK economy it seems that many business leaders are becoming uncertain, concerned and nervous.
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