Bellwether: Growth in event budgets slows to +2.6%

The Institute of Practitioners in Advertising's (IPA) Bellwether report for the third quarter of 2015 has seen a marginal increase of +2.6% to event marketing budgets.

Events was one of only three sectors to report an upward revision in marketing spend
Events was one of only three sectors to report an upward revision in marketing spend

This represents much slower growth for the sector compared to quarter two, where budgets were recorded at +7.4%, a figure that saw the events sector lead the way in marketing expenditure over the period. 

Nevertheless, events placed second in terms of growth among the sectors surveyed in the quarterly report. Internet marketing was the top performer, recording a growth of +7.8%; up from +6.8% in the previous quarter, meanwhile main media recorded an upward revision of +0.5%.

Overall marketing budgets are up +4.4% for quarter three, however this figure is markedly lower than the +12.2% reading recorded in the IPA’s quarter two 2015 report, representing the weakest growth since Q1 2013.

The biggest declines in marketing budget were identified among the PR (-5.8%) and market research (-4.7%) sectors, meanwhile sales promotion also dropped (-3.4%), as did the direct marketing (-2.7%) and ‘other’ (-1.1%) categories. 

The report also uncovered that marketers are less optimisitc about the financial prospects of the industries in which they work. In a nine-quarter low, figures fell to a net balance of +6.8%, which is down from +13.1% in quarter two.

The panel was also less confident regarding their own company financial prospects. A net balance of +22.4%, compared to +25.3% in quarter two was recorded, marking a two-and-a-half-year low.

The IPA points out that it predicted such conditions in its quarter four 2014 Bellwether report. It notes companies' more cautious approach to marketing budgets could stem from the performance of some UK economic sectors as well as easing confidence globally. 

Following the results of the survey, as well as evidence of what is described as a a wider macroeconomic slowdown, the IPA forecasts a real-term increase of +3.7% in 2015, down from +4.2% in the previous survey. It predicts growth to marketing budgets will ease at the start of 2016 to +3.6%.

Paul Simonet, creative strategy director at Imagination, said: "The sustained growth across the year in events and experiences budgets, along with the continued growth of internet expenditure, points to two fundamentals.

"First, clients are putting their faith increasingly in owned channels above paid, because they deliver greater integrity for a brand and greater depth of engagement, Second, that the internet and events and experiences are the natural bedfellows of the new brand scene. Digitally enabled experiences are the way forward for engagement."

Paul Bainsfair, director general at IPA, added: "As predicted by Bellwether, upward revisions to marketing budgets and confidence are easing. However the important point is they are still positive. More specifically, there are upwards revisions to internet, events and main media advertising budgets in Q3.

"We are seeing marketers demanding greater accountability, physical presence and share of mind in their planned marketing spend."

More: Bellwether: Event industry leads growth in marketing budgets

Bellwether industry reaction: Live experiences are driving marketing spend

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