Companies hiked their advertising budgets at the greatest rate in 14 years in the first three months of this year and they are bullish about the outlook in a boost for the Chancellor, George Osborne.
The latest quarterly Bellwether report from the Institute of Practitioners in Advertising showed a net balance of 20.4 per cent of firms hiked their marketing spend – better than the previous record set in the third quarter of 2013.
The IPA said investment in “main media”, which includes newspapers and TV, also rose faster than spending on the internet for the first time in three years in a sign of “growing confidence and willingness amongst marketing executives to commit to high-profile campaigns”.
Chris Williamson, chief economist at analysts Markit, which compiles the quarterly report, said it was “the most upbeat assessment of business and marketing spend that we have seen since starting the survey back in 2000”.
The IPA added the 2013-14 financial year to March also saw the strongest annual growth in seven years as a net balance of 17.2 per cent of companies increased ad budgets. The marketing bosses from 300 British companies were even more bullish about 2014-15.
Paul Bainsfair, IPA director general, called it “very good news for the Government in the run-up to an election year” as advertising is a key indicator for the wider economy.
The Bellwether Report, which uses forecasts from the Treasury’s Office for Budget Responsibility, expects ad spend to rise 4.7 per cent in 2014 and 3.5 per cent in 2015.
Mr Williamson said: “This augurs well for economic growth to top 3 per cent this year.”