Internet ads rise despite cuts in marketing
Tuesday 15 April 2008
Internet advertising is coming out on top as overall marketing budgets see a second consecutive quarter of cuts, and planned spending for the rest of the year suffers further downgrades, according to the Institute of Practitioners in Advertising (IPA) quarterly Bellwether report.
Unexpectedly weak sales, wary consumers and continuing economic concerns are behind cost-cutting measures that have taken a considerable bite out of forecast spending plans in the first three months of the year. One in five companies has revised their direct marketing spending plans downward, the sharpest fall in eight years. And 16 per cent have cut "below-the-line" activities such as events and market research, which is the steepest drop for 24 months.
"The negative balance is relatively small, but there clearly is a slowdown in consumer spending and that is reflected in the budgets," Moray MacLennan, the president of the IPA and European chairman of M&C Saatchi, said.
Although total expenditure is still set to rise this year compared with last, actual growth will fall far short of the budgets set in January and will be nowhere near the trajectory at the start of 2007.
Advertising in main media such as print, TV and outdoor was the only category of spending not slimmed down in the first three months of the year. But the figures are inflated by the inclusion of internet marketing, which is the only category to have seen the majority of budgets revised upwards. More than a quarter of respondents increased their forecasts between January and March, with particular emphasis on advertising linked to web searches.
The growth may be partly explained as a continuation of a five-year trend to spend more online. But the accountability of web ads, which enable companies to track the number of clicks and the number of sales that result, makes the platform more resilient in difficult times.
"Internet spending is likely to remain buoyant," Mr MacLennan said. "But spending online really just milks the existing brand, so the interesting issue will be how firms balance the need to keep topping it up offline."
- 1 Half of young women unable to ‘locate vagina’ and 65% find it difficult to say the word
- 2 Perez Hilton apologises for Jennifer Lawrence naked photo leak
- 3 A teacher speaks out: 'I'm effectively being forced out of a career that I wanted to love'
- 4 Mexican woman becomes world’s 'oldest person' at 127
- 5 Jennifer Lawrence 'naked sex video' will be leaked threatens 4Chan celebrity photo hacker
Rotherham child sex abuse scandal: Labour Home Office to be probed over what Tony Blair's government knew - and when
What do immigrants really think of Britain? Polish immigrant's Reddit post goes viral
Ashya King: Parents of five-year-old boy refused permission to visit him in hospital and denied bail at Spanish court
With Douglas Carswell joining Ukip, my party has taken another giant step forward
When elitism grips the top of British society to this extent, there is only one answer: abolish private schools
Ukip Douglas Carswell defection: Tory MP jumps ship to join Nigel Farage
iJobs Money & Business
£40000 - £50000 per annum + benefits+bonus+package: Harrington Starr: SQL Impl...
£85000 per annum: Harrington Starr: Head of IT (Windows, Server, VMware, SAN, ...
£40000 - £50000 per annum: Harrington Starr: You will not be expected to hav...
£500 per day: Harrington Starr: SQL DBA/Developer SQL, C#, VBA, Data Warehousi...