Marketers' pessimism jumps as budget forecasts slide
Despite an unexpected rise in marketing budgets, the IPA Bellwether Q1 2019 report shows that marketing professionals' overwhelming outlook is negative for the future.
There was a net positive of 8.7% of executives reporting increasing budgets for the first quarter of the year, as opposed to 0.0% for the final quarter of 2018. However, when surveyed, 74% of marketers said they expected to see cuts or no change to their budgets in the 2019/20 financial year.
The net attitude towards whether budgets would grow or contract was mostly flat, at +3.4%. Worse still, the net balance of those optimistic or negative towards their own company financial prospects sat at a disappointing -2.7%, down from -0.9% during Q4 2018.
The report comes to the conclusion this negativity and reluctance stems from "unfavourable global economic conditions, coupled with fears of falling business and consumer confidence".
Taken together with the Office for Budget Responsibility's decision to revise its growth projections downwards for 2019 by 0.4% since October, it leads the Bellwether Report to change its forecast for ad-spend expansion this year from 1.3% to 1.1%. "This downgrade reflects the challenging environment caused by Brexit uncertainty, slowing global growth and rising competitive pressures."