Marketing and IT budgets fall amid Brexit Halloween delay
Budgets in areas such as IT and marketing in UK SMEs and enterprise businesses are falling behind those elsewhere, according to new research from B2B International.
The specilaist business-to-business market research agency also said Brexit, which has now been delayed again, until Halloween, is also dragging on confidence among business leaders.
Marketing is set to be the hardest hit, with a two per cent fall between 2018 and 2019, and five per cent between 2019 and 2020 (compared to global rises of nine per cent and five per cent respectively).
UK falling behind
UK IT/Tech budgets are also failing to keep pace, with six per cent increases in both years, compared to ten per cent and nine per cent globally.
B2B International spoke to senior people across business management, HR, IT, marketing, and procurement functions in six industries (construction, healthcare, hospitality, manufacturing, professional services, and retail).
Brexit is also having a negative impact on the optimism and strategy for UK businesses, reveals the research. Its influence is causing 46 per cent of decision makers to downgrade their economic outlook for 2020.
This compares to 24 per cent of decision makers in UK businesses upgrading their 2020 economic outlook forecasts due to Brexit. The remaining 30 per cent say they are not influenced either way by Brexit.
The findings are based on 2,000 online interviews with business decision makers in SMEs and enterprise businesses in six markets (China, France, Germany, Spain, UK, and USA).
Optimism at a low
UK business people have by far the lowest optimism about their 2020 economic outlook among the six markets. Just 18 per cent of UK businesses are “very optimistic” about the outlook for their own country in 2020, compared to 45 per cent in China, 41 per cent in USA, and 38 per cent in Germany.
Some 30 per cent in the UK are “somewhat optimistic”, also the lowest among the six markets, while 24 per cent are “neither optimistic or pessimistic”, 26 per cent are “somewhat pessimistic”, and six per cent “very pessimistic”.
However, it’s not all doom and gloom when it comes to Brexit. Across the six markets, millennial decision makers are significantly more likely than older colleagues to regard Brexit as an “upgrade” for their economy. Some 30 per cent of millennials view Brexit as an “upgrade”, compared to 18 per cent of Generation X, and nine per cent of Baby Boomers.
“Brexit is a major factor in the UK showing the lowest levels of optimism regarding economic outlook than any other country included in the research”, said Conor Wilcock, Director at B2B International. “This issue has led British companies to shrink their IT and marketing budgets which could be damaging in the long term.”