Advertising spending growth remains dependent on Brexit plans
By Caoimhe Toman
Date: Wednesday 16 Jan 2019
(Sharecast News) - Marketing spending growth in the UK was halted in the final quarter of 2018 after a six-year rise due to the uncertainty over Brexit.
Doubts about the timing and the planning needed for Britain's exit from the EU is causing consumer confidence to fall leading companies to try and reduce costs which includes a reduction in the spending on marketing, according to the IPA Bellwether report, which was produced with the help of IHS Markit.
Marketing companies said consumer and business confidence was causing the fall in advertising budgets.
For 2019, the IPA said ad spending could recover if the government provides some certainty on Brexit, predicting 1.3% growth if so, up from its previous forecast of 0.7%.
Around 16% of companies said they would increase their marketing spending budget, the survey found roughly the same number of companies planned to reduce their budget.
"Company-wide indecisiveness restricted the allocation of resources to marketers, as the wait-and-see approach to how the Brexit process will transpire appears to be the current strategy in place for many UK businesses," said Joe Hayes, economist at IHS Markit.
"In uncertain times, the understandable reaction for some advertisers is to lose confidence in brand-building advertising," Paul Bainsfair, director-general of the IPA, said.
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