News & Opinion

IPA's Paul Bainsfair on media investment: "A careful balance is required"

With the release of the latest IPA Bellwether Report showing that internet marketing underpins growth in marketing budgets, the IPA's director general cautions against solely investing in online media.

The latest report predicts a 0.6% rise in adspend for 2017 and shows that 69% of UK companies kept their marketing budgets the same in Q3 2017 as in Q2, amid Brexit uncertainty. Around 21% of the survey panel made an upward revision to their marketing budget in the past quarter, while 11% of companies recorded a cut - resulting in a +9.9% net balance increase to budgets overall and the lowest reading since the first quarter of 2016.

Commenting on the report, the IPA's director general Paul Bainsfair points to the fact that recent evidence shows that "the most effective way to attract more customers is through increasing market penetration. Furthermore, the most effective approach to achieving this is through using a 60:40 ration of brand building, mass media, supported by more targeted sales activation media."

While Bainsfair acknowledges the benefits of internet advertising and welcomes the growth in internet ad budgets, he says that the IPA "wouldn't recommend sole investment in online at the expense of offline. A careful balance is required".

Putting the findings into context, Chris Duncan, managing director of Times Newspapers at News UK, says: "In the past, periods of economic uncertainty have had a heavy impact on marketing budgets. Despite anxieties around Brexit, currency fluctuations and inflation, it's encouraging to see that marketing continues to be a key driver of business growth with 89% marketing budgets being held or grown and only 11% being cut. To an extent, this could be seen as recognition in British business that communicating to your customers about the value of the products and services you provide is not a discretionary spend."

Meanwhile, Mindshare's head of connections planning Ruth Zöhrer says that the fact that this is the seventh successive quarter with a negative net balance begs the question as to whether this is the new normal and therefore the time "to buck the trend and begin to invest in long-term, demand generation marketing to create a competitive advantage into the future".

You can access the report here.

Source: Mediatel

by Jessie Sampson 18/10/17

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