Promo spend still growing
Promo spend still growing
According to the latest Bellwether report from the Institute of Practitioners in Advertising, slightly more companies reported an increase in promotional marketing budgets in Q4 2011 than said they were cutting them.
At 0.6%, the balance was lower than Q3's 2.8%: but Chris Williamson, chief economist at Markit and author of the Bellwether, says: “It seems that many companies are looking to fight the prospects of a challenging year ahead with increased promotional activity."
Unfortunately, Williamson adds, business optimism is falling further in the face of economic uncertainty, to levels seen prior to the onset of the 2008/09 financial crisis.
Across all channels the IPA measures, the balance was also 0.6%, as was the result for direct marketing.
By sector, ‘all other’ (below-the-line) and main media spend were the only types to see a reduction, suggesting companies were keen to cut spending on traditional media in favour of online, price discounting and more direct marketing strategies.
Internet advertising grew the most of all sectors, with a net balance of 13.4%. Within the internet category, search was revised up to the greatest extent in almost two years (net balance of 14.9%, up from 9.3% in Q3).
The IPM defines promotional marketing as marketing that changes behaviour and which can be communicated via any channel, including traditional sales promotion, direct marketing, online, press, TV and other media.
The IPM estimates that as much as 84% of direct marketing now includes promotional content, while almost all digital marketing will be promotional rather than pure brand advertising. TV, radio, press and posters ads are also increasingly promotional, because the growth of the Internet and mobile means they can be directly linked to promotional content.
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