Today’s IPA Bellwether Q2 Report revealed a striding return to growth in UK marketing budgets – coming in at a decade high no less.
Amid a general election, a continuing summer of sport – Euros, Olympics etc – and of course major events led by Taylor Swift, it’s easy to feel ebullient.
However, many of the industry leaders we spoke to said that, whilst it’s great to see the confidence return, many UK consumers are still struggling financially, so any enthusiasm needs to be accompanied by an element of caution…
Jennifer Davidson, Founder, Sleek Events
“It’s great to see yet another Bellwether report showing increased spend on events.
“It’s unsurprising though as there is a natural surge of in-person experiences and investment this time of year with the Euro’s and Wimbledon just finishing and the Olympics starting imminently.
“On top of this, you only have to look at concerts like Taylor Swift’s to see the power of live events.
“It’s clear people crave face-to-face interaction, especially in this noisy digital world we live in. Not only do events connect people, they’re great for overall brand exposure.
“But the importance of events goes beyond visibility; and that is why we are seeing this upward trend. When people can immerse themselves and experiment with products, the experience builds relationships with consumers, and shared moments forge deeper connections.
“Direct interactions create bonds and increase brand loyalty. Seeing audience reactions firsthand is invaluable data for brands to improve and develop.
“This continued shift towards events is an exciting trend to be a part of.”
Wander Bruijel, Chief Strategy Officer, Born Ugly
“It is encouraging to see signs of marketing budgets growing after a decade of stagnation. It’s a clear sign that companies are starting to feel confident about the current and future state of the UK economy.
“We’re finally emerging from a disastrous period of austerity, increasing deficits, Brexit, a global pandemic, a skyrocketing cost of living and a foolishly defensive focus on navigating through crisis after crisis.
“This has resulted in mild recession and at best total economic stagnation. However, the UK’s economic foundations are stabilising as has its political context. There is a renewed focus on a growth narrative and this builds much needed confidence.
“Delving into the areas of marketing growth, the focus appear strongest in events, direct marketing and sales promotion. Despite the growth in confidence, this does suggest a continued focus by companies on the short-term.
“It suggests that marketing budget remains focused on capturing demand rather than the much needed creation of demand.
“I would therefore remind marketers that focusing on the short-term doesn’t build the long-term. Instead, I encourage them to balance that with a focus on the longer-term, which – counterintuitively – is proven to deliver the short-term.”
Paul Wright, Head of Uber Advertising International
“The more upbeat outlook of the latest IPA Bellwether report is certainly cause for celebration. But brands should not forget the persistent economic pressures still weighing on UK households.
“Marketers must keep this in mind when planning their media, delivering ads to those most likely to spend.
“The key to this is quality, first-party data, which reflects audience buying intent and interests. When paired with relevant environments and exciting creatives, the right consumer can be served the right ad at the right time.
“The result for brands is better media and brand performance.
“This approach will serve marketers well during 2024’s big cultural moments, including the Bellwether’s highlighted ‘Summer of Sport.’
“Brands can unlock strong returns by investing in solutions to gain insights into specific audiences attending these events.
“This will give them a better understanding of the purchasing journey, and ultimately the ability to connect with their audience through timely ads.”
David Shaw, Co-founder and CEO, Cedara
“The upward trajectory of UK marketing budgets will hopefully bring much-needed stability for the industry in H2.
“Indeed, it’s encouraging that the Q2 2024 report cites opportunities in digitalisation and sustainability, as they should complement each other and not be implemented in isolation. It’s well-known that the digital marketing industry has a massive impact on the environment, so marketers must plan accordingly to ensure they partner with vendors that reduce their emissions.
“If we want marketing budgets to remain healthy, we must ensure the overall health of the industry for generations to come.”
Justin Taylor, UK MD, Teads
“It’s more than encouraging to see advertisers feeling more confident as we progress through this year, revising marketing budgets upwards in Q2 for the first time in 10 years!
“The summer of huge sporting events combined with the new opportunities being delivered by omnichannel, and the rise in interest in CTV, in an increasingly positive economic environment, are reasons for us to be optimistic for what’s ahead in H2.
“And while all main media budgets are up, the details in this Q2 IPA Bellwether report reveal that this is predominantly being driven by online and video, and our experience so far this year backs this up.
“We continue to see clients looking to build their brand longer term, and increasingly turning towards non-intrusive, quality video ads in premium editorial environments that can achieve the reach, engagement and attention they are seeking.”
James Hill, CCO at EXTE
“The latest IPA Bellwether shines a much-needed beam of optimism for the second half of 2024.
“With upward revisions across all marketing activity, there will be no excuse for not investing in strong creative within contextually relevant content for marketers keen to drive awareness and brand efficacy.
“As the report cites artificial intelligence (AI) as an opportunity to deliver growth and market share, it also highlights the viewpoint of businesses that see AI as a threat based on the potential of clients using it to replace other services with.
“Nevertheless, forward-thinking brands are leveraging AI to boost their creativity and innovation, recognising it as an opportunity to enhance their products and services.”
Harriet Durnford-Smith, Chief Operating Officer, Adverity
“The biggest surge in marketing budgets since Q1 2014 certainly bodes well for marketers and the industry at large, but with this growth will also come a shift in boardroom expectations.
“The traditional ‘more with less’ narrative remains relevant, but C-suite leaders will also now be emphasising the need to power maximum value in terms of brand awareness and revenue.
“While this might seem obvious, making the right choices to boost value in the short, medium, and long term is no easy task — it is an endeavour that demands strategic foresight and data-driven precision.
“Regardless of industry fluctuations, the enduring value of a mature data foundation cannot be overstated.
“Companies equipped with accurate, high-quality data consistently outperform their peers, demonstrating resilience and agility in both high-growth periods and downturns.
“This fundamental advantage ensures that marketers can navigate evolving market conditions with confidence, proving the impact of their strategies to stakeholders across the C-suite.”
Justin Reid, Snr Director Global Partnerships Solutions, Tripadvisor
“The latest IPA Bellwether report is a welcome sign that the economy, and the advertising industry, may be showing signs of improvement.
“With growth comes opportunity, however, the cost-of-living crisis still has a lingering impact on consumer spending.
“As cited in the report, it is hard work to get people through the doors, meaning marketers have a huge job on their hands.
“On the flip side, the summer of sports is a reason for optimism for the travel sector. England’s final in the UEFA Euros 2024 is an example; Google searches for “flights to Berlin” shot up 712 per cent ahead of the big game.
“People are willing to travel for sport which presents a major brand opportunity.
“To capitalise on this, you need to know your audience. Whether they’re travelling with pets, attending sporting events, or embarking on solo adventures, gaining insight into who they are and how to reach them is essential.
“Despite the challenging macro environment, for travel marketers, investment in understanding your audience will lead to more effective campaigns.”
Phil Acton, Country Manager UK, Adform
“It is encouraging that UK businesses have significantly increased their marketing budgets, with Q2 seeing the highest growth over a decade.
“Now, advertisers must use this investment strategically and direct it towards solutions that can continue to deliver results beyond the phase-out of third-party cookies.
“While some advertisers may be hedging their bets on the Sandbox, the reality is that no solution is one size fits all.
“A combination of approaches- including first-party data and unified IDs- should be tested to ensure brands can effectively connect with consumers across all browsers and achieve optimal reach and performance.
“This will also serve advertisers well in capitalising on rapidly growing channels, such as video advertising, which the IPA Bellwether found as the second-best performing channel, with many companies reporting increased spending.
“Advertisers should also investigate the growing accessibility of advanced measurement tools, which can enhance control within video advertising, especially in Open Web environments and growing CTV platforms.
“Investing in these technologies promises game-changing results for performance and transparent reporting and will ensure they lead in this crowded space.”
Ben Alalouff Chief Strategy Officer, Live and Breathe
“This report represents our hopeful industry clawing its way back into business.
“Despite budgets seeing their strongest upward revision since 2014, I think this hope still comes with a caveat – trust.
“With the economy brightening we might be tempted to charge ahead all briefs blazing. But we shouldn’t be too hasty.
“Whilst we bask in newfound financial prospects, consumers are still tightening their belts, over a third are still struggling to make ends meet. A squeeze that isn’t going to disappear soon.
“So, this makes, building their trust, more critical than ever. After all, if we lose that, no amount of budget can save us.
“Our efforts must be grounded in validity, resonance, and empathy. We need to ensure that every penny is spent in ways that genuinely address our audience’s needs and values, rather than blasting our budgets on ill-considered work we’ve rushed to deliver without an appreciation of context.
“We must keep our focus categorically sharp – it’s essential for sustainable growth. Otherwise, we risk losing it all and we’ll be back to square one, nursing our balance sheets and wondering where it all went wrong. Again.”
Mateusz Rumiński, VP of Product, PrimeAudience
“It is interesting to see that marketers are focusing on artificial intelligence, and what they must learn about it, in this year’s IPA Bellwether report.
“The technology behind Generative AI in particular is still in its early stages, but the speed, as well as its ability to digest data, cannot be ignored.
“Across everything from creatives, audience targeting, and campaign optimisation, the possibilities of Gen AI will soon be seen in some of the biggest ad campaigns.
“With marketing budgets looking so strong going into the second half of the year, brands need to be considering the best uses of AI wherever possible.
“In fact, 46% of UK and US marketers consider AI important as a tool for reaching audiences post-cookie deprecation, according to PrimeAudience data.
“The fact that cookie deprecation is delayed cannot put people off, with the need for privacy-focused approaches to marketing more important than ever.
“We are at the start of a digital advertising revolution, and the role that AI, in particular Generative AI, will play in this cannot be ignored.”
Emma Jowett, VP Northern Europe, IAS
”The upward trend seen in the report for the last quarter has been driven in no short part by improving economic conditions and the significant opportunities that global events, such as major sporting events and regional elections, have provided to reach large, highly engaged audiences.
“Underlying these short-term trends is the ever-increasing video budgets, a clear core driver for growth.
“Short form video in particular is spearheading this. While brands will want to appear alongside that content, ensuring brand safety and suitability in these environments is no doubt a concern for many marketers.
“It’s no longer enough to rely on ‘set and forget’ blocklists in these fast-paced, highly nuanced environments. Not only do marketers run the risk of appearing near unsuitable content, but also restricting the reach of their campaign.
“To maximise ROI of video budgets, brands must harness AI-based brand safety solutions that can better understand the nuance of short-form video content.
“These tools ensure that advertisers can reach the right audience at scale with precision for their own brand suitability profiles.”
Bash Labban, Head of Trading & Partnerships, Azerion
“With marketing budgets seeing their strongest upward revision in ten years, businesses have a prime opportunity to maximise the impact of their spending.
“By adopting innovative, data-driven strategies, marketers can understand their customers better, boost audience connections, and secure long-term success in this dynamic market.
“Particularly, those that harness advanced digital tools like AI-driven content classification will create more targeted and impactful campaigns; making the most of this momentum.”
Chris Hogg, Chief Revenue Officer, Lotame
“This quarter’s IPA Bellwether results came as no surprise, particularly when looking at the rise in events spend.
“The advertising industry has been gearing itself up for this summer of sport for a long time and it’s great to see that advertisers have made investments in testing these strategies ahead of time.
“As the UEFA European Championships come to a close this week, and the Summer Olympic and Paralympic Games start in the next few, it will be interesting to see whether this momentum is sustained throughout the next three months and beyond.
“We are also yet to see the effects that a change in UK political leadership will have on consumer and advertiser confidence.
“Marketers should remain cautiously optimistic as we approach the golden quarter but be prepared to pivot strategy as we monitor the changes on the horizon carefully.”
Jason Warner, Director – UK & EMEA, SBS
“Growing budgets can only be good news for the industry. For independent media agencies, this moment of positivity must be seized upon if they are to get ahead of larger competitors and drive maximum value for their clients.
“Ensuring they can access and leverage the right programmatic technologies to drive effective outcomes for clients will be vital – not only during this growth period, but also for their longer term.”
Pierce Cook-Anderson, MD, UK & N. Europe, Equativ
“With budget dials turned to their highest level for some time, the big question is how to keep them there. Through Q2, we’ve seen marketers drive stable results by sticking to traditional events, direct marketing, and promotions.
“While discount sales will remain a key focus in the final quarter — especially amid the soaring power of retail media — those looking to scale up will likely extend engagement through programmatic multi-channel campaigns that drive efficient reach across display, digital video, and connected TV.
“As part of that, we can also expect an increased swing towards direct deals and private marketplaces from marketers eager to carefully control how and where their expanded spending pots are allocated.”
Ned Jones, Head of Advertiser Customer Success, Permutive
“Given recent macroeconomic challenges impacting spending, it’s encouraging to see marketing budgets are at their highest point since 2014.
“Brands must ensure they use these increased budgets effectively, reinstalling room in their media plans for always-on iterative testing where it may have previously been removed due to budget constraints.
“With reach across the open web sitting at just 30%, there is a need to address both the problem and opportunity that exists today to unlock incremental reach and access to 100% of their target audiences.
“For advertisers and publishers alike, the current state of the programmatic industry only brings chaos and uncertainty, which is further amplified by third-party cookie deprecation delays and workarounds.
“Waiting to see what happens and allowing someone else to solve the problem for you is not an advisable solution.
“The biggest opportunity lies in data collaboration and connectivity between advertisers’ target audiences, and publisher audiences.
“A number of innovative brands are already moving out of cookie-based buying and into leveraging publisher signals, and these brands see double to triple reach, increased sales, and reduced CPAs.
“The success is derived from using their budgets to reach untapped markets, and audiences at scale, and in turn, seeing an exceptional return on that ad spend.
“Publisher signals are delivering strong results for advertisers, their solution is available today, so why wait?”
Anna Forbes, RVP Northern Europe, DoubleVerify
“While the latest IPA Bellwether report indicates optimism for marketers despite the UK election, they are still faced with challenging news cycles in 2024.
“Whether that may be due to the newly elected UK government or the upcoming election in the US. Brand safety must therefore be at the forefront of media planning to ensure ads are not placed against content not aligned with their values.
“By investing in solutions that can maximise brand safety and suitability, UK advertisers can maintain media quality and drive performance.
“The potential that artificial intelligence holds for this is increasingly being recognised, with IPA Bellwether surveyees noting its rising impact.
“Using AI-enhanced tools, for example solutions that can analyse data signals including Contextual Relevance, Attention, and Media Quality verification efficiently, provides a substantial growth opportunity for brands.
“Prioritising the allocation of resources towards these solutions to ensure both brand safety and tailored, brand-specific outcomes should be a key focus in H2.”
Hugh Stevens, Managing Director UK, LiveRamp
“The upswing in confidence indicated by the latest IPA Bellwether report is undoubtedly encouraging, but marketers should remain cautious and ensure they are allocating these expanded budgets based on data-led consumer insight.
Indeed, there are some warning lights.
“While inflation has decreased, prices remain high and will continue to impact customer purchasing habits.
“Indicatively, squeezed household finances were highlighted as a threat by representatives within FMCG, Financial Services, Retail, and Travel and Entertainment.
“This has led to an increase in sales promotions, which experienced its third consecutive quarterly rise – the longest spell of growth since 2018.
“Such activity should be used sparingly, as a prolonged emphasis on discounted prices can damage long-term brand value.
“A more sustainable and effective approach lies in better understanding consumers, their journey to purchase, and the products and advertising experiences that are relevant to them.
“This can be done by making use of available insights within the business, in the form of owned first-party data.
“While no brand has a full 360 view of their customer, thankfully, today technology exists that means they can engage in data collaboration to make ‘permissioned’ data accessible across business, and unite second-party datasets in a privacy-centric manner with their own via a data clean room to unlock rich consumer insight.
“This can be used to maximise the efficiency and ability of media plans to drive long-term revenue.
“With the pending deprecation of cookies putting a premium on first-party data, brands should investigate, experiment, and ensure they have the necessary soft skills in place to make the most of this data collaboration revolution.”
David Wilcox, Commercial Director, News UK Broadcasting
“We’re seeing a combination of a more positive economic outlook combined with some really powerful one-off events that have driven increased advertiser interest.
“The Summer of Sport has been a huge opportunity for brands and specialist media channels such as talkSPORT whilst the election has driven significant additional engagement for current affairs media like Talk and Times Radio.
“Whilst the rise in main media spend is encouraging for everyone in the market it’s clear that offering a diversity of channels, from digital and video through to audio and events, is vital if you want to answer the broadest range of client needs.
“News Broadcasting’s ongoing diversification to supplement our core audio business has enabled us to build bigger and more creative campaigns for clients that deliver across channels and audiences.”
Aleksandra Drozda, Head of Sales Development and Efficiency, RTB House
“With marketing spend in Q2 2024 experiencing the strongest rise in over a decade, brands need to prioritise AI as a way to target audiences effectively.
“The correct technology is essential for brands looking to optimise budget, in order to effectively enhance consumer experience, ad personalisation and precision.
“The report notes that with the rise of AI and the right tools harnessed correctly, brands should be better set up for success in the following quarter. That means driving growth and delivering maximum impact, without compromising on privacy.
“Educating marketers on how AI can assist them will be beneficial as they navigate the remainder of 2024 with an increased budget ahead of a significant year with Google set to remove third-party cookies.”
Paul Samuels, Executive VP, AEG Global Partnerships
“After years of being overlooked by many brands, events are finally having their moment in the spotlight.
“With the growing reliance on social media and digital engagement – and after years spent behind screens by necessity – events present an opportunity to cut-through the overwhelming volume of online content and engage with consumers face-to-face.
“As part of an integrated campaign, they can provide a climactic moment that ties other elements together and sticks in consumers’ memories for years to come.
“While brands have typically been hesitant to dip their toes in the live events pool, the industry has become more sophisticated when it comes to measurement and demonstrating effectiveness, helping marketing leaders to assess activity against other platforms and justify the spend.
“Once they experience the benefits partnerships can offer, their appetite only seems to grow.
“A number of partners have come to us this year to expand the scope of their activity, having secured the increase in budgets reported in this latest IPA Bellwether report.”
Alex Marks, Head of Marketing, Posterscope
“Stability in OOH spend is a welcome advancement from the Q1 report which indicated a decline.
“What is also encouraging to see is that marketers are recognising the importance of in-person events and media, which underlines the importance of OOH as a physical media that connects the dots to others.”
Tim Collier, Head of UK & N. Europe, Scope3
“It’s great to see UK budgets on the rise again. It’s even better to see that sustainability continues to be recognised as an opportunity for marketers.
“The staying power of the topic speaks directly to the business value in reimagining the way we work – this is particularly true for how brands execute their digital media campaigns today.
“Early adopters from leading global brands were quick to realise the efficiency and performance benefits of incorporating sustainability KPIs into their marketing strategy, and now with budgets increasing, any brand looking to drive better marketing outcomes should have a plan to incorporate it.”
Hannah March, Chief Growth Officer, Fold7
“A new dawn is on the horizon. The outlook according to Q2 is cautiously positive, marrying up to both proprietary research we have done at Fold7 as well as conversations we are having with clients and across the industry.
“I expect to see budgets remaining on slow growth until the new government has time to bed in. Hold tight for surge in 2025 should Labour prove to be a stable and unifying force.
“Concern for consumer spending remains though there have been green shoots in disposable income increases in the last year.
“A word to sum up, Patience. If businesses can stand firm, incremental gains will help positive sentiment as we navigate a full recovery from the nightmare of the last 14 years.”