Are we entering a new age of optimism?
It says something about the perilous state of the economy when marketers rejoice in data that shows marketing budgets are being slashed.
The quarterly Bellwether report, the three monthly state of the marketing nation, appeared to cause a ripple of optimism.
The study showed marketing spend fell for the eighth consecutive quarter in the three months to 30 September but, crucially, at a slower rate than in the previous quarter.
The net balance of those reporting a cut in marketing budget eased to -15%, compared with -28% in the second quarter and -42% at the end of last year.
For direct marketers particularly, there was reason to be a little more cheerful. On balance, spending on the channel declined but again at a slower rate than in the previous quarter, a net balance of -5.5% reporting cuts compared with a 7.5% in the three months to June 30.
Was it just the balmy late days of summer that put a smile on the face of the axe-wielding budget choppers and therefore a temporary halt to the budget carnage? or are we approaching a new age of optimism?
It could be direct marketers and their colleagues steering other channels are plumping for the latter. The Bellwether report indicates that confidence among senior marketers is on the up. Almost half (47%) of respondents report improved prospects for their own business for the third quarter, the best since the end of 2006, while projections for their respective industries swung to positive for the first time since the second quarter of 2007.
However, before we all start congratulating each that we have weathered the worst recession in decades; let us just dwell on a this troubling paradox: despite there being a more palpable air of optimism, spend, on balance, still continues to fall.
Chris Williamson, chief economist at Markit and author of the Bellwether report adds that this casts “doubts about the ability of the recovery to become self-sustaining”.
In a week that saw the National Institute of Economic and Social Research predicting that the UK economy did not grow in the third quarter as it was expected to, Williamson’s sentiment is sobering.
However, as the mist of economic uncertainty begins to clear and companies take their first tentative steps into growth mode, direct marketers and their channel counterparts need to fight hard to ensure they at least maintain and even grow their slice of the budget, and ensure the positive trend seen in the last quarter is seen in the next Bellwether report.
