IPA’s Bellwether should be viewed in context

‘Things are better than you think’

I think it’s fair to say we’re due some good news. After months of political change, global unrest, depressing domestic headlines and, to top it off, interminable rain, it’d be nice if we could at least be distracted by industry-wide positivity while at work. Sadly, last week’s IPA Bellwether failed to deliver on that score. After 14 quarters of consecutive growth, it has been forecasted that Q3 will be flat. Not down, which I grant would be worse, but hardly an excuse to celebrate.

With the longest gap between election and budget for a very long time (16 weeks by my reckoning), there’s uncertainty in the air. Marketers are rightly nervous about spending with abandon, but perhaps that just speaks to the mood of the nation. Optimism seems thin on the ground and it feels as if to believe ad spend is growing is too good to be true.

However, ever an optimist, I am keen to dig out some kernels of positivity from the report. Firstly, after such a stretch of increased spending, it was inevitable that at some point things would flatten out, and a Bellwether report in the no man’s land between a new government and its first budget seems as good a time as any for that to happen. So I’m not reading a huge amount more than that into it. Secondly, once the budget announcement has been made I would expect marketing budgets to continue growing, ready to embrace the season with Black Friday and Christmas around the corner.

All media agencies will gladly show a CMO the case studies that indicate that pausing their spend during these periods is the exact opposite of what they should do. When others stop, you go. Be the voice that stands out in a sea of relative silence, take the opportunity to build a larger share of voice and share of market. However, what a CMO wants to do, and can do, within the constraints of their business’s ability to invest are very different. It’s less about theory and more about helping these CMOs and their brands empirically build the growth tolerances they need to take these growth acceleration moments when they arise. 

I work for the most part with start ups and scale ups who, while more sensitive to market conditions can, as a rule, be more flexible with their spend, ramping up or scaling back as they need to. Without the deep pockets of the big corporations, they are already well versed in making a little spend go a long way, so times like this allow them to play to their strengths. It is, of course, a fallacy that high spend equals high sales. When money is tight marketers are forced to be more imaginative which we know, when done well, the public responds to very well.

And with video reportedly performing strongly, being traditionally more of a brand-led media, this increased spend on video shows that marketers aren’t sticking to the easy path of performance media, but are instead considering the importance of brand-building activity.

And finally, remember this is one source of intel. Every CMO should be asking their agency partners to provide other data sources against which to analyse their brand’s performance. At Wake The Bear, we don’t just go out and buy media, we deliver detailed modelling and remodelling, working out the impact every decision will have on our client’s business rather than just focusing on media/marketing metrics. Brands need to focus on that data, trust it, and not be distracted by more macro analyses. A knee-jerk reaction that sees a marketer in a position of strength suddenly retract spend will erode any gains they might have made.

However, once the budget is announced I believe we’ll see a shift in attitudes. Early signs are that businesses aren’t going to be negatively impacted by the budget, so once it’s out of the way I predict that everyone will exhale and get on with business as usual. Upon which we’ll see a strong upward surge in marketing spend. Christmas will be fruitful, the next interest rate review should deliver more consumer confidence and we’ll see a bumper November and December.

Well, I told you I was an optimist.

Featured image: Yan Krukau / Pexels

Tom Carter, Client Director at Wake The Bear

Tom has over 14 year's experience in media & planning agencies including Dentsu & the7stars. His previous role as Head of Media Operations & Audio Trading at the7stars oversaw management of £100m+ across a range of retail, entertainment, gaming and health clients.

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