Internet advertising is still going strong despite a second consecutive quarter of cuts in overall marketing budgets, new figures reveal.

The Institute of Practitioners in Advertising’s (IPA) quarterly Bellwether report shows that advertising in main media platforms such as print, television were the only categories where spending was not cut in the first three months of the year.

Continuing economic concerns, weak sales and slow consumer spending have led to one in five companies revising their direct marketing spending downwards – the sharpest fall in eight years.

In addition to this, 16 per cent of companies have cut “below-the-line” activities such as market research and events, which is the biggest drop for 24 months.

Total expenditure is still set to rise this year compared with last year, but actual growth is expected to fall far short of the budgets set in January and at the start of 2007.

Moray MacLennan, president of the IPA and European chairman of M&C Saatchi, told the Independent: “The negative balance is relatively small, but there clearly is a slowdown in consumer spending and that is reflected in the budgets.

“Internet spending is likely to remain buoyant but spending online really just milks the existing brand, so the interesting issue will be how firms balance the need to keep topping it up offline.”
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