What do Bellwether results signal for marketing landscape? VCCP, DigitasLBi, Carat, MediaCom and more discuss

With today's Bellwether report of Q2 of 2014 revealing another increase in marketing budgets for the seventh consecutive quarter, it was found that search spend has increased by 13 per cent, while market research budgets have fallen.

The Drum caught up with agencies in the advertising, digital and marketing sphere to discover what the results signal for the agency landscape.

Adrian Coleman, group CEO and founder, VCCP

This quarter's IPA Bellwether report is broadly reassuring, as it shows the marketing industry could finally be on a steady route to returning to stability following years of recession. It shows that marketers are increasingly confident in investing in digital media, as well as the more costly traditional media, in order to reach their audiences.

Yet the report shows that some marketers remain cautious with their budgets, so we still have a long way to go. Whilst agencies will be relieved to hear that marketing investment as a whole is on the up, it remains a fiercely competitive landscape and every agency has to prove how it is giving its clients return on investment, regardless of whether that investment goes up or down.

Zaid Al-Zaidy, CEO, McCann London

These latest findings are very welcome and bode quite well for the marketing services industry at large.

However, the real boom in client spend will continue to be felt mainly in 'digital media.' Consequently, the real winners will be the tech-driven creative companies that can talk the language of brands and those creative agencies that have successfully managed to diversify their offering to embrace post-digital marketing needs.

The trend for clients to consolidate their different specialist needs into a single agency is likely to continue. And so, it is likely that this recovery will favour some marketing firms, not all.

Claire Mason, head of SEO services, DigitasLBi

Businesses are increasingly savvy about the importance of search as part of their marketing strategy. One factor contributing to this realisation over recent years is the recognition that modern search marketing provides brands with significant insight into their core audiences. This level of audience insight allows for much more targeted campaigns with greater chances of success than ever before as brands have the ability to reach out to, and directly engage with, a willing audience in a way that complements the rest of their marketing mix.

The increased investment in search will hopefully prompt a shift in how search marketing tactics integrate into, and evolve, the current infrastructure of a business’s wider marketing department. This evolved infrastructure will enable brands to drive the customer journey more effectively by ensuring that all relevant marketing activities integrate search tactics as standard.

Jane Ratcliffe, chairman, MediaCom

With the second sharpest revision to marketing budgets in over a decade, this quarter’s Bellwether Report bodes extremely well for the marketing industry, by demonstrating the most positive assessment of the industry’s economic health since the report began.

It is clear marketing departments are being given the chance to spread their wings again, making the most of budget increases and new product developments. We must maintain this re-emerging confidence and by doing so, creativity will continue to flourish, ensuring not only our industry’s prosperity but also our place as a world leader in creativity.

Felicity Long, head of digital, Carat

Another positive increase in marketing budgets reflects our clients’ continued optimism post-recession, with an increase in investment in brands to deliver future revenue growth.

The increase in digital marketing is unsurprising with mobile devices becoming increasingly solidified in consumers lives and increasingly accessible for all versus high earners / early adopters. As marketers gain a better understanding of convergence, new touch points, what they add to the consumer journey and the value we can add into their businesses, this growth will continue to rise.

Ian Edwards, head of strategy, Vizeum

The Bellwether report provides proof of sustained growth in the advertising marketplace, and this year we expect to see investment in TV break the hugely significant £4bn figure for the first time. The issue, however, is that this increased investment is unlikely to be matched by an increase in viewers – which sent inflation in TV through the roof during the first half of the year. As the real cost of advertising increases this puts extra importance on the craft of media planning and buying to ensure that brands get the ever more expensive advertising in front of the right person at the right time.

We believe that increased consumer confidence is one factor driving this growth, but also that brands which went dark during the recession can now see the benefit of sustained investment and are continuing to increase spend incrementally.

Tom Smith, founder and CEO, GlobalWebIndex

As a seller of syndicated data focused on digital, growth for market research has been extremely strong. However there are changes in the market dynamics that could be depressing total overall spend; the core reason for this is a decline in custom research budgets.

This reduction is driven by a shift to syndicated sources, the popularity of social data and then the explosion of big data- all undermining the need for custom research. In the custom research space as data collection moves online and becomes more focused on self-service platforms you can now achieve much more for your dollar than you could with offline. Budgets do not need to be as big.

I do not see this as a sign that market research is less relevant- the need to explain and contextualize big data makes it more relevant, it is just that a very traditional industry is being shaken up. This is a good thing.

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