Market at its most buoyant since the dotcom boom
Indicating a stronger rate of growth than at any period since the height of the dotcom boom, more than 50% of advertisers are preparing to spend more money this year - according to the latest Bellwether Report.
The report revealed that a quarter of companies reported a rise in Internet spend while only 4% said they were cutting it.
It also found that Internet marketing had performed better than all the other categories of marketing spend monitored by the Bellwether Report for seven consecutive quarters.
With 5,000 new users joining the UK net community every day, 5,000 more converting to broadband and online established as the only daytime medium, the web has clearly bounced back from the doldrums of 2001.
Finally marketers have realised that in a dizzying environment of media overload, online is the new way to communicate.
And with advertising responsible for the funding behind pretty much every free-to-air website, that's great news for UK Internet industry.
Chris Williamson, author of the report, said: "Marketing and advertising executives are entering 2004 in the most optimistic mood since the height of the dotcom boom."
Adding that growth was being driven by rising profits rather than simply because of business confidence.
Sir Martin Sorrell, chief executive of WPP Group, said that the trends were not surprising given a 25% rise in US corporate earnings in the last quarter of 2003.
"Corporate profitability is improving but up to now mainly as a result of cost reductions. Perhaps now the focus is switching to top-line growth and advertising and marketing services spending is rising as a result," he said.
Sir Martin has long been predicting a recovery in 2004, citing the Athens Olympics, European football championships and US Presidential elections as contributing factors.
Even traditional media looks set to benefit from the sense of increased optimism in the marketplace, with 40% of companies budgeting higher adspend than in 2003 – that’s almost twice the number reporting a decline.
Direct marketing also continues to perform strongly, with budgets rising by a greater amount than at any time since the second quarter of 2002.
John Owen, IPA digital marketing group chairman and planning director of Dare Digital, said: "Internet marketing's steady and consistent growth continues unabated."
"Clients from all sectors now consider it a staple part of their marketing mix and many continue to revise their online budgets upwards as they see further proof of the medium's effectiveness."
Echoing his enthusiasm, Danny Meadows-Klue chief executive of the Interactive Advertising Bureau said: “In 2004, we will see adspend and audiences reach record levels. Audience time and frequency of use will rise sharply and broadband take up will increase."
"Smart marketers will use solid brand metrics to prove their campaign's effectiveness and this will spurn further investment.”
Sources: Brand Republic, IAB, NTC Research, Revolution Magazine,
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