Industry poised for long-term growth

Britain's agencies have been cheered by new figures suggesting adspends have not only halted their downward spiral, but are also set for some long-term growth.

This returning confidence among advertisers is reflected in the IPA's latest Bellwether Report, which covers the fourth quarter of last year. It claims that marketing budgets for 2007 and 2008 will be at their most buoyant levels for seven years.

Also, new forecasts from the Advertising Association are predicting a major rise in adspends between now and 2018.

The Bellwether Report says that even though marketing budgets were revised downwards, the decrease was only a slight one.

David Pattison, the IPA president, said: "Business conditions are continuing to improve, with 2007 set to be a positive one for all sectors, with indications that there will be strong growth in future spend for the main media and non-traditional marketing."

This optimism is supported by the Advertising Association. It suggests the expected recovery in 2007 will be followed by an increase in budgets, which will peak in 2009.

This is in stark contrast to 2006, when growth in marketing communications was the weakest for four years.

But the Advertising Association believes that a corner has been turned. "Underlying economic forces that drive adspend are likely to continue to be positive for the foreseeable future," its report stated.

The Bellwether Report states that 17 per cent of companies increased their marketing budgets. It also suggests that the rises were needed in order to fund the campaigns linked to business expansion and a shift in strategy towards direct marketing.

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