Marketers Begin 2014 Optimistic About Their Budgets

January 24, 2014

This article is included in these additional categories:

Europe & Middle East | Global & Regional | Marketing Budgets | Staffing

Warc-Global-Mktg-Budgets-Jan-2014Consistent with various pieces of research (such as this and this) indicating that marketing budgets are set for a rise this year, Warc reports that global marketers are retaining a high level of optimism regarding their budgets at the start of this year. This month, the budget component of Warc’s Global Marketing Index recorded a value of 56.1, down slightly from December’s record high of 57.3, but still solidly in positive territory. (A score above 50 indicates a generally improving environment, while a score below 50 indicates a generally declining environment.)

Last year, budget optimism remained above the threshold score of 50 each month, a reversal from 2012 when budget pessimism abounded. The positive score for January suggests that marketers are starting the year on the right foot.

Marketers in the Asia-Pacific are the most upbeat this month about their budget prospects, registering a score of 56.7, their highest in at least 2 years. By contrast, the index score for the Americas dropped a couple of points to 54, while the value for Europe retreated from its all-time high to 56.5. While those scores were down, they still represent budget growth.

Other Findings:

  • The Americas’ index for trading levels dropped by a significant 5.3 points to 57 in January positive at 55.8.
  • As a result, the headline global marketing index (GMI), comprised of the budget, staffing, and trading components, dropped to 56.5 in the Americas, down 2.3 points from December.
  • After reaching its highest headline GMI reading (59.1) in December, Europe’s score pulled back to 58.7, still a healthy result. Overall confidence in the Asia-Pacific region inched up by 0.5 points to 57.7.
  • The global headline GMI recorded a score of 57.9 in January, down slightly from December’s 58.6.

About the Data: Warc’s global panel (1,225 members) consists of experienced executives working for brand owners, media owners, creative and media agencies and other organisations serving the marketing industry. The panel has been carefully selected to reflect trends in the three main global regions: Americas, Asia Pacific and Europe.

Data collection period: 6-17 January 2014. The Global Marketing Index results are calculated by taking the percentage of respondents that report that the activity has risen (“Increasing”) and adding it to one-half of the percentage that report the activity has not changed (“Unchanged”). Using half of the “Unchanged” percentage effectively measures the bias toward a positive (above 50 points) or negative (below 50 points) index. As an example of calculating a diffusion index, if the response is 40% “Increasing,” 40% “Unchanged,” and 20% “Reducing,” the Diffusion Index would be 60 points (40% + [0.50 x 40%]). A value of 50 indicates “no change” from the previous month.

The more distant the index is from the amount that would indicate “no change” (50 points), the greater the rate of change indicated. Therefore, an index value of 58 indicates a faster rate of increase than an index value of 53, and an index value of 40 indicates a faster rate of decrease than an index value of 45. A value of 100 indicates all respondents are reporting increased activity while 0 indicates that all respondents report decreased activity.

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