UK ad market shows signs of recovery

Fri Nov 27 2009, 17:39 PM UTC

Adverting spend from some of the UK's biggest brands is beginning to show signs of recovery, even though it is down year-on-year, according to the latest Nielsen figures. The improvements come amid returning consumer confidence, giving further evidence that the worst of the recession is over.

According to Nielsen's Reading the Recession report, which tracks brands, consumers and job vacancies, total ad spend was down 10% year-on-year in September. This is an improvement on the 16% decline seen in May. The report says many of the UK's biggest brands are seeing quarterly growth for the first time in the last year.

Nielsen claims that in the first 12 months of the recession - between July 2008 and June 2009 - major supermarkets increased their ad spend in an effort to promote value brands. ASDA's ad spend went up by 40% during this time, while the government also increased ad spend by 33% to promote anti-smoking and alcohol awareness campaigns.

However, ad budgets elsewhere were slashed. During the same period, every car manufacturer apart from Audi and Seat cut ad spending, with Lexus reducing its media budget by two thirds. Elsewhere, Procter and Gamble, which is responsible for brands as diverse as Gillette, Pringles and Pampers, cut its ad costs by 15%, and ISP Tiscali made a 92% ad reduction.

Nielsen claims increased ad budgets in Q2 and Q3 from major retailers such as DFS, SCS and B&Q are "the first signs of 'green shoots'”. These firms previously experienced four consecutive quarters of negative growth. The research firm also claims that in Q3 consumer attitudes were beginning to change. Two-thirds of those polled said they planned to spend less on clothes, compared to 71% in the first half of 2009, while 59% planned to save on electricity and gas bills, down from 68%.  

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