U.K. Companies Boost Ad Budgets as Rosy Economic News Aids Sales

U.K. companies are budgeting more for marketing than they have in 13 years, according to a survey by an advertising group, adding to evidence the economy is getting stronger.

More than 12 percent of companies increased marketing budgets in the third quarter, up from 7.3 percent in the previous three months, according to the Bellwether Report, a survey of marketing executives by the Institute of Practitioners in Advertising.

“Marketing spend looks set to rise sharply as companies boost their budgets to an extent not seen in the 13-year history of the survey,” said Chris Williamson, who wrote the report on the answers of about 300 companies’ executives.

The publication -- which didn’t name companies -- adds to signs that the British economy is strengthening. U.K. jobless claims fell the most in 16 years last month, and business surveys suggest the recovery picked up in the third quarter after growth of 0.7 percent in the three months through June.

“The increased appetite to spend on advertising and marketing is being fueled by a surge in business optimism, with firms seeing their financial prospects to be the brightest for at least eight years,” Williamson said.

French advertising company Publicis Groupe SA (PUB), which reported third-quarter results yesterday, said European sales posted moderate growth for the first time this year. The U.K. specifically grew 7.1 percent while southern European continued to perform “very poorly,” Publicis said.

WPP Plc (WPP), the world’s largest advertising company, raised its forecast in August for 2013 sales growth after stronger-than-expected expansion in the U.K. and North America.

To contact the reporter on this story: Kristen Schweizer in London at kschweizer1@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong at kwong11@bloomberg.net

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