The latest IPA Bellwether reports marketing budgets have remained resilient, largely driven by events, despite geopolitical conflict in the Middle East.
UK marketing budgets surged to their highest level in years, defying ongoing geopolitical unrest, according to the Q1 2026 IPA Bellwether report.
The report, which polled marketers between 2 and 24 March 2026, found respondents had revised spend by 7.3%.
More than a quarter (26.8%) reported an increase in marketing spend, compared with 19.5% who recorded a reduction in budget – a significant increase from the flatline of 0% in the last quarter.
Events outperformed all other categories with the highest net increase of 14.7% in marketing investment, up from 1.4% in Q4 2025. There was also renewed investment in main media advertising in Q1, which had seen no change in the previous three quarters. Net spend increased by 4.5% – the strongest upward revision since Q3 2023.
Two out of the five categories tracked within main media saw a strong upward revision in marketing budgets; ‘other online advertising’ and ‘video’ both posted a net increase of 5.7%.
While the net balance for other online advertising dropped from 13.2% in Q4 2025, video saw a rebound in adspend from -5%.
Audio, published brands, and out-of-home all saw marketing spend continue to decline with net balances at -3.4%, -8.5% and -11.3%, respectively.
Elsewhere, spending across public relations increased by 6%, up from 3.5% in the previous quarter; direct marketing and sales promotions rose from -4% and 0% to 3.6% and 2.7%, respectively.
Paul Bainsfair, director general at the IPA, said: “These latest Bellwether results defy wider geopolitical uncertainty and signal a bullish start to the year for UK marketing investment. Looking at the details, it is pleasing to see that budgets for main media are up.
“The evidence is being heeded, even in tougher conditions, cutting back on advertising risks long-term damage. It is therefore welcome news that UK companies are holding their nerve and investing to stay front of consumers’ minds, strengthen their brands and drive future growth.”
Marketers are ‘cautiously optimistic’ for 2026
Despite an uptick in advertising spend, UK GDP forecasts have been downgraded amid political turmoil in the Middle East.
S&P Global Market Intelligence has predicted GDP to expand by just 0.5% in 2025, now from the 0.8% anticipated in Q4 2025.
The data and analytics firm has also forecast business investment to become increasingly stagnant in 2026 due to the ongoing geopolitical uncertainty, but set to recover in 2027 and in 2028, with GDP growth anticipated at 1.4% and 1.6%, respectively.
In contrast, the outlook for adpsend is more promising, with S&P Global revising its initial growth projections to 2.5%, up from 1.5% in the previous forecast.
This upgrade reflects an increased optimism among marketers and a willingness to invest in brand-building and customer engagement. According to the report, 28.6% reported greater optimism in their company’s financial outlook compared to Q4 2025, which is marginally better than the 28% who expressed a pessimistic view.
This positive momentum is expected to continue into 2027 and 2028, with adspend growth forecast to hit 2.7% and 2.9%, respectively.
This is reflected in the budget plans for the 2026/27 financial year, with spending prospects from marketing executives revised up from 1.7% in the previous quarter to 3% in Q1 2026.
According to the report, 28.7% of firms anticipate marketing budgets to increase in the coming year, while a quarter (25.6%) expect a reduction.
Maryam Baluch, economist at S&P Global Market Intelligence and author of the Bellwether report, said: “After stagnating at the end of 2025, total marketing budgets returned to growth in Q1, marking a positive start to the year. This rebound occurred despite a surge in price pressures, driven by rising energy costs, which have cast a shadow of caution and concern over the broader economy.
“Nevertheless, marketing executives have demonstrated resilience, concentrating efforts on revenue-generating sectors and prioritising targeted, client-driven campaigns – including more events – to better position their organisations amid ongoing headwinds and uncertainty.
“Budgets for the 2026/27 financial year have also been revised up, underlining a cautious mood of optimism and strategic intent within the industry. This upward adjustment reflects not only upbeat forecasts around future market conditions, but also a recognition of the need to invest in growth opportunities and maintain competitive advantage as challenges persist.”
