World Economics - Insight , Analysis and Data

World Economics - Insight , Analysis and Data


Global Marketing Index

Released: April 24, 2014

Marketer confidence rises as mobile spend is set to rocket

  • Headline GMI up 1.1 points against March and 1.8 points year-on-year to record 58.3 in April
  • Planned mobile spend is set for strongest growth in over two years, with index gains across the board
  • Trading conditions in the Americas return to highs of April 2012, while Europe remains steadfast amidst uncertainty in Ukraine

Global marketing budgets continued to rise into the second quarter of 2014, underpinned by a strong increase in planned mobile and digital (excluding mobile) spend, according to the latest data from Warc’s Global Marketing Index.

Across all regions, the headline GMI measure –which takes into account marketers’ expectations for trading conditions and staffing levels as well as marketing budgets –recorded an index reading of 58.3 in April, a rise of 1.1 points from March and 1.8 points against the previous year. A reading of 50 indicates neutral sentiment.

This uptick in the global headline figure was partly driven by a rise in the index for global marketing budgets. This index continued to indicate a net monthly increase in planned expenditure, recording 55.6 in April, a month-on-month gain of 1.4 points.

Regionally, the largest single index rise for marketing budgets was in Europe, up 2.8 points against March to 55.1 in April. Gains elsewhere were more modest, yet index readings of 55.6 in Asia Pacific (up 0.5 points month-on-month) and 55.7 (+0.2) in the Americas suggest that budget expectations generally improved in April.

Of these three regions, overall marketer confidence was highest in the Americas, with the region recording a headline GMI reading of 59.9, a 2.4 point increase from the previous month.

Confidence also remains high in Europe, where the headline GMI rose half a point against March to 57.5 in April. The outlook is improving in Asia Pacific too, although the region’s headline index of 57.4 remained flat month-on-month.

Globally, the outlook for trading conditions, the second of the three components of the headline GMI, continues to indicate strong optimism at 61.1, although this is a 1.4 point fall from March. Trading conditions in Europe showed the greatest decline in index value, down 4.6 points to record 58.9 in April, possibly due to continued uncertainty in Ukraine.

A dip in the index for trading conditions was also observed in Asia Pacific, down 2.8 points to 60.4, yet this still signifies rapidly improving conditions overall. The index for trading conditions in the Americas rose 3.1 points this month to 63.5, equaling levels not seen since April 2012.

In common with previous Global Marketing Index results, mobile and digital (excluding mobile) looked set to maintain strong budget growth relative to other media, with index gains across all regions. Planned digital spend rose by 4.2 points to 79.3, while mobile advertising’s index value of 75.2 marked a 4.9 point growth from March. The reading suggests marketers are willing to increase mobile budgets at a greater rate than at any other time over the last two years.

Mobile budget growth is highest in Asia Pacific (78.6, a 3.6 point rise month-on-month), however the US came close to matching this level during April, recording a reading of 75.5 following strong monthly growth. Mobile budgets are also glowingly rapidly in Europe, with the region registering a reading of 73.3 in April, up 1.5 points from the previous month.

Elsewhere, growth in budgeted TV spend was reigned in slightly, with an index reading of 51.0 representing a 1.0 point fall against March. Other traditional media, including press (34.7) and radio (42.4), saw a fall in planned spend of 0.7 and 2.6 points respectively.

The third and final component of the headline GMI – the index of staffing levels – climbed by 3.3 points in April to reach 58.0. The highest growth in recruitment was seen in the Americas (60.5), followed by Europe (58.2) and Asia Pacific (56.3).


 











Methodology 
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.



About the Index 
The Global Marketing Index provides a unique monthly indicator of the state of the global marketing industry, by tracking current conditions among marketers.

Our 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.




About Warc 
Warc is the global provider of ideas and evidence to marketing people. It has produced trusted and independent data on advertising expenditure and media costs for more than 25 years, and has partnerships with leading advertising organisations in more than 80 countries. Warc’s premium online service, www.warc.com, is the largest single source of intelligence for the marketing, advertising and media communities worldwide. With subscribers in over 100 countries, warc.com is a unique resource relied upon by major creative and media agency networks, market research companies, media owners, multinational advertisers and business schools, to help tackle any marketing challenge. In addition to the online service, Warc publishes five magazines, provides industry data and runs events.

To find out more about Warc, take a free trial at www.warc.com/trial.

 
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