IPA Bellwether Q2 2025: Ad spend bounces back, favoring ‘short-term’ channels

Now, that figure is back in the black. The report’s signal temperature check of the industry is not a measure of budget size but the portion of marketing decision makers from its panel of around 300 who report they’ve increased rather than decreased their marketing budgets. From a balance of 4.8% in the negative, that number has bounced back to 5.5% in the positive.

That’s the strongest positive number posted by the Bellwether in a year.

But it’s not all good news. While marketers’ reports of their financial confidence in their own businesses have increased since last quarter, they’re still in the negative, rising from a dismal -12.9% last quarter to a still-bad -3% in Q2.

And pessimism is yet greater when marketers were polled on their outlook for the wider business. 36.9% of respondents were less optimistic about industry-wide financial prospects than three months ago. Only 10.7% were more positive.

Where’s the spend going?

Money is flowing hard into what an IPA release called “short-term media,” with significant gains in the sales promotions and direct marketing space, clocking in positive balances of 9.4% and 9.1% respectively. Events and PR have also seen increases.

In a separate but connected piece of research, S&P Global, which produces the report for the IPA, also downgraded its general growth forecast for ad spend this year, from 1.3% to 0.7% (though it forecasts a substantial bounceback to a 1.6% growth rate next year).

The quiet death of traditional media?

Behind that growth for short-term channels, “main media” has flatlined at 0%. Behind that figure is evidence of a continued trend away from ‘traditional’ media channels, with out-of-home (-8.9%), audio (-6.3%) and ‘published brands’ (-4.8%) all seeing declines, offset in that ‘main media’ category by growth in online advertising channels. Market research was particularly hard-hit, with a -7% balance.

Chris Camacho, chief executive at agency Cheil UK says that “the shift from traditional to digital isn’t new but what we’re seeing now is the breaking point. The last holdouts are folding as brands chase measurable outcomes, real-time optimization and performance that boards can quantify.”

So are we watching a drawn-out death for these traditional channels – or a right-sizing that will plateau after all this haemorrhaging? For Camacho, the answer is that we may finally see a flip in media primacy. “TV, OOH and print won’t vanish entirely. They’re being redefined not as primary media but as brand-building supplements to digital ecosystems. We’re heading for a future where all media behaves like digital: trackable, targetable and optimized.”

“The bigger story here isn’t just about budget reallocation. It’s about business transformation. Media is no longer a marketing line item; it’s becoming a lever for commercial growth. That’s why spend is flowing into retail media, connected commerce and AI powered content delivery. Clients want systems, not slots. Signals, not spray and pray… Traditional media won’t die, but sentimentality won’t save it either. If it can’t prove its value in a data-led world, the dollars will keep moving.”

The industry response: Avoid ‘short-termism’

Those with an interest in the continued existence of traditional media (which is, arguably, all of us) are not the only group that has seen cause for concern in today’s figures. Plenty of top commentators have been quick to caution against panicked adoption of short-term strategies that would leave longer-term brand-building work out in the cold.

James McDonald, Warc’s director of data, intelligence & forecasting, told The Drum that the “uptick in promotion- and activation-led activity in Q2 points to a shift toward short-term strategies in response to challenging trading conditions, a commonly observed pattern during periods of economic cooling. Four decades of effectiveness data from Warc, however, clearly shows that divesting in brand-building efforts during such times can have a long-term negative impact on both salience and equity.”

And Dom Boyd, managing director of insights at Kantar UK, describes the shift towards the lower funnel as a red flag: “Short-term tactics can be useful for a quick boost to sales, but they won’t generate sustainable growth on their own.”

… But is it short-termism or a new strategic paradigm?

Sales promo and direct marketing shops might agree, though, that short-termism is bad while rejecting that their channels are necessarily short-term. While clearly bullish about the growth in his sector indicated by the Bellwether, Sam Panzer, director of industry strategy at a promotions tech shop Talon.One, agrees that the results contain within them a warning. Marketers, Panzer adds, should be “wary of investing too much in sales promotions that rely heavily on slashing prices indiscriminately.”

He says: “Blanket discounting is a knee-jerk reaction. While it might drive a short-term sales boost, it ultimately erodes margins and conditions customers to wait until the next sale… As trading uncertainty persists, brands need to move away from blanket discounting and focus on delivering personalized incentives proven to drive profitability and customer loyalty.”

And it’s not just specialized shops that will be able to glean a positive from today’s report. Lorna Hawtin is chief strategy officer of UK agency Zeal, which works across the channels that are seeing growth in the Bellwether today including events, shopper marketing and the wider digital ecosystem. For Hawtin, it’d be a mistake to brush off these shifts in spend as reflexive short-termism or an abandonment of brand. Instead, she says, we’re witnessing a shift in how brands are built.

“Events, PR and DM aren’t just cheaper alternatives in the marketing ecosystem; they’re part of the emerging battleground for creativity and cut-through,” says Hawtin. “What we’re seeing is less a return to brand-building as we knew it and more a redefinition of where brand equity is earned.”

“Shopper, social, experiential and partnerships are no longer the support act; they’re where real-world attention can be lost and won. Smart CMOs are asking, ‘How do I make a real impact, fast?’ The answer isn’t always another ad. It’s connected experiences that move people and product to connect heaven and earth.”

Amina Folarin, chief executive for agency Oliver’s UK group, agrees that a “rebalancing” is underway. “There’s no doubt marketers are under more pressure than ever to deliver short-term results, especially in uncertain times. But the smart CMOs we work with aren’t abandoning long-term brand-building... It’s a recalibration of the mix. Yes, we’re seeing more activity in short-term media right now. But that doesn’t mean the industry has walked away from long-term effectiveness. If anything, it’s a reminder of how important it is to plan across multiple horizons, not just the next quarter.”