Marketing Budgets To Take a Hit in 2025

Big budget cuts are coming. Are you ready?

If your budget has taken a hit, you’re in good company. Research from agency No Brainer* has shown that half of marketers surveyed think that marketing is one of the first areas to lose budget when a business is looking to cut costs. This comes as many businesses consider the impact of rising wages and the national insurance increases announced by Labour last year.

Most worryingly, 47% of UK marketers are worried that anticipated budget cuts will severely impact their 2025 goals.

If you’re a decision maker who’s confused in this challenging landscape, then you’re not alone!

In its latest U-turn, Spotify recently announced it was cutting marketing spend to focus on ‘accelerated execution’ – but just last year the brand said it was “correcting” a decision to reduce marketing spend “too significantly” in 2023. It seems that finding that balance is hard even at the top!

Meanwhile, fellow mega brand Starbucks is ‘bucking’ the trend (sorry!), with executive vice president and CFO Rachel Ruggeri claiming the business is “close to doubling” its marketing spend as a percentage of revenue. The brand’s “Back to Starbucks” marketing plan will focus on re-establishing the brand and shifting away from discount-led offers.

There’s good news in terms of ad spend, with the latest quarterly report from the Advertising Association and WARC showing that ad spend has increased by 9.7%. The report covers Q3 2024 and found that although growth was fuelled primarily by digital advertising and the adoption of AI tools, there was also growth in OOH, radio and even direct mail.

So how can you address cuts if they impact your marketing budget this year?

Us marketers are usually great at striking a balance between short-term wins with metric-driven campaigns, and long-term gains that build brand visibility and strengthen audience connections through a holistic marketing strategy.

But we’re noticing a shift. Businesses under pressure are focusing solely on short term, tangible results. While this approach helps secure quick wins (and gets a stressed sales team off your back), it’s not a sustainable long-term strategy, and risks weakening brand equity and limiting future growth.

At Awesomesauce, we’re helping our clients find the right balance for their businesses across the marketing mix. The brands that get it right will be the ones which navigate the cuts without losing sight of the bigger picture. Investing in your brand is what keeps your business resilient, enabling you to maintain momentum and outlast short-term fluctuations. So, get ready to shift your focus!

We’ve been advising our clients who’ve had their budgets reduced to focus on retention, customer loyalty and building trust and transparency through targeted communications, email marketing using first-party data, customer service and loyalty programmes. We work closely with our clients to create marketing plans which maximise the impact we can make together with the budget available, big or small.

If you’d like to discuss your budget and plans, don’t be shy! Drop our Account & Strategy Manager James an email on james@awesomesaucemarketing.co.uk to arrange an informal chat to find out more about how we can help. We’re a Coventry-based marketing agency working with clients around the world and delivering awesome social media, branding, graphic design, PR, copywriting and more.

Find out more about Awesomesauce Marketing here.

* No Brainer’s study surveyed 500 marketing professionals to ask their opinions on emerging trends for 2025.