Marketing Magazine has reported that the government office responsible for the purchase of advertising and marketing services (COI | Central Office of Information) have announced that advertising expenditure could fall ‘by at least 50%’ during this financial year.

The magazine also reports that a spending freeze will take effect immediately until the end of 2010/11 financial year. This action would have a direct effect on both advertising & marketing agencies, and we expect also on the promotional merchandise industry.

The COI are reported to have had a turnover of ?540m in the year ending March 2009. This included ?211m on traditional advertising, according to the COI’s annual report. Our research concludes that COI spend ?3m to ?4m on promotional merchandise, it is as yet unknown how the effects of the cut backs will affect our sector. This is of course not great news, but perhaps is expected as the government take on the task of reducing the country’s deficit.

Published on: June 3rd, 2010