The study of 250 companies confirms that fears of a looming global recession have started to impact on marketing spend, with the biggest downward revision in the survey's nine year history.
The report also marks a full year of marketing cutbacks, the fourth successive quarterly reduction in spend, with just 8% of companies now more optimistic about prospects for their industry than they were three months ago.
Hardest hit were budgets for main media advertising and "all other" which includes PR, events sponsorship and market research, both of which saw record downward revisions. Budgets for sales promotion and direct marketing fared slightly better, but were nevertheless still revised downwards.
The internet managed to buck the trend with budget expenditure for the year holding steady. Internet search was the only category to see an increase, yet the rise was only marginal.
Moray MacLennan, president of the IPA, said: "I doubt these gloomy results will come as a surprise to anyone. The industry will be watching the next set of results with great interest hoping that, following four quarters of decline, the downward curve levels off, despite the impending recession."
In an earlier interview with Media Week, MacLennan, who is also chairman, Europe of M&C Saatchi, urged companies to look at investing during the downturn. He said: "I think it's a good time to be planting some acorns from perhaps relatively low costs, just to be putting some things in place so that when we do come out of it, you can start to ride on the back of an upturn. This can be anything from investing in staff, new business or start-ups."
This article was first published on Media Week