DM spend fell by 12%, the same percentage decline as Q4 in 2008, which the IPA described as a "moderate" downgrading.
Overall, some 45% of all companies surveyed reduced their marketing spend in Q1, compared with 11% who said they had increased spend.
The hardest hit budgets were for 'main media advertising' and ‘all other' media, which includes PR, events sponsorship and market research. Main media advertising, which includes TV advertising, was revised down by 33% in Q1 2009, the second-steepest decline in the survey's nine-year history.
But the IPA believes this latest survey indicates some green shoots are emerging, with the decline of overall marketing spend slowing in Q1, suggesting budget cutting may have reached its peak in Q4.
"This data supports the view that the bottom of the market has been reached," says Moray MacLennan, IPA President, and CEO, M&C Saatchi Worldwide. "It will be a long road to full recovery, but this maybe the turning point."
Internet advertising suffered a record reduction of 2% in spend, but the IPA says this rate indicates it has gained share of overall marketing spend to 10%.
Scott Knox, managing director of the MCCA, commented: "This latest Bellwether reflects our Agency Barometer results for the same period. Around half of agencies predicted cuts [while the IPA survey] shows that 45% of clients did make downward revisions. The slowing of the budget-slashing in DM is good news, but it's too early to tell whether this is a sign that we are reaching the light at the end of the tunnel, or the results of other factors."
He added: "Clients still want accountability and will be fighting harder than ever for their 09/10 budgets - agencies offering measurable, targeted disciplines should capitalise on this."
The IPA reports that business confidence has picked up from the all-time low of Q4, with the percentage of companies believing their prospects have improved rising from 5% to 14%.
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