Direct, sales incentive marketing proved to be the industry favorite during the third quarter – outperforming media spend, sponsorship, public relations, and market research according to a recent marketing budget survey by The Institute of Communications and Advertising (ICA).

The ICA survey found that although the marketing spend revised up, it’s at a slower pace with just more than one-in-five companies reporting an increase in their total marketing budgets in Q3 – outnumbering the 17% that reported a decline. Budget increases were attributed to good sales in both consumer and corporate markets along with profitability. However, the increase in Q3 was the weakest out of the four quarters, which according to the ICA survey was due to growing concerns over a slowing economy.

Taking a closer look at media spend, the increase to total marketing budgets was spearheaded by a surge in direct marketing (which showed the steepest rate of increase), sales promotion and internet-related spending. Marketing executives responding to the survey attribute DM’s strong showing to the ease of accountability in relation to other activities. Following on the heels of DM, sales promotion budgets increased sizably but is attributed to the influx of incentive offers, which came in the face of declining sales due to weak demand and a competitive market.

Overall however, media spend – while still accounting for the largest share of marketing budgets – was decreased on average in Q3, which is in contrast with previous quarters where budgets were increased.

Other ICA findings included marketing activities like sponsorship, PR and market research also having their budgets slimmed down – citing cutbacks to reduce costs as the main culprit.