The Daily Telegraph has released results of a TNS study into consumer spending intentions, following government announcements of public sector budget cuts and a rise in value-added tax (VAT) to 20% from January 2011.

Almost three-quarters (73%) of UK adults polled said they planned to curtail their spending as a precaution. At the start of 2010, 44% of consumers said they intended to tighten their belts.

Richard Hyman, chief retail adviser to the accountancy firm Deloitte, commented: “Since the Budget [in June 2010] reality has kicked in for many consumers. … If interest rates go up, alongside an increase in VAT in the new year, suddenly people will be feeling a lot less wealthy and they will spend less. This is going to make life awfully tough on the high street.”

The Telegraph reported that adults with children were even more worried about their immediate financial future, with 82% of respondents in this category saying they would buy less.

The Internet will play a vital role for consumers hoping to stretch their buying power. According to Fleishman-Hilliard and Harris Interactive, 30% of UK Web users polled in January 2010 said the Internet was “absolutely essential” or “extremely important” as an information source. No other source—including family, friends and colleagues—came close to this level of authority.

We can also expect to see more of the attitudes noted by the e-Dialog Center for Digital Marketing Excellence in Q1 2010. The Center asked UK and US Web users what information they most wanted to see in e-mail marketing messages. Top of the list were discounts on future purchases and advance notice of money-off sales.

For retailers in particular and advertisers generally, the message is clear: until confidence levels rise, most consumers in the UK will want to see value for every penny.

A new forecast from the Online-Vermarkterkreis (OVK) sees spending on Internet display advertising rising between 8% and 9% in Germany during 2010. The OVK noted that interest in a range of display formats, including video and banners, has been growing faster than expected since the beginning of the year, prompting it to revise its predictions upward.

Advertisers were also more willing to invest than last year, said the OVK, now that the worst of the global economic crisis appears to be over.

Further rises in Germany’s online population are also encouraging marketers to boost their Internet presence. The most recent edition of “Internet Facts” prepared by the Arbeitsgemeinschaft Online Forschung (AGOF) reported that 49.7 million residents had been online in Q1 2010. 

Men still dominate online, accounting for 53.7% of Web users in Germany. The direct correlation between youth and Internet use remains too; 97% of individuals ages 14 to 19 were estimated to be online in Q1 2010, compared to 71% of those ages 50 to 59. These figures are unchanged from Q4 2009.

Interestingly, 35.2 million people in Germany were estimated to go online only or primarily for private reasons, and did not use the Net for work. Almost 64% of respondents said they regularly shopped or bought items online – roughly the same number who said they used the Web to follow world news.

Detailed results from “Internet Facts 2010 – I” are available here.

Today’s headline in Marketing Week said it all: “Businesses give cautious welcome to new PM but marketers wonder what next.”

Five long days after the general election in the UK delivered a hung Parliament with no majority for any party, Labour’s Gordon Brown resigned suddenly on the evening of May 11. A few hours later, the Conservative David Cameron took over. He will govern in coalition with Nick Clegg, leader of the Liberal Democrats.

Many business leaders are pleased that the Conservatives are in charge once more; they are traditionally seen as more pro-business than Labour, keener supporters of the free market and more likely to favor a light touch in the regulation of banks and other institutions.

In the wake of the financial crisis, however, the new Prime Minister has said he will look for significant spending cuts in many areas, to bring Britain’s budget deficit under control. Clegg has agreed with Cameron that the government’s own enormous advertising and marketing budget needs chopping back. There may also be new regulations for advertisers marketing to children.

Until the new PM and his team produce detailed plans, advertisers and marketers will share two emotions: relief that a new administration is in place, and concern about the potential pain to come. Consumer confidence could also take a knock if cuts in public spending appear harsh. Digital marketers can probably discern a silver lining, however. While total ad spending in the UK fell in 2009, investment in online advertising grew, according to ZenithOptimedia and other sources. Any future shrinkage in ad budgets will likely drive even more marketing to the Web.

Online shoppers in Germany spent roughly €15.5 billion ($21.5 billion, at average 2009 exchange rates) last year, according to recent data from GfK’s WebScope Panel. That marks an annual rise of 14%—well below the 19% growth rate in 2008, but distinctly positive given the difficult economic conditions.

The average expenditure per online buyer in Germany rose by 10% in 2009, to €506 ($703), though the number of purchases, on average, remained constant at 9.4 per year.

Of the non-food product categories monitored by GfK, clothing and fashion showed the greatest gain (24.5%) since 2008. Sales of electronics were up 12.3%, and sales of durables (such as furniture, toys, books and household goods) grew 11.5%.

So far, expectations for growth in 2010 are modest—though e-commerce should continue to perform more robustly than offline sales. Consumer confidence in Germany fell marginally (0.1%) in February 2010, according to GfK’s monthly assessment, and a similar slippage is expected in March. The German economy is beginning to pick up steam again, but prospects of further job losses and wage constraints due to lingering effects of the financial crisis are weighing on consumers.

GfK’s WebScope Panel research is based on a nationally representative sampling of 10,000 Internet users ages 14 and older. GfK has surveyed online buying habits in Germany continuously since 2001.

The UK’s Institute of Practitioners in Advertising (IPA) published a statement today supporting the Grocery Supply Code of Practice. The code aims to deter retailers in the UK from forcing brands to slash prices to damaging levels.

As the financial squeeze continues to shape consumers’ expectations and buying habits, the IPA is concerned that brands may be suffering unfairly. While retailers lean on advertisers to keep prices down, shoppers too are anxious not to pay over the odds.

Price promotions have been an obvious weapon for advertisers during the 2008-2009 recession. A spokesman for the Institute of Sales Promotion (ISP) noted that the proportion of goods sold at discounted prices in the UK rose by 25% in 2009, and reached a value of £14 billion ($22.3 billion) in the month of November.

The ISP also noted that 70% of sales directors polled recently said they expected significant discounting to continue in the near future.

But the IPA’s October 2009 report, “Pricing for the upturn: How can brands fight back?” argued that advertisers and their brands could suffer long-term damage if they depended too much on discounts to attract shoppers.

The IPA had already explored the potential impact of discounting in an earlier report, “Price promotion during the downturn: shrewd or crude?” Data collected for that study indicated that price promotions eroded consumer loyalty toward brands.

The WARC’s coverage of the later IPA report also discusses further implications for advertisers. Worth a look.