The first-ever EU-wide report to isolate the economic and social contribution of advertising and marketing communications highlights the sector’s ability to drive economic growth across the EU.

Advertising delivers powerful economic benefits across Europe

The first-ever EU-wide report to isolate the economic and social contribution of advertising and marketing communications highlights the sector’s ability to drive economic growth across the EU.

Value of Advertising, an independent study by Deloitte, has identified a multitude of benefits generated by advertising to the overall economy, jobs and civil society.

Using econometric modelling, the study, which was commissioned by the World Federation of Advertisers and other industry partners, found that advertising contributed nearly 6 million jobs across the EU and 4.6% of total GDP.

Every Euro spent on advertising is estimated to add an additional seven Euros to GDP. This means that the €92 billion spent on advertising in 2014 in the EU would have contributed €643 billion to GDP, representing 4.6% of the overall EU GDP.

The study found that advertising contributes to the wider economy through its ability to support competitiveness by providing consumers with information on products and services and helps to increase their choice of goods and services. This, in turn, drives innovation by incentivising businesses to create differentiated products and services, allowing them to out-compete their competitors not just in the EU but around the world.

  • Advertising provides personal and social benefits by funding or part funding media services. Advertising ensures that EU citizens benefit from news, entertainment and communications tools at a reduced cost or even for free. The €92bn spent on advertising in 2014 directly funded content of all kinds.
  • Outdoor advertising also provides additional civic benefits in the form of an improved urban environment while search engines help people to reduce both the time and financial cost of seeking new information.
  • Without advertising, funding for all sorts of media would be reduced. This could drive up costs to consumers, damage media independence, reduce the amount of news and entertainment content and force professional sports and cultural events to seek financial support from other sources.

Online, advertising largely funds free services that people across Europe use at little or no cost. For example, around 70% of EU citizens regularly use email services, while social media are accessed extremely widely.

Stephan Loerke, CEO of the World Federation of Advertisers says: “Advertising is a vital economic engine that encourages competition, drives innovation in business and provides significant benefits to society by funding or part funding media services, from news to entertainment. Policy-makers should be mindful that ad restrictions have important economic, social, and cultural consequences.”

The European ad industry is calling for a moratorium on further restrictions on advertising to ensure that the overall impact of any new rules, including their unintended consequences, is fully assessed. Right now, the industry is concerned that the revised Audio Visual Media Services and ePrivacy directives will create additional restrictions, hurting the European digital economy and reducing its potential to create local champions and more jobs.

“Advertising matters for employment, innovation, culture and entertainment, and supports media plurality, which is fundamental to democratic freedoms. The benefits are pervasive and run through the fabric of society,” said Loerke.




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