The European ad industry has requested a moratorium on further regulatory restrictions, following the first ever EU-wide report on the economic and social contribution of the industry.
Deloitte’s ‘Value of Advertising’ study, commissioned by the World Federation of Advertisers, has demonstrated the benefits of advertising through econometric modelling, including 4.6% of total GDP and nearly six million jobs across the EU.
Looking at economic benefits, every Euro spent on advertising is estimated to add an additional seven Euros to GDP, as well as supporting competitiveness, providing consumers with information on products and services and increasing their choice of goods and services.
The survey has demonstrated that the industry provides millions of jobs, either directly in production (16%), through media or online businesses (10%), or in the wider economy as a consequence (74%).
In total, this is equivalent to 2.6% of all employment in the region.
Socially, advertising funds or part funds media services, allowing consumers to benefit from news, entertainment and communications tools at a reduced cost or free. Without advertising, funding for various media would be significantly reduced, with ads funding the majority of free online services.
Outdoor advertising also provides civic benefits through an improved urban environment, while search engines help reduce the time and social cost of seeking new information.
“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,” said World Federation of Advertisers chief executive Stephen Loerke.
Off the back of these findings, the European ad industry has called for a temporary halt to further restrictions to ensure the impact of any new regulations are fully assessed. This follows concern that revised Audio Visual Media Services and Privacy directives will create additional rules, thus damaging the digital economy in Europe.
“Policy-makers should be mindful that ad restrictions have important economic, social, and cultural consequences,” said Loerke.
“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.”