NEWS16 January 2017

Advertising delivers seven-fold return on investment

Europe Financials Media News Trends UK

EUROPE – The economic impact of Europe’s advertising industry has been analysed in a new report from Deloitte showing that for every Euro or Pound spent on advertising, a seven-fold return is achieved in terms of GDP.

Advertising in Picadilly Circus

The Value of Advertising report was funded by the World Federation of Advertisers and a range of industry partners, and shows that advertising benefits the economy, jobs and society.

Using econometric modelling, the study found that advertising contributed nearly six million jobs across the EU and 4.6% of total GDP.

It identified three key areas where advertising provided direct or indirect benefits to European economies and citizens:

  • Economic benefits: The €92 billion spent on advertising in 2014 in the EU would have contributed €643 billion to GDP.
  • Employment benefits: Advertising provides almost six million jobs in the EU, equivalent to 2.6% of all EU employment. These come in three areas: those employed directly; media and online jobs funded by advertising; and jobs created as a consequence of advertising such as hospitality.
  • Social Benefits: 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 free.

Stephan Loerke, CEO of the World Federation of Advertisers, said: “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.”