IAB Europe warns of restricting data-driven ads

Digital advertising contributed up to €526 billion of the EU’s annual GDP, both directly and through the business growth it enables, according to analysis from independent financial research company IHS Markit.

But it claimed up to half of the digital advertising market could disappear if proposed restrictions on the use of data in advertising, as proposed in the European Commission’s ePrivacy Regulation, came into force.

IHS Markit found that 66% of current digital ad spend requires data, and that data use is behind 90% of annual growth in the digital advertising market.

In addition, GfK research among 11,000 internet users in 11 countries, found that only 30% of EUropeans are prepared to pay for content to replace digital ad revenue. The average amount they were prepared to pay was €3.80 per month, far below what’s required by news sites to fund their journalism.

Townsend Feehan, CEO of IAB Europe, said: "These findings should give MEPs very significant cause for concern as they consider the proposed ePrivacy Regulation.  The alternative to data-driven advertising isn’t just less targeted advertising – it’s a digital ad industry half the size that it is today. That has huge consequences for Europeans."

The research was co-funded by the European Interactive Digital Advertising Alliance (EDAA) and the Interactive Advertising Bureau Europe (IAB Europe).