If you thought the ad was only good for whipping a few extra cans of dog food or frozen corn to stressed mothers, you need to think again if the results of a new study are to be believed.
Rather than just creating an opportunity to use the restroom during your favorite TV shows, advertising boosts savings by creating an effect seven times greater for every dollar spent. He employs lots of people and pays for media that wouldn’t normally be available.
These are the findings of a new report from global accounting firm Deloitte and commissioned by the World Federation of Advertisers.
The report looked at the collective media spending of 28 EU countries and found that in 2014 (when the most recent figures were calculated) some 92 billion euros (AU $ 139 billion) was spent in advertising, resulting in an estimated GDP effect of 642.8 billion euros (AU $ 912 billion) – almost seven times the impact.
The media are also a good provider of jobs in the EU, the report notes. Almost six million Europeans work in the advertising and media sectors and – surprisingly as it may seem – people working in this sector were paid higher than average salaries (€ 34,000 versus € 22,000).
The report notes: “Advertising is important for jobs, innovation, culture and entertainment, and supports the plurality of media, which is fundamental for democratic freedoms. The benefits are pervasive and cut through the fabric of society. “
He added, “Advertising is a vital economic engine that encourages competition, drives innovation in businesses and delivers significant benefits to society by funding or partially funding media services, from information to entertainment. Policy makers should be aware that advertising restrictions have important economic, social and cultural consequences. “
However, he also came with a warning. Stricter regulation of advertisers collecting data on people has been raised across Europe, which could lead to “fear that the economic benefits of advertising may be diminished”. He also pointed out that advertisers are moving away from traditional media for things like Facebook and Google should be of real concern to publishers and traditional media models.