The money spent on advertising by brands across Europe generates up to a seven-fold contribution to the economy, according to a new study.
More than €92 billion ($98 billion) was spent on advertising in 2014 (the most recently-available figures when the report was written) and the estimated effect on Gross Domestic Product (GDP) was €642.8 billion, a nearly seven-fold impact.
"The economic contribution of advertising in Europe" report, carried out by Deloitte on behalf of the World Federation of Advertisers, examined the collective media spend of the EU 28 countries, including Germany, Spain and the U.K.
It also estimates that the EU 28 will have spent €102 billion on media in 2016, with a GDP impact of €709 billion.
As well as contributing to the economy, those working in advertising and media earn higher than average salaries: €34,000 compared with an average of €22,000 across the EU. Nearly six million people work in the advertising and media industries, making up 2.6 percent of employment, according to Deloitte.
The WFA is using the report to highlight a "concern that the economic benefits of advertising could be diminished," because of potentially tougher regulation, according to an emailed statement. The European Commission's latest ePrivacy directive draft proposes tougher measures for brands and publishers to gain consumers' consent when collecting data about them online, which could mean a diminished user experience, the WFA 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," WFA CEO Stephan Loerke said in a statement.
The report also highlights the services paid for by advertising, such as news and entertainment websites, social media platforms and email services. "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," Loerke added.
However, advertisers are moving away from spending money with publishers, instead shifting spend to Facebook or Google, which are forecast to take 54 percent of ad spend this year, according to a report released by MAGNA in December 2016.
Deloitte's model is based on Advertising Association and WARC data from 1998 to 2014 and looked at 28 developed markets.