Daily Management Review

New Report says Nearly $692 Billion to EU Economy Contributed by Media Spending


01/17/2017




New Report says Nearly $692 Billion to EU Economy Contributed by Media Spending
A recently published new study has found that up to a seven-fold contribution to the economy of Europe is generated by the money that is spent on advertising by brands from all across Europe and abroad.
 
The reports quotes the spending figures from 2014 which is that time for the latest available figures at the time of preparing the report, and with an estimated effect on Gross Domestic Product (GDP) of €642.8 billion, which is nearly a seven-fold impact, the report states that more than €92 billion ($98 billion) was spent on advertising in 2014.
 
"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.
 
With a GDP impact of €709 billion, the EU 28 will have spent €102 billion on media in 2016, estimates the new report.
 
The people who are working with the advertising and media industry earn about €34,000 on the average as salaries, in addition to contributing to the economy, compared to an average of €22,000 across the EU. According to Deloitte, the preparer of the report, making up nearly 2/6 percent of the total employed people in eth European area, the total number of employees who work in the advertising and media industries is nearly six million.
 
According to an emailed statement issued by the agency for whom the report was prepared, because of potentially tougher regulation, the report is being used to highlight a "concern that the economic benefits of advertising could be diminished," the WFA said.

The WFA says that to gain consumers' consent when collecting data about them online, the European Commission's latest ePrivacy directive draft which proposes tougher measures for brands and publishers could mean a diminished user experience.
 
"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.
 
News and entertainment websites, social media platforms and email services are among the services that are paid for by advertising and this has been highlighted in the report. "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.
 
According to a report released by MAGNA in December 2016, due to the assumptions that Facebook or Google are forecast to take 54 percent of ad spend this year, there is a trend of shift among advertisers who are moving away from spending money with publishers, instead on social media and search engines.
 
Deloitte's model looked at 28 developed markets and is based on Advertising Association and WARC data from 1998 to 2014.
 
(Source:www.cnbc.com)






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