Partner Article

Advertising could generate £100bn GDP

Advertising could contribute £100bn to the economy if firms commit to spend £16bn.

A joint report from Deloitte and the Advertising Association, entitled “Advertising Pays” said the industry is like “economic fuel” and it must be thought of as like oxygen for GDP growth.

Investment in advertising could support a wide variety of industries, according to the study, including media, the creative sector and digital businesses, as well as having a direct effect on the advertisers themselves.

A positive impact could also be felt in UK exports, market growth and employment, while investment could also boost innovation and competition.

Deloitte and the Advertising Association also said advertising’s potential to contribute to society would have economic value.

Figures show that for every £1 invested in advertising, £6 is generated towards UK GDP, based on a cross-country analysis covering 17 markets over 14 years.

BT Retail’s chief executive and President of the Advertising Association, Gavin Patterson, said: “I believe, advertising’s potential to support growth is often overlooked.

“This report was commissioned to fill that void with an authority that goes way beyond the instincts of ad-land – it is founded on independent analysis from one of the world’s leading consultancy firms.

He went on: “Deloitte’s conclusions are startling.The implications for policy-makers are powerful and compelling.

“If the task of government is to seek out policies that can encourage and sustain growth, then the time has come to look more closely at advertising.”

Speaking ahead of a UK advertising summit, LEAD 2013, on Thursday Maria Miller, Secretary of State for Culture, Media and Sport, said: “Advertising has a huge impact on our economy and on our reputation abroad, helping to inspire growth, investment and tourism.

“The creative talent that makes Britain a world leader for fantastic film and TV, amazing special effects and wonderful music is the same talent that inspires and makes our advertising.

“We must nurture this talent, which is admired the world over, so as the advertising industry can realise its full potential as a key driver of economic growth.”

The Advertising Association urged the Government to get to grips with regulations holding the industry back, and said it must boost UK capability and production levels.

Tim Lefroy, chief executive of the Advertising Association, said: “In an economy where 60% of GDP is rooted in household consumption, the means to bring products to market must not be forgotten.

“Advertising is sharpening competitiveness and acting as a spur to innovation. This report should prompt fresh thinking both by industry and in Government in support of our role.”

This was posted in Bdaily's Members' News section by Miranda Dobson .