Latest Research

Data-driven advertising in Europe: latest research

During 2017, we commissioned three original, independent studies, to explore data-driven advertising’s contribution to the European Union (EU).

These studies were conducted by the research agencies IHS Markit and GfK and involved surveys of internet users in 11 EU countries, including a balance of Eastern and Western markets with a range of income levels and stages of economic maturity. They also involved in-depth interviews with online advertisers and publishers, and econometric analysis of the role of data in digital advertising. Together they show how data-driven advertising makes a fundamental contribution to economic growth – and how the accessibility of the internet for EU citizens would be seriously compromised without it.

Europe online: an experience driven by advertising

The research company GfK conducted online surveys with over 11,000 internet users across 11 EU countries. They explored the types of content they access online, their attitudes to data-driven advertising, and their willingness to pay for content as an alternative to advertising.

Key findings include:

68% of European internet users say they would never pay for news content online – even if no free content were available

83% prefer free content with advertising to being required to pay

92% say they would significantly reduce their internet use if asked to pay for content

69% are willing for browsing data to be used in advertising, in order to access free content

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The economic value of data-driven advertising

The research agency IHS Markit used interviews with advertisers, publishers and technology companies to help identify the role of data in digital advertising. With its proprietary database of advertising trends and econometric modeling techniques, it predicted the likely impact of the proposed ePrivacy Regulation, which in the current form will effectively to prevent the use of behavioural data for ads.

Key findings include:

Digital advertising in the EU generates annual revenues of €41.9 billion, with growth of 12.3% year-on-year

Behavioural targeting is used in 66% of all digital advertising and contributes to 90% of digital advertising growth

Data-driven advertising is over 500% more effective than advertising without data, and increases the value of advertising units by 300%

A balanced estimate sees the digital advertising market losing nearly half its value if behavioural data were no longer used

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The economic contribution of digital advertising in Europe

IHS Markit updated its analysis of the economic contribution that digital advertising as a whole makes to the EU. This provides important context for the analysis of data-driven advertising’s value. This analysis used publicly available data, including Gross Domestic Product (GDP) and employment data. It includes digital advertising’s direct contribution through Gross Value Added, as well as its indirect, induced and wider effects. IHS Markit identified the contribution that digital advertising makes to revenue growth for advertisers, and also explored how different digital industries depend on advertising.

Key findings include:

Digital advertising is the single largest advertising medium in Europe, representing 37.2% of all advertising revenue

In total, digital advertising adds €526 billion to the EU economy each year

6 million jobs in the EU are supported in some form by digital advertising

Automation and the use of data in advertising is growing the number and diversity of the jobs it provides

Online advertising represents 81.5% of publisher revenues in the EU, and 51.9% of the revenues for online video platforms

 

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full research report