Free digital services are worth twice as much as Britain’s food, according to new survey The Digital Dividend produced by Public First for IAB UK.
£39bn is directly generated by businesses in the digital advertising sector, such as agencies, social media platforms and ad tech companies. This is greater than the direct impact of the UK’s legal sector (£34bn GVA) and twice as large as the agricultural industry (£19bn GVA.) GVA means gross value added.
In total digital contributes £129bn to the UK economy, says the report, an estimated £14,600 per UK household. Not surprisingly 70% of consumers say free digital services are important, especially in a cost-of-living squeeze.
Of the estimated £129bn £39bn is directly directly generated businesses (so no arguing with that), £41.3bn from businesses using digital ads (but they could do something else) and £48.5bn from digital advertising along supply chains.
The report reckons that digital ads increased by £73bn, 26bn for smaller companies.
Christie Dennehy-Neil, head of policy & regulatory Affairs at IAB UK, says: “The vast majority of us rely on the internet every single day to stay in touch and informed – be it email, news, maps or social media – and the reality is that it’s only free because of advertising. This study provides much-needed insight into the huge contribution that the digital ad industry makes to the UK economy and how people value the vital services it funds.
“Having a deeper understanding of this is particularly important at the moment, with 85% of the population worried about rising inflation and the Government considering how to further regulate the digital ad sector. This can only be done effectively if the very real benefits that digital advertising delivers for people and businesses across the country are recognised and protected.”
There’s the nub of course, lots of this stuff is on sites like Facebook and the IAB is trying to bat off regulation. Nevertheless the survey shows that digital is now well and truly embedded in the economic life of the country, whether we like it or not.