The Digital Dividend: an introduction from IAB UK’s CEO Jon Mew

We had a very clear aim when we embarked on this study with Public First: to quantify the value that the digital advertising industry delivers to the UK economy, businesses around the country, and the vast majority of people who depend on free digital services every single day.  

Significantly, we have been able to put a monetary value on the UK digital advertising industry’s economic footprint for the first time: ‘The Digital Dividend’ shows that the contributed a total of £129 billion in gross value added (GVA) to the UK economy in 2022 and supported 2 million jobs. For every £1 spent on digital advertising, £4.80 was delivered back to the economy in GVA.  

It’s hard to put such big numbers into context, but it helps if you consider that the direct contribution of the digital advertising industry to the UK economy (£39 billion) is twice as large as the impact of the country’s agricultural sector, while the employment footprint is 50% bigger than that of the automotive industry. In short, digital advertising is crucial to the economic health of the nation.  

However, this report isn’t solely about the macro-economic benefits of the industry. We also wanted to truly grasp how digital advertising contributes to our society by helping businesses of all sizes to succeed and grow and - crucially - enabling everyone to access a vast range of online services for free. This is all the more important given the cost-of-living crisis. With 80% of the nation worried about rising inflation, it was no surprise to find that 7 in 10 people say it’s important to them that digital services are provided for free.  

In fact, we found that free, ad-funded digital services - such as email, social media, online news and maps - are worth an average £14,600 per year to every UK household in consumer surplus. This is significant because while we instinctively know that ad-funded services are vital to people’s everyday lives, we have never before been able to quantify the value that’s placed on them.  

It shows us that digital advertising isn’t just contributing to the UK’s economy, it’s also having a huge impact on the lives of people right across the country on a daily basis. Without it, the services that the vast majority of us rely on to stay in touch, informed and entertained would cease to be free.  

Having a deeper understanding of this is particularly important at the moment as policy makers consider the future of digital advertising regulation. It is essential that the findings detailed in this report are taken into account throughout that process in order to protect the vast and varied benefits that the digital ad industry delivers for businesses and people around the country.