A briefing on advertising's role in the economy and society
The value
Advertising plays a role far beyond promoting products and services. It connects businesses with consumers, helps new ideas find a market and provides people with information about the choices available to them. In doing so, advertising supports a dynamic marketplace where businesses can grow, new entrants can compete and consumers can discover and compare products and services.
Its value extends across the wider economy and society. Advertising supports innovation, competition, economic growth and jobs, while helping fund the news, journalism, entertainment and content people rely on every day. Its reach can also be used to raise awareness, challenge established attitudes and encourage behaviours that contribute to broader societal goals.
Together, these contributions show the wider role advertising plays in the economy and society. Explore how advertising creates value for businesses, consumers, the economy, media and society, and how responsible advertising and self-regulation help sustain that value over time.
Six ways advertising creates value
Advertising contributes to policy objectives by:
Each of these is backed by independent research, competition authorities and courts — not industry opinion. Select one to learn more.
Advertising drives innovation
Advertising helps businesses commercialise innovation
Key message: Innovation only creates economic and societal value when it is successfully commercialised and adopted at scale.
Advertising is the bridge between innovation and market success, helping consumers discover new products and services while enabling businesses to earn a return on their investment in research and development. By supporting the successful commercialisation and widespread adoption of new products and services, advertising enables firms to capture the returns that fund continued investment in R&D, creating a virtuous cycle of innovation, productivity and economic growth.
Advertising strengthens competition
Strengthens competition
Key message: Competitive markets depend on businesses being able to compete for customers on a level playing field. Advertising lowers barriers to competition by enabling new entrants and challenger brands to reach consumers, build awareness and compete on the merits of their products and services.
By increasing market contestability, advertising encourages firms to innovate, improve quality and compete more effectively, ultimately expanding consumer choice and strengthening market performance.
Advertising supports economic growth
Supports economic growth
Key message: Sustained economic growth depends on businesses being able to innovate, compete and grow.
Advertising supports this by helping businesses reach customers, realise the commercial value of their products and services, and expand into new markets. In doing so, it enables firms to generate the revenues needed to invest in innovation, people and productive capacity. As businesses grow, they create jobs, increase productivity and contribute to broader economic prosperity.
Advertising empowers consumers
Empowers consumers
Key message: Effective consumer choice depends on people having access to accurate, timely and relevant information about the products and services available to them. Advertising plays a vital role by providing information about products, services, prices and innovation, helping people discover new options, compare competing offers and choose the products and services that best meet their needs.
Advertising also serves as an important channel for communicating public interest information, from health and safety information to product recalls and behavioural change campaigns.
By reducing information gaps, advertising expands choice and enables consumers to make better-informed decisions, tailored to their needs and preferences.
Advertising supports media & content
Advertising supports a diverse media ecosystem
Key message: Trusted news, quality entertainment and many digital services rely on sustainable business models. Advertising is a vital source of revenue that helps fund the creation and distribution of news, entertainment and online content, enabling consumers to access a wide range of information and cultural content, often at little or no direct cost.
In doing so, advertising supports a diverse and vibrant media ecosystem.
Advertising advances societal goals
Advertising contributes to advancing societal goals
Key message: By reaching people at scale, advertising can raise awareness, shape attitudes and, when combined with the right products, services and policies, encourage changes in behaviour.
This gives advertising an important role in supporting broader societal goals, from advancing inclusion and healthier, more responsible behaviours to encouraging sustainable consumption and supporting the green and digital transitions.