UK think tank attacks advertising

17 December 2009

LONDON: Advertising is contributing to a number of negative social trends which are currently observable in the UK, a report by a leading think tank has argued.

The New Economics Foundation has produced a study, entitled A Bit Rich: Calculating the real value to society of different professions, assessing the role of various segments of the employment market.

At the positive end of the spectrum, the ad industry was estimated to employ 17,000 people directly, as well as supporting jobs in numerous other sectors, and providing corporation tax to the government.

More negatively, it "encourages high consumer spending and indebtedness," and "can create insatiable aspirations, fuelling feelings of dissatisfaction, inadequacy and stress," the NEF suggested.

Overall, commercial communications were ascribed a "social cost" of £16 billion ($26.0bn; €17.8bn), having contributed to rising levels of obesity and debt, and been linked to some "anxiety-related mental health issues."

Furthermore, £30bn of "overconsumption" was attributed to the actions of ad executives, with these non-essential purchases exerting a highly detrimental effect on the environment.

"We have weighed all the costs incurred by advertising professionals, which amount to £1.2 million per person, against a benefit of £370,156 per person," the NEF concluded.

"The result is that for every £1 of positive value, £11.50 of negative value is generated."

However, Rory Sutherland, president of the Institute of Practitioners in Advertising, and vice chairman of Ogilvy Group UK, challenged the think tank's findings.

"They seem to attribute in their calculations all excess consumerism and all the miseries on earth to advertising," he argued. "But they didn't mention that advertising pays for media."

"The fact is media for the most part survives on advertising and the media is one of the most environmentally friendly and gratifying ways of spending time."

Moreover, advertising can mitigate the risks of underconsumption, which threatens economic stability, he added.

Companies like Easyjet, IKEA, McDonald's and Tesco have also made high-quality goods available to shoppers at reasonable prices.

Similarly, many campaigns are based around positive objectives, a trend that applies not only to charities and public services, but to the private sector as well.

"Not everything that is advertised is aspirational," said Sutherland. "Advertising has helped popularise sectors like computing and broadband."

"I have worked on the BT account for years and have helped get four or five million homes connected to the internet, which is something I am spectacularly proud of."

Data sourced from New Economics Foundation/Marketing; additional content by Warc staff