Digital advertising has become a massive industry that plays an important economic and societal role. Some key facts about the industry’s size and growth:

Global digital ad spending surpassed $500 billion in 2021 according to eMarketer, growing 19% year-over-year. Digital now accounts for over 60% of total ad spending worldwide.

In the US alone, digital ad spend was projected to be over $250 billion in 2022. This is more than the GDP of most countries.

Year-over-year growth of the digital ad market remains in the high double-digits, far outpacing traditional media like TV, print, and radio. The pandemic provided an additional boost as consumer behavior increasingly shifted online.

Emerging formats like social media ads, online video, and mobile ads are fueling continued expansion of the market. For example, mobile ad spending in the US exceeded desktop for the first time in 2017 and now accounts for over 50% of digital ad dollars.

This massive level of spending translates directly into economic impact. Digital ads support a vast advertising and marketing industry that employs millions of people. Tech companies that specialize in digital advertising, like Google and Meta, employ hundreds of thousands and generate massive revenue streams for their businesses. This spending then ripples out through other sectors of the economy.

Beyond direct employment, digital ads also provide economic value as an important subsidy for free online content and services. Many news and media websites, along with search engines, social networks, and other “free” digital offerings rely on advertising money to fund their operations. This means consumers have access to an enormous amount of information, entertainment and tools at no direct cost to them.

It is estimated the value provided to consumers by Google Search alone, in terms of time savings from finding information quickly, is over $2000 per user each year in the US. On a global scale, the availability of free digital services supported by ads likely provides trillions in economic value each year.

With immense economic benefits also come immense societal impacts, both positive and negative:

Positive societal impacts include the ability of digital ads to effectively target audiences. Precise ad targeting enables small businesses to compete more evenly with larger brands by reaching interested customers. It also allows non-profits and advocacy groups to promote important causes.

Digital also makes advertising more measurable. Online ads can be precisely tracked for engagement and outcomes like sales. This has made advertising more accountable and data-driven. Consumers also benefit from more relevant ad messaging as marketers better understand their interests and behaviors online.

Digital advertising has faced growing criticism around privacy and excessive data collection. The core business model of Google and Facebook depends on massive user surveillance to target ads. Over 15,000 data points per person are estimated to be collected by some platforms.

The lack of transparency around how personal data is collected, shared, and monetized has led to a “surveillance capitalism” where privacy is eroded without clear user consent. Studies also show that personalized ad targeting can exacerbate societal issues like political polarization, lack of media literacy, spread of misinformation, and the “filter bubble” effect.

Other societal issues blamed partially on digital ads include the decline of local news as advertising dollars shifted online, contribution to consumerism and overconsumption through relentless targeting, and promotion of unhealthy views around diet, beauty standards, and materialism through some ad campaigns.

Research in psychology has also found that techniques like dynamic ad creative optimization, which adjust ad content in real-time based on user responses, can potentially be psychologically manipulative. And rampant ad tracking online has been found to enable new forms of digital discrimination as advertisers micro-target or exclude certain groups.

Digital advertising undeniably generates vast economic benefits but must be regulated to mitigate serious societal costs to privacy, democracy, public health, and consumer well-being. As the ad market grows exponentially, both policymakers and the ad tech firms themselves face increasing pressure to balance these impacts and ensure the next phase of digital advertising growth does not come at the cost of civil discourse or human welfare online.