An average of 39%, or $54.3 million, in digital media advertising expenditure was wasted between July and September this year, according to the Digital Media Wastage Report by independent media agency Next&Co.
The data is compiled from Next&Co’s Prometheus proprietary media auditing tool which, in an initial analysis, found that almost a third, or $3 billion, of digital ad spend was wasted annually.
The July 1 to September 30 report audited 67 brands from the pharmaceutical, real estate, finance, retail, insurance and education sectors, across ASX-listed, multinational, national and SME companies. Media budgets for these companies ranged from $500,000 to $27 million.
Wastage in the retail sector was largest at more than $15 million. It was followed by finance, with $12.7 million wasted, real estate ($10.3 million), insurance ($8 million), pharmaceuticals ($4.8 million) and education ($2.7 million).
Across media channels, the most digital ad spend was wasted on Facebook at $25 million, then Google at $20 million, Bing at $8 million and LinkedIn at $4 million.
Next&Co co-founder John Vlasakakis says the wastage problem highlights a critical issue in the market.
“Many brands are simply spending their digital advertising budgets in the wrong places and not harnessing the right platforms for their campaigns,” he says.
“The answer is regular, independent media auditing. These audits allow companies to find the spend that is not attributed to a conversion, and then look for opportunities to scale their media spend in areas that are working. Audits are all about providing brands with an immediate and long-term roadmap for performance and channel strategy – it allows them to really consider whether their current agency is delivering results and if not, find new avenues to pursue.”
Auditing platform Prometheus has now been used by more than 300 companies. It has the ability to tell advertisers exactly how much, and where, ad spend is being wasted on their digital platforms.
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