MORE THAN $123 MILLION IN DIGITAL MEDIA AD SPEND WASTED BETWEEN APRIL AND JUNE – NEXT&CO DIGITAL MEDIA WASTAGE REPORT
Announcement posted by Third Avenue Consulting 11 Aug 2021
An average of 37%, or around $123.3 million in digital media advertising expenditure was wasted in the second quarter of 2021, according to the new quarterly Next&Co Digital Media Wastage Report.
Next&Co’s recently launched its Prometheus proprietary media auditing tool, which in an initial analysis found that almost a third, or $3 billion, in digital ad spend was wasted annually.
The 1 April to 30 June report audited 115 brands from the FMCG, finance, retail, health, 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 insurance sector was largest at $69 million, although it is also the biggest spending sector. It was followed by health with $50.6 million wasted, education - $42 million, retail - $38 million, FMCG - $26 million and finance - $21 million.
Across digital media channels, the most digital ad spend was wasted on Facebook at $55 million, then Google at $48 million, LinkedIn at $11 million and Bing at $8 million.
The most common sources of waste were overbidding on things such as search terms, buying the wrong demographic and buying ineffective search terms.
Next&Co Co-founder, John Vlasakakis, said the wastage problem is getting worse for advertisers.
“The problem is a combination of internal marketing teams who do the work for their company and agencies on retainer simply not having the right capabilities in digital media to service clients. There always was a talent shortage of skilled performance marketers in Australia and COVID has probably amplified this,” he said.
“The answer is to get your media audited more frequently. Companies need to take the initiative and get an independent view of how well and efficient their current advertising expenditure is performing for them. Whether this audit is with us or someone else, brands need to keep internal teams and agencies on their toes a little more and if they are not improving performance under current spends, the time to switch agency partners is now.”
Prometheus has been used by more than 300 companies. It has the ability to tell advertisers exactly where and how their ad spend is being wasted on digital platforms and by how much.
Prometheus has inbuilt KPIs advertisers can select from, including leads, customer conversions, ROI, reach and they can choose their targets across each metric. The auditing tool then determines the exact wastage of their total annual digital spend in dollars and where that wastage is occurring campaign by campaign and on a creative level.
It provides a score out of 100 on the overall performance of each metric and the exact amount of media dollars wasted. The data is then individually audited for each type of advertising activity run within the tool and an individual score for each.
Prometheus can also predict how many conversions advertisers could potentially achieve, make creative recommendations and CPA (cost per acquisition) improvement recommendations.
The Next&Co Digital Media Wastage Reports will be released each quarter. Next&Co offers Prometheus auditing free of charge to advertisers and can also create bespoke reports for a fee.
For further information contact:
Rochelle Burbury | Third Avenue Consulting
0408 774 577 | email@example.com
Next&Co is an independent digital media agency founded in Melbourne in 2010. The agency has specialists in strategy, media buying, creative and tech and provides services including digital strategy, digital media, organic search, social, UX/CX design, web and app design, creative and content production, conversion rate optimisation and CRM and loyalty. Next&Co’s clients include Vanguard Investments, National Basketball League, Maven Dental and Healthia. Next&Co – the continuous improvement agency.