$6 Billion Wasted In Misplaced Digital Ads

And that's just Australia.

Next&Co’s annual Digital Media Wastage report shows $6.149 billion was wasted on digital ad spend that “failed to further digital advertising objectives”. And wastage was 17% higher last year than in 2022.

Next&Co’s auditing platform Prometheus measured over 400 companies with budgets varying from $500K to $21 million. The mix included roughly equal percentages of nationals, multinationals and SMEs.

Of the wasted billions, Google accounted for 49% and Meta 41%. In fact, for every $10 spent on digital ads last year, $4 was wasted.

Founder of Next&Co, John Vlasakakis, commented:

“This data shows that brands are still throwing away billions of critical advertising dollars by failing to understand best practice data use and running campaigns that don’t deliver a strong ROI.”

He added:
“Brands are relying too heavily on AI and automation to drive their spend, without understanding the platforms and how to best use the data they have”.

One of the key problems is that Google and Meta have produced platforms with a high degree of automation, but a low degree of sophistication.

This encourages non-expert use by people with no knowledge of the fundamentals of what makes advertising work – how individuals react psychologically to creative messages and how customers are stimulated to interact with brands.

Combine that with encouragement by the big platforms to use their automated audience targeting, which is large, fuzzy and unsophisticated – the spray and pray model – and you have 40% of your ad spend going up in smoke.

Anything that companies might have saved by going down their current marketing route has been lost again many, many times over with 4 out of every 10 ad placements wasted.

Now is the time for companies to really look at what they’re doing and start to work strategically to bring that $6 billion back into play to create growth and expansion.

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