More than $74m wasted on digital media ad spend in Q3 2022: Next&Co
E-commerce brands wasted the most digital ad spend in the July to September 2022 quarter at $20.2 million, out of more than $74 million in media wastage in total, according to a Next&Co report.
For the report, Next&Co audited 32 companies with annual digital ad budgets of between $500,000 to $21 million across a mix of ASX-listed, multinational, national and SME companies.
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The wastage counts for an average of 40% of audited spend, which is down less than only 1% from the previous quarter.
Across digital media channels, the most digital ad Q3 spend was wasted on Google at $33 million, followed by Facebook ($31 million), LinkedIn ($6.7 million) and Bing ($2.9 million).
Next&Co co-founder, John Vlasakakis, said: “Ad spend is still sitting at an industry high, but we are heading into a period where brands will need to think smarter, not harder about where and how they spend their money.
“We have been using our Prometheus technology to audit brands across a range of sectors and it is clear that efficiency will be key for brands to succeed over the next year. Assessing the efficiency of media spend will be crucial, and also the thing that sets them apart from the competition.”
The report used Next&Co’s auditing platform Prometheus’ in-built KPIs for advertisers, including leads, customer conversions, ROI, and reach, enabling brands to choose their targets across each metric.
It provides a score out of 100 on the overall performance of each metric and the exact dollar figure of ad spend wastage. The data is then individually audited for each type of advertising activity run within the tool and a score is prepared for each.
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Darcy Song was a reporter at Mumbrella, covering media owners, adtech and social platforms. She left in October 2023.
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This really shouldn’t surprise anyone. So many e-commerce brands are still stuck in 2010s Ad mentality (if you throw cash at Facebook/Google, you’ll acquire customers) when all the updates to consumer data privacy have told us this mentality will no longer work. Comprehensive marketing strategies that champion content and put it at the centre of 360-degree plans is what will win in the long run.
Like I tell my fellow e-commerce peers: If you get approached by an agency promising out-of-this-world ROIs, AOVs and low COAs on simply building and placing digital Ads with zero content marketing strategy attached…run. Run as far as you can from them.
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