Forrester: Marketers wasted $7.4B on low-quality ads in 2016
- Forrester Research made available a report to Marketing Dive that found U.S. marketers wasted as much as $7.4 billion on digital display ads alone last year. Forrester's ForecastView team found 56% of those ad dollars went to ads that were either fraudulent or unviewable inventory.
- Forrester suggested that a lack of transparency in the ad technology space is the most significant cause of the broken digital media supply chain leading to these problems. Barring any industry moves to rectify the issue, Forrester predicts the number of wasted budgets will grow to $10.9 billion by 2021, while the "real dollars" marketers spend to reach an audience will nearly double.
- The report found that a lack of viewability keeps 36% of digital ads from ever getting in front of internet users. The ads might be served on computers owned by actual people, but the ads run in places where no one can actually see them. In the report, RealVu co-founder Alan Edwards said, "When you take away the non-viewable ads, there’s not much left."
Forrester offered a two-part solution for the problem — setting more stringent standards, especially in choosing vendors, and that marketers must "get a grip" on the media buying process. The group said just 37% of business-to-consumer marketers "believe that they know what works in digital marketing," a statistic made concerning given the billions invested in the channel, which is set to become the largest by media spend for the first time ever this year.
The Media Rating Council (MRC) has viewability standards cited as a partial solution, both by Forrester and by top marketers. Procter & Gamble's Chief Brand Officer Marc Pritchard recently set the MRC Viewability Standard as a baseline minimum requirement of third-party verification for advertising partners to achieve by year's end lest they lose the CPG giant's business.
The problem, Forrester suggests, is that these standards aren't really standardized. Major digital agencies, including WPP's GroupM, have their own methods that might be even more rigid than the MRC's. The big digital ad platforms like Facebook keep their measurement metrics behind a walled garden, though some of that guardedness is starting to crack under pressure from marketers like P&G.
On helping marketers better educate themselves on the intricacies of media buying, Forrester outlined a number of strategies: working with vendors that deliver transparency, requiring all partners to adhere to industry standards, buying inventory directly from publishers or from aggregators that monitor fraud, paying for quality inventory and incentivizing good behavior.