September 28, 2023

Digital Ad Dollars Not So Wisely Spent, Experts Suggest

By Jay Bemis | Advertising Systems Inc.
Digital ads drive much of today’s marketing business, but recent research suggests that some marketers may want to study how wisely their digital dollars are being spent and whether more of their ad budgets should go to other places.

The experts at eMarketer/Insider Intelligence recently identified several areas “where digital ad spending doesn’t match up with consumer habits,” including digital ad spend overall.

“This year, 74.6% of all US ad spending will go toward digital media, while US adults will only spend 62.1% of their daily media time with digital,” eMarketer said.

Specifically, “Our forecast data reveals a mismatch between marketers who have been quick to transition to digital platforms, and consumers who are still spending time on traditional media like TV, newspapers, and radio.”

Meta, as owner of Facebook and Instagram, was cited as one platform that has been a chief beneficiary of the mismatch between time spent on digital media and the percentage of digital ad dollars going there.

US adults spend 7.6% of their daily social media time on Meta properties, yet the platform is gaining 19.5% of total digital ad spend, according to eMarketer.

“There is this huge, gigantic, massive discrepancy with the amount of money that Meta is making off advertising compared to the amount of time that people are spending with it,” said eMarketer analyst Ethan Cramer-Flood.

Meta will reap roughly 75% of US social ad dollars this year, eMarketer said, compared to only 41.8% of daily social media time that US adults spend on Meta’s properties.

“None of (Meta’s competitors) actually have a positive ratio in terms of drawing in more money than time,” Cramer-Flood said. YouTube, for example, draws 5.8% of all digital ad spending but accounts for 7.5% of US adults’ digital media time.

Other platforms studied were Hulu, 1.6% of digital ad spend versus 5.12% of time spent on the platform; TikTok, 2.3% share of ad spending versus 3.7% of time spent there, and Snapchat, 0.8% of digital spend versus 1.8% of the time adults spend on it.

“There (are) reasons for this money to be going (toward digital),” Cramer-Flood said. But the degree to which marketers and advertisers have sprinted in one direction faster than the general population stands out, he noted.

Diversify By Blending Digital With Traditional Strategies

If you’re wondering whether your digital ad spend is getting the most bang for the company buck, shifting your budget dollars and marketing strategy to accommodate more ads in traditional media — via print marketing and video/TV marketing campaigns — could well be the way to go.

By incorporating services like print marketing and video marketing (including TV), your business not only is diversifying its marketing strategies but also helping you reach a wider audience. Such an approach will allow you to connect with consumers through different channels and engage with them in unique ways.

Although digital ads are popular these days, print marketing does still have its place, allowing you to target and reach specific audiences that are difficult to reach through other media channels. In the world of newspapers and magazines, for example. you can target local or weekly publications, as well as special editions, to narrow down your audience and achieve your marketing goals.

Brightly designed display ads stand out on a printed page, so enlist your creative services staff to design a newspaper or magazine ad that will catch a reader’s attention. Adding a coupon to the display ad can be an extra attention-getter, be it through the newspaper or magazine or by also employing the display ad in a direct-mail campaign.

With a video marketing campaign, meanwhile, you can enhance your branding through promotional, corporate messaging or instructional videos, or by creating television/connected TV commercials.

Connected TV (CTV) comprises devices that connect to — or are embedded in — a television to support video content streaming via the internet: Think Xbox, PlayStation, Roku, Amazon Fire TV, Hulu TV, Apple TV or other such platforms or devices.

Our aforementioned eMarketer research about how digital ad spending doesn’t match up with consumer habits did also address the issue of CTV, which, because of cord-cutting, has an audience that is ripe for digital ads but isn’t getting its share of them.

Calling it “CTV’s conundrum,” eMarketer noted that a quarter (25.3%) of US adults’ daily digital media time is spent on connected TV, but marketers are dedicating less than 10% of their digital ad budgets to that space.

“That’s going to have to change because CTV is the future,” eMarketer said.

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