In Economic Uncertainty, Don’t Slash Ad Spend, Slash Ad Waste

As advertisers look towards a future of more actionable outcomes, it’s imperative that we explore, pilot and build solutions across platforms– advancing advertising with new currencies that add value and positively impact overall business health.


As both consumers and companies face economic headwinds driven by recession, rising inflation, volatile equity markets and lingering issues from the pandemic, advertising spend is like to be cut as brands look to become more efficient.

But now might not be the time to cut budgets, as this comes at a cost to sales and brand metrics. However it is an ideal time to cut waste and increase performance with a new approach that drives sales and builds long term sustainable value.

The pressure to increase efficiency under a shrinking economy typically comes by way of cutting marketing spend. This is an environment to cut waste, not spend. Maintaining ad spend and removing waste is a winning strategy for marketers as they can actually increase sales and make outsized gains on competitors that do pull back on spend.

The challenges to overcome

The advertising industry is powered by legacy systems, fragmented point solutions and heavy service models. This creates an extremely inefficient and unhealthy ecosystem where the majority of spend is wasted on the wrong audience and over- or under-exposure of ads. This puts the entire industry at risk.

Advertising is valued, transacted (currency) and optimized on unsophisticated and inaccurate metrics, such as people exposed inside an age and gender cohort vs. in-market sales prospects who are more likely to convert.

Traditionally, advertising measurement has been unable to deduplicate and compare across traditional, digital and streaming platforms, which creates waste due to consumers seeing the same ad too many, or too few, times. This creates a wasteful distribution of delivery where some audiences are overexposed to ads while other valuable prospects do not get enough exposures to motivate a sale.

Legacy TV currency and measurement solutions built on a single panel—siloed from big data—are unable to effectively measure streaming audiences, destroying value for TV networks by underrepresenting their growth assets. For advertisers it means not only admitting there is a great deal of waste within the current system, but then figuring out a way to do something about it.

The new approach to take

A new approach to valuing and transacting on media is taking shape. A change in media currency presents a once in a lifetime opportunity to make meaningful change. This unprecedented opportunity is changing the very foundation of how media is bought and sold for early adopters and, in doing so, changing the game for advertising.

Now is the time to take the step into the future with a new currency solution. A solution that can enable advertisers to go beyond traditional metrics, like age and gender GRPs, and break down silos between linear and digital so they can aggressively cut waste and make their dollars go further.

A recent campaign transacted on VideoAmp as media currency delivered a 4:1 ROAS across a major TV networks’ linear and digital inventory for a leading U.S. advertiser. This was 2.5 times the conversion rate of the rest of the media buy and yielded a 17% savings in the CPM against the brands advanced audience target. With no extra effort, the brand achieved dramatically better performance by choosing a new currency and way of transacting.

The investment and tools needed

While there is much talk about measurement and currency innovation, it’s good to remember that simply fixing the measurement and currency problem is just not enough. Buyers and sellers need to be able to extract more value from their investments.

This involves significant investment in operationalizing a new currency and optimizing the manual steps required so marketers can make faster data-driven decisions. Consider this: Advertising is one of the largest industries that still hasn’t been automated, with over 20% of marketing being wasted on disparate systems, manual input and headcount support, according to BMO Research.

The amount of data available to advertisers today is paralyzing and most cannot act quickly enough on the measurement they have invested in. Manual processes are no longer the best way to create and execute a media plan. Advertisers must quickly analyze “what-if” planning scenarios based on their currency and outcome measurement to implement pre-, mid- and post-campaign optimization to be successful.

But it is possible with easy-to-use software that automates manual steps typically required in this process. Advertisers can algorithmically plan, monitor and optimize media plans through all stages of the campaign lifecycle and receive granular optimization recommendations powered by predictive algorithms to maximize outcomes during the campaign flight.

Automated campaign monitoring tracks progress of planned scenarios vs. actuals in platform and creates new scenarios to re-configure media plan budgets to maximize performance throughout the campaign. Marketplace and brand data can be included as inputs for optimization across all media activation platforms and partners to enable the most efficient means of optimizing performance across all channels. This is what the advertising platform of the future looks like and it is already here for those interested in a better way.

Now is the time to push for change and re-think how media is valued, bought and sold in order to cut waste and increase sales efficiently. It’s time to try the future of measurement and prove that a smart media currency delivers dramatically better results, especially when automation is added and friction removed. Together, marketers, agencies and media sellers can create an environment where waste is eliminated and the value of advertising increased, leading to more sales for everyone.

SOURCE: THIS PIECE WAS ORIGINALLY PUBLISHED IN ADWEEK ON SEPTEMBER 23, 2022

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