Commerce Signals estimates that 40% of all media spend is wasted — a number that comes from about 60 studies, said Tom Noyes, the company’s founder and CEO.
Some marketers think at least 26% of their budgets is wasted, the company says. The main reason for the waste is that marketers can’t get accurate insights from data to measure the impact on sales from advertising. Without the information, they can’t reallocate dollars away from inefficient audiences, advertising formats, creative pieces, and media channels.
U.S. digital ad spend reached $28.4 billion in the first quarter of 2019, up from $23.9 billion in the year-ago quarter. Retail accounts for nearly 22% of that spend, according to the Interactive Advertising Bureau (IAB).
Noyes, who has a background in software and banking, believes that media spend directly links to findings on the most accurate data, which requires trust and partnerships.
The company’s first product, Media Measurement, brings the largest set of payment information to the industry through trusted partnerships with Bank of America Merchant Services, and Worldpay. The two companies process all plastic payments from credit to debit and private label.
Noyes founded the company to “unlock” quality data and make deterministic data work in media. Through these partnerships Noyes’ company can deliver to brands actionable insights within 72 hours or less in near real-time, based on analytics that provide insights into 60% of all payment transactions.
Research by the company across more than 60 campaigns during the past two years has shown that digital advertising wastes about 47% of impressions. Commerce Signals gives brands the data they need to redirect inefficient spend toward more effective approaches.
While purchase payment data has been available for 40 years, legal and privacy issues have prevented its use.
Commerce Signals developed a patented analytics platform that connects consumers to purchases and media without exposing any of the data. The platform uses a federated data architecture that prevents data from ever leaving its source and measures the sales impact. An online dashboard provides performance data to determine which channels that are working or not.
Commerce Signals sits between all of these sources: purchase card processor, identity resolution service provider, or other data source. The company acts as an intermediator.
No individual transaction data leaves the secure environment of its partners, and only aggregate insights are delivered to the brands it serves, according to the company. Noyes believes this is the only way to protect the data and obtain a clear picture of media waste.