While considerable improvements have been made in the
efficiency of their ad spending over the past couple of years, major advertisers are losing the programmatic media-buying arms race, with the level of "wasted" ad spending rising 34% to $26.8 billion
from just $20.0 billion when the Association of National Advertisers (ANA) released its first Programmatic Transparency Benchmark report in June 2023.
"To help marketers close the remaining
$26.8 billion inefficiency gap, the ANA is making programmatic performance data more accessible," the ANA announced as part of the release of the latest edition of the periodic
report, unveiling a new "ANA Online Benchmark" tool available to its members as well as TAG (Trustworthy Accountability Group) members.
The new tool, the ANA said, enables marketers to "spot
inefficiencies, track progress and make smarter, faster investment decisions without waiting for the next quarterly report."
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While some of those reports have been released to the press
periodically, including the latest one, the aggregate "waste" estimates depicted in the chart above were derived from press releases that the ANA issued highlighting the release of three reports.
It shows the increasing magnitude of overall waste and inefficiency in the programmatic media-buying marketplace, but the reports themselves have found significant improvements in the efficiency of
specific -- especially vexing -- parts of the marketplace, including so-called "made-for-advertising" or MFA sites, which accounted for two-thirds of programmatic ad-spending waste in the ANA's first
report in June 2023, but now represent only 0.8% on a median basis.
“The gains we’re seeing in MFA reduction and supply path curation are encouraging, yet the billions in
unrealized value and dip in efficiency make it clear that optimization and transparency must remain top priorities,” ANA CEO Bob Liodice said in a statement, adding that the new online
tool is expected to further "reduce programmatic waste."
Much of the overall improvement in programmatic media-buying efficiency has been derived from advertisers concentrating their
programmatic buys on top-tier sites, as well as a marked increase in the amount of CTV (connected TV) advertising being bought programmatically.
As a result -- and despite the overall increase
in programmatic advertising waste -- the ANA's latest report shows marked improvements in both of two proprietary metrics it has been using to gauge overall programmatic media-buying efficiency: the
ANA's "TrueAdSpend Index" and its "TrueCPM Index" (see current trending below).
