Brands wasted close to $100 million in digital ad spend in the first quarter of 2024, a decline of 3.85% on the previous corresponding period, Next&Co’s quarterly Digital Media Wastage report has revealed.

Wasted digital ad spend reached $97.1 million between January and March this year – an average of 42% across total audited digital media spend. The figure is slightly down on the same time last year, where overall ad spend wastage reached $104 million for the quarter, comprising 43% of the overall digital media spend.

Next&Co’s annual Digital Media Wastage report found that brands wasted a record $6.149 billion in 2023, representing nearly half (43%) of the $14.1 billion invested in digital advertising Australia-wide.

The retail sector recorded the highest amount of wasted digital ad dollars for the first quarter, at $28.1 million. The figure, however, is down on the same period in 2023, where retail brands notched up $40.6 million in wasted advertising spend.

The finance sector came in second in the first quarter of 2024, at $26.2 million, followed by insurance ($12.6 million), education ($11.6 million), health ($9.7 million) and real estate ($8.7 million).

Across digital media platforms, the most first quarter 2024 ad spend was wasted on Meta’s Facebook and Instagram platforms at $49.5 million – an increase on the $45 million recorded in the same period in 2023. Additionally, $38.8 million was wasted on Google, while $6.8 million was wasted on LinkedIn and $1.9 million on Bing.

Next&Co co-founder, John Vlasakakis said, “Given the current economic climate, with the cost-of-living crisis affecting overall consumer spending and advertising budgets, brands could be doing so much better if they simply addressed efficiency in their media spending.

“Wasted advertising dollars have a flow-on effect across the business, affecting everything from day-to-day operations to recruitment, production and more. Brands could improve their overall budget and costs by investing in better understanding their digital advertising platforms and audiences.

“Businesses need to undertake an independent assessment of how their ad spend is delivering – this audit effectively enables a brand to become ‘recession proof’ by significantly cutting back on wasted ad dollars.”

Next&Co’s auditing platform Prometheus has now been used by more than 500 companies across Australia. It can tell advertisers exactly how much, and where, ad spend is being wasted on digital platforms.

Prometheus has in-built KPIs for advertisers, including leads, customer conversions, ROI, and reach, enabling brands to choose their targets across each metric. The auditing tool then determines the exact wastage of their total annual digital spendin dollars and where that wastage is occurring, campaign-by-campaign, and on a creative level.

It provides a score out of 100 on the overall performance of each metric and the exact dollar figure of ad spend wastage. The data is then individually audited for each type of advertising activity run within the tool and an individual score prepared for each. Prometheus can also predict how many conversionsadvertisers could potentially achieve and make creative and CPA (cost per acquisition) improvement recommendations.