Brands are wasting hundreds of millions in digital ad spend during the holiday season, according to new analysis by Creative X.
The analysis, which looked at more than 400 brands across 10 different industries including retail, food and beverage, and consumer packaged goods, found that brands spent over $600 million worldwide on adverts that are not digitally suitable in the golden quarter.
Looking at 2023 ad spend, Creative X forecasts $73 billion to be wasted on digitally suboptimal adverts in Q4 2023.
In addition, previous research found that in 2020 and 2021 over 50% of digital ad spend was put behind image and video ads that were not optimised to their digital environment (a total $700 million out of $1.2 million analysed.
A year later, it is extrapolated that almost as much budget has been wasted in the final quarter alone.
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For many brands, the last quarter of the year accounts for more than 50% of their annual revenue, and approximately 30% of worldwide ad spend takes place during this time, with buying intent peaking over the festive season and Black Friday and Cyber Monday.
According to Creative X brands stumble at the last hurdle, before their ads reach their final digital destination, with millions being wasted on ads that are not formatted correctly or do not include any branding in the first 3-5 seconds.
“Creative teams have toiled hard all year to deliver break-through holiday campaigns and tap into consumers’ heightened intent to purchase. Sadly, the impact of their work is minimised by the last executional leg of the journey: adapting creative assets to align them to the digital media environments they’re intended for,” said Creative X CEO and founder Anastasia Leng.
“These small tweaks increase an ad’s Creative Quality Score and media effectiveness, and during a year heightened budget scrutiny, it may just give marketing teams something to be joyful about,” she continued.
