Bots will waste at least $7,200,000,000 ad dollars in 2016*

When we started Arteria in Fall 2015, one specific fact stood out about the state of advertising today: Bot traffic was wasting an estimated $6.3 BILLION of ad spend in 2015.1

$6.3 BILLION.

$6,300,000,000. This appalling number is about the same as Iran’s military budget in 2015. Some estimates had put the possible bot waste even higher.

Recently, the new accepted estimate for 2016 was released by the Association of National Advertisers and White Ops. Unsurprisingly, the waste in online advertising is rising. Bots are poised to waste an estimated $7.2 BILLION in 2016. A 14% increase in one year. (ed note: recently, another study has estimated fraud losses are even greater.)

$7,200,000,000.

If you owned a company that grew revenue from $6.3b to $7.2b year-over-year, you’d probably be pretty thrilled. Well, the crooks who run bot farms couldn’t be more excited, too.

As a result of this type of click fraud, combined with zombie computers, malware, popup blockers and other ad avoidance software, it is variously estimated that only between 2-20% of reported online ad impressions are actually seen by a human.2 Couple that with “good” click-through rates in the 0.1% ballpark, a small fraction of which will actually convert, and your digital ad campaign is essentially useless.

What’s this all mean?

The value of digital advertising is decreasing. That’s the bottom line.

It’s one thing to spend marketing budget on a variety of programs which inherently include some waste and ultimately build a strong campaign. It’s an entirely different proposition to spend marketing and ad budget on a medium so clearly fraught with waste, and which consumers actively avoid and ignore as a regular part of their online experience.

The digital ad market is seductive. It’s relatively easy to launch a campaign and gather metrics from it. However, evidence today shows alot of digital ad spend is a big waste of money. With decreasing ROIs and rampant fraud, 59% of Agency Digital Media Buyers Believe Bot Traffic Negatively Impacts Campaigns.3

The only way to guarantee a potential customer gets a consumer brand’s message is to put the product in their hands and let them try it. Sampling converts prospects into customers. And the ROI of a strong sampling campaign becomes even more attractive when the campaign is a) highly targeted, b) gathers feedback from the audience, c) encourages social sharing of the experience, and d) converts that well-targeted consumer into a customer.

A handful of mature services already accomplish some of these goals, but only Arteria provides brands and publishers with a platform to instantly connect and match audience to product, in seconds.

Advertising and marketing are changing rapidly, moving away from ineffective, impression-based campaigns4… and towards leveraging targeted, contextually relevant brand experiences as the best marketing tool in a consumer brand’s arsenal.

Show 4 footnotes

  1. AdWeek
  2. Bloomberg
  3. SolveMedia
  4. In case you are curious or confused, “All your clicks are belong to us” is an internet meme cultural reference. Wikipedia

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