Nobody likes waste, especially when it’s costing them money. Yet research reveals that 41% of overall digital ad spend is wasted. This happens as a result of ad fraud, poor placement quality, and inaccurate targeting.

That’s discouraging news for marketers, but there is a silver lining. If so much of the digital budget is being wasted now, that means eliminating ad waste could boost your results without increasing demands on your budget.

Here’s how strategic investment backed by the right tools can maximize your ROI by minimizing ad waste.

What is Ad Waste?

Ad waste is the portion of your budget going to ads that are not furthering your marketing objectives. These ads bring down the ROI of your campaigns by costing you money without delivering results. They might even be actively harming your brand by annoying potential customers or creating embarrassing associations between your brand and contentious topics.

Programmatic media placements purchased through demand-side platforms (DSP) are particularly susceptible to ad waste. One study found that up to $0.35 of every dollar spent through DSPs goes to low-quality media. This includes invalid traffic, nonviewable and non-measurable inventory, or made-for-advertising (MFA) platforms. MFAs are created almost exclusively to host ads, with little actual content that might attract visitors.

MFAs aside, some advertising systems, such as social media sites, may create audiences made up of bots rather than real people. This could result in “views” and “clicks” but no conversions because there are no real people involved.

And the problem of poor targeting is bigger than bots. Ads shown to people who aren’t interested or are outside your service area can be just as wasteful.

Why Worry About Ad Waste Now?

Digital ad spend has been increasing steadily for years. In 2023, advertisers spent an estimated $271.2 billion with a 10% increase projected for 2024. In part, these increases are the result of a rise in the cost-per-click. Retail brands have seen the average [CPC increase by 40-50%](https://searchengineland.com/report-google-search-cpc-up-13-yoy-ad-spend-growth-slowing-439860#:~:text=CPC increase.,on-year in Q1 2024.) over the last half-decade.

Yet despite increased investment, many marketers are not seeing the results they want. From 2022 to 2023, the average cost per lead increased by 25%. With costs on the rise, marketers simply can’t afford to waste money on ads that don’t deliver results. Many marketers are looking for ways to increase efficiency rather than pouring even more money into ad efforts.

Ad Waste Management Strategies Made Easy

Two key strategies can help you eliminate ad waste from your budget by ensuring that your targeting is dialed in.

1. Retarget visitors who have left your website without purchasing
2. Use first-party data to build look-alike-audiences that target people not bots

Ignite by Launch Labs makes both of these possible. When a visitor lands on your site, they are asked to share their location. With this permission, Ignite goes to work to geolocate and identify the visitor. As the user moves through your site, Ignite builds a profile that includes their verifiable identifying information as well as shopping behavior.

You can then use this first-party data to create digital ads, television commercials, and direct mail. You can also craft email and SMS messages that continue the conversation after users leave your website. Because these ads target in-market individuals with addressable households, you know that your ad dollars won’t be wasted.

Then you can use your database of collected first-party information to create look-alike audiences that attract more site visitors with similar purchase intent. This approach is built on more precise targeting which delivers a substantial increase in ROI. In Beta testing, traffic from ads targeting Launch Labs' modeled audiences surpassed standard Facebook Audiences, demonstrating a 386% increase in time spent on site and a 275% increase in scroll depth.

We're not an ad platform (or DSP) that serves ads via the same platform that gathers the data. Instead, we collect first-party data that you can upload to the platforms to serve your ads. This  allows agencies, in particular, more control over where their spend is going.

Maximize Advertising ROI with Launch Labs

By leveraging first-party data gathered by Ignite, advertisers can avoid the pitfalls of ad fraud and MFAs, ensuring your campaigns reach genuine, engaged users. Our solutions provide a more efficient and effective advertising strategy, to maximize your ROI. See how Ignite by Launch Labs can work for you. Schedule your free demo today.