$1-2 Billion In Streaming Ads A Year Aren’t Being Watched Because The TV Is Off

Overhype

from the into-the-void dept

Critics of modern tech often lean towards hyperbole when discussing “surveillance capitalism” and the seemingly omniscient power of advertisers and adtech. In reality, as journalists who cover the space for any amount of time can attest, it’s all frequently much dumber and clumsier than that:

A new study, first reported by The Wall Street Journal (paywalled), found that brands are wasting billions every year buying advertisements that people are never seeing. More specifically, ad company GroupM bought streaming ads beamed to 20 million Viso TV sets via adtech company iSpotTV.

What it found when crunching the data was that seventeen percent of these ads were being shown on streaming hardware or smart TVs after the TV were powered down (usually because TVs are entering energy saving mode which isn’t registered by the streaming hardware). This happens less when talking about a “smart” TV with embedded apps, but it still happened between 8% and 10% of the time.

The study guesstimates that this means about $1.5 to $1.9 billion annually in ad spending is being thrown in the trash. But as Gizmodo notes, given this is a hugely competitive and fast-growing sector we’re probably not fully measuring, there’s a very good chance that’s a stark underestimate:

One recent study, for example, estimated that advertisers spent about $1.3 billion in 2021 to reach viewers across ad-supported services like Hulu and Peacock, roughly 3% of total digital ad spend and growing. The figure is likely to grow as Disney+ and Netflix debut ad-supported versions of their products. Another study from ad industry insiders found that major brands like Hersheys and Coca-Cola were dropping $4 billion alone in the first 4 months of this year; some analysts estimate those figures could spike to nearly $63 billion total by the year’s end.

Keep in mind this is just one small study, which was leaked to the Wall Street Journal instead of being publicly released, funded by a company that may or may not have its own reasons for tilting measurements one way or another, in an industry that very much operates with little to no transparency and numerous, sometimes conflicting, agendas (isn’t this fun?).

That said, this study’s results are before you get to all the other waste, fraud, theft, and artificially inflated metrics that occur in the notoriously non-transparent and intentionally complicated adtech sector. Keep in mind some studies suggest a whopping fifteen percent of adtech money operates in an impenetrable vacuum, meaning they don’t even know where the money is going.

That’s not to downplay the uglier aspects of snoopvertising, just to note that it’s all probably dumber and sloppier than you think. We’re basing a huge portion of our economy on a sector that’s rife with fraud and incompetence, largely unaccountable and unregulated, completely non-transparent, heavily based on hype and growing too quickly to even accurately measure. What could go wrong?

Filed Under: adtech, advertising, cable, smart tvs, streaming, streaming video, tvs
Companies: groupm