More people are involved in the digital media investment decision-making process than ever, according to a report by marketing consultancy R3.

“Our conversations with advertisers showed that media agencies have the most say on where advertisers allocate their media spend, but there is still dissatisfaction around the types of media opportunities being presented,” said R3 co-founder and principal, Greg Paull.

The Australia Digital Decisions Report was based on interviews with marketing and media teams across categories to better understand how media decision are being made in a digital advertising market worth US$8.8bn in 2018 according to IAB Australia.

The hunt for more opportunities in digital media has become increasingly important as advertisers continue to deal with issues of ad fraud – although there is some dispute on how prevalent this is in Australia.

R3 cites estimates that Australian marketers are losing around US$116m per year to fake news, fraudulent traffic and inappropriate content; a report by fraud intelligence firm Pixelate found that Australia had the world’s third worst rate of invalid traffic – which the R3 report equates with ad fraud – at 20%, although IAB Australia has disputed the basis of these findings.

On the flip side, media owners continue to compete for digital ad dollars in a market that is currently dominated by Google and Facebook. A 2018 review by the Australian Competition and Consumer Commission (ACCC) found that for every A$100 spent by Australian advertisers on digital advertising: 47% went to Google and 21% went to Facebook, leaving just 32% for all other websites.

Paull advised digital media owners to pay closer attention to issues like brand safety and initiate more data sharing as advertisers consider this part of ROI in considerations.

“Relationship management can get overlooked, but it has a notable influence on the amount that advertisers spend, and the volume of media bought,” he added.

In its look at how digital media investment decisions are made, the consultancy outlined the various categories of external and internal influencers, with each providing input at various stages of the digital media buying process.

Other key findings of the report include:
  • Flexibility exists though the majority have pre-committed budgets: Despite nine out of ten organisations having some form of pre-commitment, most organisations still maintain some flexibility in overall budget allocation.
  • Data is the backbone of the media investment process: Particularly within large organisations, an understanding of data models used by advertisers will help media owners provide better insights to support media strategy and allocation.
  • More effective product consolidation is needed: Media owners are expected to possess good vertical and channel knowledge. They can benefit from offering media offerings that focus on solutions and not just platform products.

Sourced from R3; additional content by WARC staff