With ad spend growth slowing to 5.3%, new research reveals an emerging threat to dwindling budgets – invalid traffic (IVT).
In 2024, advertisers are set to waste over $71bn (£59bn)* on traffic generated by invalid activity, including bots and automated scripts – an increase of 33% from 2022.
Conducted by leading marketing efficiency platform Lunio, the research analysed 2.6bn paid ad clicks and 104bn impressions from 60,000 ad accounts across the platform’s customers.
As a result, the analysis found 8.5% of all paid traffic across major marketing channels including Google, Meta, Linkedin, X (formerly Twitter) and TikTok was invalid, equating to one in every 12 website visits.
The findings also show that invalid traffic goes beyond wasting ad spend. It wastes marketers’ time on spam leads that follow on from fake clicks and which never convert, leading to inaccurate budget allocations and unpredictable projected revenue forecasts. Ultimately, IVT will cost businesses a staggering $204.8bn (£168.6bn) in lost revenue opportunity in 2024.
Of the channels analysed, LinkedIn had the highest invalid traffic rate at 25%, meaning over $1.43bn (£1bn) of Ad Spend Forecast will be wasted by fake clicks on the platform next year. This is likely due to the growing number of fake profiles, generated and used by marketers, on the platform.
Similarly, invalid traffic generally is more costly on non-Google channels such as Meta, Bing, LinkedIn, X, and Pinterest, with the average IVT rate across these platforms being 17.5% and equating to a cost of $54.8bn (£45bn). On the other hand, the average rate across Google channels such as Search (inc Shopping), PMax, Display, and YouTube campaigns is just 5.5%, or $16.6bn (£13.7bn).
On the findings, Neil Andrew, co-founder and CEO of Lunio, said: “Bots, fake users, and fake clicks are becoming more and more pervasive. They instantly waste budgets, contaminate CRMs, distort analytics, waste the time and energy of sales teams, and make projected revenue forecasts unpredictable. Ultimately, this causes sizable lost revenue opportunities – which we estimate could be as high as $204.83bn (£169bn).
It’s never been more important for marketers to find new insights on how to maximise ad spend efficiency and eliminate sources of fake ad engagement. It’s the only way marketers can leverage a digital advertising ecosystem where every click, impression and placement drives genuine value.”
* This figure has been calculated by applying IVT rates of 5.5% to Google’s 2024 revenue forecast of $301.59 billion, and 17.5% to total non-Google channel’s 2024 revenue forecast of $313 billion, and adding the two results together.
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