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Advancements in digital advertising technology were meant to improve users’ experience. People interested in shoes are intended to get ads for sneakers and loafers, and not repeated pitches for courses teaching seduction techniques. And the technology is supposed to filter out misleading or dangerous pitches.
But lately, on several platforms, the opposite seems to be happening for a variety of reasons, including a slowdown in the overall digital ad market. As numerous deep-pocketed marketers have pulled back, and the softer market has led several digital platforms to lower their ad pricing, opportunities have opened up for less exacting advertisers….
….But advertising experts agree that crummy ads — some just irritating, others malicious — appear to be proliferating. They point to a variety of potential causes: internal turmoil at tech companies, weak content moderation and higher-tier advertisers exploring alternatives. In addition, privacy changes by Apple and other tech companies have affected the availability of users’ data and advertisers’ ability to track it to better tailor their ads.
Then, there’s the economy: A survey of 43 multinational companies representing more than $44 billion in advertising spending, conducted last fall by the World Federation of Advertisers, found that nearly 30 percent planned to shrink their marketing budgets this year. Clorox, which budgets hundreds of millions of dollars a year to advertising and promoting products like Burt’s Bees lotions, Brita filters and Pine-Sol cleaners, said this month that it was beginning to streamline its marketing, which included cutting back on spending.
Digital ad spending, while still growing overall, “has decelerated precipitously,” according to an analysis last month by the research firm Insider Intelligence.
Twitter seems to be faring the worst. The company has struggled to retain top-flight advertisers since Mr. Musk took over as owner in October, amid fears of a proliferation of hate speech and misinformation on the platform. Its 10 largest advertisers last year spent 55 percent less during Mr. Musk’s tenure than they did a year earlier, with six of them spending nothing so far in 2023, according to estimates from the research firm Sensor Tower. Twitter has offered buy-one-get-one-free deals, discounts and bonus incentives to lure back advertisers, media buyers said.
But advertising troubles have hit the biggest publicly traded social networks, too. Snapchat’s parent company last month posted its slowest-ever rate of quarterly growth and projected a sales drop for the current quarter. Google’s parent company, Alphabet, said ad sales at YouTube slipped nearly 8 percent in the latest quarter.
Last year, Meta, which owns Facebook and Instagram, reported its first decline ever in quarterly revenue (it fell again last quarter). Ad prices on Facebook and Instagram fell 24 percent in the last quarter of 2022 from a year earlier, according to the investment bank Piper Sandler.
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