Speaking at Google's IAB Digital Upfront event today, Philip Miles, director of Google DoubleClick, introduced the problem with a story: "Phil is opening a bakery, and he wants to give free donuts to the first 100 customers. But what he ends up doing is giving five donuts each to the first 20 customers. This upsets and disappoints the next 80, who get nothing, while the first 20 have had more than is good for them and now they feel sick."
"It's a silly story, but it's what media buyers are effectively doing with digital media," Miles explained.
"The way digital media is planned using multiple DSP/Networks leads to is that buys within a frequency silo. And consumers have multiple devices, which are also frequency silos. This isn't even taking into account walled gardens which are another kind of silo," he explained.
In a case study shared by DoubleClick, a brand found that while consumers who saw their ads an average of 2.3 times were most likely to convert, after seeing 8.4 ads the probability that the consumer would convert dropped 65%.
The overlap in frequency was costing the company about 33% of its budget which could have been used to reach new users rather than retargeting and overexposing the same ones.
This is a real problem for advertisers because money is constantly being wasted on ineffective media, Erica Probst, head of specialisms at DoubleClick UK pointed out.
"In fact, in the two hours since this event started at 1pm, we estimate that $14m [£10.7m] of global digital media investment has been wasted," Probst said.
To prove that its programmatic guaranteed offering helps address this issue, DoubleClick engaged Nielsen to put its consolidated offering to the test.
Nielsen benchmarked the same impressions bought via traditional ad servers and DSPs against impressions bought via DoubleClick's offering.
For an auto client, Nielsen found that ads bought via DoubleClick resulted in a 24% drop in wasted impressions and a 32% increase in unique reach.
A retail client saw 14% fewer impressions wasted and a unique reach bump of 16%.
"Through better frequency management and maintaining on target impression delivery, reach is amplified towards the intended target audience through consolidated buys," Phil Sumner, head of advertisers at Nielsen, concluded.