Here’s a question the VAB asks that you very much would like the answer to yourself: Where do ad dollars go when they’re spent with Google?
Even after an in-depth analysis of Google parent Alphabet Inc.’s latest 10-K filing with the Securities & Exchange Commission, the organization dedicated to a fair, transparent and accurate TV measurement marketplace is “still left dealing with a lot of unanswered questions and non-disclosed facts.”
Based on the filing, which details the fiscal year 2024 financial performance of Alphabet, the VAB determined that Alphabet reported nearly $265 billion in total global advertising revenue. Of that, 14% is attributed to YouTube.
There’s just one important footnote: the Alphabet 10-K filing does not provide any segmentation of video ad revenue. And, the VAB explains, it cannot be assumed that “YouTube Ads” is wholly video, or that “Google Search & Other” activity is 100% non-video in nature.
What can be gathered from the annual report is that “Google Search & Other” is nearly a $200 billion business that now represents three-quarters of Alphabet’s total global ad revenue. That’s up from $175 billion in 2023 and $162.5 billion in 2022.
At the same time, revenue for YouTube Ads in 2024 totaled $36.1 billion, rising from $31.5 billion in 2023 and $29.2 billion in 2022, respectively.
An attempt to look deeper into the “Other” revenue through independent third-party research conducted by Analytics Research LLC found that roughly 7% of Google Search spend goes to undefined platforms.
There’s more: Based on “Google Network” data and VAB’s own estimates for “Other” revenue, $43.6 billion (or 17%) of Alphabet’s total ad revenues potentially comes from undefined platforms.
How much is nearly $44 billion? Google’s ad revenue from undefined platforms is on par
with global print media spend and much more than outdoor or radio, VAB finds. Radio’s estimated global advertising revenue for 2024 totaled $29.3 billion. Outdoor totaled $36.2 billion.
“Over the last three years, an estimated $130 billion has potentially been allocated to
undefined platforms and websites through Google ad buys,” the VAB says. “Furthermore, 86% of Google’s global ad revenues overall may come from non-transparent and largely unaudited media beyond ‘YouTube ads.’”
Furthermore, the VAB shares that Google’s “non-transparent, largely unaudited media accounts for $228 billion in global ad revenues, an increase of $33 billion over the last three years.”
What are the risks associated with non-transparent, largely unaudited media placements?
“Lack of transparency from Google can create misaligned incentives which could
lead to poor ad decisions, especially among small businesses,” the VAB concludes.
What should marketers be asking of their media partners? Full campaign transparency and verification from their media partners is paramount, the VAB concludes.
