We know, the idea seems pretty self-serving coming from an advertising agency. But give us a minute to explain. Waste, defined as over-spending for no additional effects, is something that needs to be discussed differently than we do now. Typically, any discussion of advertising waste starts something like this:

“We don’t want to waste money on advertising.”

Which really means:

“What is the least we can spend to achieve the effects that we seek?”

With an implied understanding that we need to avoid waste, the problem all advertisers face is trying to determine if and/or when they are wasting money.

In 2005, Tim Ambler from London Business School and E. Ann Hollier of Cogent Consortium decided to take a look at advertising waste and its effects. Their study and accompanying article The Waste in Advertising is the Part That Works turned the idea of “waste” on its head. At least it should have, but we can’t say that we’ve experienced many advertisers acting on this understanding. What Ambler and Hollier were able to demonstrate is that customers can and do perceive expense in advertising media and production.

“Just as female peacocks are drawn to mates with the largest, most spectacular tail feathers because the display signals biological fitness, consumers are attracted to brands that invest in lavish displays like Superbowl commercials because such extravagance signals a high-quality, successful brand.”

So “waste” in the traditional sense, isn’t really waste, it’s a signal.

Take for instance the cultural phenomenon/disaster that was the Fyre Festival. They spent so much money on video production, talent (celebrities, models, etc.), social media and influencer marketing that they earned a level of credibility that allowed them to sell out an ultra-luxury festival in 48 hours. As we now know they couldn’t actually deliver the experience they promised…but hopefully you won’t have that problem.

This new understanding means that when we’re discussing a video for social, a photo shoot, the type of paper for new collateral, or the number of OOH boards we’re buying, we shouldn’t think about avoiding waste. The focus should be on what we want to signal to the market. Maybe spending “too much” on that video or on that brochure paper is exactly what we need to do to achieve the desired results.

It’s not to say that wasting money on advertising isn’t possible…because it definitely is. For example, in Profit Ability: The Business Case for Advertising they show that online display advertising has essentially no effect on brand growth in both the long and short term. So, spending money on online display would be a waste.

Now go ahead and “waste” your money, just make sure you’re sending the right signal.