Advertisers increase budgets as audiences fragment

The research points to fragmented consumer journeys and identity challenges across devices and channels as barriers to audience expansion.

Taboola's new report, The Data Advantage, finds that advertisers are increasing budgets while struggling to reach audiences beyond the segments they already target.

The report examines how advertisers are responding to changes in consumer behaviour, including the growing role of large language models in discovery and purchase journeys. It is based on a survey of more than 300 senior marketing and advertising leaders at companies with more than 1,000 employees and monthly marketing spending of at least $300,000.

Advertisers increase budgets as consumer journeys fragment

US adults spend nearly 13 hours a day with media, according to eMarketer data cited by Taboola. Consumers can move between email, news sites, search engines, price aggregators and LLMs before making a purchase decision, creating a fragmented path to conversion.

Against this backdrop, advertiser budgets are rising by nearly 10 percent as brands seek to reach additional audiences. Thirty percent of respondents identified reaching new audiences as a top priority for allocating additional budget.

However, the report found that 81 percent of advertisers are not successfully reaching new audiences and instead repeatedly target existing audience segments.

Identity challenges limit advertisers' audience expansion

Identity fragmentation across pre-conversion touchpoints is contributing to the problem. Seventy-five percent of advertisers reported difficulty recognizing the same non-converting customer across multiple touchpoints.

The challenge can push advertisers toward established audience pools within large closed platforms, limiting their ability to identify potential customers elsewhere. Taboola argues that better identity and measurement capabilities across the open web could help advertisers expand beyond these recurring segments.

Adam Singolda, CEO, Taboola: "As AI search overviews and shifting habits fragment how consumers discover content, brands and agencies must understand true purchase intent at the crucial moment of decision. Outside closed ecosystems, advertisers face a significant identity blind spot. By relying on recycled audiences on walled gardens, they miss vast opportunities. Unlocking identity and measurement on the open web allows brands to break free from targeting ruts and connect with valuable, untapped audiences."

Brands look beyond walled gardens for audience growth

The report also points to advertiser interest in diversifying media investment. Eighty-one percent of respondents said they would consider increasing advertising spend across channels such as publishers and news sites if identity challenges could be addressed.

The findings suggest that advertisers see the open web as a potential source of additional reach but require greater confidence in audience identification and measurement before shifting more spending.

Taboola's research highlights the growing tension between the need to find incremental audiences and the difficulty of tracking consumers across an increasingly fragmented media environment.

The full report can be accessed here

www.taboola.com

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