Youth audiences worth billions to social media

New research from Harvard suggests most advertising kids see isn't meant for them

In 2017 and again in 2019 our team at SuperAwesome worked with PwC to estimate the size and growth rate of the kids’ digital advertising market. The objective was to know the scale of advertiser demand for youth audiences and to shine a light on how much of that was being fulfilled in a privacy-compliant way vs how much went to general audience platforms that were not systematically protecting kids from being tracked and profiled.

Now researchers at Harvard have published an estimate of the ad revenue social media make from kids and teens, and the answer is: a very big number. The social media platforms—recent safety efforts notwithstanding—are by definition not privacy-compliant for kids.

Graph from: Raffoul A, Ward ZJ, Santoso M, Kavanaugh JR, Austin SB (2023), Social media platforms generate billions of dollars in revenue from U.S. youth, https://doi.org/10.1371/journal.pone.0295337

In our 2019 study, we forecasted that 2021 digital advertising spend on compliant websites, apps and games (ie, made for kids) would be ~$500m, where as spend on non-compliant sites (including social) would be ~$160m (the balance of ~$1bn was made up by search, VOD, broadcasters’ digital offerings). This estimate reflected advertiser intent, ie a measure of where toycos, entertainment services, games, etc—brands that have legitimate kids’ products or services—were seeking to reach kids across digital media, and where their spend actually ended up.

The Harvard research, by contrast, estimates the amount of advertising revenue social media platforms generate from their youth audiences. In other words, it’s a measure of how much advertising kids are exposed to on these platforms, whether actually intended for them or not. For the cohort aged 0-12, the estimate is $2bn in 2022 (and that’s just the US).

Even taking into account a wide margin of error for the studies¹ and knowing that as a matter of practice advertisers can’t ask to reach under-13s on these platforms, we can surmise that 90% of the advertising seen by kids here was not meant for them, ie it is essentially wasted.²

So, while the Harvard research seeks to highlight how much money social media make from exposing kids to ads—presumably to encourage the platforms to be more transparent (and open themselves up to more regulation or enforcement)—I suggest that the other big story here is the mis-targeting of billions of dollars worth of advertiser spend.

There are two ways we can increase the reach of privacy protections for kids in this scenario: (1) try to keep them out of environments were they are profiled for advertising (clearly not working), or (2) advertisers pressure the platforms to ensure their ads reach their intended audience (and if that is indeed kids, then they should require compliant, contextual delivery).

If advertisers were to insist that the platforms do more to prevent serving their ads to the wrong audience, the value of kids to social media will plummet. I’d be interested to see what innovations might emerge as a result, perhaps to improve age verification or to find methods or content types that are less likely to keep kids endlessly engaged?

1. Both lacked access to real data from the platforms and had to rely heavily on extrapolation.

2. And that’s before we consider the extent to which some of this advertising is potentially age-inappropriate or harmful… something for another post.