[HN Gopher] Uber discovered they'd been defrauded out of 2/3 of ...
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Uber discovered they'd been defrauded out of 2/3 of their ad spend
Author : rbanffy
Score : 1743 points
Date : 2021-01-03 18:37 UTC (1 days ago)
(HTM) web link (twitter.com)
(TXT) w3m dump (twitter.com)
| gnicholas wrote:
| I recently read Subprime Attention Crisis, [1] which talks about
| the ways in which advertising is opaque and may be leading to a
| bubble. In particular, the author draws parallels to the mortgage
| crisis of 2008. He doesn't say a catastrophic event is
| necessarily imminent or even inevitable (it could slowly deflate,
| either by design or by chance). But it has made me think that at
| some point there will be a tipping point and there will be a mass
| exodus from online advertising.
|
| This will have big impacts on businesses like FB and Google,
| whose businesses have been designed around ad revenue. It would
| be interesting to envision what a social network would look like
| if they weren't incentivized to gather data about you for the
| purpose of advertising.
|
| 1: https://www.amazon.com/dp/0374538654?tag=macmillan-20
|
| 2 [video about same]: https://www.youtube.com/watch?v=X9dlJ4sHfSk
| soared wrote:
| Augustine fou is basically a troll in r/adops.
| doopy1 wrote:
| To some extent yes, but I think he's better than a troll,
| because IMO there is value in what he's doing, despite the
| hyperbole.
| acfou wrote:
| the adops community helps me to understand the mechanics and
| when i don't know something I usually turn to that community to
| ask questions.
|
| most are helpful, but a few anonymous ones spend their time
| making polls that make fun of me; but that's OK, I know it
| comes with the territory
| rukshn wrote:
| I'm not saying Facebook, or online advertising is perfect, I have
| not run Google ads because most of my audience hangs out on
| Facebook and Instagram.
|
| I have been running Facebook and Instagram ads for 2 years now
| for my small business, and what we do is we hyper target the
| audience, from their age, sex (the business appeals more towards
| female demographic), to their schools and job (people who work at
| an office or get a higher income is more likely to purchase)
|
| From this hyper targeting we are able to generate a good amount
| of sales, sometimes more sales than we can handle.
|
| And since we didn't do any advertising during the pandemic, we
| can really see the difference our advertising makes.
|
| I believe these companies maybe targeting a broader audience
| which maybe diluting the quality to a point where there is no
| difference between the organic reach and paid advertising reach
|
| (A broader audience may expose your ad to fake accounts, bot
| accounts) etc.
| skinkestek wrote:
| Tell this to the poor scammy-dating-site-slash-mail-order-bride-
| site operator who has been sold 10+ years of impressions on me:
|
| - an extremely happily married man
|
| - with multiple small children
|
| - in a rather conservative church
|
| Sometime during the last two years they finally stopped
| advertising to me. I've always blamed their marketers - or Google
| for being so utterly incompetent as to not pick up any of the
| available, extremely strong signals sent out - including me
| reporting the ads as irrelevant on a number of occasions, but
| maybe I should blame it on incompetent middlemen?
| nkrisc wrote:
| If you take a look at people who have been caught in extra-
| marital affairs I think you'll find those three qualities are
| not immediate disqualifiers.
|
| Maybe the "happily" part, but how does Google know that?
| skinkestek wrote:
| > Maybe the "happily" part, but how does Google know that?
|
| 3 hints for Google:
|
| 1. I newer showed any interest in those ads.
|
| 2. I never sought out anything related.
|
| 3. I repeatedly put in the effort to mark these ads as
| irrelevant.
| nkrisc wrote:
| Maybe Google knows something about married, church-going
| men with children the rest of us assume to not be true.
|
| Not that it applies to you, but more generally to a similar
| demographic.
| nautilus12 wrote:
| I've said for a long time that Martech is due for a correction
| due to lack of understanding in attribution. Could this finally
| be the bubble bursting?
| alexeichemenda wrote:
| What's important to highlight here is that marketing teams at
| companies such as Uber are incentivized to pus vendors to drive
| fraud. Specific example: Uber works with vendors A, B, C.
| Marketing team is incentivized to reach a cost per sign-up of $X
| (Let's say $50 for the sake of this example). Vendor A, running
| fraud, delivers sign-ups @ 45$ each. Vendor B, clean, delivers
| them at $55 each. Vendor C @ $65 each. The new baseline from an
| exec standpoint is $45 each, and every vendor that doesn't
| deliver at that level is cut. Repeat with multiple vendors.
|
| The solution to this problem is incrementality measurement at the
| channel level. Every time you _scale_ with a recently onboarded
| vendor, measure baseline of ALL conversions happening on your
| app. If this baseline doesn 't move, cut the vendor. I say
| _scale_ and not _launch_ because upon launh, there won 't be a
| visible impact on the global conversions. To be able to spot this
| spike from baseline, pick a small market than "worldwide". For
| ex, pick "California", let the new vendor scale in California,
| and measure spike in California.
| alexeichemenda wrote:
| I'll also mention: this is a problem that goes up every ladder.
| Marketing individual contributor wants to show good performance
| to their manager, so delivering rides for cheap is good.
| Marketing manager is in the same boat with the CMO. CMO ->
| Board -> VC (VC will be happy to see great efficiency on the
| customer acquisition side). VC -> LPs (LPs will be excited
| about customer acquisition efficiency). A limited number of
| people are actually deeply concerned with this, and that's why
| it's taking so long for the top KPIs to change from "cost per
| action" to "incremental impact and incremental ROI".
| moonbug wrote:
| Couldn't have happened to a more deserving company.
| hermitcrab wrote:
| Some time back I kept hearing how effective remarketing (aka
| retargetting / cyberstalking) was. So I did my own (small scale)
| A/B test and it didn't work for my small business. Fair enough.
| But the weird thing was that no-one else seemed to have done the
| same simple A/B test. Or, if they had, I couldn't find it.
|
| https://successfulsoftware.net/2014/12/23/remarketing-does-i...
|
| It is also widely quoted that you "have to see an ad 7 times
| before you buy", or words to that effect. I tried to find out if
| this was true. Turns out there is no real evidence for it:
|
| https://successfulsoftware.net/2010/06/03/do-customers-need-...
|
| It is hard to avoid the conclusion that a lot of marketing is
| based on bullshit.
| hermitcrab wrote:
| I also looked into Twitter demographics back in 2014 and they
| were clearly bullshit as well:
|
| https://successfulsoftware.net/2014/04/03/twitter-demographi...
| ddevault wrote:
| The adtech industry is a _huge_ sham. It 's an open secret that
| ads don't work and that most of the data is fraudulent. There are
| thousands of companies with deliberately complicated
| relationships to pull a giant shell game with advertiser's money.
| All of the data that supports the lie is built out of massive
| internet surveillance dragnets. Ultimately, even casting all of
| this in the best possible light, it's designed to psychologically
| manipulate people. No one wants to see an ad. Adtech is
| despicable.
| rainyMammoth wrote:
| I always saw ads as a zero sum game. We all have limited dollars
| and attention. When you advertise, you might slightly change the
| allocation of attention and dollar to your product.
|
| When everyone advertises, it is back to the same status quo. And
| when everyone stops advertising it ends up being the same.
|
| I really hope more companies would stop advertising or at least
| question the value they are getting out of those money pits. Ads
| created some of most horrible companies the world ever saw
| (Google, Facebook).
| Animats wrote:
| _I always saw ads as a zero sum game. We all have limited
| dollars and attention. When you advertise, you might slightly
| change the allocation of attention and dollar to your product._
|
| That's worth thinking hard about. Is advertising worth it? With
| most US consumers spent out to the limit of their income, all
| advertising does is try to move demand around. It's thus zero-
| sum and a waste of resources for the country.
|
| I'd argue that ads should not be a tax-deductible business
| expense.
| cbsmith wrote:
| So, there's some bits of this story that hint at the problem
| here. The big headline is that as they removed Breitbart, their
| spend was reduced. If you're really doing "performance marketing"
| in the sense that people think of it, that doesn't make a lot of
| sense. Of course, it makes total sense in the industry.
|
| If you are properly doing performance marketing, that means
| you're going after the best opportunities to get customers, and
| you're paying as little as you can for those opportunities. If
| you cut out a whole set of opportunities from consideration, that
| should not change your spend. If those were really some of your
| best opportunities, that means now you'll have to show ads where
| you have worst opportunities. Either you'll have a lower chance
| of getting a conversion or you'll have to spend more for each
| ad... either way, your opportunity cost should go up. Basically
| you've constrained your supply without constraining your demand,
| so the price might go up, but demand still gets fulfilled.
|
| Except, this isn't what really happens in the industry. Instead,
| you're given an ad budget and a campaign window, and you're told
| to burn through the budget within the campaign window. Most ad
| networks will try to find the best inventory to give you out of
| that campaign window... except often the "performance" they're
| chasing isn't "performance". It's "impressions" or "unique users"
| or "clicks" or "conversions" (where the goal post on what a
| conversion means is moved to "goes to the landing page" instead
| of "buys the product"). So what they end up doing is finding the
| cheapest (i.e. crummiest and least likely to _actually_ perform)
| of whatever your "performance" goal is. So you'll get
| impressions that are least likely to click, or clicks that are
| least likely to convert, or conversions that are least likely to
| actually buy your product.
|
| This happens, because there is actually a fixed constraint on the
| _quality_ side of the supply.
|
| You're trying to spend $X in a tight time window, and the dirty
| industry secret is the need to spend that money so quickly is the
| real challenge. Ad networks don't get paid the part of the budget
| they don't drain. The ad spend is a big deal. More important than
| performance. Ad execs' comp are tied to that spend.
|
| But when you cut a big chunk of the supply, the expectation is
| you're not going to hit the same spend, so... you cut your budget
| too. Well now that changes everything. Now you don't have to
| spend so much money over so much time. Imagine if you cut your
| budget in half, but because you are performance focused, you want
| to lose the worst performing half. You should expect _better_
| performance. Way better. Because now some other idiot
| "performance" marketer is going to buy up all those crummy bits
| of inventory, and you're going to pay the big money to outbid
| them for the bits of inventory they were going to get that would
| have performed well.
| wdr1 wrote:
| The use of the "fraud" here is curious, as I don't think it's
| what's most advertisers would use. "Waste" would be a better
| word.
|
| Fraud generally indicates a bad actor or something the advertiser
| was unaware of. Claiming to run my ads on the New York Times and
| instead running them small blogs would fraud.
|
| On the other hand, if I chose to run my ads for wedding dresses
| on ESPN.com, they would be very effective (they'd have a lot of
| waste), but that's not really fraud. _I_ made a bad decision.
|
| I read the Uber comments as 2/3rds of their spend was waste, not
| fraud. That still seems a surprisingly high number, although I
| wonder how much of it was upper- or mid-funnel, which is
| notoriously harder to measure.
| SteveGerencser wrote:
| I'm not surprised by this a all. I do PPC for a living and I find
| that a lot of ad spend is totally wasted on paying for clicks
| that you would have gotten anyway, especially on Google and on
| Mobile devices.
|
| A lot of big brands bid on, and pay for, their brand terms
| because someone at some point told then that they should. So when
| a person uses search to find Uber, they get an ad first, then a
| regular listing second. And almost everyone clicks the first
| link. Take away the ad and the free click is first.
| sixothree wrote:
| With google specifically, I've always wondered if the placement
| of the listing itself is related to the ad spend.
| aetherson wrote:
| In fairness, I've worked at several places that engaged in this
| practice, and they're perfectly clear that they're paying for
| clicks that they'd likely get for free.
|
| The theory is that if they don't do this, their competitors buy
| this ad space and steal some of their organic traffic, and/or
| that they're just bidding up the cost of that space to make
| their competitors less efficient.
|
| Now, that theory may not be cost-efficient in practice. But
| it's not like the marketers didn't understand that someone
| searching for the name of our app were going to see it in the
| list anyway.
| arbuge wrote:
| That theory can easily be tested by turning off the ads in
| question and seeing what actually happens. Can always turn
| them on again later if needed.
| chillacy wrote:
| Ebay did this 7 years ago, not sure how it turned out
| though https://hbr.org/2013/03/did-ebay-just-prove-that-
| paid
| sosborn wrote:
| Would you be willing to make that decision knowing full
| well that it could reduce revenue that is 100% traceable to
| that decision? I mean, obviously there are ways to make
| this politically acceptable in your organization, but you
| better be completely confident that it won't bite you in
| the ass.
| arbuge wrote:
| You can just turn the ads off in one small geography
| and/or for a short time. Seems to me the potential
| benefits far outweigh the risks here. If your
| organization can't see that, then you have bigger
| problems.
| austinpena wrote:
| Google Ads also has a built in report for seeing uplift of
| ads + organic and organic only
| arbuge wrote:
| I'd take that report with a big grain of salt and run my
| own tests independently. Google is more than slightly
| biased here.
| austinpena wrote:
| You've got a point. Plus attribution modeling isn't for
| the faint of heart.
|
| One popular method is a geolocation test. Turn off the
| test campaign (usually remarketing) in certain geos and
| see what happens.
| arbuge wrote:
| Exactly what I suggested earlier... see my other comment
| reply.
| spockz wrote:
| The solution to this would be to have a very authoritative
| site for a query show _above_ any ads.
| tpetry wrote:
| If the company ranking results and selling these ad spaces
| are the same every decision will not be in case of
| advertisers/users. Google has long lost it's spirit and is
| only optimizing for money.
| undreren wrote:
| DHH of Basecamp had a long twitter thread about this. Their
| competitors bought "basecamp" as a keyword for google ads,
| effectively forcing basecamp to pay to stay #1 on searches
| for basecamp.
|
| Google has/had no policies restricting this, unless of
| course, you guessed it, the keyword you are squatting is
| "google".
| joaodlf wrote:
| This being allowed shows the sad state Google is in - you
| search for a brand, get ads for a competitor? Search engine,
| my ass. You now effectively need to pay Google to keep your
| product relevant through ads, even when the user is
| specifically looking for you.
| tqi wrote:
| If I search "Kleenex", am I specifically looking for the
| Kimberly Clark product or should Procter & Gamble be
| allowed to bid on ads for that search?
| joaodlf wrote:
| Certain types of product have become directly linked to a
| product name, yes. Google is smart enough to know this,
| though. If I google for my non VC funded product name,
| which is unique, why should the first result be for a
| direct competitor with deep pockets in advertising?
|
| This would be fine if Google embraced their dependance on
| ads, but Google still labels itself as a "search engine".
| tqi wrote:
| Isn't this more of a protection for established players?
| ie if your product is a GitHub alternative, should you be
| allowed to buy ads targeting ppl who search for Github to
| build awareness?
| friendlybus wrote:
| If I search "Kleenex" on Google, I'm asking Google to
| find me Kleenex, not some ads. If Google is going to
| start listing things in highest-to-lowest bid, then it
| stops being a search engine and starts becoming an
| auction house of links.
| lotsofpulp wrote:
| It already is an auction house of links. I think you have
| to go down at least 6 or 7 links nowadays for actual
| search results.
| speedgoose wrote:
| Isn't it "take away the ad" and Google will put first a ad link
| to a competitor instead?
| misterbwong wrote:
| Having worked on the publisher side for most of my web dev
| career, I can say with confidence that most ad spend attribution
| is a load of crock. Sure people along the line _claim_ to have
| attribution figured out but, coincidentally, they all attribute
| your spend to their "value add."
|
| The incentives of the current ad system and ad spend attribution
| for everyone along the chain from publisher => advertiser are all
| misaligned and almost no one is doing it properly. It's so bad
| because everyone gets paid to turn a blind eye.
|
| For example, lack of good bot detection. Publishers benefit by
| higher CPC/CPM. Ad networks, ad agencies, and creative agencies
| all benefit because they take a vig off of total # of ads served
| and/or total ad spend. Average individual paid ad buyers benefit
| from the vagaries of the system because it allows them to justify
| spend by correlation, not causation (e.g. I bought this KW and
| traffic went up! Too bad conversions and revenue didn't.....)
|
| Like organic SEO, the gulf between the average and the good is
| huge. If you find a good paid ad manager, hold on to them because
| they can be worth their weight in gold.
| jrpt wrote:
| Most companies either use a neutral third party attribution
| product or build their own system. They're not simply trusting
| the attribution stated by the companies along the line. I agree
| that those are all biased. I also believe many of the neutral
| and home grown attribution systems don't work very well.
| julienfr112 wrote:
| There is also one agent problem : manager status is linked to
| headcount or/and budget. As a head of marketing, you have no
| interested at all at reducing your ad budget, quite the opposite
| !
| seg_lol wrote:
| Right, if you do science and it turns out your department has a
| smaller effect on revenue you just lost power/status. So these
| experiments won't be done at most orgs.
| objclxt wrote:
| That's a rather naive way of looking at how corporations work.
| If you're the head of marketing and go to the CFO and say "hey,
| we found a way to get the exact same results we currently get
| but at half the cost" you can bet you will be rewarded for it.
| tehlike wrote:
| Headcount is a sad driver for promotions, so managers are not
| really incentivize to do it. Only the good ones would try to
| keep the team lean and fast.
| MattGaiser wrote:
| Depends. Are you sticking with that company or do you want to
| shop your resume around?
| Nextgrid wrote:
| And given the terrible career advancement options in our
| industry it makes total sense to optimise for "resume
| value" as opposed to "business value" since your resume
| will compensate you much more (in the next company you're
| going to end up at) than contributing to your current
| company where you'll end up with a pitiful statutory raise.
| one2know wrote:
| No one is going to half the cost, and executives don't in
| general do any sort of cost reduction activities for two
| reasons. First, they would be fighting diminishing returns
| since there is only so much reduce-able cost. Second, they
| might in reality only be able to do a small cost reduction,
| then they are doubly screwed as they will reach diminishing
| returns faster. If the company mandates cost reduction
| executives will just fire a few hundred or thousand employees
| because that is deterministic, easy, and instant savings.
| They will just restaff when the cost reduction campaign is
| over.
| strictnein wrote:
| A smart manager won't just let their budget be cut, because
| that won't be good for the company. If they find that marketing
| approach X doesn't work as well as Y or Z, they will simply
| move funds to do more of Y and Z.
|
| By doing so they will increase revenue and profits all the
| while keeping ad spending at the same level.
| aerosmile wrote:
| I am surprised that the concept of incrementality is not
| discussed more in this context.
|
| At a high level, marketers measure the effectiveness of ads using
| metrics like ROI, ROAS, etc. The way those metrics are measured
| is by choosing a certain attribution model (eg: last click, first
| click, etc) and attribution window (eg: 1 day view, 28 day
| click). As you can already tell, it's a bit like accounting - you
| can get different results depending on which rules you follow. So
| clearly, there's a lot to criticize.
|
| But, a lot of that criticism goes away as soon as you introduce
| incrementality and start adjusting for it (randomly split the
| population, only show ads to one group, then observe the results
| between the two groups). If the two groups exhibit similar
| behavior, your product is already getting a good amount of WOM
| and other sources of distribution, so no need to push that paid
| channel quite as hard (or at all). Most young companies are not
| in that position, and the amount of adjustment needed is in the
| sub 20% range. Whatever the range, my point is that the concept
| of needing to make this adjustment is well known and understood,
| and the fact that this was never mentioned in the original
| article is really strange - it almost sounds like if the involved
| people didn't know about it.
|
| Here's more info on incrementality:
| https://www.adroll.com/blog/marketing-analytics/beginners-gu...
| miguelmota wrote:
| Online advertising is fundamentally broken because it pegs dollar
| amounts to HTTP requests. Ad fraud steals billions from
| advertisers because it's so easy to fake being a publisher,
| impression, or click. Not to mention that you have to take the
| word of the upstream partner (ie Google) that the requests are
| valid without them providing you any actual request logs.
| jasode wrote:
| _> Stopped [some] Spending on Digital Ads, Nothing Happened.
| Why?_
|
| [Added "some" for clarity.]
|
| Let me try to restate the author's article because he presents it
| in a confusing way.
|
| The issue is that both Google and Facebook have "core ad tech"
| that works decently with proven ROI -- and they both have
| "additional ad tech inventory" (a.k.a the partners/affiliates)
| that's _much lower quality_ :
|
| Facebook "quality" ad placements on their core platforms with
| decent ROI:
|
| - ads in Facebook Newsfeed
|
| - ads in Instagram feed
|
| The "questionable" ad placements with much lower (possibly zero)
| ROI:
|
| - ads in Facebook Audience Network
|
| (Here's an example screenshot in Facebook's Ads Manager to
| visualize the options above:
| https://storage.googleapis.com/website-production/uploads/20...)
|
| Same concept applies to Google AdWords. The adwords clicks on
| "google.com" perform better than the ones coming from partner
| websites. The lower quality ad tech in partner networks has more
| bots, more scam websites, more fraud, more negatives, etc that
| reduce ROI.
|
| Bottom line is... if you're buying digital ads, you need to
| understand _exactly_ what _type_ of clicks you 're paying for and
| how it actually performs.
| jariel wrote:
| Text-based search ads - are completely different from - network
| banners ads.
|
| They are used for different reasons.
|
| 100% of ad buyers, marketing people know this, it's not an
| insight.
|
| Nobody is 'accidentally spending money' on banner ads, when
| they thought they'd be spending money on Text ads.
|
| Also - it's very straight forward to apply different
| measurements to FB ads in and out of network.
| acfou wrote:
| great summary
| Animats wrote:
| That's more or less accepted. Ads that appear in Google search
| results have some value, since they appear when someone is
| looking for something specific. That's measurable.
|
| Ads that appear on irrelevant web pages have less value. That's
| well known. Apparently so little value that it's near zero for
| known brands, this article says. In the end, they're like
| useless banner ads. Mostly clicked on by bots.
| lumost wrote:
| There's a useful correlary to this for consumer tech.
|
| While it is tempting to monetize with a publisher network,
| these networks don't work well enough to justify their own
| spend for many advertisers. As a publisher you'll likely be
| stuck in a race to the bottom until you have sufficient scale
| for direct ad deals (read as 10s of million MAU).
|
| I'm not sure if kicking fraud out of these platforms would
| raise ROI, or reveal that the real price of banner ads and
| interstitials is 0.
| MichaelMoser123 wrote:
| i usually get ads for things that i just bought. That means
| they are very good at snooping, on the other hand if I just
| bought a TV set then that doesn't mean that i would need
| another one soon.
|
| Funny that Goole/Facebook currently don't seem to be running
| ads for complements of products too often; Amazon is better at
| that (if you bought this book, then you might also want this
| one).
| jrumbut wrote:
| It seems like we've been talking about this so long that a
| complementary product feature would be standard everywhere
| even if it didn't work.
| croes wrote:
| Source?
| croes wrote:
| Really? Downvoted because I wanted to know the source for the
| proven ROI?
| anishjain2000 wrote:
| i agreed with u
| cm2012 wrote:
| This all true. Source: My 11 years running ads on these
| platforms.
| Judgmentality wrote:
| Can you please elaborate? Your source is just an appeal to
| authority, but I would really appreciate more evidence to
| help explain your position.
| croes wrote:
| By that logic any lottery winner could argue that lotteries
| are a great pension plan.
| cm2012 wrote:
| If they consistently win lotteries year after year with a
| good ROI, sure. Not sure how that comparison works.
| anishjain2000 wrote:
| may be this is there trick
| anishjain2000 wrote:
| what if
| croes wrote:
| Ever heard of survivor bias? Let me make an example: I
| choose 2048 random addresses. I choose I random company
| on the stock market. Half of the addresses I send a email
| stating the stock will rise in the next month, the other
| half the stock will fall. After a month I check the stock
| and disgard the addresses where my prediction was wrong.
| Than I repeat the previuos steps until only one address
| is left. Now ask him about my expertise on the stock
| market.
| tehlike wrote:
| It is true. Partner sites make revenue for the partner
| through revshare and partners attempt to create fake clicks
| and even conversions to inflate their revenue. Cobra effect
| in play.
|
| This risk is zero (except for things like ad neuseam) on
| first party / owned and operated placements like
| search/ig/fb.
|
| As with anything you should verify your roi through third
| party measurement providers, just like you would do for
| others.
|
| Disclaimer: current fb ads engineer, former google ads
| engineer.
| nabla9 wrote:
| It's not about clicks or traffic. The real issue is selection
| effect vs. advertising effect
|
| SEO traffic benchmarks don't measure the right ting or show
| real ROI. FB or Google don't want you to measure the right
| thing.
|
| Traffic to the website has licks, purchases and downloads that
| are happening anyway (selection effect) and clicks, purchases
| and downloads that would not have happened without ads
| (advertising effect) mixed. Only way to differentiate between
| the two is do real experiment where you divide target groups in
| two sections and show only the other group the ads.
|
| When you do this experiment correctly, you find out that online
| ads are usually wasted money for any established brand and
| lower than expected value for less known brands.
| marketingtech wrote:
| These are pretty easy to measure on Google or FB with their
| "lift study" tools and a conversion pixel. The lift tools
| will let you create a holdout group of X% of people who
| should be targeted by your ad. They won't see the ad, but you
| can still measure the rate at which they convert on your
| site. Then, you can compare that conversion rate to the rate
| of people who actually saw/clicked the ad.
|
| Conversion pixels are never 100% accurate (and are becoming
| increasingly inaccurate due to browser/OS changes) and
| shouldn't be used to say "This ad generated exactly X sales
| that wouldn't have happened otherwise!", but you can examine
| the relative rates from people who saw or didn't see your
| campaign.
|
| I've also seen companies who don't trust FB/G to grade their
| own homework on a known lift study, so they measure the
| effect by running PSA ads. Their ad campaign will be
| something like "Donate to charity XYZ!" but will be set to
| measure purchases on their website. That lets them establish
| the baseline purchase rate of the customers in their
| audience.
| mikewarot wrote:
| >These are pretty easy to measure on Google or FB with
| their "lift study" tools and a _conversion pixel._
|
| I hate that Facebook and Google have normalized this
| invasion of privacy.
|
| https://en.wikipedia.org/wiki/Conversion_tracking
| marketingtech wrote:
| This was normalized on the web long before these
| companies started - they're just the best to do it
| (though Google did acquire one of the earliest players in
| DoubleClick).
|
| The term "conversion pixel" is a misnomer these days for
| a Javascript snippet or API call - the concept predates
| JS and used to refer to a 1x1 transparent GIF.
|
| Anyways, that generation of tech is being pushed out due
| to browser privacy enhancements and will be replaced with
| privacy-protecting browser and server APIs that introduce
| noise to the data, such that you can still measure the
| directional/relative impact of advertising without being
| able to tell exactly who converted.
|
| There are a few competing industry proposals involving
| differential privacy/cryptography/blockchain/fixed
| entropy that are being publicly discussed here:
| https://github.com/w3c/web-advertising
| dylan604 wrote:
| > They won't see the ad, but you can still measure the rate
| at which they convert on your site.
|
| This sounds like such an assumption. There's no guarantee
| that any one person will ever "convert" on your site.
| That's such an ugly carrot that FB/G are dangling in front
| of you. "If you spend enough money with us, we'll
| eventually show your ad to someone that will absolutely buy
| your product. Pinky swear, just keep putting coins in the
| slot to continue".
| marketingtech wrote:
| Let me explain it a little differently with a
| hypothetical scenario.
|
| You set up an ad campaign with an audience of 100k people
| who are already on your mailing list.
|
| You set up a conversion pixel and run the ads. Let's say
| that Google's tools say that 10% of people who saw the ad
| converted. That's incredible! But considering that they
| were already on your mailing list, maybe they were going
| to buy anyways - or maybe your TV ad is actually what
| convinced them to buy.
|
| You test for this by creating a holdout group from that
| 100k. Let's say 5k people. These are people that could
| have seen your ad, but we're intentionally not going to
| show it to them. We'll still use the conversion pixel's
| measurement functionality on them, and we see that 8% of
| those 5k people buy your product.
|
| Now, we have a clearer picture - the Google ads drive 2%
| more conversions for your audience - or people on your
| mailing list who see an ad on Google are 25% more likely
| to convert than those who don't.
| aerosmile wrote:
| Nobody can predict the future, but it's a lot better to
| inform your predictions based on historic performance
| than on no data at all.
| tnt128 wrote:
| Just because the ad placement is low quality (eg audience
| network) doesn't mean they can't produce a positive ROI. Keep
| in mind, Lower quality comes with a lower price, so it makes
| sense for some brands, and some products. The reason people
| dont get a positive return on low quality ad placement is that
| they often use the same ad, or adverse the same product as for
| the higher quality ad placement. These ads and product often
| needs to be tailored for that specific placement.
| rbanffy wrote:
| I love it that it was the Sleeping Giants campaign against
| neonazi website Breitbart that started this.
| eksabajt wrote:
| This related article is excellent - "The new dot com bubble is
| here: it's called online advertising" by Jesse Frederik and
| Maurits Martijn. https://thecorrespondent.com/100/the-new-dot-
| com-bubble-is-h...
|
| > Marketers are often most successful at marketing their own
| marketing.
| lasagnaphil wrote:
| Another related article skeptical of the effectiveness of online
| ads (by the Correspondent, which is sadly shutting down this
| year): https://thecorrespondent.com/100/the-new-dot-com-bubble-
| is-h...
| offtop5 wrote:
| I actually did find a few products which I used for at least a
| short while, on Facebook.
|
| If I had to guess, hyper targeted digital ad spend is very
| effective, but you'd have to sell very high margin products to
| come out ahead.
| mttddd wrote:
| Ya anecdotal for sure but a ton of my friends bought their
| significant others some new fangled thing they only heard about
| because they saw it on Instagram. HN loves to bash marketing
| (and FB/google) but it has never been easier to spin up your
| own shoe company and easily advertise and get customers (e.g,
| allbirds).
| Nextgrid wrote:
| I've also seen and personally know people who bought crap off
| Facebook ads and ended up either being scammed or with a
| product below what the ad promised.
| offtop5 wrote:
| For me I've been very happy with my Facebook purchases
| ppeetteerr wrote:
| I believe the article is mainly around third-party websites
| displaying ads, not FB. I agree that Insta, FB, and Google ads
| are effective, but only on their own properties. I ran Google
| ads for an ecomm project and quickly disabled the affiliate
| site ads since they generated garbage traffic.
| slyrus wrote:
| I'm reminded of the famous quote by George Best: "I spent a lot
| of money on booze, birds, and fast cars. The rest I just
| squandered."
| blntechie wrote:
| Ad tech is a bubble and full of sketchy players. The advertisers
| always get fleeced, the only question is for how much.
| [deleted]
| earthboundkid wrote:
| The only sane way to do advertising is to do what's done on TV:
| you buy a time slot based on estimated impressions and then a
| third party auditor (Nielsen) uses surveys to get a better after
| the fact number. Doing sales based on server traffic is just
| pointless. You get what you pay for (a server moving bits
| around), and not a damn thing more.
| dylan604 wrote:
| Are Nielsen surveys still a thing? Every single device that
| displays a video signal to you has been tracking what you watch
| since way before ad tech became a thing. The companies
| collecting that data then profit from that collection.
|
| As an anecdote, I have AT&T Gigaverse. I primarily only watch
| recorded material on the DVR, and only watch sporting events
| live. However, once I'm done watching a signal from my "cable
| box", I switch it over to my external media device on a
| different input on my TV. The cable box stays on whatever that
| channel it was on for however long it takes before the cable
| box goes into screen saver. Someone is getting skewed ad view
| counts by 1 as my cable box displayed it but nobody saw it.
| jtsiskin wrote:
| This is probably a waste of electricity?
| dylan604 wrote:
| Yes. It is. However, if you can tell me how to turn it off
| in a manner that actually turns it off without unplugging
| it, I'm all ears.
| PMan74 wrote:
| > The biggest story in tech no one's talking about
|
| Is this not an old (3 years), well reported story?
|
| https://www.reuters.com/article/us-uber-fetch-idUSKBN1ES1ZI
| UShouldBWorking wrote:
| I love watching people realize that online ads do little to
| nothing. It took me a week or two to realize this years ago with
| my own sites.
| m3kw9 wrote:
| Depends how much of that is attributed to fraud. There should be
| equivalent of cyber security to ad "security".
| anishjain2000 wrote:
| amazing
| kmeisthax wrote:
| I think a lot of this was already obvious to slightly-savvy
| mobile app users. Look at pretty much any free-with-ads app; a
| majority of the ads are going to be ads for other free-with-ads
| apps, many of which you already have installed. The thing is,
| outside of the Internet most ad spend is for marketing ubiquity,
| not direct response. You don't really buy, say, TV advertising
| with the expectation of getting so many clicks or calls out of
| it. And, up until a few years ago, TV was the lion's share of ad
| spend. So who knows if we'll see an actual industry reckoning or
| not. The whole point of advertising is to waste money, after all,
| and plenty of brands were fine with getting nothing but exposure
| out of it.
|
| More interesting to me is the fact that tech companies are
| finding it surprisingly difficult to control where their ad-spend
| goes. I suppose this is an inverse of the problems with supply
| chains, where Apple can take three years to get a connector
| vendor out of their supply chain even when they were using
| literal child/slave labor. It's a market for lemons; bad "money"
| (publishers, suppliers) drives out good. The question is: will
| questionable ad publishing actually harm corporate reputation to
| the point where big ad spenders go away, or will we just see
| periodic Adpocalpse-style waves of spending being decreased and
| then brought back?
| qeternity wrote:
| I suppose this is true in the same sense that the purpose of
| life is to waste oxygen.
| perfmode wrote:
| this confirms the previous post if you subscribe to the idea
| that the purpose of advertising is to waste oxygen
| cortesoft wrote:
| The point of traditional advertising IS pretty much to waste
| money, similar to how the point of a peacock's tail feathers
| are to waste resources... it is a signal to potential partners
| (business or romantic) that they are so capable they can waste
| resources. It is a signal of bonafides.
| jackson1442 wrote:
| I'm not entirely sure about that, at least not in all cases.
|
| I was recently in the market for a new mattress, so went to a
| mattress store and tried some out. Even though Tempur Pedic
| is all the rage with their insane ad spending, I was not all
| that impressed, and found a considerably cheaper mattress
| that felt much higher quality.
|
| Now, this may all be sales mumbo-jumbo, but the sales rep
| noted that a lot of people come there only interested in
| Tempur Pedic mattresses, which he regards as "literally a
| piece of foam, total crap mattresses." They sell at such a
| high price point because they advertise so much, while the
| mattress I found came from a no-name brand that doesn't
| advertise at all, and was therefore cheaper.
|
| So I guess in some markets, advertising does work. I've never
| heard of someone telling me how much they loved a mattress
| unless it's a Sleep Number or a Tempur Pedic, and those
| advertise by far the most.
| datagram wrote:
| I guess that's the thing; for a lot of industries, people
| aren't generally going to make a purchase without doing
| some amount of research. Maybe Tempur-Pedic was on their
| mind when they entered the store, but once they're in the
| store they're generally going to end up trying out several
| mattresses. I /love/ my mattress (and have said as much to
| friends), but I honestly couldn't tell you the brand off
| the top of my head; I just went to a store and picked
| whatever felt the best.
|
| One could argue that Tempur-Pedic has to sell at a higher
| price point to make up for the money they spend on
| advertising.
| unethical_ban wrote:
| I'm genuinely shocked at how many people think advertising
| doesn't work.
|
| Just because it doesn't make a person consciously stand up
| and say, "I want a Snickers" does not mean the ad didn't
| work.
|
| Like, honestly, are there people here suggesting viral ads
| don't work? Or don't understand the point of Coke or Mercedes
| Benz ads are for? Coke establishes themselves as the defacto
| soda. There is no other soda, or if they are, wish they were
| coke.
|
| MB ads among other things reinforce to MB owners the wisdom
| and luxury of their brand. To own an MB is to be part of a
| club, one that is advertised across the media spectrum. If MB
| didn't advertise at all, they would either become another
| commodity brand, or have to be so luxury that only word of
| mouth is necessary (Bently, etc).
|
| Now, maybe that's what cortesoft is saying "get you to waste
| money" but if it got you to waste money on their product, it
| worked.
| cortesoft wrote:
| Sorry, I think you misunderstood my point a bit... I think
| I am agreeing with you.
|
| My point was that advertising's purpose (from a consumer
| point of view) is for the ADVERTISER to waste money, to
| signal that they have confidence that their product is good
| enough to recover the cost of wasting money on advertising.
| zymhan wrote:
| They weren't disagreeing with you in their reply, just
| emphasizing the same point.
| pmontra wrote:
| I understand the point but the MB example could be off the
| mark. According to their site [1] they sold more than 2 M
| cars in 2019. Luxury yes, at least a bit, but a pretty
| large club. Maybe Ferrari and similar brands? But they do a
| different kind of advertising.
|
| [1] https://www.daimler.com/investors/key-figures/markets/
| curryst wrote:
| I don't think they meant that it's a private club.
|
| Personally, I think it's less about luxury and more about
| value signalling. Having a Mercedes says that you're
| comfortable financially, and they're "dignified". I'm not
| saying it's true, but it's what their marketing generally
| implies. Luxury is generally just a dog whistle for value
| signalling merchandise.
|
| Ferrari does different value signalling. They imply
| wealth because of the cars performance, and they're
| generally a much more obvious signal. They're usually a
| bold color like red in the ads, and the body styles are
| distinctive. You could miss a Mercedes in a group of
| sedans; you're not going to miss the Ferrari.
|
| The private club brand, to me, is Rolls Royce. I would
| guess because I never see ads (and rarely see them in
| person), so my only references are pop culture where
| they're associated with the ultra wealthy.
| xiphias2 wrote:
| This was true in the past, but nowdays it's much easier to
| try out a product and see reviews.
|
| With Uber it would be so easy to penalize drivers who cancel
| because they don't like where I'm going, but I'm still
| wasting 30 minutes quite often, because Uber spends that
| money on ads and UI rewrites instead of improving the core
| experience.
| cbsmith wrote:
| It's also an important signal to consumers.
| cortesoft wrote:
| Yeah, that was who I meant by 'business partners'
| Nextgrid wrote:
| The problem is that it is no longer true with online ads.
| The barrier to entry in online ads is non-existent and thus
| seeing an ad for a product should not be considered a trust
| signal (if anything, it should be the opposite) unlike on
| TV or print where the price of such ads works as an
| effective filter.
| Ma8ee wrote:
| That the products are overpriced?
| Phenomenit wrote:
| That you're paying for these ads.
| cortesoft wrote:
| No, that the product is good enough that it makes enough
| money to afford expensive advertising.
|
| There is a really good essay about this that I re-read
| quite often: https://zgp.org/targeted-advertising-
| considered-harmful/
| neaanopri wrote:
| I can't believe I had to scroll down this far for someone
| to point this out.
| mlazos wrote:
| Honestly though why tf did these companies never try lowering
| spend incrementally to see if it made a difference? Is this why
| engineers are so valued because we understand the simple concept
| of AB testing?
| Traster wrote:
| For the same reason that you never lower your margin. It's very
| easy to lower your margin, and you _might_ get growth as a
| result of your lower margins, but it 's a massive gamble with
| the most likely outcome being that you are now selling the same
| stuff for less money. And do you know what happens when you cut
| your marigns and don't see growth? You get fired.
|
| Same thing with advertising. You drop your ad spend, you lose
| market share, and you're fired. There is no step 4. If you're
| right and the ad spend was unnecessary, you've made a tiny
| difference (no one cares about cost, only growth), if you're
| wrong, you're fired.
| texasbigdata wrote:
| Disclaimer: I'm not a marketing guy.
|
| It's sold as hand wavy. I once dropped in on a consulting
| client (at the request of an investor on the board) and did a
| quick assessment. The assessment was holistic and marketing was
| one of many enterprise value levers, so did a rough check. The
| marketing firm, very similar to the Uber commentary in the
| underlying podcast above where he found 20,000 installs coming
| from an app with 30,000 MAUs, I calculated claimed performance
| which back of the envelope would imply you could capture the
| entire US vertical for that industry for sub $X0M of annual
| spend. I knew that space very well, and well that just was not
| possible.
|
| My quick question kicked off a large tap dance in which some
| finger pointing occurred and a "new attribution formula" was
| introduced.
|
| The vendor got fired.
|
| This was sort of a reasonably sized entity, with some
| sophistication. But think about it, unless you're tech native,
| your VP of marketing has no granular data abilities in 2020,
| and unless you have a pool of SQL capable analysts lying
| around, AND you're going to insist to validate on your own, it
| simply doesn't work.
|
| So you trust the vendor. But wait the vendor gets paid X% of
| what you spend. Hmmm, would they realllllly work super hard to
| make sure the results are real if they are not easily found out
| to be falsified? This is a paranoid stance, obviously. But
| intrinsically structurally flawed.
|
| The Uber guy on the podcast straight up said he wouldn't buy a
| dollar of programmatic ads without a big data team internally
| and a policy of (loosely quoted) "we need that file to check
| and if you don't send it to us we're cutting you off".
|
| That's just a lot of work.
| reilly3000 wrote:
| Marketers do tons of A/B testing and most measure conversions
| based on ad copy and placements. The problem often is they
| don't look beyond aggregates ( as Google/Facebook flood
| marketers with dimensions, this one is easy to overlook). So it
| the overall ROI may be passable, but specific segments are
| over-analyzed (did YOU place the right message?) and others
| ignored. The platforms have never ever in any amount of years
| been willing to hand over raw clickstream logs of ad data, so
| marketers are forced to rely on misleading aggregates.
|
| I'm sick of engineer elitism. Try harder to see that brilliant
| folks exist in every department. You'll be a happier person and
| learn a lot more. Marketing analytics is fascinating and full
| of puzzles. Marketers were driving engineers to make
| multivariate testing scale 20 years ago.
| theqult wrote:
| So Uber was financing a nazi propaganda website, nice. Im super
| happy that they lost their money.
| eternalban wrote:
| Run surveillance on masses and defraud businesses: the
| advertising industry.
|
| Of course it could just be a parallel construct for funneling
| money to surveillance tech companies such as Google by compliant
| companies that know they are not getting anything for their ad
| monies, to serve the policy goals of unseen but powerful
| interests.
| [deleted]
| dhosek wrote:
| But without unlimited tracking, how will small businesses
| survive?
| jl2718 wrote:
| 90% of email traffic is spam. 90% of ad clicks are fraudulent.
| 90% of visitors? 90% of tweets? 90% of likes? Some day, 90% of
| YouTube videos. As human-mimicking technology improves, all human
| interactions that can be faked, will be.
| tomaszs wrote:
| I don't know now, but some time ago Google consultants told me
| that I should create an ad that displays when someone searches
| for my brand name. It was very odd because without it, my page
| ranked obviously first for the brand name. It may be the case it
| looks good in ads reports to see paid conversion.
|
| What definitely made me realize what ads are about was when I
| have installed user interaction tracking on my website. I was
| able to see what paid ads users was doing.
|
| 90% of the traffic was generating users that behaved like bots.
|
| But there is a big marketing and a lot of money for everyone. No
| one really cares about results. You can find tons of articles how
| to optimise campaigns that are aimed at SMB.
|
| But no one will mention most of such advice are for companies
| that spend tens of thousands of dollars per month. Otherwise
| there is too little data for ROAS or even CPC and CPM
| optimization. Comparison results for smaller campaigns are just
| not statistically signifant.
|
| I must agree with the article it is all about perfect crime. No
| one , including clients, are not concerned about real results. It
| is like let's throw money into the fireplace and enjoy it is
| warmer.
| jpollock wrote:
| I expect Unilever has some data from their Facebook and Twitter
| ad boycott.
|
| They're restarting their advertising.
|
| https://www.campaignasia.com/article/unilever-to-end-faceboo...
| ashtonkem wrote:
| I'm continually haunted by a fear that online advertising is a
| bubble propped up by fraud and willful blindness, and that when
| it eventually pops it's going to destroy all our careers.
| joezydeco wrote:
| So think about how many ads you've clicked through in your
| lifetime on the internet.
|
| Honestly, I'm with you. I have no idea who's using the ads
| other than logrolling robots.
| ryanSrich wrote:
| I'm not sure if this is equivalent to fraud. But I've recently
| discovered that 99.9% of the website visitors to my new startup's
| website are just random @gmail addresses from India and China -
| most of which are coming from Google ads. We don't spend much,
| about $100/m mostly to keep our #1 ranking in Google (which I
| think helps), but it does seem fraudulent. If I turn the ads off,
| the traffic from those IPs drops off a cliff.
| janmo wrote:
| With Google ads you can select the countries where you want the
| ads to run in. If you go worldwide and chose to maximize
| clicks, Google Ads will mainly run them in India and other
| emerging countries because it's much cheaper to get clicks from
| there.
| ishjoh wrote:
| I also had a small Google ad spend ($350 over 3 weeks), that
| I setup to run exclusively in the USA, and had the same
| experience where IP addresses recorded by hotjar were all
| from India, all new signups from the ad spend were '.gmail'
| email addresses and although I had about 100 signups not a
| single one entered a credit card.
| ryanSrich wrote:
| Yeah, same here. We have done some spam mitigation, but we
| still get so many bogus sign ups and form submissions. In
| this instance, who is committing the fraud? Is it Google to
| ensure you spend your entire budget? I don't see anyone
| else benefiting from these bots and click farms. We're so
| small and new that it can't be a competitor.
| nickphx wrote:
| Some "bots" perform searches and click on ads to build a
| "user profile" for the browser.
| SheinhardtWigCo wrote:
| ...so that they can bypass Google's captcha.
| hermitcrab wrote:
| IIRC sometimes bots will click on random ads to try to
| obscure the nefarious other things they are doing. You
| are just collateral.
| [deleted]
| Aldipower wrote:
| Almost the same here. Had an Google Ads budget of $200 a
| month. All I got from this were dubious sign ups, which all
| together never looked around in the application and never
| came back. As my ROI turned to be negative, I turned off
| ads completely. My organic sign-ups even increased since
| that. And those people are staying!
| austinpena wrote:
| Physical location only or location of interest included?
| ryanSrich wrote:
| Yeah so that's the weird part that I didn't mention. These
| ads only run in the US.
| cj wrote:
| This might help you fix the problem:
|
| Google Ads default settings for location targeting is based
| on "Presence or interest" in a location, not whether the
| user is actually in the targeted country. That means even
| if you have "United States" selected as your target, your
| ads will still show mostly to people outside the US who
| "show interest in" the US.
|
| To fix it: Campaign Settings > Location > Location Options,
| and under "Target" select "Presence". Never use the default
| "Presence or interest" option, as it will result in exactly
| the scenario you're describing.
|
| This is my #1 pet peeve with Google Ads. Using the default
| setting is an incredibly common (and expensive) mistake
| people make setting up new campaigns.
| hermitcrab wrote:
| The default Adwords settings are garbage (unless you are
| Google).
| undreren wrote:
| Maybe this is due to chinese and indian click farms running
| through VPN's?
|
| Click farms click on _everything_ in order to dodge fraud
| detection, as far as I know.
| cj wrote:
| I've been suspicious of this in my own campaigns as well.
| Google Ads lets you drill down to specific cities where
| your ads were clicked. Very often, Ashburn Virginia shows
| up very high on the list. Ashburn is where AWS's us-east
| region lives, and presumably also where many VPNs operate
| out of.
|
| I simply ended up excluding Ashburn from our campaigns
| for this reason.
| shiftpgdn wrote:
| Is it possible to create an IP blacklist for your ads?
| Seems like blocking India, China and AWS/Azure/Digital
| Ocean would be step one.
| thekonqueror wrote:
| By default Google will show ads to people in or "intersted
| in" the selected location. You can change this to only show
| ads to people actually present in the specified location,
| from campaign level location targeting. I spend low 5
| figures per month on ads and changing this parameter has
| significantly reduced poor quality clicks.
| wenbin wrote:
| The podcast episode where Kevin Frisch (former Uber head of US/CA
| performance marketing) talked about this issue:
| https://listennotes.com/podcasts/marketing-today/historic-ad...
|
| All podcast interviews of Kevin Frisch:
| https://lnns.co/5UZnQ_FopCb
| 101008 wrote:
| This has already 303 comments so probably no one will see mine,
| but I was planning this year to start doing some online
| advertisement to get more visitors to my website and convert them
| into Patreons. But I think this will not a good idea after all.
| Any other recommendations in how to be more visible to more
| people on the Internet?
| bwooceli wrote:
| He who cracks the code of the call center assisted lead gen in
| the online world will win the day. This is why "influencer"
| marketing is such a draw. There is NO more attributable
| conversion statistic than "I talked to THIS person, and had
| them talk to YOU in order to make a purchase". I've run agent-
| assisted call center lead gen for education industry and over
| the past 10 years, nothing has been more profitable or
| effective. The call center conversion rates subsidized the HUGE
| losses on pure digital and other ads.
| xwdv wrote:
| Wow so this means if some companies optimized their ad spends to
| stop spending on fraudulent ads for growth they could probably
| turn a profit.
| person_of_color wrote:
| Can't wait for the Enron-like moment in adtech. The numbers are
| all fraudulent.
| AzzieElbab wrote:
| Wow there are actually orgs such as sleeping giants? They
| actually make living off harassment?
| [deleted]
| soared wrote:
| There is a thread in r/adops in response to this HN thread for
| some good context.
|
| https://www.reddit.com/r/adops/comments/kprrcd/uber_discover...
| oli5679 wrote:
| This is pretty interesting study at Ebay.
|
| https://www.nber.org/system/files/working_papers/w20171/w201...
|
| They tested the counterintuitive claims by performance marketers
| that 'brand' keywords (containing Ebay) had the highest ROI. They
| did an experiment and found that, contrary to attribution model,
| these Ebay keywords resulted in ZERO incremental sales, although
| they were clicked on by many people that purchased.
|
| This resulted in cut of Ebay marketing budged by $100 mn.
|
| There is now a big literature in economics looking at experiments
| and natural experiments, generally finding much smaller sales
| impact of advertising than claimed by industry participants, and
| genearlly -ive ROI.
|
| https://www.nber.org/system/files/working_papers/w20171/w201...
|
| This Freakonomics episode is a nice overview.
|
| https://freakonomics.com/podcast/advertising-part-2/
| reiska123 wrote:
| Yeah, I remember this one. Worked in top 10 brand performance
| marketing team as analyst/data scientist and brought this up to
| our marketing director.
|
| I have never been shot down so quickly in my career. Very toxic
| environment to work in.
| rightbyte wrote:
| Obviously 'brand keywords' has the highest apparent ROI. It is
| users already looking for your site that click those. It is
| probably some internal bonus scam that fuel such nonsense - a
| industry wide marketing department conspiracy.
| simonkafan wrote:
| It would be the downfall of the Google empire (and probably half
| of the Internet) if the majority of companies realized that most
| of their online/mobile ad budget is absolutely wasted. I don't
| know of any other industry where people put so much money into it
| only to have so little tangible evidence at the end of the day of
| what they really paid for ("look, X real people clicked on your
| ad.... at least that's what we tell you and whatever that means
| for you.").
| addicted wrote:
| Playing devils advocate, couldn't this just be reflective of the
| fact that Ubers brand reach us strong enough that there is very
| little advertising that gives them a marginal benefit?
|
| Uber owns taxi services as a brand as much as Google does search.
| acfou wrote:
| you are right; some of the biggest brands need to do the least
| advertising
| adrianmonk wrote:
| I guess there are 3 reasons why reducing ad spend might not
| show a negative effect:
|
| (1) Due to fraud, the money wasn't actually going to ads.
|
| (2) You didn't need the ads. You were over some saturation
| threshold and the law of diminishing returns kicked in hard.
|
| (3) The ads were valuable to you but not in an easily measured
| way. Maybe you could coast on brand awareness inertia for 6
| months or a year before it affects sales.
|
| This case seems to have decent evidence for at least part of it
| being #1, but not necessarily all of it.
| whistlingwhip wrote:
| adapp solutions, hasoffers, tatto media, tune have been
| defrauding their customers for quite some time now
| dang wrote:
| A related article is
| https://www.forbes.com/sites/augustinefou/2021/01/02/when-bi....
| (It was posted at https://news.ycombinator.com/item?id=25620707,
| but the topic and discussion are substantially the same as this
| one, so we merged them.)
|
| Note: this thread is being paginated, so you need to click More
| at the bottom of the page to read the rest of the comments. Or
| via these:
|
| https://news.ycombinator.com/item?id=25623858&p=2
|
| https://news.ycombinator.com/item?id=25623858&p=3
| PragmaticPulp wrote:
| A lot of comments are rushing to dismiss the entire concept of
| advertising as ineffective, but they're missing the point of
| these Tweets.
|
| One of Uber's advertising partners created numerous apps that did
| things like auto-click on their ads and install apps in the
| background, collecting the commission for themselves on customers
| who didn't actually click the ad or intentionally install the
| app.
|
| They discovered it when they turned off those ads and didn't see
| a drop in signups, which is something that normally happens when
| they turn of legitimate ads.
| soupson wrote:
| Right, it seems like the point isn't "Targeted ads don't work,"
| it's "There are ways to fake ad targeting that fooled a major
| company." Uber could benefit from legitimate ad targeting
| (assuming they haven't hit market saturation), we just don't
| know.
| ErikVandeWater wrote:
| Why is no one discussing that the term "defrauded" is not
| substantiated by the tweet?
| EugeneOZ wrote:
| When I'm reading this from my phone, 50% of the screen is taken
| by ads, so please, Forbes, stfu.
| soared wrote:
| This is really just Uber failing to effectively manage their ad
| spend. Somebody at Uber is not doing a core function of their job
| if this can happen. A person at Uber is responsible for ad spend,
| moving it between vendors, checking CPAs, etc.
| chevman wrote:
| Yeah, first thing I thought as well when I read this.
|
| Dude has $150MM annual ad budget and has never audited his
| vendors?
|
| Either total incompetence, or something shady was going on.
| jariel wrote:
| So Uber has 15B revenue and they only spend 150M globally on
| acquisition ad spend.
|
| It'd seem to me that this is relatively thin, and likely wouldn't
| have any impact for some time.
|
| Uber is already well known - their spend in most cases boils down
| to brand advertising and nothing else.
|
| Marketing is hard, and anyone just throwing money at something
| isn't going to win hard.
|
| For an established brand, user acquisition is going to obviously
| have to be more targeted. Putting ads on 'Breitbart' was never
| going to drive new customers.
|
| In fact - I don't think 'banner ads' will drive any new customers
| for Uber.
| jsnell wrote:
| > So Uber has 15B revenue and they only spend 150M globally on
| acquisition ad spend.
|
| The events described here happened right at the start of 2017,
| so you wouldn't want to look at their current revenue. Their
| 2016 revenue was $4 billion, 2017 revenue was $8 billion.
| zuhayeer wrote:
| "For ex, one ad network launched 'battery saver' style apps in
| Google Play, giving them root access to your phone.
|
| When you type the word 'Uber' into your Google Play, it auto-
| fires a click to make it look like you clicked on an Uber ad and
| attribute the install to themselves "
|
| The things you can do on Android devices are insane. Also ads
| aren't necessarily for conversion, they're for permeating brand.
| tempsy wrote:
| big brands have the least to gain from online ads
| notional wrote:
| I like that this story references the #deleteUber tag on Twitter
| because it helps organize the timeline of events going on at
| Uber.
|
| There was another twitter thread on here recently about the
| chaotic and disastrous (though successful) Swift rewrite they did
| which happened during the same time frame.
| https://twitter.com/StanTwinB/status/1336890442768547845
|
| During those time frames is also when all of the execs were
| quitting or being fired, along with their internal harassment
| problems.
|
| It feels like Uber has really succeeded in spite of itself.
| lxe wrote:
| Tangentially related, but how is Uber Caller still expanding
| (even to various countries) on WeChat? Aren't they essentially
| using stolen cards and accounts?
| dschuetz wrote:
| Welcome to the Advertising Tech Bubble.
| ghaff wrote:
| Maybe. A lot of people have been saying this for over 10 years.
| If it's a bubble that's real though, the effects are going to
| be pretty widespread. Not only do two of the biggest (and best-
| paying) tech employers get slammed, but so do all the inter-
| related companies. And, also BTW there will also be a lot fewer
| fat exits for startups if Google and Facebook acquisitions get
| turned off.
| dschuetz wrote:
| First signs of bubbles are fraud and wrong valuation.
| Gibbon1 wrote:
| First sign to me that the dot bomb was imminent was a two
| inch article in the WSJ summarizing a finding that
| something like 2/3rds of startups had board members or
| upper managers that had been sanctioned or investigated
| previously for securities fraud.
|
| It's telling that all the FAANG companies are basically in
| open violation of a number of laws.
| jonplackett wrote:
| I remember reading a while back that if you pay for likes from a
| like farm VS genuine, you get about the same quality of likes
| because the like farms have to like EVERYTHING to cover their
| tracks. How is anyone supposed to know they're really getting
| what they paid for?
| icedistilled wrote:
| Uber instructs ad buys to block all ads on breitbart, but ads
| still appear regularly. Uber identifies agencies that are
| responsible and stops all advertising buys with them. It amounts
| to 10% of their ad budget, no change in new users is detected
| despite 10% drop in ad spend, about 15M.
|
| Edit: oops didn't finish the whole thread.
|
| Next uber turns of 2/3 of the ads. 100M. Still no effect.
| liminal wrote:
| I know someone who worked at a marketing "machine learning"
| company. The ML really needs to be in quotes, because if you
| looked under the hood you'd see the people behind the curtain
| (literally -- Amazon Turk workers). But VCs loved them, customers
| loved them. The blind selling to the blind... Marketers had money
| to spend, ML is the hotness, everyone makes money! (My friend no
| longer works there)
| vardhanw wrote:
| Two related articles I read this year: [1] is an account of a
| deeper analysis of this problem, [2] is AirBnB's experience with
| cutting off spending on online advertising during the pandemic.
| The conclusion is the same, but what is important is the analysis
| of the reasons for continuing ad funding in orgs which has more
| to do with the marketing executive's psychology and need for
| feeling important than any objective analysis of the
| effectiveness of the campaigns.
|
| [1] https://thecorrespondent.com/100/the-new-dot-com-bubble-
| is-h...
|
| [2] https://www.theinformation.com/articles/airbnbs-new-
| strategy...
| onlyrealcuzzo wrote:
| You can A/B test ads pretty easily, and this is quite common.
| With some degree of statistical certainty, you can tell how one
| ad performs to another.
|
| You don't have control over your SEO results as well - but you
| can also measure against SEO traffic with a high degree of
| certainty.
|
| All big companies do this.
|
| Sure, you're never going to know exactly how many people you
| advertised to would have organically, eventually found your
| product and bought it.
|
| But that honestly doesn't seem that important compared to the
| other metrics - which most functioning large companies have
| decent data on.
|
| You're also never going to know how many of your customers ate
| Green Eggs and Ham for breakfast. It's irrelevant. You have
| decent insight into your direct-online ROAS, and that's unique to
| direct online advertising, and it's important!!
|
| Yes, you're never going to know if that million dollars you
| invested in online ads was the best use of that million dollars.
| But that's not much different than building a new factory,
| either.
|
| Edit:
|
| Specifically to Uber's case - they did NOT turn off 66% of ALL
| ads randomly to no adverse effect (implying that all ads are
| worthless).
|
| They DISCOVERED that a certain type of ad (paying for installs on
| dubious ad networks) was mostly fraud. After turning off 100% of
| this type of ad - they found no adverse effect.
|
| This is a fail on their analytics team. They should've been
| measuring this type of ad better - especially given how big a
| portion of the total spend it was - and had insight into
| something not being right. They should have been able to do this
| - and if they couldn't, because the network somehow didn't give
| them enough data to do it, they probably shouldn't have been
| spending this much money for exactly these reasons!
| isoprophlex wrote:
| Did you actually read the linked tweets?!
|
| Uber turns off a shitload of ad spending, nothing bad happens
| to new user acquisitions.
|
| I'd say there are about a million better uses of a million
| dollars than just pissing them away on a scam.
| walshemj wrote:
| Paying for crappy app installs on shady sites is not really
| advertising.
|
| What they should have done was a proper hyperlocal SEO
| campaign like Firestone Gieco, and Mc Donalds do.
| ashtonkem wrote:
| Literally lighting them on fire in a cold office to help
| provide some BTUs would've been a better use of that money,
| since at least that would offset spending somewhere else.
| m00x wrote:
| There's a huge difference between a company that is widely
| known for being the app for ride hailing and a small company
| trying to get eyes on their new product.
| coldtea wrote:
| Well, Uber is known to everybody by now. To the effect that
| "to Uber" is even kind of a verb/noun.
|
| Also people either need a hired transportation or not. If
| they don't have a car or don't want to mess with the traffic
| and need to go somewhere, it's either Uber or Taxi usually.
|
| It's not like Coca Cola, which is well known, but people
| could do without it (unless addicted), so needs to constantly
| nag people.
|
| And it's not like some new product, which without advertising
| nobody would even know it existed.
|
| In fact most of Uber's existance its operation has been 100%
| advertising (spending VS money to offer cheap rides and
| expand and gather "eyeballs" and "customers" without a
| profit). In my book, customer acquisition without profit is
| another name for advertising.
|
| So it doesn't sound strange that it could do without
| advertising today.
|
| But what if there were 3-4 strong players in the same, each
| eating in Uber's market share? You'll see how fast they'd
| found advertising indispensable again...
| thrav wrote:
| There's an interesting question there about when this form of
| advertising becomes obsolete.
|
| Uber is in a very different position than many other
| companies. Anyone who browses the internet with regularity is
| already aware of their existence and probably just needs the
| right set of circumstances to come together to make Uber
| useful to them.
|
| I suspect the results would be different if Uber were earlier
| in their adoption curve, but maybe that's not true either.
| Maybe they'd be ignored for different reasons at that time.
| wasdfff wrote:
| Likewise, I probably haven't seen an ad for coca cola or
| kleenex in a while. Once a brand is ubiquitous to the point
| where soda becomes coke and tissues become kleenex in the
| lexicon, it feels like ad spend is wasted.
| DanBC wrote:
| Coca Cola spends billions on ads.
|
| 8 million views:
| https://www.youtube.com/watch?v=yg4Mq5EAEzw
| coldtea wrote:
| > _8 million views_
|
| So, less than a viral cat video?
| ajsnigrutin wrote:
| Is it really christmas time, if there are no cocacola-
| trucks-driving-to-town ads on tv?
| jhawk28 wrote:
| Brand advertising is different. It is there to remind
| people about the brand. Companies do it because they have
| the analytics that show that it works.
| z3t4 wrote:
| I think both Uber and CocaCola has a lot of work to do
| until I like any of them. I like CocaCola as a product
| though. Never tried Uber. For example I really like some
| Nestle products, but try to avoid them because of their
| bad company/brand reputation, even if their product is
| both cheaper and tastier I buy from a competitor instead.
| Whatever a company stands for and how they act will
| affect their brand.
| Retric wrote:
| They mostly do it from inertia, how well it works is a
| separate question. Historically you can find many
| examples of hugely successful advertising campaigns, it's
| much harder to quantify the negative.
| LoSboccacc wrote:
| > You can A/B test ads pretty easily
|
| A/B testing ads is a complex matter. you can A/B traffic and
| conversion easily, but a lot of established companies with
| fierce competition fight for mind share, not direct conversion;
| for that, you have both awareness effects (user won't forget
| about coca cola if they don't run ads for a month, and an ad
| that doesn't directly convert but increase awareness still has
| value) and coverage synergies (the number of repetitions in a
| day will increase coverage non linearly and the amount of
| channel repetitions will increase awareness more than a single
| channel view, even if it doesn't convert immediately)
| azornathogron wrote:
| > All big companies do this.
|
| Except Uber, apparently? Or would the method you're talking
| about not have discovered that something fishy was going on? (I
| don't work with ads so I don't know the limitations of the type
| of experiment that you're talking about)
| onlyrealcuzzo wrote:
| It would work for some of Uber's ads. From the article, it
| looks like they were frauded mostly by in-app ads. And they
| were paying for installs - not actual trips.
|
| So, no, Uber's advertising here is a little different than (I
| think) the majority of companies. They are mostly paying for
| installs rather than sales / conversions. A lot of newer
| "app" companies could be in similar situations.
|
| Though, honestly, this seems like a massive fail on their
| analytics team for not figuring this out earlier. They should
| have been able to see that all of these "installs" from
| certain advertisers were not leading to trips.
|
| In fact, it says they turned off 66% of ads. They didn't
| randomly turn of 66% of ALL ads. They turned off this TYPE of
| ad, which they failed to earlier recognize was ineffective.
|
| Step 1) assume your ads won't work.
|
| Step 2) have enough analytics / logging in place to convince
| yourself the ads do work.
|
| Step 3) if they don't work, turn them off.
|
| Looks like they skipped step 2 - which honestly, is not
| uncommon for a fast growing business - even if they are huge
| and already make a lot of money.
|
| What they found isn't even what people are discussing. They
| found that certain networks they were buying ads from were
| almost 100% fraud (which is pretty well known).
|
| Instead, people here seem to be discussing that most online
| advertising is fraud, and/or that there's no way to prove
| it's effective. That is absurd.
| lincolnq wrote:
| Hang on though, in the linked thread they said that the
| fraud was incurred at the point of _real users_ signing up
| for uber -- when they type uber into the app store search
| (e.g. an organic install), the ad network fraudulently
| takes credit for it at that point. So "enough
| analytics/logging" would not do the trick here - I think
| they would have noticed if a certain type of ad wasn't
| leading to trips, as you are pointing at.
| nojito wrote:
| This is all discussed in the podcast.
|
| There's no revenue change even after testing (when you tack on
| costs of ad delivery).
| ransom1538 wrote:
| "You can A/B test ads pretty easily, and this is quite common.
| With some degree of statistical certainty, you can tell how one
| ad performs to another."
|
| Nope.
|
| You need a unique id for an AB test AND apple wont give this to
| you. No company is going to give you a click/tap id. Android
| might. This is so inaccurate I don't know where to start. Apple
| has turned off all unique ids that work across an AB test [1]
| cross platform. You would need on the ground mobile ad
| experience to know this.
|
| https://www.invoca.com/blog/what-is-idfa-and-why-apple-kille...
| jameshush wrote:
| For native Android you 100% have access to an Android "device
| id". I set this up on an Android app we delivered. There's
| even companies that pay other Android apps to host their code
| inside the app, co-related that ID to other data available to
| the web (e.g. IP address, installed fonts, etc) to provide a
| very good guess of a user's device id via the web.
|
| Apple had something similar, but you're right they're
| starting to turn it off. In my past life in Adtech we noticed
| the click through rate of users with Android user agents were
| a lot higher on certain campaigns than iOS users for this
| reason.
| adrusi wrote:
| It can happen that an almost certainly bogus scientific field
| persists for decades using state of the art research methods
| and no bad faith on the part of the researchers (any bias they
| introduce is probably not conscious).
| https://slatestarcodex.com/2014/04/28/the-control-group-is-o...
|
| A/B testing is... not a state of the art scientific research
| technique. Moreover the companies that provide the tools to do
| A/B testing are the same companies that sell you access to
| advertising space. I'm not saying that it's a common practice
| to defraud A/B tests, I'm saying that the fact that adtech
| companies have chosen to enable that research methodology out
| of the set of all methodologies they could offer suggests that
| we should expect, before seeing the results of any A/B trial,
| that the results will tend to favor the adtech narrative.
|
| I don't think that people in the adtech space believe they're
| selling a bogus product, but I do think they wouldn't want to
| know if they were -- they have a good thing going.
|
| If you're employed in adtech you're mostly fine, skills
| transfer. If you're invested in adtech, do what you can to
| diversify away. Advertising is overvalued to some extent and
| that bubble will burst at some point or other. The question is
| just how much actual value advertising provides, how much will
| remain when the bubble bursts.
| oli5679 wrote:
| > Sure, you're never going to know exactly how many people you
| advertised to would have organically, eventually found your
| product and bought it.
|
| This is typically an order of magnitude less than the
| attribution figures stated by digital marketing experts. A/B
| test is the right method to use, but the crucial thing is you
| need an earmarked population to see zero adds over your
| attribution window, since what you care about is impact on
| incremental sales, rather than incremental click likelihood.
|
| There is a long econometrics literature on this and it is not a
| fussy technicality, the figures typically differ by 10x +.
| gregoryl wrote:
| Instagram definitely does this. I'm part of the magic cohort
| who never see any ads :)
| maxerickson wrote:
| So how much ad spending is going to 'dubious ad networks'?
|
| Are they easy to categorize? Or is it a big secret what's
| dubious and what isn't?
| nabla9 wrote:
| >but you can also measure against SEO traffic with a high
| degree of certainty.
|
| None of these benchmarks distinguish between the selection
| effect (clicks, purchases and downloads that are happening
| anyway) and the advertising effect (clicks, purchases and
| downloads that would not have happened without ads).
|
| You can fix this by dividing the target group into two random
| cohorts in advance: one group sees the ad, the other does not.
| Designing the experiment thus excludes the effects of
| selection.
|
| When you do this experiment correctly, you find out that ads
| have low effect or are not cost effective (as eBay discovered).
| st1x7 wrote:
| > Sure, you're never going to know exactly how many people you
| advertised to would have organically, eventually found your
| product and bought it. But that honestly doesn't seem that
| important compared to the other metrics...
|
| Wait, why wouldn't that be important? It seems like the most
| important question since it asks whether advertising has any
| significant impact at all.
| reissbaker wrote:
| I think the implication here is "that honestly doesn't seem
| that important" because the expectation is that the number of
| people who would find you anyway would be a small number
| compared to a well-run ad campaign, at least over timeframes
| startups care about.
|
| Having worked with a decent number of small teams without a
| lot of brand recognition, ads bring in a lot of customers: it
| was pretty obvious in our metrics when we ran ad campaigns vs
| when we didn't. Sure, eventually a few of those people may
| have found their way to us somehow anyway, but there was a
| step change in volume from ads. At least in my experience,
| the idea that ads have no significant impact is not really
| supported by the evidence. I assume that's what the OP meant
| by it not seeming important: they're working under the
| assumption that "do _any_ ads do anything " is clear and you
| don't need to prove the worth there -- instead you need to
| prove which ads work better than others, and cull the ones
| that don't perform well (which will also help save you from
| scammers).
|
| One could argue that advertising for large brands with name
| recognition could be less valuable. I don't really have data
| or experience to know that one way or another, but in a
| competitive market that seems a little hard to believe. Tesla
| is an interesting counterexample, but I think it may be in
| part due to the EV market in the US not being particularly
| competitive; no one makes attractive, mid-priced cars with
| long range other than Tesla, let alone having an established
| charging network for road trips. And Elon's antics are, tbh,
| a form of marketing in and of themselves; "all press is good
| press."
|
| Edit: I wrote the above paragraph badly. I can definitely
| believe ads are _less_ valuable if you 're a big brand vs a
| small one. But I'd be surprised if they're useless, at least
| in a competitive market. People don't have infinite money, so
| if they're looking to buy X and an ad for X from your
| competitor pops up, it seems reasonable to me that some
| percentage of the time your competitor would make the sale
| and thus you wouldn't, even if organically that sale might've
| gone to your company instead.
|
| Also, I wouldn't argue that even small companies _need_ ads
| -- just that they do seem to be effective at increasing the
| volume of people interested in using your product at a given
| time. That may or may not be necessary /useful depending on
| your situation. I have been on teams where we intentionally
| turned off ad campaigns because we learned what we needed to
| learn from the cohort of new users, and now wanted to improve
| the product based on their feedback before spending money on
| more ads.
| lasc4r wrote:
| >One could argue that advertising for large brands with
| name recognition could be less valuable.
|
| It is without a doubt, and this is what the Freakonomics
| advertising episodes are mostly about.
| reissbaker wrote:
| Yeah, I wrote that badly. It's easy for me to believe
| they're _less_ valuable. I really meant "One could argue
| that they're useless, but that seems hard to believe in a
| competitive market."
| megablast wrote:
| Does advertising create an increase in buying your product.
| That's the most important question.
| [deleted]
| monkeybutton wrote:
| At least with ecommerce one can track users that have seen
| and/or clicked on ads with what they have purchased and
| return on ad spend can be calculated.
|
| But yes, the question still is: does it raise intent or did
| the user already want the thing, googled it, and clicked on
| the first result (which is your ad, above the organic
| results that also lead to your online store)?
| dlp211 wrote:
| The fundamental problem with this is that if I bought
| your product, it's because I was looking for your product
| after doing a decent amount of research which meant I was
| on a bunch of retargeting lists and you've wasted money
| on me. I have never to my recollection purchased anything
| because of an ad. If I have clicked through an ad, it was
| simply because it was the quickest way to get to the
| website/product.
|
| There is a role for advertising because Google polluted
| their organic search results with Ads making it harder
| for you to find what you want and forcing you to compete
| for the top Ad spot. I realize that I can only speak for
| myself, but I have never seen any evidence that
| advertising works and I've worked in ad tech.
| secondcoming wrote:
| You've researched every item you buy in your weekly shop?
| You've never bought anything on a whim, or a gift for
| someone else?
| ipsum2 wrote:
| It's pretty clear to see direct causation when using ads
| to promote your product. Promote your product using ads
| for 1 month, then turn off ads and see how many sales you
| get. For a majority of e-commerce, you'll see a
| substantial drop.
| Aeolun wrote:
| If you are sinking $100M in, I sure hope it's having some
| effect.
| LoSboccacc wrote:
| You're also bidding for eyeballs. An established player
| might want to scoop up the most relevant keywords forcing
| competitors to at least price match, effectively starving
| them either of views or cash
| asdfasgasdgasdg wrote:
| Maybe the person is referencing how difficult it is to
| determine the value of the counterfactual? If it were
| possible to determine I imagine people would really want to
| know.
| wonnage wrote:
| There's still value in getting people to buy _now_ instead of
| maybe buying later.
| joe_the_user wrote:
| The thing about the "advertising doesn't matter" argument is
| that there are situations where advertising absolutely
| matters - when a company is just starting out and there's no
| way they can get organic referrals, when the public is
| unaware of their existence, etc.
|
| Moreover, most companies started small at some point so
| advertising and maintaining advertising made sense up to a
| point.
|
| And if we look at those companies where maybe advertising
| actually doesn't help, companies that have reached a level of
| success where organic referrals and public awareness drive
| most of their business. And they're ongoing businesses that
| probably reached that level through advertising and have
| money now to use for that.
|
| But not only are they already advertising but they don't if
| their word-of-mouth/public-knowledge presence will last
| indefinitely, they don't know if just word-of-mouth would let
| them control their image, would stand-up against future
| competitors ads and so-forth. So, even supposing you could
| show advertising didn't offer any immediate increase in
| customers, continuing to spend on it doesn't seem to me as
| irrational as it sounds.
| polyomino wrote:
| Also Uber would benefit from a higher price of advertising
| for upstart taxi companies.
| raverbashing wrote:
| This is the point that a lot of people are missing
|
| Uber shows up in the news and in conversation every day.
| Most people have heard about it by now. Very few people are
| going to install it because they saw an ad.
|
| Not the case for your neighborhood "Bob's Burgers" or "Uber
| Competitor" or some other new company. Or for specific
| marketing actions of known companies (promotions, new
| services, etc)
| ghaff wrote:
| Furthermore, many of the people who say they hate
| advertising also hate PR and other sort of marketing
| campaigns. So presumably their theory is that people should
| build something and just hope people will discover them
| somehow.
| shadowgovt wrote:
| It's a subset of the misunderstanding of "meritocracy"
| that defines it as "how well you can do at a narrowly-
| defined task" as opposed to the practical definition of
| "How many people know how well you do at a narrowly-
| defined task."
|
| Our industry is shot-through with idealists who believe
| meritocracy should be the former, when in reality it's
| always been the latter (and always will be, unless
| someone can invent omniscient humans).
| ghaff wrote:
| Well, and arguably, "How many people know how well you do
| at a set of tasks that are broadly relevant to them."
| Nextgrid wrote:
| > Furthermore, many of the people who say they hate
| advertising also hate PR and other sort of marketing
| campaigns. So presumably their theory is that people
| should build something and just hope people will discover
| them somehow.
|
| Could it be that people simply don't like being
| interrupted and having their time wasted, whether it's by
| ads, marketing or PR? Just because you have a business to
| grow shouldn't give you the right to waste my time.
| andrewjl wrote:
| That still doesn't address the GP point, advertising
| doesn't matter if you can get customers coming to you
| organically. Business size changes the odds of that,
| irrespective of that if the customers would have come to
| you anyway (and there are ways to know this!) then the ad
| spending was largely a waste.
| secondcoming wrote:
| You misunderstand what advertisers are trying to achieve.
| It's about Brand Awareness. They just want their brand
| out there and seen. Even click-throughs aren't as
| important as they once were. Coca-Cola still advertise
| when they probably don't need to.
| andrewjl wrote:
| I understand the distinction between advertising and
| building brand awareness. It doesn't sound like Uber was
| doing the latter. It also doesn't take away that if
| you're advertising to an audience who'd have come to you
| anyway, you're wasting your money.
| secondcoming wrote:
| Brand awareness must also be maintained, just like human
| relationships! How often do you tell a loved-one that you
| love them? Is once enough, because going by your stance,
| since you've told them already once before you shouldn't
| need to do it again!
| mikeryan wrote:
| I don't think there's a large "advertising doesn't matter"
| camp. For most the real question is around the efficacy of
| certain types of ad buys, ad targeting, SEO efficacy and
| the amount of fraud in the system.
|
| The real problem is that for large companies with brand
| awareness they're starting to find a lot of their spend may
| not be generating revenue. Ebay in the Freakonomics podcast
| turned of about $100M in ad spend with no loss of revenue.
| But smaller, companies usually don't have the
| staff/knowledge necessary to know how and where to use
| their ad dollars.
| PaulDavisThe1st wrote:
| Depends on the timeline. If for financial (or other)
| reasons, they need to "reach the audience ASAP", then sure,
| advertising is likely to be a good or even required move.
|
| But if they want to exploit a more organic growth curve,
| and are in a financial position to do so, then advertising
| isn't so useful.
|
| Ardour is a cross-platform DAW that has been around for 21
| years. Every 2 minutes somewhere in the world, someone
| starts a version they got from us. We've never advertised.
| Barrin92 wrote:
| >when a company is just starting out and there's no way
| they can get organic referrals, when the public is unaware
| of their existence, etc.
|
| I don't think I ever saw a Whatsapp or Telegram
| advertisement in the first few years of their existence.
| There's a lot of software in particular that gets around by
| word of mouth alone.
|
| Necessity for advertisement seems correlated to how unclear
| it is what advantage your product has for the consumer. If
| you make something that's like X but twice as fast or twice
| as cheap you don't need advertisement.
| hnick wrote:
| Ad spend by incumbents will also drive up the price of
| advertising in general since it's a limited resource,
| making an uphill battle for the smaller competitors where
| it matters. It's another moat.
| mumblemumble wrote:
| It's critically important for adtech companies' customers,
| since it's an essential part of determining return on
| investment.
|
| But it's also critically important for both adtech companies
| and data scientists who work in the space to direct people's
| attention away from those sorts of metrics. You generally
| don't want to call the attention of the person who signs your
| paycheck toward the fact that it's all but impossible to
| really know for sure if your service has delivered them any
| net benefit.
| pnw_hazor wrote:
| This is creeping pretty close to the legal definition of
| fraud.
|
| But advertising has had a fair amount of safe-harbor carve-
| outs for over a 100 years or so that are not available to
| other industries. So it is no surprise it continues today.
|
| edit: I hate to say it but the auto-downvoters here on HN
| are approaching reddit levels. Everything I said above is
| true.
| [deleted]
| [deleted]
| aidenn0 wrote:
| It is not fraud to distract from evidence that your
| product might not work. It is fraud to claim your product
| works if it doesn't.
|
| Therefore ad companies are not going to try to prove that
| their product doesn't work.
| pnw_hazor wrote:
| Common law fraud is hard to prove in the US.
|
| All of the elements listed below must be proven. However,
| some of the comments here describe behavior that comes
| pretty close.
|
| (1) a representation of fact; (2) its falsity; (3) its
| materiality; (4) the representer's knowledge of its
| falsity or ignorance of its truth; (5) the representer's
| intent that it should be acted upon by the person in the
| manner reasonably contemplated; (6) the injured party's
| ignorance of its falsity; (7) the injured party's
| reliance on its truth; (8) the injured party's right to
| rely thereon; and (9) the injured party's consequent and
| proximate injury.
| dang wrote:
| Please don't break the site guidelines by going on about
| downvotes. I know they suck, but bilious addenda about
| downvotes also suck, which is why users here are asked to
| restrain themselves from posting them.
|
| https://news.ycombinator.com/newsguidelines.html
|
| Apart from taking threads badly off topic, such
| complaints usually end up as uncollected garbage, since
| often the most unfairly downvoted comments end up getting
| corrective upvotes from users.
|
| https://hn.algolia.com/?query=corrective%20upvote&dateRan
| ge=...
| aaron695 wrote:
| > advertising has had a fair amount of safe-harbor carve-
| outs for over a 100 years or so that are not available to
| other industries.
|
| What safe-harbor carve-out existed 30 years ago for
| advertising that another industry might have wanted
| something similar on?
| pnw_hazor wrote:
| Lying to consumers. Puffery is the legal term of art.
|
| The "reasoning" allowing advertising/advertisers to lie
| is that it is assumed consumers do not believe it.
| jodrellblank wrote:
| > " _edit: I hate to say it but the auto-downvoters here
| on HN are approaching reddit levels. Everything I said
| above is true._ "
|
| It's not that you're wrong, it's that you're boring.
|
| "I knew this years ago, look how my cynicism is superior
| to your naievite" is a boring comment to read. You could
| explain why you think this is any closer to fraud
| compared to selling anything else and claiming it's the
| best in its class, or what safe-harbor carve outs by
| whom, or why they matter more than other effects, or what
| you think should be done to change them, or _anything_
| more substantial than "I'm not surprised". Oh aren't
| you? Great, cool story bro. Except it's not /even/ a cool
| story.
|
| It's old man "get off my lawn". It's every tech forum's
| old-man status grabbing which is now approaching Reddit
| /r/SysAdmin levels on HN. The only question is whether
| aggressive downvoting can curb its growth here before it
| gets a choke-hold.
| stevespang wrote:
| Ehhh, get off my lawn, arsehole.
| dang wrote:
| Please don't cross into personal attack and name calling.
| It only makes things considerably worse.
|
| https://news.ycombinator.com/newsguidelines.html
| imdsm wrote:
| It's sad to see the downvote culture come here.
| Downvoting is meant for removing contributions that don't
| add much to a discussion, not for indicating whether
| someone agrees or disagrees with you. It seems to be a
| norm that is spreading though, sadly.
|
| It would appear jodrellblank is perfectly demonstrating
| how to misuse the feature, by calling you boring. Not
| exactly the kind of attitude that we want to have around
| here.
| beaconstudios wrote:
| The downvote button should be replaced with an "off
| topic" flag. If downvote is opposed with upvote and
| upvote is understood to mean "I agree" or "this is
| informative" then downvote would be expected to mean "I
| disagree" or "this is bunk". It's semantically
| misleading.
| mumblemumble wrote:
| > The downvote button should be replaced with an "off
| topic" flag.
|
| I hope not. Some of the most informative, useful comments
| I've seen on Hacker News have taken the form of wild
| tangents.
|
| I do see where you're going, though, that if "I agree" is
| sufficient cause for an upvote, then it's only reasonable
| that a vote in the opposite direction should be allowed
| to carry the opposite semantics.
|
| It's just that, from a purely social standpoint, that's
| not actually how human beings typically think, feel, and
| react. Perhaps it could be that simple on the Vulcan
| version of Hacker News.
| dang wrote:
| Oh for sure--wild tangents are fine as long as they're
| unpredictable, which is what makes them interesting. The
| offtopicness we try to avoid are generic tangents, the
| kind where people get sucked into the same argument about
| some topic that they always get sucked into. Those are
| the black holes of internet forums--it's best to steer
| clear.
|
| https://hn.algolia.com/?query=generic%20discussion%20by:d
| ang...
|
| https://hn.algolia.com/?query=whimsical%20by:dang&dateRan
| ge=...
| dang wrote:
| https://news.ycombinator.com/item?id=117171
| beaconstudios wrote:
| To be clear, "off topic" here's just an example. My main
| point was the semantic implication of a downvote - I've
| seen the argument of "downvotes are not meant for
| disagreement" expressed here previously.
| scubbo wrote:
| > It would appear jodrellblank is perfectly demonstrating
| how to misuse the feature, by calling you boring.
|
| I don't have an opinion on what "correct" downvoting
| culture would be, one way or the other, but - if you say
| "contributions that don't add much to a discussion"
| should be downvoted, then isn't a "boring" comment
| precisely one that _should_ be downvoted?
| dang wrote:
| That's not true. Downvoting for disagreement has been ok
| on HN from the beginning.
|
| I realize people have strong feelings about it, but
| that's because of the psychological intensity of the
| mechanism. There's no way HN would survive without
| downvotes, despite the fact that not all downvotes are
| fair. It's a critical part of the immune system.
|
| https://news.ycombinator.com/item?id=16131314
| ascar wrote:
| I also always thought that downvoting should be reserved
| for low quality comments, but I had been corrected and
| even dang said:
|
| _Downvoting for disagreement has always been ok on HN._
| [1]
|
| I don't really like it, but it has always been the case
| on HN. The question is if the community voting behavior
| has actually changed.
|
| [1] https://news.ycombinator.com/item?id=17666145
| mumblemumble wrote:
| From somewhere in the warren of links to dang posts I
| traced out from there:
|
| > I think people have the wrong idea about HN downvotes
| because they think Reddit rules apply to HN.
|
| That one gets me, because I had previously assumed that
| downvoting for disagreement would be a standard Reddit
| thing, but that HN's community is supposed to strive
| toward a more "we're all mature adults here" kind of
| community standard.
| pnw_hazor wrote:
| Downvoting for disagreement is okay? That is new to me.
| Well okay then. I will proceed accordingly.
|
| Thanks.
| TeMPOraL wrote:
| This is the industry whose job is to manipulate and
| deceive people. It should surprise no one that, if they
| do that to others, they'll do that to themselves as well.
| zxcvbn4038 wrote:
| I have noticed the same thing over the last four or five
| months. I've been curious if a voting ring has sprung up
| on HN or maybe a COVID impacted demographic suddenly has
| a lot of time to patrol the site, or if it's something
| else. It would be really interesting to have some
| anonymized voting data to analyze and see how downvotes
| map to accounts, geography, and economic trends over
| time. Though voting data must be relatively huge compared
| to content and I bet it gets discarded after items close
| to replies.
| stevespang wrote:
| There are whole bureaus setup offshore to scan sites and
| down vote or flag anything they deem negative to their
| clients . . .
| Reebz wrote:
| Across this and the other[0] highly active digital ads post,
| there's 3 interesting forces at play:
|
| a) technologists screaming "ads are literally the worst
| societal cost, like ever" who don't _want_ to understand the
| industry
|
| b) advertising folks taking up arms to defend their
| shamanistic, money-printing machines without statistics (Reason
| No. 7 will SHOCK you)
|
| c) A tiny, tiny group of Mandalorian-like voices who have a
| necessary statistics AND industry understanding who are being
| drowned out
|
| (this is in jest, but I double-dare you to say it isn't at
| least directionally accurate)
|
| Other commenters have mentioned it throughout this whole
| comment thread as "incrementality tests". Amongst other
| approaches, this is the way.
|
| Freakonomics severely lack the industry understanding.
| Listening to the podcast was like hearing how HTML is a
| programming language from the kid in week 2 at code camp. Then
| too the article, all the issues with Uber was just doing a bad
| job of managing their ad spend and they can fall into group B,
| noted above.
|
| The baseline of this work is a control group who see no ads and
| then you build your tests from there that factor in channels,
| cohorting, and other components to get a statistically
| significant outcome. Yes, this will get more challenging with
| upcoming privacy changes (IDFA removal, et al). However, the
| last 10 years this wasn't a problem and I'm sure the
| corporations in the identity resolution business will hand-
| shake on a bunch of 2nd party data deals that just move the
| deals done in broad daylight around identity tracking and
| audience creation to the alley. Further, any advertising that
| is tied to an already known customer is able to be backed into
| at an audience level with login and cookie data. Even Pi-hole
| users may not be exempt here.
|
| To finish with some constructive advice:
|
| 1) Advertising is not a synonym for marketing. We're only
| talking about advertising in both HN threads.
|
| 2) Every industry has high and low quality. Pareto's principle
| should be aggressively applied to where one spends their budget
| in the cesspool that is the Internet.
|
| 3) If you're ever seeking an agency to provide advertising
| services and they don't have a qualified data science or
| statistics leader (10+ years work experience, degree in
| Stats/Math/Econ, an MBA, or similar), run. Run from those
| shiny-shoes gurus. Channel your inner Usain Bolt and run.
|
| 0. https://news.ycombinator.com/item?id=25620707
| dillondoyle wrote:
| You can definitely measure 'lift' - though it's far easier with
| online only sales.
|
| For sure it's harder for say Gucci to measure incremental
| cross-platform lift but any good large brand spends big money
| trying to parse it out
|
| One example way to get some value measurement would be
| Facebook's powerful tools. Beyond a basic 1:1 audience 50/50
| exposure test, Facebook also lets you upload offline sales (or
| use their pretty effective pixel for real time online sales)
| and then feed into their system. Using the data your purchase
| data FB matches to ads delivered and you (with PII but also
| purchase value and frequency). Then the advertiser can define
| lookback/conversion definitions to get a measure of incremental
| lift. E.g. those who clicked ad bought __ right away, those who
| viewed ad within 1, 7 or 28 days bought __.
|
| For what it's worth the adtech forums I participate on view
| Uber as incompetent idiots on this issue (which has been
| reported on like last year) - all they had to do was measure
| beyond the initial install for say did these installs actually
| pay to ride...
|
| Install fraud from SSPs and resellers is huge, doing this basic
| measurement and quality control is the reason Facebook and
| Apple have huge and growing app install business. Though TBD on
| Apple fucking over Facebook and keeping the attribution for
| themselves alone with their new privacy features
| bra-ket wrote:
| this looks like self-promotional piece by some uber-woke, far
| left organization trying to 'cancel' conservative voices.
|
| Flagged.
| nutanc wrote:
| We did a similar kind of experiment some time back and found both
| FB ads and Google ads were doing jack shit for us. Google was
| better. FB ads were absolutely useless. So we stopped our ad
| spend. We observed no change in our customer acquisition.
|
| Another way these ad engines extract money out of you is by
| allowing competitors to bid for your brand name keyword. Try
| searching for Ozonetel on Google. There will be six competitor
| ads and then our website will show up :)
|
| In our early days we used to be scared and bid for it.Lost a lot
| of money doing that. Then we talked about it and stopped. Again,
| no change in customer acquisition. Turns out, customers scroll
| down the ads and still click on our website.
|
| Are our competitors getting some of our traffic?
|
| Of course.
|
| But my business is not built on the assumption that people will
| not find my competitors. Its built on the fact that people will
| explore options and try to find the best fit for them. So its ok.
| hn_throwaway_99 wrote:
| If anything, FB ads were worse than useless for my business,
| all they attracted was 90% fraud.
|
| Looking at what business Ozonetel is in (i.e. sales are
| directed towards business owners), I'm not suprised FB ads were
| also worthless for you. I get the sense FB ads are really only
| good for things a consumer might impulse buy (e.g. clothing,
| games, small gifts, etc.) but anything where the user is
| probably going to do some more in-depth thinking about the
| purchase, they're beyond useless. Which pretty much makes sense
| - even if you've drilled down your targeting well for business
| decision makers who may sign up for Ozonetel, it's highly
| unlikely that decision maker is going to really want to know
| more about Ozonetel while they're looking at cat vids and
| fighting with crazy uncles about politics.
| tron27 wrote:
| I work for a retail app and can usually tell when we have or
| haven't been spending on FB ads when I check our usage
| numbers for the week.
|
| They do work but like anything it's about choosing the right
| tool (platform) for the job. We wouldn't run ads on LinkedIn
| and B2B SAAS companies shouldn't advertise on FB/Instagram.
| zpeti wrote:
| Reading this thread I really start to feel people don't
| understand what fraud is. You shouldn't be calling it fraud
| when in the next paragraph you say that FB does work for
| impulse buys and not "ozonetel"
|
| Just because your ads didn't convert, or 90% of the traffic
| you buy didn't convert, doesn't make it fraud. Fraud is
| malice, with the intention to defraud someone and not deliver
| what you promise, with intent. This is completely different
| to you setting a target demographic on FB and Google and it
| not converting.
|
| I imagine most people calling fraud in this thread aren't
| actually talking about fraud, just non converting traffic.
| There could be a million reasons for this. You haven't set up
| conversion tracking, your targeting could be off, or your
| product or landing page is just crap. Calling it fraud is not
| helpful.
| dd36 wrote:
| Here are the California jury instructions for fraud and
| deceit: https://www.justia.com/trials-
| litigation/docs/caci/1900/
|
| There are definitely multiple categories this would fall
| under.
| hn_throwaway_99 wrote:
| You've misunderstood what I wrote. When I'm saying that
| "90% of what we got what was fraud", I mean that 90% of the
| traffic that _did_ convert from FB ads were users that were
| trying to scam us (it was a financial services app), I mean
| literally steal money from us with things like stolen
| credit cards.
|
| The general user quality you get from Facebook Ads is
| atrocious.
| speeder wrote:
| I think you misunderstood what he wrote.
|
| My business also sell only to other business, and Google
| kept calling us nagging us to do some "experiments".
|
| One of them involved enabling "display network" ads on
| mobile.
|
| Like the guy side... it "attracts" fraud.
|
| So, what kind of fraud?
|
| I am not talking about no conversion or no click, I am
| talking about all our clicks, or almost all to the point it
| was impossible to tell the difference, were fraudulent, for
| example most our ad spending was going into a musical
| keyboard app for kids, that has nothing to do with my
| business, despite me blocking the category multiple times,
| the app in question just kept being reuploaded in different
| categories to avoid bans.
|
| When I went to check out the app Google Play page, it was
| rated 1 star, and lots of complaints similar to this:
|
| "App is just a fraud, it keeps opening ads in the middle of
| the song while my toddler is playing to force my toddler to
| click the ads, then it automatically closes the page that
| opened and keep running, using all my battery and making my
| toddler see weird stuff."
|
| So yeah, it is fraud, it is not "failed conversion", it is
| an app conning toddlers into clicking my ads that are
| selling stuff that shouldn't be anywhere near a toddler,
| both the parents and my business were being scammed.
| [deleted]
| TimSchumann wrote:
| > You shouldn't be calling it fraud when in the next
| paragraph you say that FB does work for impulse buys and
| not "ozonetel"
|
| I don't believe they were saying the adds themselves were
| fraud, merely that they had a higher than average
| propensity to attract fraudulent customers.
| edgyquant wrote:
| Facebook ads are the worst from a users perspective. I bought
| a floor mat through them once and for the next week all the
| ads were for floor mats. I just bought one I'm not interested
| in buying another. I bought a PC chair recently with my
| credit card, now I see a bunch of ads for PC chairs, again, I
| don't need another one.
| MaxBarraclough wrote:
| One way to avoid/reduce this is to always place orders from
| a private browsing/incognito window, and to never log in
| using your normal browsing sessions.
| ksec wrote:
| Well no one has a plausible explanation on it yet but with
| some of the highest A/B testing ratio and best Data
| Scientist Amazon too seems to think this works.
|
| And yes I agree it sucks.
| IgorPartola wrote:
| Hah. I remember shopping for a wireless router and seeing
| things like "shoppers who bought this item also
| bought...". Yes, we all buy three slightly different
| models of routers. Good job Amazon.
| lis wrote:
| Actually there is. There is a certain chance that you're
| unhappy with your fridge and you'll return it. So the
| assumption is that you are more likely to buy a different
| fridge than any other item. That's why they show you
| other fridges.
| modin wrote:
| Same thing with kitchen appliances, but not limited to
| Facebook. I'm not going to buy another refrigerator for at
| least 10 years, but still I'm treated as Mr Fridge.
| rtkwe wrote:
| Honestly this might be a good thing, it seems to show
| that ad networks don't have or at least don't provide
| your actual purchase history to the ad space buyers
| because given that info they probably wouldn't be
| spamming someone who just bought a $thing with ads for
| $thing_but_from_us. As annoying as it is it's probably
| better than the alternative of ubiquitous access to your
| purchase history.
| disgruntledphd2 wrote:
| Yup, this is the problem. There is no centralised log of
| what people bought, which is what you'd need to actually
| fix this problem.
| joshspankit wrote:
| A good argument, but it happens on Amazon when the
| search, research, and purchase were all on Amazon.
| htrp wrote:
| ML is pretty shitty at causal inference
| rchaud wrote:
| Yup, I get "buy it again" prompts on nearly all of my
| recent purchases, even when they are all durable goods
| that don't expire or require restocking, like say a
| tablet case.
| edgyquant wrote:
| Well we know these places buy your credit card history,
| so it's more proof that their ad system is shitty and
| their customers should make a fuss.
| mathw wrote:
| Amazon enjoy that kind of thing too. Look at a product
| page, Amazon ads become for that product or similar ones.
| Buy it, and... they still want me to buy another one. And
| they wonder why people use ad blockers...
| Mauricebranagh wrote:
| And the emails! I keep getting suggestions I just brought
| a copy of a book why on earth might I want to buy another
| copy the next week.
| detaro wrote:
| I've seen the theory floated that people return so much
| stuff that shortly after buying a thing you are indeed
| most likely to buy another, slightly different one of the
| same kind, and that explains the weird categories where
| it happens. (and for lots of things Amazon sells
| recommending similar items does make some sense, although
| I would expect a bigger spacing in time sometimes.
| blaser-waffle wrote:
| Also that brand satisfaction is related to how it
| performs relative to other offerings. If you just dropped
| $44k on a new vehicle, they want to make sure that you're
| seeing fancy cars, thinking about how nice and luxurious
| they are, etc.
| aasasd wrote:
| I have an established personal opinion on this, and the
| opinion is that I'm glad that things are this way. It means
| that ads are pretty dumb and relatively harmless so far and
| I can easily ignore them. Floor mats? Tough luck bud, I
| just bought one.
|
| Now, when the ads begin predicting what I would want the
| next day--that's when I start worrying.
| TriNetra wrote:
| > For ex, one ad network launched "battery saver" style apps in
| Google Play, giving them root access to your phone.
|
| > When you type the word "Uber" into your Google Play, it auto-
| fires a click to make it look like you clicked on an Uber ad
| and attribute the install to themselves.
|
| Isn't above an example of a criminal intent of deliberate
| fraud?
| pjc50 wrote:
| Yes, and? How on earth are you going to even explain it to
| the police, let alone find which jurisdiction to use?
| yreg wrote:
| You are buying it from some vendor, their company is
| invoicing you. You can use either your or their
| jurisdiction, whatever fits better and you can also sue
| them directly.
|
| You explain it like:
|
| >For ex, one ad network launched "battery saver" style apps
| in Google Play, giving them root access to your phone.
|
| >When you type the word "Uber" into your Google Play, it
| auto-fires a click to make it look like you clicked on an
| Uber ad and attribute the install to themselves."
|
| You don't have to be a genius software engineer to
| understand that.
| fegu wrote:
| Usually you will have to choose the jurisdiction of the
| party you want to take to court. This is part of the
| reason some regulated industries require you to have
| presence locally.
| yreg wrote:
| Ah right, usually you can sue on your home turf only if
| there's a treaty for it (e.g. when both parties are based
| in EU).
| iamacyborg wrote:
| Ad fraud is HUGE online.
| disgruntledphd2 wrote:
| In display, at least. It's not massively common with either
| Google or Facebook (assuming you avoid their networks),
| which is part of the reason that both of them make so much
| money.
| iamacyborg wrote:
| I don't think that's true, just that fraud is different
| on those platforms. I suspect it depends on how you
| define fraud but certainly if a platform tells me I'm
| bidding to show adverts to customers who match criteria
| X, then I expect them to match that criteria.
|
| Unfortunately, that's frequently not the case.
|
| https://pubsonline.informs.org/doi/abs/10.1287/mksc.2019.
| 118...
| supernovae wrote:
| Twitter has been by far the worst ad spend i've ever seen. When
| I complained that the clicks i got weren't real people, they
| blamed the landing page. I was advertising to 3 keywords "free
| astrophotography data" and the landing page was 0 ads, 0 popups
| and a link to free data to download.
|
| They charged me for the ads, I complained to credit card
| company and did a charge back and they never followed
| through...
|
| in fact, they offered me more credit to try advertising more.
|
| For the life of me, I'm not sure how you can pay for 1,000
| clicks to a very specific keyword and not have a single person
| download anything. The download was also valid for any user
| type. If you were on a mobile device, it showcased data that
| you could see on your mobile phone vs requiring a tool to
| download XISF or FITS data - it allowed you to download the
| high res image(s) in native iOS/Android formats.
|
| Beyond the improbability of landing page being junk, Google
| analytics didn't fire for the majority of the traffic and
| twitters response was "the landing page may be too slow"
|
| the landing page was < 1 second load times even within the
| twitter iframe nonsense.
|
| anywhoo... the same ads on facebook, bing and google all had
| 75% click through and downloads but there were still a ton of
| clicks that had no analytics, no web time, didn't load anything
| in web analytics that we got charged for too...
|
| the whole thing seems like a scam
| ajit_singh wrote:
| Great initiative. Frankly most organisations continue spending
| on digital ads despite seeing diminishing returns because they
| have had hired people, often at the VP level to do just ads.
| These people obviously have to justify their salary so they
| forcibly convolute numbers to attribute some revenue to justify
| what they do- which is running ads.
|
| They randomly change distribution models, ignore the bot
| traffic, and present eye candy line graphs to show "tremendous"
| impact from ads. And this keeps on running until cash graph
| goes below the threshold and CEO goes into the "introspection"
| mode.
| collyw wrote:
| One place where I worked spend a lot on ads, but they also
| hired some marketing people and a leads conversion person who
| seemed to be able to quantify how much return on investment
| they were getting from ads.
| somedude895 wrote:
| Thing is, everybody involved has an interest in making the
| numbers look good. And it's really easy to make them look
| good even without faking anything. Just omit the fact that
| you're counting post view leads, stretch the lookback
| window, etc
| roenxi wrote:
| Prefacing this with an acceptance both that HN culturally has
| US management principles and that I've got no idea how to run a
| business...
|
| Why is it an initial assumption that customer acquisition and
| ad spend are linked short or even medium term? That doesn't
| seem right.
|
| When I see an ad for washing machines it doesn't make me run
| out and buy a washing machine. It gets me familiar with Samsung
| the brand so in 6-12 months when I buy a washing machine I am
| familiar with Samsung and buy their brand. Or it means that if
| my washing machine starts to sputter I'm more confident knowing
| where to go to buy a new one.
|
| It doesn't seem enough to stop advertising for 6 months and
| claim no damage is being done. It seems well understood that
| repeated exposure to a brand has a powerful effect on humans.
| manigandham wrote:
| You're correct on that. Large scale ad spend is divided into
| "branding" (creating awareness about the company and
| products) and "performance" (leading directly to a sale). The
| performance category has many factors including the path to
| the actual conversion/sale and how many steps are in the way
| and how long it takes. It can be instant (clicking a buy
| button in the ad itself) or many months.
|
| Optimization is part of the process to ensure wasteful
| spending is reduced as analytics and sales data is generated
| but unfortunately the biggest issue is the people who
| actually run these campaigns. Lots of politics, perverse
| incentives, lack of skills, and general apathy.
| nebolo wrote:
| That's fine - that's awareness marketing and if you want to
| do it with online ads that's up to you. But then you should
| consider it compared to your other awareness marketing
| channel.
|
| But the promise of performance marketing is exactly this
| immediate connection between ad spend and performance (i.e.
| sales).
| bitcharmer wrote:
| Don't know how much of that is true as I am not a
| practitioner but when I was studying marketing we were taught
| this (continuous brand awareness reinforcement) only works
| for FMCG.
| pvorb wrote:
| So this is arguing against GP's point since a washing
| machine should last for several years and is not fast-
| moving, right?
| bitcharmer wrote:
| Yes, that's correct
| roenxi wrote:
| Uber is about as fast-moving a consumer good as it gets. Up
| to the local speed limit.
| drevil-v2 wrote:
| Well then it becomes a question of attribution. How do you
| with a finite amount of dollars to spend on advertising know
| if you are getting your money's worth when you cannot connect
| a dollar spent on ad with incoming revenue?
|
| Sure in broad strokes you are probably right that brand
| awareness has ROI positive in the long term. But then why
| would you buy targeted advertising vs a giant billboard on
| the main road?
| pfranz wrote:
| This quote is over 100 years old, "Half the money I spend
| on advertising is wasted; the trouble is I don't know which
| half."
|
| To more specifically answer your question; I imagine they
| have some sort of strategy with advertising. A billboard
| campaign might work. I always see Barracuda ads in
| airports, but nowhere else. Soap operas are named because
| soap and consumer products advertised to homemakers during
| the day. Even when using a broad brush you look for the
| best use of your money and target your audience.
| iamacyborg wrote:
| > Well then it becomes a question of attribution. How do
| you with a finite amount of dollars to spend on advertising
| know if you are getting your money's worth when you cannot
| connect a dollar spent on ad with incoming revenue?
|
| The problem with attribution is that it's entirely flawed.
| Just compare what Google Analytics reports for a campaign
| vs what Facebook is reporting for the same thing. They'll
| give you different results and in most cases you probably
| shouldn't trust either.
|
| BUT, what they do is provide an easily accessible number
| that you can show your boss to show you had results. This
| is massively flawed but most marketers don't understand the
| mechanics of advertising or tracking well enough to
| understand why they're reporting garbage data.
| austincheney wrote:
| In online marketing/merchandising online advertising is very
| alluring for two reasons: immediate feedback and the few key
| players are well known. Essentially online advertising makes
| a marketing team's life much easier even though it could be a
| net negative for the business revenue.
|
| When I was doing some work in this space for Travelocity many
| years ago the biggest problem was cannibalism of data and
| traffic. Yes, the traffic coming in from ads was shitty and
| generally costs more than it returned, but even still
| cannibalism was the bigger problem. We would have been better
| off taking all the ads off the site and spending money in
| other offline venues. It was so apparent that ad spend was a
| drug addiction. I still don't understand how this was a
| mystery to anybody in management considering the strength of
| the brand and the success of their television ads.
|
| Eventually the business imploded and the partner/affiliate
| segment became more valuable than the core business partially
| because it was absent online ad spend.
| danpalmer wrote:
| I think it's worth countering this with the fact that FB ads
| work very well for us at Thread, because in the HN echo chamber
| it's very easy to lose sight of this.
|
| This is going to depend entirely on the product and the market.
| We're B2C, and a very "personal" service rather than a service
| for one's professional life, so that probably helps. Plus our
| target market isn't defined by being tech-savvy.
|
| As with all channels, optimising for customer acquisition (not
| just clicks), and lifetime value (not just easy sales) is
| critical for the long term health of the channel.
| efreak wrote:
| Tip: URL suggestions are rarely advertising, and pop up faster
| than the results page does. Check the suggestions before
| searching.
| bdefore wrote:
| Too much to hope for: a Chromium fork to have the search hint
| dropdown provide suggestions + Duck Duck Go results. And
| maybe block the enter key unless a resolvable address had
| been entered to prevent inadvertent Google searches.
| maxwelljoslyn wrote:
| I had a hunch and looked at MDN's list of web extension
| APIs.
|
| https://developer.mozilla.org/en-US/docs/Mozilla/Add-
| ons/Web...
|
| It seems like you could implement your described behavior
| as a cross-browser extension, for everything except Safari
| (and Android Firefox -_-). Easier than forking Chrome! :)
| takeda wrote:
| What's the point of listing Edge or Opera? Is the same
| damn browser as Chrome after they forgo their engines.
| bdefore wrote:
| Thanks. It does seem tantalizingly there. Now that I've
| pondered it a bit more I think what I want is a one-way
| direction from Google's suggestions into an ad-free
| browsing space. The omnibox is a bit of a misdirection.
| phire wrote:
| In my experience, the loss of conversion to competitors was not
| the problem with google ads on your brand.
|
| The problem was phishing attacks on our customers.
| KingOfCoders wrote:
| Luckily bidding on your competitors name is illegal in Germany.
| We did get our competitors to not do that with some letters
| from lawyers.
| baybal2 wrote:
| I always thought that it was clear cut decided by Interflora
| case in EU court, and that such bidding is only prohibited if
| impersonation happens.
| KingOfCoders wrote:
| IANAL
|
| In Germany there is a law against dishonest competition,
| called "Gesetz gegen den unlauteren Wettbewerb".
| exikyut wrote:
| Serendipitous but of anecdata... was curious where you were
| located (ah, CA), so googled :) aaaand my keyboard decided I
| wanted, uhhh, "ozometel" (???).
|
| _Did you mean: ozonetel?_
|
| Nice.
|
| (Gboard bit me again while typing it out here too lol)
| riverdroid wrote:
| From my limited experience, resources are better spent to SEO
| to boost ranking. Also, you can request review on google ads
| keywords to prevent competitors from using your name,
| especially if you have a trademark.
| somedude895 wrote:
| You can keep them from using your brand name in their ad
| text, but you can't keep them from bidding on and showing up
| on searches for your brand.
| nuclearnice1 wrote:
| > searching for Ozonetel on Google. There will be six
| competitor ads and then our website will show up :)
|
| Tried it. One ad. From ozontel.com
| kroggen wrote:
| It appeared 2 ads for me, the first one very big with 3
| clickable links
| seanmcdirmid wrote:
| One ad from dialpad for my try.
| ARandomerDude wrote:
| But we all tried it. So that was either a mistake or pretty
| good advertisement from the op.
| wraptile wrote:
| I've got two ads: salesforce and weeloy.
| davidmurdoch wrote:
| Same
| [deleted]
| dexterdog wrote:
| You still see ads on Google?
| throwbacktictac wrote:
| Strangely enough my ad blocker had been disabled and I didn't
| get any ads for Ozonetel. Perhaps it's because I'm searching
| from Philippines.
| Akababa wrote:
| ozontel.com doesn't exist. Is that a typo or did a competitor
| really buy ads to a nonexistent domain?
| nuclearnice1 wrote:
| good eye. That's a typo on my part
| rofrol wrote:
| ozonetel.com
| joeblau wrote:
| Hah, I saw Ozonetel Alternative - Dialpad(r) Official Site...
|
| So Dialpad.
|
| Pretty sneaky Dialpad lol
| nutanc wrote:
| We recently launched in the US. Nice that Dialpad has
| noticed us. All the best to them :)
| srtjstjsj wrote:
| It's not sneaky to compete in a marketplace.
| rlayton2 wrote:
| I'd argue it _is_ sneaky to put the competitor 's name
| first, as most people will click quickly to move on to
| the website.
| amarghose wrote:
| Disagree in this specific situation (generally yes) -
| "XYZ alternative" is about as clear language as you can
| get. Nothing sneaky about it.
| Dylan16807 wrote:
| People click through search results really fast. "XYZ
| alternative" would be much more acceptable if it came
| after the real name, but putting "XYZ" as the very first
| word is guaranteed to cause confusion.
| throwbacktictac wrote:
| The result can be split two ways. Either the advertiser
| wasted money on a click because the consumer will seek
| out the true XYZ. Or the consumer will be satisfied with
| what they've clicked and choose to buy it.
|
| Hopefully the metrics show that the latter is mostly
| happening.
|
| It's only fraud if the advertiser counterfeits XYZ's
| brand on their website.
| Dylan16807 wrote:
| I'm worried about trademark law, not fraud per se, and
| consumer confusion is the gold standard.
|
| The ad can violate trademarks even if the site behind the
| ad is squeaky-clean.
| rjmunro wrote:
| Trademark law does not stop you saying "my product is
| better than X". It only stops you saying "my product is
| X".
| Dylan16807 wrote:
| Generally, yes. But if a large fraction of people are
| getting confused in a specific context, then you can say
| "don't word it that way", even if the wording is true
| when you consider it in a vacuum.
|
| If putting the other brand name first causes consumer
| confusion in certain places, that's a problem, even if
| they're not lying or even doing it on purpose.
| underdown wrote:
| If ozonetel is trademarked it's generally against Google
| Ads TOS for competitors to use the term in ad copy. File
| a complaint.
| 40four wrote:
| Ok you guys made me curious, so I tried to. I got Ozonetel at
| the top, zero ads! I win! :)
| kalyanganjam wrote:
| All results related to Ozonetel and zero ads
|
| https://imgur.com/a/q70nShf
| wtn wrote:
| I saw Dialpad
| ashtonkem wrote:
| Honestly, the way that ad companies treat brand specific search
| terms has a whiff of fraud to me. Surely Google is well aware
| that by the time an end user is searching for a brand, they
| have _no_ interest in anything else; they just forgot the
| specific URL. If I ever found docs encouraging such behavior, I
| 'd upgrade it from "whiff" to "pants on fire".
| swiley wrote:
| We're probably not in your target market but most people here
| probably know anything marked with "ad" is very likely to
| contain malware and probably won't click it even if they think
| it goes where they want.
| nl wrote:
| This isn't true. Google search ads are rarely malicious -
| Google does a pretty good screening them.
| kirill5pol wrote:
| I have recently been getting straight up spam ("you won 1
| million dollars!" type) as ads in Gmail. No idea how these
| managed to show up when these would have been easily marked
| as spam if it was an email.
| jtbayly wrote:
| So would 99.9% of ads. In fact, that's what spam is--an
| ad.
|
| The difference is that Google got paid for one and not
| the other. Pay them the protection money, and they'll let
| you through.
| dannyw wrote:
| I disagree. When searching for crypto related terms, more
| often than not I see phishing sites as ads than legitimate
| ads.
| fwip wrote:
| The whole cryptocurrency field is scamming. Phishing is
| just a little bit more obvious about it.
| Grustaf wrote:
| That is inevitable since 99% of crypto sites are scams...
| srtjstjsj wrote:
| What are some examples?
| [deleted]
| Grustaf wrote:
| Google ads are just links to sites, there's absolutely no
| malware.
| drusepth wrote:
| While Google does admittedly do a much better job
| preventing malware-ridden sites from running ads (for very
| long) than most platforms, to say there's "absolutely no
| malware" is a bit disingenuous when there do exist some
| sites with exploits and/or malware that manage to get ads
| in search results. The ad itself might not have malware,
| but the site it links to sometimes does.
| Grustaf wrote:
| Yeah that's what I meant, clicking the ads will always be
| just as safe as visiting the sites themselves, you can't
| really ask for more than that.
|
| EDIT: I suppose you could ask for more, you could do as
| you hint at and not even link to sites with malware I
| suppose.
| matkoniecz wrote:
| Why you think that website are unable to control malware or
| other harmful payloads?
|
| In form of directly executing code or something encouraging
| to download and run programs containing it.
| crossroadsguy wrote:
| That's at least something related being offered :)
|
| When I searched for a very specific pillow type (and added
| country name to the search to get local results) I get this as
| first result on Google https://i.imgur.com/Fxx9b80.png. It's a
| mattress/pillow start-up/brand in India. The ad shows the exact
| thing I am looking for.
|
| But when I click, and I am redirected to the actual product
| page https://i.imgur.com/eI6sNtJ.png that has none of these
| features and the product description is completely different
| from what it shows on Google Search result page.
|
| I had reported this to Google sometimes back and nothing
| changed in their SEO gymnastics the last time I had checked a
| couple of weeks later.
|
| I think what they are doing is fraud (wrong? unethical?). But
| what really annoyed me is it wasted a lot of my time as I
| thought I was doing something wrong and probably they actually
| had the product I am looking for.
| Mauricebranagh wrote:
| SEO isn't Paid its a different channel
| 1f60c wrote:
| > Try searching for Ozonetel on Google. There will be six
| competitor ads and then our website will show up :)
|
| DHH (of RoR and Basecamp fame) has been beating the drum about
| this for a while now.
| Pxtl wrote:
| I'm surprised that's legal, since they're literally
| referencing somebody else's trademark.
| bhouston wrote:
| I first ran my such Google Ad in 2005. And yeah our
| competitor at the time was pissed.
|
| Google makes money with these so they allow it as long as
| the ad text does contain the trademark.
| srtjstjsj wrote:
| You need to have a thick skin in business. What matters
| are whether consumers are happy.
| notatoad wrote:
| There's nothing illegal about referencing somebody else's
| trademark as long as you're using it to talk about their
| product.
|
| Having a trademark doesn't forbid your competitors from
| talking about you.
| [deleted]
| fredguth wrote:
| The problem is that a lot of times they act like they are
| the trademarked brand in the ad to trick the user. This
| is unethical and should be illegal.
| notatoad wrote:
| That not only should be illegal, it is. Using somebody
| else's trademark in a way that could decieve a customer
| into thinking your product is theirs is like the
| definition of infringement.
|
| But from what I've seen, the vast majority of ads that
| incorporate a competitors trademark are not doing that,
| and making it very clear they are advertising an
| alternative to the trademark being referenced.
| SulfurHexaFluri wrote:
| This seems like a positive thing imo. A lot of adverts
| are formatted as "Tired of x? Check out Y!". I see no way
| this is infringement and its a net benefit to the world
| since it shows people new things without tricking them.
| notatoad wrote:
| Yeah, there's lots of places where IP law is pretty dumb,
| but this is one of those spots where they struck a pretty
| good balance and things are mostly working well.
| hn_throwaway_99 wrote:
| What I think _should_ be made illegal is that Google (and
| others) is essentially collecting another toll even when
| users enter in the brand name of the target business in
| the first place. That is:
|
| 1. User types CompanyFoo (whose real URL is
| www.companyfoo.com) into their address bar, which lands
| them on Google (because Google owns Chrome and pays
| billions for the privilege on other browsers).
|
| 2. Since Google will sell this keywords to others, many
| businesses always bid on their own brand name to ensure
| it comes up first.
|
| 3. Thus, an ad for CompanyFoo shows up first, even though
| www.companyfoo.com is the first search result, so when
| user clicks on the CompanyFoo ad Google takes its cut.
| Again, this is also because Google has done as much as
| possible to make ads as visually similar to SEO results
| as possible - just the teeny 'ad' banner, compare to the
| big yellow box of early Google.
|
| I don't have as much objection for other companies buying
| branded keywords, but the way Google has set up things up
| they are taking their cut from everyone even when they
| are giving very little value.
| SulfurHexaFluri wrote:
| What do you expect should happen? The browser should
| automatically load the first google search result? Google
| should prevent companies bidding on their own name? Or
| that they should make bidding on their own name free?
| harry8 wrote:
| How about they clearly separate search results from ads
| and don't put the ads first.
|
| There was a search engine that got really popular doing
| that. I think they were called Google..?
| fredophile wrote:
| I'm pretty sure that if I typed foo in my browser back in
| the early 2000s I'd go to foo.com or www.foo.com. Now I
| type foo in Chrome, see the logo for foo, but end up at a
| Google search page. This is very clearly a step back in
| terms of user experience.
| Miraste wrote:
| In modern Safari this pattern will often take you
| directly to the website (or some other, non-Google
| website when it guesses wrong). When it works it's very
| nice.
| SulfurHexaFluri wrote:
| I wonder how it works, if its powered by google or if its
| their own search engine in use.
| beefield wrote:
| Well, I think there are two options.
|
| Either Google should take a note from the old days when
| they were not rent-seeking jerks but did no evil and
| actually distinguished search results and ads by placing
| the ads to the side bar.
|
| Or their practical search monopoly and all the
| profitablity from there should be regulated to oblivion.
|
| That's just what I think _should_ happen. The sensible me
| understands that obviously neither is going to happen.
| srtjstjsj wrote:
| You are under no obligation to use Google's browser or
| search engine if you believe it doesn't provide you with
| a valuable search experience.
| mark-r wrote:
| You have no control over the browser or search engine
| your potential customers use.
| npx13 wrote:
| This Google squeez also happens when a company spends on
| offline ad campaigns as often the first action in
| response to an ad is to type the company name into the
| browser. The searcher then arrives at the Google gate
| where friction is applied to divert a percentage of those
| to click on competitor online ads. Google is also taxing
| global offline ad spend.
| nutanc wrote:
| Yes, we have also been beating the drum since a long time.
| But unfortunately our drum is not as big as DHH :)
| pb7 wrote:
| Curious: why do you feel your competitors shouldn't be able
| to do this? If your customers intend to go directly to you,
| why do they not go directly to your site but instead search
| for it on a general search engine? More generally: if I
| search for "apple", what should the first result be?
| Wikipedia or Apple.com?
| ogre_codes wrote:
| When Google used to show organic results front and center
| and made advertising conspicuous, this was reasonable.
| Now that there is a pile of undifferentiated advertising
| on top of organic results, it's borderline fraud.
| aaronmdjones wrote:
| why do they not go directly to your site but
| instead search for it on a general search engine?
|
| Do you honestly expect people to remember the domain
| names of the brands of everything they have or are
| interested in?
|
| My grandmother still searches Google for "google images".
| pb7 wrote:
| Sounds like a pretty valuable service that connects you
| to the things you are looking for. Why do you feel
| entitled to get this for free?
| aaronmdjones wrote:
| What? I didn't ask for anything for free. I'm just
| telling you what happens. Normal people don't remember
| domain names. I'd hazard a guess that half of them don't
| even know what those are. If they want to get _anywhere_
| , they put it into a search engine, even if it's
| something ridiculously common like Wikipedia.
| pb7 wrote:
| That's fine. But if you want to use a service, you have
| to agree to the service's terms. That includes ads that
| appear before results and competitors bidding on ads for
| any search terms. That's just how it works in a rational
| world. It doesn't really matter the reason you had to use
| the service. Otherwise, why is Grammarly a billion dollar
| company? People are bad at grammar, let them live! And
| use the service for free, according to your logic.
| Dylan16807 wrote:
| That's how it works under certain market conditions.
|
| Calling out flaws, or wanting a change, doesn't mean
| people are demanding the strawman you've constructed of
| "exactly like you get today but free".
|
| Just as _an example_ , the people at the top of a few
| organizations could flip a switch and make all the major
| browsers default to nonprofit search engines.
| aaronmdjones wrote:
| Or Google could display ads on the right, next to the
| results, like they used to, instead of putting them above
| the results.
|
| Putting them above the results gets more clicks though,
| and the predatory advertising customers know this.
| nutanc wrote:
| As I have mentioned, I have no problem with my
| competitors being able to do this. The problem is how
| Google buries ozonetel.com below everything else. It
| should be absolutely fine if Google puts Ozonetel as
| first search result(because there is a brand and company
| called Ozonetel), and then puts the ads below that. Its
| win-win for everyone.
|
| "If your customers intend to go directly to you, why do
| they not go directly to your site but instead search for
| it on a general search engine?"
|
| It's because now mostly people(including me) search for a
| brand we know and click on the site. Mainly we type in
| the address bar(without .com) and press enter. The
| default search engine brings up the list and we click.
| pb7 wrote:
| >The problem is how Google buries ozonetel.com below
| everything else. It should be absolutely fine if Google
| puts Ozonetel as first search result(because there is a
| brand and company called Ozonetel), and then puts the ads
| below that.
|
| Sure, and I want to watch a show and then have all of the
| commercials run at then end after I turn off the TV.
|
| >More generally: if I search for "apple", what should the
| first result be? Wikipedia or Apple.com?
|
| So what would your answer to this be?
| nutanc wrote:
| "if I search for "apple", what should the first result
| be? Wikipedia or Apple.com?"
|
| Apple is a common noun in the English language. So I
| would assume the first result to be Wikipedia or some
| site which gives the best details about apples. The
| second result could be Apple.com or whoever has applied
| for the keyword.
| pb7 wrote:
| Thank you for answering. But that is inconsistent with
| what you said about your brand appearing first before any
| ads. In Apple's case, are competitors allowed to bid on
| this keyword, since it is a common noun in English? Why
| or why not? I assume your brand is not a common word in
| the English language but what if it is in another
| language? As you can see, I can continue muddying the
| waters until it's not so trivial to make a decision on
| these things -- especially automatically.
| tobr wrote:
| Now you're comparing apples and Ozonetels. Ozonetel is
| not a common noun.
| LeifCarrotson wrote:
| I'm behind a Pihole and the top result for Ozonetel is
| ozonetel.com. On mobile, there is a "People also search
| for" bar that takes me to Google searches for their
| competitors, but it's mostly the Ozonetel home page,
| LinkedIn, Twitter, Crunchbase etc.
| pests wrote:
| Normal users don't type domains, they type where they
| want to go into the address bar. my aunt will type
| "google" into chromes url bae to bring up the classic
| google search page she knows, and then will continue to
| type something like "jcpenney" into that box.
| srtjstjsj wrote:
| If the site is in her browser history she'll get an
| autocomplete suggestion for jcpenney.com .
| LeifCarrotson wrote:
| One justification might be that it creates an environment
| where everyone but the ad provider loses.
|
| If, hypothetically, Google was more pervasive than it
| already is, and made their ads more intrusive until
| consumers overwhelmongly clicked the highest priced ad
| for a given keyword, and Exotel bought the Ozonetel
| keyword, Ozonetel would have no choice but to buy ads for
| its own name. They could also buy ads for the Exotel
| keyword. The two could get stuck in a bidding war,
| wastefully sending money to Google when the optimal thing
| would be to _just send users to the site they 're trying
| to reach_.
|
| We're long past the point where you should expect users
| to try to guess domain names and to pretend that Google
| is just another general-purpose search engine. That
| universe could be nice but we don't live in it.
| nutanc wrote:
| This is exactly what happened and a bidding war
| started(long time back).
|
| And then we decided to step back from the bidding war.
| One reason to do so was because we did not have VC funded
| money. If we had VC money, maybe we would have continued
| the bidding war. But glad that we could make the right
| choice.
| [deleted]
| porknubbins wrote:
| As a practical matter, search is how 99% of everyone gets
| to everything. Even if the browser fills in http:// for
| me so I can just type a name to get a complete URL why
| would I risk misspelling or mis-domaining a URL and
| possibly getting a fake or time wasting similarly named
| site? It doesn't really matter whether the apple wiki or
| apple.com comes first because there is no chance I will
| confuse the two (unlike, say competing online furniture
| companies).
| srtjstjsj wrote:
| If you trust Google more than your browser and your own
| self, surely they deserve to make money off the hard work
| they put in to earn your trust.
| eropple wrote:
| 1) Not if that goes to a place that isn't the best answer
| for it, as expected by a normal person not paid by Google
| or purchasing Google advertisements. Might this threaten
| the ability of Google to screw with smaller companies for
| money? Darn, that's a shame. They'll have to make only a
| transcendental amount of money instead of _all of the
| money_.
|
| 2) Related to the above: Google has decided they want to
| be a critical cog in the body politic. We as citizens get
| to have a say in how critical cogs in the body politic
| function. If Google doesn't like that, Google should not
| put themselves in that spot. We can help them with that
| if needed.
| latexr wrote:
| > If your customers intend to go directly to you, why do
| they not go directly to your site but instead search for
| it on a general search engine?
|
| Plenty of people use the search engine as their homepage
| or reflexively open it when making a new tab, and
| searching for the name of the service (you don't have to
| remember the TLD) becomes a habit.
| [deleted]
| utopcell wrote:
| > Another way these ad engines extract money out of you is by
| allowing competitors to bid for your brand name keyword. Try
| searching for Ozonetel on Google. There will be six competitor
| ads and then our website will show up :)
|
| Fact checking you: On Google, I see at most a single ad (on
| most refreshes for Ozonetel, on one occasion for something
| called dialpad, on some cases, no ad is shown) and then your
| website, whatever it may be. It would seem that you are trying
| to piggyback on this article's discussion to increase awareness
| of your brand, which is not cool.
| f430 wrote:
| Google is by far the most problematic. You are paying ridiculous
| amount of money for a click you don't even know came from a
| legitimate source.
|
| There are many many botnets out there undetected running headless
| chromium browser instances that is indistinguishable from a real
| one.
|
| So if you can't tell and then you will never know if you are
| paying for legitimate prospects or not.
|
| However, advertising for established brands direct response isn't
| what they are going for rather brand awareness
| drno123 wrote:
| So, somehow blackmailing a company to stop buying advertisement
| at another company you disagree with turned out to be a good
| thing.
| gnu_beskar wrote:
| There is this nice book on the subject called Subprime Attention
| Crisis by Tim Hwang, on why the whole ad industry might be a
| bubble.
|
| And this Freakonomics podcast episode on digital advertising
| https://freakonomics.com/podcast/advertising-part-2/
| BillyBlazkowicz wrote:
| liberals are the real enemy.
| dorkwood wrote:
| I read a news article yesterday that had the same ad repeated
| roughly 20 times. Would the metrics show a separate impression
| for every one of those ads I scrolled past?
|
| Also, despite the repetition, I don't remember what it was for. I
| think it had a photo of a woman outdoors.
| janmo wrote:
| I think Uber is to blame here, reading the story it is obvious
| that they bought ads from very shady sources/networks, probably
| they went for the cheapest CPC. You get what you pay for.
| justin_oaks wrote:
| In reality, you get AT MOST what you pay for. There are plenty
| of cases where you get much less, or nothing at all, for what
| you pay for.
|
| This story goes to show that.
| onion2k wrote:
| "You get what you pay for" doesn't mean you deserve to be
| defrauded for choosing the cheap option.
| the_pwner224 wrote:
| On the other hand, if you pay someone $20 to buy a brand new
| ApplePhone 12 XS Max, you should expect to not get the phone.
| The Twitter didn't mention anything about price; and it is
| possible that the fraudsters were actually charging a normal
| market rate; and nobody _deserves_ to be defrauded for trying
| to get something for cheap; but if Uber was taking the
| cheapest option then it 's hard to feel sympathetic towards
| them - they're a big company with lots of marketing people
| and they should know better.
| kerng wrote:
| Might be a possibility to disrupt the ad business. FB and Google
| might be paid tons of money for providing little value or maybe
| even toxic value.
| Out_of_Characte wrote:
| Off topic but why do people make these twitter threads? It is the
| most uncomfortable way of reading more than 140 tokens. any other
| platform is better.
| asah wrote:
| A lot of ad spend isn't about positive ROI but "being in the
| game," i.e. if you _don 't_ advertise then customers, suppliers
| and partners all perceive you as a market laggard. That
| perception has major consequences. For example, the top technical
| and managerial talent goes to your competitors.
|
| But there are companies that do little advertising - they have
| other ways of building and sustaining their brands.
| x86_64Ubuntu wrote:
| I remember reading about ad-fraud on HN. I can't find the post,
| but they were talking about "ad attribution" and how the ad-world
| has items that may have _some_ statistical meaning, but it gets
| lost in the sales pitch. They ended their post by talking about
| how the bottom will eventually fall out of from under the ad-
| world in a matter of time. Uber finding this out the hard way
| doesn 't surprise me.
| kabes wrote:
| If ads don't work, how did the advertising industry convince
| people to spend on advertising in the first place?
| phillipcarter wrote:
| Many (most?) people high up enough in an org chart to control a
| significant budget in online advertising are so abstracted away
| from the actual mechanics of that spending and its impact,
| coupled with communication chains that get increasingly
| political (you don't want to say your expensive proposal did
| nothing, after all!) and you get a recipe for shady ad networks
| doing basically whatever they want.
| TeMPOraL wrote:
| They work on the margin, so if your competitor spends on
| advertising, you have to spend as much yourself just to cancel
| out the effects of their ad spend.
|
| As for big brands and brand advertising - the same applies,
| there's just more inertia.
| arsonaut wrote:
| ebay did the same years ago and found out that ads were relevant
| depending on the new/repeat cohort of visitors.
|
| the ad market is looking a lot like the 2008 subprime market,
| lots of opacity, lack of accountability across all actors
| (Agency, platforms, customers). And if we consider how relevant
| is the ad money in making the internet able to run nowadays, this
| starting to be pretty concerning.
| klvino wrote:
| The Uber incident has been known for almost a year. There are
| other instances, mostly undisclosed audits which have shown
| similar results. One audit revealed $220m in ad spend for a
| global brand with a +$500m budget had no impact on their results,
| it was vapor. On the finding of these results, they didn't want
| public embarrassment or the hit to their share price.
|
| Not everyone in the industry is fraud, not everyone in the
| industry is a huckster. But most of the industry is people
| talking up their game and creating a facade, from Brand CMOs to
| Pubs gaming their performance numbers. Fraud can be reduced, but
| few want to engage in the rigor and even less want to recognize
| actual/validated performance when the current fiction suits their
| purposes more easily.
| hugoromano wrote:
| Got a call from our Google Ads account manager to better match
| conversion analytics with Google Ads, after 90 days we found that
| the ads didn't convert at all, no change in sales. End result was
| to suspend our Google Ads budget. The best phone call I got from
| Google staff.
| sanmak wrote:
| This is epic. I believe Google ads is the best. Other channels
| has one or the other issues.
| [deleted]
| greenyoda wrote:
| Related article posted earlier today:
| https://news.ycombinator.com/item?id=25620707
|
| It mentions that other big companies, such as P&G and Chase, also
| noticed that cutting ad spending had no result on their business
| outcomes.
| cbsmith wrote:
| Yup, the problem is advertisers want big numbers more than they
| want ad performance.
| sn_master wrote:
| Can someone explain the tweet for me please? I am really confused
| on what she's trying to say.
| DanBC wrote:
| Uber were running ads, and some of them were appearing on
| Breitbart.
|
| There's a campaign called "sleeping giants" that looks at a
| company's corporate values, and looks at where that company is
| advertising, and asks whether that ad placement is compatible
| with the values. Breitbart has freedom to say what they like,
| but customers of Uber don't have to buy the megaphone.
|
| Uber tried to pull the ads from Breitbart.
|
| But the ads kept appearing.
|
| So Uber looked closer, and they realised some of the data
| reporting was fraudulent. One ad company had a "battery saver"
| ap on Google Play. That ap had strong permissions, and it was
| scanning for people typing "uber" into the Google Play store.
| When they did that the ap made it look like the user had
| clicked on an ad and then installed the Uber app when they'd
| just organically found the uber app themself.
|
| Uber closed off a lot more of their ad spend and they found no
| difference in user signup.
| [deleted]
| sn_master wrote:
| ah, so the investigation into the Brietbart campaign made
| them discover other things completely unrelated to Brietbart
| itself. Thanks!
| misiti3780 wrote:
| How were the ads "slipping thru"?
| joeblau wrote:
| The podcast[1] does a lot better job of explaining what is
| going on than Twitter.
|
| [1] https://www.marketingtodaypodcast.com/194-historic-ad-
| fraud-...
| misiti3780 wrote:
| thanks
| renewiltord wrote:
| Some vendors weren't respecting the Breitbart ban.
| reilly3000 wrote:
| As a publisher and ad network vet, I can vouch that Dr. Fou knows
| his stuff. He's been one of the clearest voices about the
| mechanics of ad fraud. Any engineer would be enlightened at what
| wild escapades have been hacked into DOMs around the world on the
| backs of starving publishers. Any business person would see how
| much ad fraud has shaped the world we live it. He's a fellow
| that's definitely worth a follow!
| acfou wrote:
| thank you!
| ss2003 wrote:
| Wow, Twitter is such a horrible way of telling an important
| story.
| ckelly wrote:
| A root cause of this is an overreliance on Multi-touch
| Attribution (MTA) models, instead of true incrementality
| experiments: https://www.adweek.com/programmatic/lower-ad-fraud-
| will-be-a...
| nr2x wrote:
| I continue to believe the main reason Facebook is scared of new
| iOS tracking controls is people will figure out the CTR is the
| same without the tracking.
| MobileVet wrote:
| Digital ad spend feels like an 'emperor has no clothes'
| situation. No one wants to admit it, but it is highly inefficient
| and fraught with fraudulent clicks / views.
| rm999 wrote:
| Back in the early 2010s I worked in ad tech on a data science
| team, and one of the things we were pushing for was causal A/B
| testing; basically turn off a campaign's advertising to a % of
| people and correlate it with sales to measure ROI.
|
| As we were kicking this off I was at a conference chatting with
| an executive at another ad tech company. His response: "oh yeah I
| know a guy who tried that, he's not in the industry anymore."
|
| We almost immediately came to realize our launch clients were
| getting negative ROI, sometimes severely so. AFAIK our efforts
| fizzled out, and I believe none of the people on my team are in
| the industry anymore.
| saganus wrote:
| I might be misunderstanding... but, negarive ROI? I.e, the more
| they spent on ads, the less sales they got?
|
| Feels like a missed something, as that sounds...
| counterintuivie.
|
| (Not in any way related to the ad industry so pardon my
| ignorance)
| jmfisch wrote:
| As I read it, the amount they were spending on the ads
| themselves was more than the converted revenue from ad
| clicks. While the decline was probably (guessing) not linear,
| spending more on ads led to less than proportionally more
| revenue. If that had happened I can imagine calling that
| negative ROI.
| saganus wrote:
| That makes more sense!
|
| Thanks
| qeternity wrote:
| No. A negative ROI just implies that the ratio of
| benefit/cost is less than one. If I incur a cost/investment
| of $100 but it creates value of $200 then I have an ROI of
| 100%. If this same expenditure instead only produced $80
| value then I would have -20% ROI as in the value I'm
| realizing from my investment is 20% less than the cost of the
| investment.
| alacombe wrote:
| Ratio can't be negative, they can either be above of below
| 1. What you are talking about is "$benefit - $cost", not
| "$benefit / cost".
| [deleted]
| rocqua wrote:
| We tend to call most rations below 1 'negative'. Its
| technically wrong but most people get what you mean when
| you say it.
| ducttapecrown wrote:
| Positive and negative are the right words on a log scale
| :D
| ddulaney wrote:
| ROI is (net benefit)/(cost), where net benefit is (gross
| benefit - cost). Net benefit can be negative, making ROI
| negative if cost exceeds benefit. GP was using benefit as
| a shorthand for net benefit, which can certainly be
| negative.
| loeg wrote:
| Even gross benefit could conceivably be negative, if the
| ads are bad enough! (I.e., a terrible ad might prevent a
| sale.)
| benjam47 wrote:
| Ratio can't be negative, but ROI can. Positive ROI is the
| percentage of the ratio being 1 or higher. Negative ROI
| is the percentage of the ratio being less than 1.
|
| Or, from a "common sense" perspective, if I spent $1000
| on advertising, and earned $100 in revenue from that
| investment, my ROI is definitely negative.
| jacob019 wrote:
| I would expect: ROI > 1 = profitable ad
| spend 0 < ROI < 1 = ad spend does not cover its cost
| ROI < 0 = losing money because of the ad spend (the ad is
| damaging to your brand)
| cmrdporcupine wrote:
| Similar time frame for me, worked at an ad-tech startup, when
| retargeting was first becoming a big thing and we were pivoting
| the startup from the bad business idea it started to to doing
| retargeting as a demand"-side-platform" (DSP) on ad various
| exchanges. Tried myself to confirm whether any of it had any
| positive effect, I couldn't really discern any increase in the
| click-through-rate (CTR) for various approaches, but I'm not a
| stats expert, etc. so talked to the founder about how we should
| employ someone with a stats background. That convo went
| nowhere, and for that and other reasons I was out the door
| within a couple months.
|
| That was the era of the ad-exchange DSP bubble. After that I
| went to work at another company that was on the other side of
| the exchange pipeline and I could see all these DSPs just
| plugging away doing their thing and none of it looked (to me)
| like it was accomplishing much. It was all bottomfeeding off of
| lower quality inventory but I suspect making big promises to
| investors.
|
| That startup eventually pivoted a couple more times and sold to
| a bigger player a few years later, making some money for the
| founder but I suspect no value to the buyer.
| dmix wrote:
| Reading about startups that pivot dramatically multiple times
| make me cringe so hard.
|
| The goal of pivoting isn't throwing spaghetti at the wall
| until you hit something before running out of VC or angel
| money. That just shows terrible product/marketing leadership.
|
| Your prior story is unsurprising combined with that.
| bsenftner wrote:
| As a person with just shy of a stats graduate degree, the early
| 2010's were a nightmare of trying to get ad tech companies to
| grasp their incompetency. I met a dizzying number of slick
| talking frauds and became quite jaded.
| cmrdporcupine wrote:
| Ok good, it wasn't just me being overly negative (because I
| usually am). I am not a stats grad, my math is weak, but it
| didn't look good to me, and I tried to get my employer to
| bring a stats specialist in to analyze. That got a cold
| response.
| syndacks wrote:
| What do you mean by the two references to not being in the ad
| industry anymore? Quit? Fired? Why?
| karaterobot wrote:
| Did they leave the industry because they realized their product
| wasn't providing a positive ROI, or were they fired for
| pointing that out to other people? I think the former is
| probably what you mean, I just want to be sure.
| rm999 wrote:
| Good question. In the first case it was left vague but I
| understood it as being fired and then not trying to find a
| new ad tech job. In the case of my team it was finding better
| industries to work in.
| ben509 wrote:
| Yeah, it could be that many startups try to do advertising
| ethically, realize that it doesn't work, and drop out. That's
| necessarily going to leave all the firms willing to sell
| snake oil behind.
|
| You can get firms selling stuff that doesn't work that are
| "trusted" simply because they've been around for years; there
| are plenty of distinguished brands selling homeopathic
| remedies, audiophile speaker cables, timeshares and MLM
| schemes.
| nodamage wrote:
| When Google replaced mobile app install campaigns with machine
| learning based "universal app campaigns"
| (https://support.google.com/google-ads/answer/6167162?hl=en) that
| give you very little control over the placement of the ads I
| always wondered if they were simply showing ads to Play Store
| users who were searching for the name of our app and charging us
| for installs we would have gotten for free anyway. Does anyone
| have here have experience with UAC or know how to prevent this
| type of thing from happening?
| polote wrote:
| That's what happen when you have too much money to spend and you
| don't take time to evaluate if money is well spent.
| Nextgrid wrote:
| That's what happens when your own job is to waste oxygen, pull
| numbers out of thin air and take credit for "conversions" that
| were organic in reality; in this case you have no incentive to
| optimize things because you'd inevitably show the company your
| own position and maybe entire department is irrelevant and a
| waste of money.
| cbsmith wrote:
| No, it's what happens when the objective is something
| different. The objective is often to get big ad views &
| audiences, not to drive performance.
| ozim wrote:
| ... or deliver value to customers ...
| cbsmith wrote:
| The customers value the big numbers, so...
| johnrgrace wrote:
| I work at a fortune 50 company, a top 10 advertizer. We have a
| universal holdout poplation that NEVER recieves any
| directed/targeted marketing that serves as a control group for
| many marketing programs. Further in more mass areas there are
| direct A/B tests that go on. There is a very strong awareness of
| campaigns that are measurable with ROI's and other programs that
| are general branding that you can see the impacts in gneral
| customer awareness surveys', favorability ratings etc.
| nojito wrote:
| This a flawed way to measure ad spend and roi.
|
| eBay tried what you did and noticed that revenue increase
| didn't warrant the ad spending costs required to do so.
| PragmaticPulp wrote:
| Measuring as spend ROI is standard practice on any large scale
| ad campaign. The trick about having a holdout population is a
| neat twist.
|
| It boggles my mind when HN commenters start claiming that
| measuring ad campaigns is impossible or that ads are
| universally ineffective. Anyone who has spent time working with
| large ad campaigns should know the tools and methods used to
| measure these things.
|
| I suspect the HN sentiment comes from a common feeling among
| techies that they are somehow immune to influence from
| advertising, combined with a high adoption rate of ad blockers.
| HN commenters tend to assume that other consumers are just like
| themselves, which is far from the truth. In the real world,
| advertising (when done right) is not only very effective but
| not that difficult to measure using modern technology.
| johnrgrace wrote:
| Every campaign has TWO holdouts. First, the universal holdout
| who gets nothing from any campaign, and a second additional
| holdout who doesn't get a specific campaign but gets other
| campaigns. We have an entire group of people designing the
| holdout matrix to make sure they are sound and don't cross
| over. That's the elementry school version of things.
|
| The graduate level stuff we run is using decioning engines
| with adaptive models down to EACH email, switching up not
| just offers but also ad copy, images, time of delivery etc.
| that drive VERY complex holdout matrix's which can limit the
| number of things we can test at once.
|
| One of the executive decisions is when or if the drop
| customers out of holdout populations. Usually keep the
| holdout going for X period of time as a standard practice,
| but if a campaign is showing very strong response we might
| drop half the holdout if we can still make a read on
| campaign. We have a formal notice of decision that is
| published when this happens. Holdouts have alot of
| opportunity cost, but finance doesn't see those numbers.
|
| Some of the digital exhaust from our primrary product can be
| used to solve marketing attribution issues for major brands
| in an area that has until now lacked attribution. Our product
| beta is just hitting the market.
| Judgmentality wrote:
| > I suspect the HN sentiment comes from a common feeling
| among techies that they are somehow immune to influence from
| advertising, combined with a high adoption rate of ad
| blockers.
|
| I don't believe this at all. The reason I am skeptical of the
| effectiveness of advertising is despite engaging with dozens
| of people over the years, I have never had a single person
| provide me with convincing evidence that it works. Instead,
| they simply repeat "but of course it works!" similar to your
| comment.
|
| So, where is the evidence?
| thu2111 wrote:
| Google's yearly revenue
| Judgmentality wrote:
| I'm asking for evidence that advertising is an effective
| use of money. All you're saying is that people spend
| money.
|
| By your logic, Scientology and Gwyneth Paltrow are also
| selling the real deal.
| cturitzin wrote:
| I manage advertising spend for a small technology company.
| We spend in the 10's of thousands per month on Google and
| Facebook.
|
| We can measure customer acquisition cost and we do using
| normal tools like Google Analytics.
|
| We've had days where we pause our campaigns, and we get
| fewer new customers that day. We've had platforms pause for
| a period of time because of some issue, and we get fewer
| new customers over that period of time.
|
| It's one data point. I'm aware of plenty of other companies
| with similar results to what we see.
| Judgmentality wrote:
| Thank you. Even if it's only one data point, I appreciate
| it.
| schappim wrote:
| Your Fortune 50 company owns a heap of brands (at least 16+
| active) that span multiple demographics, geographies and maybe
| more importantly self-identities.
|
| Does the "universal holdout population" span across all the
| brands, or do you have a "universal holdout population" for
| each brand?
| johnrgrace wrote:
| There is the core product, accessories, repair parts, digital
| services. Each area has it's own holdout because the sales
| process and channel are different. Channel partners also run
| their own advertizing which gets looked at.
|
| For example: The digital services are an ingredient brand and
| can only really be sold to core product owners so they'll
| have a differnt holdout as their target population is
| different. Also that area has a short measurable path and
| thus different metrics and measurements.
|
| There are some B2B areas that may not have holdouts, they
| functionally don't do any targeted marketing.
| 6510 wrote:
| In the middle of the night I visited a dutch but and sell website
| searching for something specific. The search results, page after
| page, were filled with advertisements from the same auction
| agency. My single visit, clicking though 20 pages produced well
| over a thousand ad impression. I _had to_ click though them to
| find other peoples ads. The next day they were all gone.
| Apparently the budget ran out.
| Nextgrid wrote:
| I really can't feel bad for someone who wants to pay 100M to
| annoy people and waste their time. The "fraudsters" here have
| done a service to society: Uber wasn't satisfied with the free,
| organic growth they were getting and wanted to be more greedy and
| pay 100M to litter the web with ads; the fraudsters took the 100M
| and cleaned up their littering by "consuming" these ads with
| fraudulent clicks while giving Uber the outcome they wanted,
| albeit one they would've gotten anyway had they not been greedy.
| g42gregory wrote:
| This looks like a very significant disclosure on the businesses'
| part. Before COVID-19, there was no reason really to turn-off the
| ad spending just to see what happens (with some exceptions, such
| as Uber in the other article). I was surprised to see that the
| small businesses have experienced the same outcome as the large
| ones. It also looks like at least partially this seems to be
| coming from the mobile advertising. I wonder, how should we
| change our Ad placement strategy as a result of this data?
| [deleted]
| franze wrote:
| I was VP Growth for a fintech for a while. And the one thing I
| learned that Paid Ads are a Trap. Here my open the read medium
| article about this https://medium.com/@franz.enzenhofer/ads-are-
| a-trap-80df01d2...
|
| Tl;dr: money is at best a halfway decent accelerator. And as long
| as you don't massive positive retention just a sinkhole of fake
| growth. And if you have this massive retention there are better
| ways to invest your money.
| sophia_li wrote:
| I've had numerous experiences working closely with big companies
| and small companies' marketing/media buying teams. From my
| experience, these big companies lack the diligence on ROAS. Maybe
| it's the lack of ownership, whereas for smaller companies,
| usually the CEO/COO/Founder(s) on top of their spending and other
| performance metrics. I see much less of a waste on the ad spend
| when it comes to customer acquisition.
|
| For example, I had a company that was spending a million dollars
| a month, they are a big brand, a tech company, their team kept on
| asking why the spend wasn't up even when their CAC was way over
| their target. The team wanted to keep the spend up to meet their
| metrics at any cost, in reality for every customer they were
| acquiring they were losing 50% on ROAS.
| lavp wrote:
| I think all of us know deep down that something about online
| advertising doesn't seem right. I'm still surprised at how big of
| an industry it is given how ineffective it can be. To me it seems
| overvalued.
| ggm wrote:
| For research we made ads which were grey, flat field, and
| basically said "please don't click on me" and we got astronomical
| numbers of clicks sometimes. Hmm...
| netsharc wrote:
| But... reverse psychology works? Wouldn't people be curious
| what's behind the "curtain"?
| KirillPanov wrote:
| A better test ad would be something that looks like an
| obscure website failure/error message, like "404 Ad Not Found
| 18afe4481".
|
| Or even just a copy of the placeholder image $POPULAR_BROWSER
| uses when an <img> link is broken.
| ggm wrote:
| Yea, there's some of that.
| jedberg wrote:
| There was a freakonomics podcast recently about advertising
| (online and traditional).
|
| No one can actually prove it has any ROI at all. No one is
| willing to run the experiments necessary. In the few cases of
| natural experiments, where ads got turned off for some people by
| accident, there was no change in buying behavior.
|
| https://freakonomics.com/podcast/advertising-part-1/
|
| https://freakonomics.com/podcast/advertising-part-2/
| soared wrote:
| I don't understand this line of reasoning. P&G, Unilever,
| Cocacola, etc have never, not once in history, had a gung-ho C
| level exec who said "Screw it, I'm going to find out if our
| advertising works". And then either found it works and kept
| spending, or found out it doesn't work and saved literally
| billions of dollars.
|
| There is so much money at stake that could be either saved or
| generated, its simply not possible that no one has looked at
| it. I used to help Pepsi/Fritolay set up tracking to tie
| advertising on youtube to in-store sales. They spent millions
| of dollars to measure their ads, Google had a clean-room data
| center specifically for pepsi/frito. The idea that no one
| actually checked if this system works is simply not possible.
| TLightful wrote:
| >> The idea that no one actually checked if this system works
| is simply not possible.
|
| Have definitely heard that one before. No disrespect.
| SheinhardtWigCo wrote:
| > Google had a clean-room data center specifically for
| pepsi/frito.
|
| Why?
| soared wrote:
| My company provided sales data from stores to a specific
| team on google that compares it to users who'd been
| advertised to. This team didn't want my company to
| influence results, and didn't want YouTube to influence
| results.
|
| More complicated since there are multiple device graphs/etc
| in play, but effectively tens/hundreds of millions of
| dollars at play and no one trusted anyone. The largest
| thing at risk was YouTube's ad revenue.
| fomine3 wrote:
| But does it need dedicated datacenter? I wonder they just
| run different service instance rather than datacenter.
| morelisp wrote:
| For brands that large the majority of their spend isn't
| campaigns specific to new products, but overall brand
| management. The experiments would need to run for years or
| decades and if the prevailing belief that these are Red
| Queen's Races is correct, the cost if they're wrong could be
| the whole company.
| Ericson2314 wrote:
| Fortune 500 is a cesspool of insane inefficiency balanced by
| equally ~~insane rent seeking~~ insanely secure revenue. The
| sooner everyone understands this, the better.
| jariel wrote:
| The answer is not complicated, and the logic on this board
| is strained by people I think that don't work in marketing.
|
| 1) Advertising works.
|
| 2) Coke, a sugary drink, is largely kept alive by smart
| marketing, that involves mostly advertising in the end.
|
| 3) Much of advertising is quite wasteful, because it is a
| fuzzy instrument - but on the whole, good marketing works.
|
| 4) There is a lot of self-awareness in the industry on
| this, and no doubt, a lot of borderline fraudulent actions
| by participants willingly spending money they know doesn't
| work.
|
| 5) Ad networks will happily sell you ads that don't work,
| and look the other way when there are shenanigans.
|
| The problem here in the thread, is that people are having a
| hard time grasping how all of these things can be true at
| the same time, but it's not that hard really.
|
| That some ad spending turned out to be 'not useful' is 'not
| news' when everyone knows that easily 50% of ad spending is
| probably wasted, we usually just don't know which 50%.
| ksec wrote:
| Agree with most,
|
| >2) Coke, a sugary drink, is largely kept alive by smart
| marketing, that involves mostly advertising in the end.
|
| Not sure I agree. I haven't seen any Coke Cola Ads for
| years, not online digital Ads and I rarely consume any
| traditional media. But I will still buy Coke Cola every
| once in a while.
|
| They are also on all of the convenience store with decent
| positional shelf space or visual merchandising. Something
| I learned that no one on HN actually knows anything about
| during the discussions of App Store.
|
| Edit: All of my friends can taste the difference between
| Coke and Pepsi. It is just different. So I was surprised
| to read comments and youtube video about "blind tasting"
| on the two. No, I didn't drink Coke because of Ads, I
| drink it because it taste better. (And some people prefer
| Pepsi )
| jariel wrote:
| Your personal situation doesn't represent the market,
| moreover, you spent 20 years watching coke ads growing up
| and having coke, it's impossible to tell how that
| affected you.
|
| You saw 1000 'product placements' for coke without being
| aware of it in films other things. Taste is associated
| with familiarity and comfort.
| xpe wrote:
| First, care to define your terms?
|
| Second, inefficient relative to what?
|
| Third, so far, what you've written here looks like a rant,
| not a predictive theory nor a powerful explanatory theory.
|
| Would you like to quantify your claim? Or at least make it
| more precise? As it is, I don't think it advances your
| argument.
|
| I'm interested in strong logic, data, explanations, and
| persuasion. I see none yet.
| Ericson2314 wrote:
| > Second, inefficient relative to what?
|
| The sad thing is it's not inefficiency relative
| comparable things. But anyone that has worked at these
| places or sold B2B to them just knows it on intuitive
| level that they are garbage, and need a heavy sedative to
| think there are no alternative.
|
| > not a predictive theory nor a powerful explanatory
| theory
|
| It's not. It's about letting go of some efficient market
| ideal and _then_ finding new ideas.
|
| We can look at Fortune 500 case-by-case to learn new
| things
|
| > Cola cola
|
| Sugar drug cartel. Despicable business with very stable
| revenue despite being a net drag on society. (At least
| "regular" drugs have a lot more upside!)
|
| > Proctor and Gamble
|
| Just as restaurants are reaching down market, and the
| inefficiency of everyone cooking and cleaning is starting
| to have market implications, we should see their reign
| finally dwindle. Wash-and-Fold should follow laundromats.
| The specialization means that stupid differentiation
| between products for uninformative consumers (c.f.
| https://en.wikipedia.org/wiki/Monopolistic_competition)
| should go away and restaurants and laundromats optimize.
|
| Personal soaps and cosmetics (of course many soaps _are_
| cosmetics) however will stay as cultural reasons ensure
| people will continue to clean themselves and not contract
| that out for the foreseeable future.
| xpe wrote:
| Thanks for elaborating. I don't think I disagree with
| many or most of the points you've made.
|
| It might be interesting to define a systematic and
| testable definition of organizational efficiency relative
| to an ideal market. Just like combustion engines can be
| compared to their theoretical maximum efficiency, it
| would be interesting to compare a particular organization
| against its maximum potential.
|
| Here is another angle on the topic of relative
| efficiency. Consider a particular organization. Coca Cola
| will do as an example. Given its environment (financial
| incentives, regulations, cultural norms, etc), are we
| _surprised_ by its behavior? This raises the question of
| how much an organization 's particulars (e.g. leadership,
| history) affect its efficiency.
|
| I suppose I take a systems view of it. Many deplorable
| businesses survive in niches. But can you "blame" them?
| It is a matter of perspective: organizations, like life,
| adapt to their environment and modify it to their liking.
| Such organizations can stretch the environment to or past
| its breaking point for a relative long period of time
| before having to deal with the downstream consequences.
| Miraste wrote:
| > the inefficiency of everyone cooking and cleaning is
| starting to have market implications
|
| Elaborate on your reasoning here? While I can maybe
| imagine a more centralized food preparation system being
| more efficient, the currently growing market solutions
| (DoorDash, etc.) are certainly not, and I can't think of
| a system in which transporting clothing somewhere for
| someone else to clean would be more efficient than an in-
| home washing machine. The wasted energy alone would be
| colossal.
| kortilla wrote:
| How is Coca Cola rent seeking? How about Apple? I suspect
| you aren't using that term correctly but maybe I'm missing
| something.
| TheOtherHobbes wrote:
| Coca Cola sells water with flavouring and quite
| astonishing amounts of sugar. Apple sells nice devices
| made by what might as well be slave labour.
|
| Both are propped up - actually maintained - by huge and
| vastly expensive brand management strategies.
|
| The criticisms of individual campaigns here are missing
| the point. It's not about micro ad spend, but the
| _perception of value and manipulation of behaviour_
| created by the combined effect of multiple PR and
| advertising efforts - which include traditional print and
| TV /radio ad campaigns, guided advertorials disguised as
| news in the MSM, interviews with prominent figures,
| political campaigns of more or less obvious relevance to
| the core business activity, state, national, and
| international political lobbying, direct political
| campaign donations, advertorials masquerading as
| "freelance" journalism and blogging, managed astroturfing
| on social media, shareholder relationship management,
| product placements in movies and music promo videos,
| articles about commercial visual design elements in trade
| journals. And on and on.
|
| That perception of value is - unsurprisingly - extremely
| valuable. And it's very much a US way of doing business.
| Instead of producing products that are inherently
| superior, produce something that is functional but
| glossily packaged, brand it as a premium lifestyle
| commodity, and charge exorbitant prices for it.,
|
| The prices are traditionally far out of proportion to its
| actual utility. In fact real utility may well be negative
| - see also diabetes and any number of other health
| issues, depression associated with social media use,
| debt-driven spending on lifestyle products. Etc.
|
| So the rent seeking comes from a kind of cultural
| squatting. There is value in dominating discourse in all
| of these different ways, because discourse and narrative
| define markets and ultimately control behaviour. And
| while this is happening other kinds of discourse - which
| may well have more real utility - are diminished at best
| and crowded out at worst.
|
| So in this case it doesn't matter if Uber "wasted" their
| money. Uber have their own branding thing going, and
| explicit ad spend is a tiny part of that.
|
| And even if all online ad spending ended tomorrow, a
| small number of corporations would have a difficult time
| for a while, but the marketing industry as a whole would
| inevitably interpret the change as minor damage and route
| around it.
| mschuster91 wrote:
| > Both are propped up - actually maintained - by huge and
| vastly expensive brand management strategies.
|
| In the case of Coca Cola, I agree - in the case of Apple,
| _not at all_. "Keyboardgate" aside, their products are
| vastly superior to the competition in build quality and
| life time. A typical Windows laptop is unusable after
| two, three years (almost all are made from plastic which
| breaks or looks extremely ugly rather sooner than later),
| and has next to no resale value while in contrast even
| old cheesegrater Mac Pro's fetch many hundreds of dollars
| today. iPhones are supplied with firmware updates _far_
| longer than most Android phones outside the flagship
| Pixel line are. OS X is, while it has gotten locked down
| a fair bit over the last years, still way better than
| Windows as it doesn 't do tracking bullshit and start
| menu ads and decently better than Linux because no matter
| which device, stuff usually Just Works (tm) without
| having to fiddle for hours to get something as basic as a
| Bluetooth headset working.
|
| Apple built themselves a loyal following with pure
| quality superiority over the competition, unlike HP or
| Dell who are only surviving because of enterprises who
| follow the "no one got fired for buying IBM" line.
|
| And that doesn't even touch that it's _Apple_ who 's at
| the forefront of innovation. iPods, iPhones, iPads, Apple
| Watch, AirPods, now the M1 CPU - these entire _device
| classes_ were created by Apple. When was the last time
| you heard about something truly innovative from the
| Windows /MS/Google side of IT? Only thing I can remember
| is the Google Glass.
|
| What Apple is doing is not a "brand management strategy"
| per se - it is _delivering actual value and innovation_
| instead of rent-seeking. And for what it 's worth Tesla
| are doing the same thing.
| Daho0n wrote:
| >A typical Windows laptop is unusable after two, three
| years
|
| This shows that you are just spreading FUD. A Windows
| machine is no slower after 10 years than it is the day
| you bought it. Sure you might have added so much
| software-crap that the software runs slow (which is
| easily fixed) but the hardware is _exactly_ as fast after
| 10 years as Apple hardware is. Do you think Apple builds
| their hardware out of magic and unicorns?
| ksec wrote:
| >but the hardware is exactly as fast after 10 years as
| Apple hardware is.
|
| Capacitor, DRAM, Heat Sink, etc.... There are quality
| difference in hardware. Although the two / three years
| remarks were definitely exaggerated.
| megameter wrote:
| Apple isn't repairable. Apple devices have high prices
| simply because of the brand ecosystem. Old Thinkpads use
| commodity parts - but they command good prices because
| they are repairable.
|
| Marketing the new thing is what Apple does. It is good at
| it. That is not the entire spectrum of customer value.
| shadowgovt wrote:
| Thinkpads are pretty much the worst form factor for a
| laptop that doesn't transition into "toy" space.
|
| Source: forced to use one daily. If I could get a Mac
| laptop running Linux but with the input smarts of the
| Apple trackpad and keyboard, I would in a heartbeat.
| Daho0n wrote:
| That shows that 1) people are different or 2) you are a
| fan of Apple hardware. It doesn't show that Thinkpads are
| bad. IMO they are light-years ahead of anything Apple
| sells.
|
| Source: Me.
| shadowgovt wrote:
| Out of curiosity, how do use it without bumping the
| trackpad while typing?
| paulie_a wrote:
| I recommend a dell xps 13 developer edition
|
| The trackpad is superior to apples and it can come
| preloaded with linux
| Dylan16807 wrote:
| > A typical Windows laptop is unusable after two, three
| years (almost all are made from plastic which breaks or
| looks extremely ugly rather sooner than later), and has
| next to no resale value while in contrast even old
| cheesegrater Mac Pro's fetch many hundreds of dollars
| today.
|
| By "typical windows laptop" do you mean a cheap model
| where the macbook equivalent is buying nothing at all? Of
| course it's going to be lacking in that case.
|
| Well-made windows laptops exist, and hold plenty of
| value. But you have to pay for that, no matter what brand
| you choose.
|
| > tracking bullshit
|
| Like checking signing certificates by pinging servers
| almost every time you run a program?
| gundmc wrote:
| I've been using my windows laptop daily for 5.5 years
| without issue.
| shadowgovt wrote:
| This analysis excludes glossy packaging and status
| signalling from the inherent superiority, when (in terms
| of overall market value) they're part of the superiority.
| xapata wrote:
| And in Coca-Cola's case (among others) the advertising is
| much of what _creates_ the value. When you know it 's a
| Coke, it tastes better. I've had a lifetime of absorbing
| ads that make me think of good things whenever I know I'm
| drinking a Coke.
| Ericson2314 wrote:
| Because the ideology of capitalism is "cooridation
| failure, whatever", It sure would be nice to find a way
| for one of those companies to freeload off the culture-
| shaping the others do, and bring the whole enterprise
| crashing down!
| TeMPOraL wrote:
| Trademark laws exist to prevent such freeloading. In this
| context, they ensure only the ones paying for the
| culture-shaping can benefit from it.
| treis wrote:
| Effectively every restaurant in the US has to pay either
| PepsiCo or Coca Cola. Similarly, if you want to buy a
| non-alcoholic beverage at the grocery store it's mostly
| down to those two (with Dr. Pepper having a much smaller
| but still significant stake). Any competitor that emerges
| just gets bought up by one of the three.
|
| Apple's half of the phone Duopoly. Either you pay them or
| pay Google if you want a phone and want to buy software
| for it.
| ABeeSea wrote:
| Restaurants only pay because consumers demand it and
| would not visit the restaurant otherwise. That's not rent
| seeking. That's market forces. And what they pay
| correlates with how much their customers demand
| coke/Pepsi.
| deelowe wrote:
| The exclusivity contracts are what some consider to be
| rent seeking. I don't know if this is the correct term,
| but I do believe they are anti-capitalist and shouldn't
| be allowed in a capitalist economy. If freedom of choice
| is so important, than large businesses shouldn't be able
| to use their ability to corner the market to force you
| into exclusivity agreements.
| treis wrote:
| The rent seeking is buying up competitors until its a
| duopoly and then protecting that through shenanigans like
| exclusive agreements. It has nothing to do with consumer
| demand.
| ksec wrote:
| Buying up competitor does not immediately make it a
| monopoly or duopoly. Especially in industry where barrier
| of entry are low.
|
| Exclusive / Special agreement with serving only one kind
| of Soda ( or no Pepsi where there is Coke ) are Anti-
| Competitive arrangement. Not Rent Seeking.
| [deleted]
| [deleted]
| Ericson2314 wrote:
| Yes. But in fairness I retracted rent sneaking as a
| combination of monopolization, bonafied rents, addiction,
| and just shear damn inertia contributes to the malaise.
|
| Calling it all "rent seeking" is not a hill I want to die
| one.
| throwaway201103 wrote:
| "Rent sneaking" is an interesting typo. Going to have to
| give some thought to how to use that term in appropriate
| context.
| hncommenter13 wrote:
| I'm not sure this is quite right. I would have thought
| that most restaurants very much WANT to sell sodas, as
| the margins are enormous--much, much higher than the
| margins on cooked food.
|
| This page [0], for instance, says the cost of goods sold
| for the soda itself is a penny an ounce for the syrup and
| CO2. Iced tea is apparently the margin champion, as the
| same page indicates it can cost as little as a penny per
| glass.
|
| [0] https://www.restaurantowner.com/public/Restaurant-
| Rules-of-T...
| mumblemumble wrote:
| The trick isn't figuring out whether advertising in general
| influences people's behavior. The trick is in figuring out if
| any particular advertising campaign generated more profit
| than it cost to run.
|
| Also, there's one alternative that's often forgotten in these
| discussions: Perhaps game theory is at play. It may be, for
| example, that, across entire industries, advertising costs
| more money than it's worth. But that everyone has to do it
| anyway, because anyone who chooses not to will start losing
| ground to everyone else. IOW, just like in the standard
| prisoner's dilemma, choosing to act is less about increasing
| your potential gains than it is about limiting your potential
| losses.
|
| There is an interesting long-running natural experiment in
| the pharmaceutical industry that suggests, albeit
| inconclusively, that this is the case.
| doopy1 wrote:
| Distilling it down into "any particular advertising
| campaign" is pretty myopic in this world. It's about
| strategy as a whole over decades. Not every ad campaign is
| to drive immediate sales or signups (direct response).
| Branding and awareness campaigns can take years to run, and
| these are ALL diligently measured at every stage. Losses do
| occur do to negligence, malice, and poor execution all the
| time, but the brands should take some blame as well as they
| often feel compelled to spend. They have huge budgets that
| they NEED to spend regardless of they perform - sometimes
| due to accounting shenanigans, sometimes because they don't
| know any better, etc.
| Dylan16807 wrote:
| No matter what time scale you pick, there's still a point
| where ad spending costs more than you benefit. As time
| passes, the boost from any campaign decays. For any
| particular person you only need to show them so many ads
| to maintain awareness.
|
| > these are ALL diligently measured at every stage
|
| Mmm. Sometimes. Sure, you can obsessively measure
| audience and sales numbers, but if you don't have any
| controls then it becomes nearly impossible to figure out
| how much of that came from ads and how much came from
| everything else in the entire world.
| missedthecue wrote:
| it is true that that profit/loss point exists, but it may
| be impossible to measure. But it's very clear that 75+
| years of Coca Cola marketing strategy has produced the
| situation where any human on earth immediately associates
| "Coca Cola" with soft drink.
|
| If Coca Cola cut advertising 90% this afternoon, they
| likely wouldn't see the consequences until a new
| generation or two grew up.
| ghaff wrote:
| I suspect that a similar dynamic can be in effect with many
| industry events. Everyone would collectively perhaps be
| better off with pulling out of or at least scaling back on
| big industry shows. But that doesn't mean it makes sense
| for _just you_ to pull out. (And, certainly, your events
| team probably isn 't going to push for scaling back.)
|
| There's also a huge mutual back-scatching thing going on. I
| remember in a former life we wanted to pass on a big
| software vendor's user group show because, while we sort of
| needed their software for some important customers, we got
| _very_ little traffic at this expensive event. Their CEO
| called our CEO and basically said to him "Be a pity if
| something happened to our partnership."
| avar wrote:
| > IOW, just like in the standard prisoner's dilemma,
| choosing to act is less about increasing your potential
| gains than it is about limiting your potential losses.
|
| You seem to be assuming that the potential gains are
| limited to current players of the game in this comparison.
|
| It's possible that Coke, Pepsi etc. are all losing more
| money on ads than they're gaining in market share against
| their current competitors and in increased sales. But that
| doesn't begin to address the question of whether
| advertising is a net loss.
|
| For one, the advertising also serves as a collective moat
| against new competitors, which could enter the market and
| eat up both Coke and Pepsi's market share. Maybe their
| biggest gain from it is that a bankrupt soda company from
| the 80s didn't replace them, and that a similar company
| today wouldn't have room to enter the market.
|
| It also doesn't account for more complex effects like a net
| increase in sales for all companies in that market. E.g.
| maybe Rolex, TAG Heuer etc. all benefit in the long term
| from expensive watches being seen as fashion accessories.
|
| If Rolex stopped their advertising spend one month and saw
| little immediate change, then TAG Heuer etc. might follow
| suit. But both might only experience the real loss years
| later as "luxury watches = must buy" faded from the psyche
| of their current and potential customers.
| likpok wrote:
| Part of the claim is that the people who are checking are ad
| execs who, if PepsiCo stopped buying ads, would shortly be
| out of a job (or have their budget and influence slashed). A
| counter to this might be that different advertising channels
| are likely not identically effective, and a TV ad exec has a
| big incentive to poke holes in non-TV ads.
| soared wrote:
| Yeah that is what is usually given as the reason so I was
| getting at a gung-ho CEO, CFO, CRO, Consultant, etc.
| toast0 wrote:
| See the Pepsi Refresh Project of 2010. Where Pepsi
| redirected a sizable amount of ad budget (including super
| bowl ads) to community projects. They abandonded this
| strategy after a while because they lost market share.
|
| This is the biggest large scale test of advertising I'm
| aware of. But it probably doesn't apply to all products.
| amelius wrote:
| They only lost market share because everybody else was
| still using advertising. Therefore, this is not a test in
| favor of advertising (only in the prisoner's dilemma
| sense).
| rocqua wrote:
| If advertising is an arms race with more total cost than
| total benefit, that would be an argument that advertising
| works. Because anyone, at any given time, will benefit
| from running advertising.
|
| It also means advertising is a net loss to society, but
| that is separate from the question 'does advertising
| work'
| xapata wrote:
| > net loss to society
|
| Not so clear, especially before internet search engines
| existed. As a consumer, I find it useful to know what's
| available for me to purchase.
| amelius wrote:
| I think you rephrased my comment, yes.
| andrewflnr wrote:
| If you're running a company, "just stop being in a
| prisoner's dilemma" is not one of your options.
| pkalinowski wrote:
| So advertising works? If it didn't, those buying ads
| would not take the pepsi market share
| otabdeveloper4 wrote:
| PepsiCo has third-party auditors that they employ to check
| the checkers.
| adkadskhj wrote:
| How do you look into it though? I don't know, so i'm asking -
| but my immediate thought is that you treat it like science.
| You isolate an environment, advertise, and see if it has an
| affect. But the implication there is that if it doesn't have
| an affect, money is on the table.
|
| If this is even remotely close to reality then it makes sense
| to me. Companies are more concerned with constant growth than
| strict efficiency, imo. They're throw as much money around as
| possible, and every cent lost or left on the table is panic
| inducing.
|
| I also imagine different types or products and/or markets
| behave quite differently. Eg a new product might very well
| benefit from advertising - since no one can buy your product
| or visit your store if they don't know it exists.
| [deleted]
| hammock wrote:
| >No one can actually prove it has any ROI at all. No one is
| willing to run the experiments necessary. In the few cases of
| natural experiments, where ads got turned off for some people
| by accident, there was no change in buying behavior.
|
| This may be true but it's a separate issue than the fraudulent
| clicks.
|
| Brand advertisement (the kind you are talking about, as opposed
| to closed-loop direct advertising) is an investment in a brand,
| that doesn't get paid off in a day, or a week, or a month, or
| even a year. It adds fractions of a penny onto a customers
| value, every day from today into eternity. It's an investment
| in your mind, but the long time horizon makes it, as you point
| out, nigh impossible to measure ROI.
|
| However, this is one of those cases where despite being
| immeasurable, it still works.
|
| Imagine doing a study on low-fat or low-fat diets and trying to
| measure health outcomes like lifespan, or heart disease, or
| cancer after just one month. You can't do it. The best you can
| do is measure _markers_ of these outcomes, like insulin
| resistance, blood triglycerides etc. Brand advertising is
| similar. You measure markers of long-term purchase intent. It
| 's not perfect.
|
| And just like actually doing a long-term study of diet for
| example is riddled with confounding variables and very hard
| (nigh impossible) to do well, so it is with advertising.
| srtjstjsj wrote:
| You are conflating value of the marginal ad with value of any
| ads at all, and also exaggerating what those articles say
|
| One of them said tracking cookies only boosted conversion 4%,
| and another said P&G did better with some traditional media
| advertising than some digital advertising.
| [deleted]
| rriepe wrote:
| "Half the money I spend on advertising is wasted; the trouble
| is I don't know which half." - John Wanamaker
|
| Half was true in his time (a century ago) but I think our
| numbers are way worse.
| actuator wrote:
| This is patently false. I have friends who have worked years
| developing solutions for doing ad effectiveness comparisons.
| They are A/B tests in most cases but some methodologies require
| a lot of sophistication because of problems tracking
| conversions.
|
| Traditional ad platforms like TV, newspapers might not have
| done this but online ones surely do. Infact that is one point
| they consider an advantage as you can measure effectiveness
| unlike the traditional platforms.
| Ericson2314 wrote:
| Yes, the advertising industry is just obfuscated basic income
| for the twitter class.
| thehappypm wrote:
| This is blatantly false. It's incredibly easy to prove that
| digital advertising is effective using A/B testing.
| beardedscotsman wrote:
| I think they did the A/B testing by switching off 100m of ads
| and having the same results.
| karaterobot wrote:
| There was a good piece of reportage on this subject last year:
|
| https://thecorrespondent.com/100/the-new-dot-com-bubble-is-h...
| mgraczyk wrote:
| This is completely false. Large advertising platforms have many
| A/B tests that show significant differences in consumer
| behavior between groups that receive different ad treatments.
|
| Ads might be less efficient than some believe, but it's super
| easy to see that they "work", and advertising platforms do it
| constantly.
| jedberg wrote:
| That's comparing one type of ad or channel to another.
|
| But none of them test "no ads" vs "ads".
| mgraczyk wrote:
| Some of the A/B tests I have analyzed are exactly "no ads"
| vs "ads"
| mgh2 wrote:
| Back in 2017, Uber sued Dentsu for ad fraud
|
| https://www.japantimes.co.jp/news/2017/09/19/business/corpor...
| jefftk wrote:
| _> No one can actually prove it has any ROI at all. No one is
| willing to run the experiments necessary._
|
| Depends enormously what sort of business you're in. I used to
| work for a company where all of our sales came from ads, 100%.
| It was trivially true that if we stopped advertising we would
| have no sales. We were also committed to running experiments:
| we knew how well all of our many advertising channels
| performed, and we ran A/B tests for every change.
| megablast wrote:
| Yes of course they can. They can run trials in different areas,
| and see if there's an increase in spend. They run tests all the
| time.
| handedness wrote:
| > No one is willing to run the experiments necessary.
|
| This is incorrect.
| spoonjim wrote:
| This is nonsense. I had a startup completely powered by Google
| Ads. Ads brought in nearly 100% of the traffic. When my billing
| information with Google got mixed up and the ads stopped, the
| traffic went to 0 immediately.
| DrScump wrote:
| That means you have zero loyalty among your consumers. Don't
| you see that as a problem?
| spoonjim wrote:
| Nope. They needed me for a specific job. Got their money,
| gave their thing, and they moved on.
| hardtke wrote:
| Lewis and Rao published a meta-analysis of 25 large scale
| controlled advertising experiment [1]. Here's the abstract:
|
| Twenty-five large field experiments with major U.S. retailers
| and brokerages, most reaching millions of customers and
| collectively representing $2.8 million in digital advertising
| expenditure, reveal that measuring the returns to advertising
| is difficult. The median confidence interval on return on
| investment is over 100 percentage points wide. Detailed sales
| data show that relative to the per capita cost of the
| advertising, individual-level sales are very volatile; a
| coefficient of variation of 10 is common. Hence, informative
| advertising experiments can easily require more than 10 million
| person-weeks, making experiments costly and potentially
| infeasible for many firms. Despite these unfavorable economics,
| randomized control trials represent progress by injecting new,
| unbiased information into the market. The inference challenges
| revealed in the field experiments also show that selection
| bias, due to the targeted nature of advertising, is a crippling
| concern for widely employed observational methods.
|
| [1] https://academic.oup.com/qje/article-
| abstract/130/4/1941/191...
| Mountain_Skies wrote:
| Though not an intentional test, we found out what happens when
| a movie gets a wide release but does not advertise. In 2008,
| the movie 'Delgo' was released on over 2000 screens with nearly
| no advertising. Because the production company could not find a
| distributor, they spent their ad money on renting the screens
| for a week, with the hope that some people would randomly see
| it and word of mouth would spread, leading to the theaters
| wanting to keep it for additional weeks. It became the lowest
| earning wide release movie up to that point in time. Each
| screening averaged two people per screening. More people saw
| Conan O'Brien making fun of the movie in his monologue than
| actually saw it in the theater.
|
| The reviews for the movie were poor but it had lots of
| household names as its voice talent, including Anne Bancroft in
| her final film. Good or bad, advertising likely would have lead
| to more people seeing it than two per screening. Of course
| there's no way to know for sure how many more would have been
| enticed by the ads but we do know that going with zero
| advertising resulted in a huge disaster.
| johnsoft wrote:
| So the movie was bad, and people didn't go see it? Doesn't
| seem related to advertising.
|
| Eminem released his last two albums without even announcing
| them. Word of mouth got them both to #1 on the charts.
|
| If you tried that same movie experiment with something like
| Avengers, I bet the results would look a lot closer to
| Kamikaze than Delgo.
| UpsilonAlpha wrote:
| These are not fair comparisons. Eminem and the Avengers
| have already established identities. Music cannot even
| compare to movies due to the sheer quantity of modern
| musicians. There are plenty of fantastic (IMO) bands out
| there that release music without advertising and they get
| nowhere.
|
| As for movies, Avengers got to where they are today through
| lots and lots of advertising.
| josefx wrote:
| > It became the lowest earning wide release movie up to that
| point in time. Each screening averaged two people per
| screening.
|
| On the other hand it got displaced by Oogieloves which had
| $40 million in marketing costs. Critics found it mostly bad
| and the only award it won was for films produced in Brazil.
| Maybe there was a reason no one wanted to spend ad money on
| that movie?
| mlthoughts2018 wrote:
| This is really, really not true. Advertising lift has been well
| studied, especially in metastudies spanning hundreds of digital
| campaigns across Facebook and Google. These are independent
| academic metastudies, with hundreds of millions of impression
| data samples.
|
| Positive lift in the range of 0-20% is very common, and many
| statistical aspects of causal inference on ad impacts are well
| understood.
|
| Negative lift and flat campaigns are real phenomena too, and it
| does deserve more widespread publicity that negative lift
| happens in an appreciable number of campaigns, but that doesn't
| take away from the overwhelming evidence that digital
| advertising works and that the mechanics of positive lift are
| well studied.
|
| Here are two of the foundational papers in this area:
|
| -
| https://www.kellogg.northwestern.edu/faculty/gordon_b/files/...
|
| -
| https://www8.gsb.columbia.edu/media/sites/media/files/Garret...
|
| Particularly Figure 1 (page 26) in the second link. That figure
| alone utterly refutes any nonsense claim that digital
| advertising doesn't have provably positive ROI.
| jedberg wrote:
| Did you read the transcript the for episode and the
| associated links and notes?
|
| They back up their claims with studies of their own as well
| as metanalysis.
| Reebz wrote:
| I did, and I think there's a lot of p-hacking going on.
| Leading with TV advertising is disingenuous at best.
|
| The ebay example twists the concept of user acquisition
| (new customers) and purchases (new or old customers). It is
| a common tactic to buy advertisements defensively, for
| example, if you're a product manager, and have determined
| that some of your user base are more transactional rather
| than frequent.
|
| Another pet peeve I have is how they conflate direct
| response advertising and marketing.
| mlthoughts2018 wrote:
| It would seem their backing research and metastudy totally
| missed the boat and ignored well-known academic experts on
| the matter.
|
| I definitely trust the academic studies over an
| entertainment podcast.
| mr_toad wrote:
| > No one is willing to run the experiments necessary.
|
| Because advertising is like military spending. It takes a lot
| of money to maintain the status quo.
| newbie2020 wrote:
| Maybe not for companies of uber's size/current reach, but small
| businesses definitely do benefit from ads. They see an
| immediate uptick in sales when they start advertising on
| various platforms.
| posedge wrote:
| Listening to the podcast just a minute ago as I found this
| post... What a coincidence. I second that recommendation.
| guerby wrote:
| "No one is willing to run the experiments necessary."
|
| Tesla is one natural experiment about not spending money on
| advertising in the mass media compared to traditional car
| companies that spend HUGE amount of money advertising.
|
| https://www.motorbiscuit.com/gm-spends-an-embarrassing-amoun...
|
| "Hyundai spent $4,006 per Genesis vehicle sold in 2018. Ford's
| Lincoln brand came in second with $2,106 per vehicle sold.
| After Jaguar and Alfa Romeo, GM's Cadillac brand came in fifth
| with $1,242 spent per vehicle sold. Tesla was the lowest at
| just $3 spent per vehicle sold."
| toast0 wrote:
| Telsa is in an enviable position of selling most of their
| cars before they're produced. In that position, you don't
| really need to advertise much. They also get a lot of PR to
| keep up brand awareness.
|
| If Hyundai couldn't keep Genesis vehicles on the dealer lots,
| they'd advertise them less too. Having a dealer network means
| dealers that want manufacturer support in advertising to keep
| dealers happy, even if the new cars sell themselves, dealers
| need to get people in to sell used cars.
| morelisp wrote:
| Tesla's marketing spend is whatever it costs them in legal
| fees and fines to keep the mouthy celebrity CEO - and their
| high-profile campaigns in 2018 seemed pretty effective.
| specialist wrote:
| I get downvoted whenever I propose digital advertising bubble
| will pop once people wise up to the fraud.
| choward wrote:
| I think the next major recession is going to be triggered by
| this bubble popping.
| missedthecue wrote:
| Why would it cause a recession? Google and Facebook would
| report lower numbers, literally every other company on
| earth would save more money.
| specialist wrote:
| IDK. It's a risk worth chewing on. eg If Google and
| Facebook tanked, bringing down the stock indexes and all
| the institutional investors, triggering a sell off...
| What would the knockon effects be? I don't know (no
| clue). The 2008-9 crisis largely happened when CDS stuff
| popped. Is there a similar house of cards on top of FAANG
| stocks or the digital ad market or...?
| missedthecue wrote:
| 2008 was bad because of excessive leverage. Top tech
| companies have little to no debt and there aren't any
| leveraged securities to do with ads.
| lern_too_spel wrote:
| The ad buyers aren't smart enough to measure the actual
| effectiveness of their ads, and the ad sellers are not
| incentivized to teach them how to do it. This can go on for
| an arbitrarily long time.
| Wowfunhappy wrote:
| I'm only about halfway through the first of the podcast
| episodes you linked (thanks!), but just thinking about this
| logically for a moment:
|
| I would not be shocked to learn that advertising for a specific
| product or event is not particularly effective. However, I'm
| inclined to believe it has a huge effect on overall brand
| recognition.
|
| Let's say you go to Amazon to buy a roll of toilet paper. How
| do you choose from the literally hundreds of options? You could
| spend a day of your life reading reviews, and trying to parse
| which ones are fake. Or you could buy the toilet paper from
| Scott because you recognize the brand.
|
| As I see it, buying brand advertising is a lot like buying an
| expensive suit. It's not that the suit makes you more
| productive, but it is a sign of professionalism, and--frankly--
| of wealth. If a brand is advertising everywhere, you know they
| aren't a fly-by-night company, and their products likely meet
| some standards of quality.
| dehrmann wrote:
| There's also the bit about luxury (mostly) car commercials.
| Half their purpose is to remind you that you made a good
| decision buying your <brand> car, and maybe your next car
| should be the same brand.
| pfalke wrote:
| At least in e-commerce it's very much possible. The company
| that I work for does such experiments regularly (there's a
| dedicated Data Science team for measurement) and I've
| personally been involved in lift studies for Google Ads. They
| work, you just have to be careful with the 'how much' combined
| with 'for what'.
|
| Happy to chat with anyone who is interested in the topic
| (pfalke at pfalke dot com).
|
| Haven't had a chance to listen to the podcast, apologies if
| that made me miss the point of the parent post!
| mumblemumble wrote:
| > No one is willing to run the experiments necessary.
|
| Not without reason. Even without the conflict of interest that
| Nextgrid points out in a sibling post, there's still a
| significant financial barrier to attempting to measure this
| stuff. According to a former professor of mine who spent a
| large chunk of his career studying this stuff, the size of
| study you need to conduct in order to get any kind of
| statistical power at all on an ROI study is just absurd. See,
| for example, the treatment starting on page 15 of:
| http://www.davidreiley.com/papers/OnlineAdsOfflineSales.pdf
| mgh2 wrote:
| Additional resource discussed in the past:
|
| https://news.ycombinator.com/item?id=21465873
| im_down_w_otp wrote:
| Gabriel Leydon of Machine Zone spoke to the general topic at
| Code/Media back in 2016. Basically discussing that they'd gone
| through the trouble of building internal expertise and tools
| for optimizing their ad spend to better ensure specific
| outcomes they desired/required in a way that would inevitably
| lead to more sophisticated ad buyers and putting a nail in the
| coffin of traditional media advertising.
|
| https://www.youtube.com/watch?v=oXBqzpExvrk
| manigandham wrote:
| This made the rounds in adtech in 2016 and it's really
| nothing special. His entire speech comes down to a single
| quote: "media will be quantified".
|
| Sure, everyone wants that. Precise attribution has been the
| holy grail for a long time and the struggles are far larger
| than just a few technology products. The new battleground is
| first-party data and clean rooms vs privacy regulations. And
| that's after dealing with all the politics and perverse
| incentives that happen in such a massive industry.
| disgruntledphd2 wrote:
| Alternatively, they dumped hundreds of millions of dollars
| into ads based on a wildly unrealistic notion of a customer
| lifetime (much like the rest of Silicon Valley).
| im_down_w_otp wrote:
| I didn't say they achieved their goal. Though I do think it
| was/is an admirable one. It would be nice if marketing
| budgets weren't a near limitless accountability-free money
| pit.
| manigandham wrote:
| This was a superficial analysis at best. Adtech produces
| petabytes of data every day proving that advertising works.
| There's a reason why two of the most valuable internet
| companies sell ads.
|
| The problem is knowing exactly which formats and campaigns are
| working down to the dollar, but part of that is just the
| reality of fuzzy attribution and it's only getting harder as
| privacy regulations get stronger. However you can definitely
| tell the difference when turning everything off, and if you
| can't then you were advertising to the wrong people in the
| first place.
|
| Uber's mistake isn't that advertising didn't work, but rather
| that they didn't vet their vendors or even bother doing any
| checking and optimization of their own.
| polk wrote:
| The implication here is that money spent on ads is largely
| wasted.
|
| Companies like Uber and Ebay have turned off all their
| adspend and saw little to no change in their acquisition
| metrics. You can argue that they were just doing it wrong.
| But the point is that, if even they are doing it wrong - and
| getting nothing in return for the millions they're spending
| on ads - then it's very likely most others are in the same
| situation.
|
| You are right that this doesn't mean _all_ advertising is
| useless, there are absolutely profitable usecases. But the
| larger points still stands: most money being spend on
| advertising right now is likely not returning anything.
|
| We now have some strong precedents being set. I believe this
| will cause more major companies to run the ultimate
| experiment: turn off all ads and see what happens. It's too
| early to tell, but it's not impossible we'll see adspend drop
| significantly across the industry once everyone finds out
| they're just burning money.
| manigandham wrote:
| Why the ad spend isn't working is a critical detail. It's
| definitely not _most_ money but yes there 's a lost of
| waste because it's a 12 figure industry with lots of
| politics, perverse incentives, thousands of vendors, and a
| complex global supply chain.
|
| Fraud is a special case because it's criminal activity and
| has nothing to do with advertising. It happens in every
| industry but it's especially easy with online technology
| spanning multiple countries and data that can be easily
| faked. Uber was exceedingly oblivious here but I wouldn't
| extrapolate advertising efficacy from these examples.
| zamalek wrote:
| > there was no change in buying behavior.
|
| I suspect that if our browser isn't blocking ads then our brain
| is. It's complete conjecture, but I assume that adblockers
| eliminate this cognitive load explaining a portion of why they
| became successful before they were necessary for
| security/malvertising.
| indymike wrote:
| Beware extremes like "no one can actually prove". One
| difference between internet ads and their more ethereal tv and
| radio predecessors is that adviews, clicks and purchases can be
| tracked. Also, there are techniques that can make even TV,
| radio, print and even digital to physical world ad performance
| more visible: coupons, response codes and campaign-specific
| phone numbers and URLS. That Uber was buying hundreds of
| millions in ads and could not attribute performance (sales, for
| example) speaks more to poorly designed campaigns and
| potentially very bad actors in the supply chain.
| xapata wrote:
| > No one is willing
|
| Counter-example: I know of at least one consumer goods company
| that has studied the long-term effects of certain kinds of
| sponsorship deals on consumer behavior. The study had tracked
| people for at least 10 years at the time I learned of it. Of
| course, this company would never publish the results, because
| they provide a competitive advantage in structuring and bidding
| on sponsorship deals.
| tempsy wrote:
| it's funny how trillions of dollars in market cap are built on
| top of some service with unprovable and questionable value.
| tiahura wrote:
| > No one is willing to run the experiments necessary.
|
| Or, no one is willing to share the results of the experiments.
| legitster wrote:
| I work in digital marketing and this episode made me want to
| tear my ears off.
|
| First of all, they didn't differentiate between display or PPC
| advertising. PPC you only pay if the user actually engaged with
| the ad. Nearly all of the anecdotes they used where about
| online display advertising - a known crock.
|
| And we absolutely run experiments all the time! In fact, we tie
| our ad spend directly to conversions. If anything, the market
| is _too_ efficient - it 's really hard to get more than what
| you are paying for.
| jedberg wrote:
| But the experiments you run pit one ad type or channel
| against another. Have you ever run any experiments comparing
| ads to no ads?
| xenospn wrote:
| I have. When I run ads, I grow. When I stop running ads, I
| don't.
| legitster wrote:
| Absolutely. You can give a campaign its own website or URL
| if you want to test something like the effect of a specific
| billboard or radio ad.
|
| Or you can do the equivalent of an excess mortality study
| but for client acquisition or product sales. You take
| something like the month of January and you say "this is
| what we expect for web traffic given our standard traffic
| for that month, and extrapolate it with your average web
| activity growth". And so long as you have "clean" months to
| compare it to (with no ads running), you can get a pretty
| decent back of envelope about what your ad campaign did.
|
| Like, there's so many different ways you can cut the apple,
| it's patently ridiculous they made those claims.
|
| To give them a bit of credit, there's something to be said
| for there being a _lot_ of bad ad spending out there. But
| like the stock market, there 's a tacit understanding that
| it's more or less efficient.
| swyx wrote:
| since you work in the industry - how about your opinion on
| the Uber case in the original post? that is PPC.
| legitster wrote:
| I'm struggling to follow the actual narrative presented in
| the chopped up Twitter style. It sounds like there were was
| a third party ad network involved?
|
| One thing we learned a long time ago is never to trust
| "engagement" data from platforms (be it Google, Facebook,
| LinkedIn, whatever). There are enough random user behaviors
| that you generate a ton of noise. You need to build larger,
| more robust attribution models that tie ad spending
| directly to revenue sources - new leads, new accounts,
| purchases, etc. Patting yourself on the back for how many
| shares or clicks you get is not great.
| swyx wrote:
| as a nonexpert its hard for me to say too but perhaps you
| will benefit from hearing directly from source - the
| performance marketing guy at Uber who found all this out:
| https://www.marketingtodaypodcast.com/194-historic-ad-
| fraud-... honestly i am not sure if he did a good thing
| by asking all these questions, or was partially to blame
| for gross incompetence managing a 150mm ad budget, or
| both. (the chronology of when exactly he took over
| matters, it seems he was only in the job about a year)
|
| and of course for more detail the full text of the fraud
| suit is public https://www.adexchanger.com/wp-
| content/uploads/2019/06/Uberf...
| masonic wrote:
| PPC you only pay if the user actually engaged with the ad
|
| Who defines that "engagement" legitimately occurred? The ad
| network.
|
| Example: TVguide.com/listings. On most devices, I get a
| nondismissable audio ad when I'm looking at telecast
| schedules. I kill the audio immediately.
|
| I never experience the bulk of the ad, and even if I can
| identify the product being advertised, I'll form a strongly
| negative impression of them.
|
| I don't count this as "engagement", but it's charged as that.
| Ericson2314 wrote:
| Great subject matter, but boy does reading the transcription
| remind me why I hate podcasts. Stop infantilizing the audience
| with these coo-coo-ing sounds bites and get to the damn point
| already!
| lumost wrote:
| It's unclear how this experiment would be done. In the case of
| brand advertising, it's likely that brand awareness would decay
| over some period of time and in turn purchase behavior would
| change.
|
| It's not currently possible to run an A/B experiment with a
| hold out group of potential customers across all channels, let
| alone for any longer duration experiment. So how can we
| separate cause and effect? (although pay per conversion
| channels do get gamed left and right)
| marcinzm wrote:
| Traditional brand advertising testing (TV, newspaper, etc.)
| would be geography segmented as I understand it. So half the
| cities got the campaign and half didn't. You can mimic that
| with IP based geo-location although you'd get more leakage
| than pre-internet.
| pas wrote:
| Come up with some new product that requires some personal
| data for usage (eg. age, gender/sex, address). Start to
| advertise this in just one country to one demographics, and
| look how many out-of-target orders you get.
|
| Maybe it's even enough if you simply just sell it via mail
| order, you can then look at the addresses.
|
| There's probably a natural information spread in any market
| (word of mouth, trade magazines), and there's probably a
| physical dispersion of the target group of people too (people
| move, visitors/tourists saw the ad/product and order it at
| home), but it still should be a valuable to see how much
| effect just one campaign has.
|
| Maybe one of the best products for this could be a car. They
| are pretty standard, really not much difference between them,
| they are in all price ranges, and regularly new models come
| out. Advertise one in a few major US cities but don't in
| others.
| lumost wrote:
| For most vendors, not possible to accurately target
| age/sex/address online. They will certainly sell you the
| option, but they won't tell you how accurate the data is -
| or they will provide it a high accuracy with extremely low
| coverage.
|
| To see this in action - spend a day watching pitbull videos
| on youtube and see how many spanish language ads you'll
| get.
| pas wrote:
| Hm. How about simply buying ad space at a few local
| newspaper sites? Sure, it's noisy as hell, but maybe
| still a decent proxy variable.
|
| Plus, maybe it's possible to somehow offer a coupon for
| those who buy via the ad, and so on.
|
| After all the ad/tracking industry probably have a
| thousand tricks to increase accuracy of this.
|
| But, yeah, I'm not holding my breath for a conclusive
| answer on this.
| marcinzm wrote:
| These experiments are run all the time even before the
| internet. I remember reading about how for broad brand
| advertising they used to segment by city. Half the cities got
| an ad for Coca Cola and half didn't. Then you compare sales of
| Coca Cola. No one will publicly publish numbers because it's a
| mix of sensitive sales data and competitive advantage (ie:
| otherwise your competitors don't have to burn money running
| their own tests). Also, smaller shops turn their online
| advertising campaigns on and off all the time to test impact.
| notional wrote:
| Why does reddit have ads if all ads are a money pit?
|
| I understand you no longer work there, but ads started in 2009
| I believe, so you perhaps had some input on this?
| mattkrause wrote:
| Owning the pit into which other people throw their money
| seems like it would be pretty lucrative.
| tnt128 wrote:
| Depending on what kind of advertising you are talking about.
| Direct response advertisers measure ads to the cents. And they
| know exactly what the ROI is and where the customer is coming
| from.
| OmarShehata wrote:
| They mention the common retort to this which is very bizarre to
| me: "If online ads don't work, then huge companies wouldn't
| spend billions of dollars on them. Therefore they must work.
| You academics are just missing something."
|
| Ok, how does those companies know it works? They don't have any
| real data to show that it does, just the fear that if they stop
| they'll lose a lot of business.
| manigandham wrote:
| They do have data. It's pretty easy to see sales without ads
| vs sales with ads and then do further testing to narrow down
| results from there. This has been done for over a century
| since the first billboards were put up.
|
| The amount of data generated by adtech today is staggering.
| The problem isn't data or advertising, it's the wrong people
| running the wrong campaigns for the wrong reasons.
| ABeeSea wrote:
| This is incorrect. Companies do the experiments. They just
| don't publish the results. Why would they? The idea that Amazon
| doesn't know the ROI on their ad/marketing spend is laughable.
| saagarjha wrote:
| But then why do they keep doing laughably bad advertising?
| vkou wrote:
| Because 50% of advertising spend is wasted, but it's hard
| to figure out which 50%.
|
| If you're doing an $XY,000 ad campaign, it's a waste of
| your time and money to figure out which 50% it is.
|
| If you're doing a $XY,000,000 ad campaign, you employ
| people whose job it is to figure out which 50% it is. The
| thing is, you usually don't go ahead and pay them to blog
| about it.
| otabdeveloper4 wrote:
| > No one can actually prove it has any ROI at all.
|
| That's a philosophical question of whether you consider
| statistics to be "proof".
|
| > No one is willing to run the experiments necessary.
|
| You're nuts if you think this is true. I assure you that
| companies in traditional industries (i.e., without venture
| capital) can and do run these experiments.
|
| The Uber story is about venture capital and its anti-market
| incentives, not about the ad industry.
| jedberg wrote:
| Read the podcast transcript. An economist proposed turning
| off print ads in one market to find out if they mattered, and
| the head of marketing said he'd rather not know.
| otabdeveloper4 wrote:
| "Chief marketing officer of Unilever" isn't the guy running
| experiments, he's the guy that hires ad agencies and
| auditors that in turn have teams of data scientists running
| various experiments for Unilever.
|
| I guess you could propose a conspiracy theory that all
| these people are conspiring to put together fake reports
| and data sets, but that sounds extremely unrealistic - ad
| agencies are essentially money-counting businesses like
| banks, and they take data security very seriously. (Because
| usually they'd be audited at every step.)
|
| In short, smart people have already thought about these
| issues, and there isn't any inherent pro-advertising bias
| in industry, rather the opposite.
| aerosmile wrote:
| Only because the head of marketing realized it would expose
| his past misjudgments - not because he didn't realize it
| would actually be a good thing for the company. You'll see
| this type of behavior in every department - people trying
| to cover up their mistakes.
| SilasX wrote:
| Wait, so their marketers are unwilling to do anything
| that would reveal ad ineffectiveness, and you consider
| that an argument in _favor_ of the claim that ads are
| effective (the topic at this point in the thread)? Like,
| you take that as a signal that marketers _would_ converge
| on effective ads?
| aerosmile wrote:
| My point is that we have to differentiate between bad
| employees and the overall effectiveness of ads.
|
| The latter is all about incrementality. When you adjust
| for it, you get the true effectiveness of ads. In some
| instances, the incrementality will be significant, in
| others it won't. It looks like that in Uber's case, the
| incrementality was low. Btw, if you're not familiar with
| this term, please look it up - there's a ton of
| literature on it: https://www.adroll.com/blog/marketing-
| analytics/beginners-gu...
|
| Which brings me to the point about bad employees -
| marketers who are not adjusting their performance
| measurement based on incrementality should be fired (and
| it certainly looks like this was not being done at Uber
| at that time).
| SilasX wrote:
| You think Uber's marketing people are extreme outliers
| compared to the typical large company?
| Razengan wrote:
| I've thought and said so before: The ads racket is be a case of
| the emperor with no clothes, at best.
|
| At worst, it's a front for building "profiles" of everyone.
|
| I can't recall the last time I bought anything _-because-_ of
| an ad.
|
| If anything, ads have sometimes actually _put me OFF_ from
| buying something!
| Razengan wrote:
| Oh look, yet another news about how the advertisement economy
| fucks up more shit than it benefits:
|
| https://news.ycombinator.com/item?id=25624112
|
| "URL shorteners set ad tracking cookies"
| pas wrote:
| But someone did. "Brand awareness" is a thing.
|
| For example we can probably agree that for completely new
| companies spending on ads makes sense. Or giving out free
| samples, etc.
|
| Similarly for big companies doing media campaigns to keep the
| new ones at bay makes some sense.
|
| Even if word of mouth is a thing, even if there are organic
| searches, and even if it seems like a race to the bottom if
| everyone just tries to outspend each other.
|
| It'd be great to make experiments about how to sensible
| prevent/regulate this ad arms-race. But first better data
| privacy laws.
| paulsutter wrote:
| Ecommerce sites have very fine grained measurement of their
| advertising spend and know exactly the ROI (which is why they
| focus so much on retargeting)
| m12k wrote:
| This article also sheds a lot of light on the whole issue of
| why people don't realize when digital ads don't work:
| https://thecorrespondent.com/100/the-new-dot-com-bubble-is-h...
| crakhamster01 wrote:
| > No one can actually prove it has any ROI at all. No one is
| willing to run the experiments necessary.
|
| This is entirely false. I work in adtech, and almost all
| companies run experiments in order to optimize their ad spend
| (everything from Ad A vs Ad B, to Ad vs No Ad, to Channel A vs
| Channel B, and more).
|
| This isn't to say that advertising always produces ROI. Quite
| often, experiments will be run that will show a certain
| strategy isn't performing well, and the company will adjust
| accordingly. It's incredibly naive to think that companies are
| flushing half a trillion dollars a year down the toilet on
| advertising without any attempt to validate their investments.
| voxl wrote:
| That's great, thanks for your experience, but can't comment
| on the argument provided?
|
| Isn't it possible that these experiments you talk about are
| fatally flawed? I have serious doubts that a company can run
| and do well designed statistical experiments when academic
| experts are plagued by p-hacking and other foot guns.
| Spivak wrote:
| That's kinda a weird take when there's every incentive to
| be the the person/manager/director who saves tens to
| hundreds of millions of dollars in ad spend.
|
| Sure marketing people want to protect their jobs but the
| odds of "advertising is entirely worthless" being this
| closely guarded secret kept by millions of people in the
| industry or being a collective delusion is pretty darn low.
| The reward for defectors is just too high.
| crakhamster01 wrote:
| I'm not sure what argument you're referring to? I quoted
| two claims from the parent comment and refuted those based
| off of industry experience.
|
| > I have serious doubts that a company can run and do well
| designed statistical experiments when academic experts are
| plagued by p-hacking and other foot guns.
|
| By "company" are you referring to individual advertisers or
| digital advertising platforms? Why do you doubt that either
| are incapable of running well-designed experiments? It's in
| both parties best interest to spend ad dollars as
| efficiently as possible.
|
| While it's certainly possible that every one of the 100
| million+ ad experiments ran over the past decade have been
| fatally flawed, it's highly unlikely. I guess the
| alternative scenario is that digital advertising is one
| giant hoax being kept secret by the millions of employees
| who work in the industry, but given how easily tech news
| leaks, this also seems extremely improbable.
| User23 wrote:
| Another option is that the experiment design was wrong
| for every single one of those experiments. Sounds
| unlikely right? Running the same broken experiment any
| number of times won't change that it's broken. So if
| these "100 million+" ad experiments are more or less
| copies of each other they could all be wrong. How likely
| is that? I don't know, but I do know that at a big
| Silicon Valley tech company that you've definitely heard
| of I was involved in an exercise where we were told to
| create an experiment. The type A take charge person in
| our group did what they do, which in this case was
| talking over and shutting down the Los Alamos trained
| particle physicist who was trying to explain to her why
| her "experiment" could never show anything.
| skronch wrote:
| IMO large social media platforms are actually much more
| capable of running these experiments than academics.
| (Disclaimer: I work on ads at one of these companies).
|
| Platforms can accurately determine who engaged with an ad
| (basic logging on their sites), they have infrastructure to
| create statistically balanced ad experiments, and can also
| accurately determine whether a conversion happened (either
| through a conversion pixel or through data brokers).
|
| Running these tests on behalf of advertising clients, or
| for internal research is fairly standard. If we couldn't
| prove statistically that our ads were working, I would have
| left a long time ago.
| tfehring wrote:
| I think the difference from academic studies that fail to
| replicate is less about capability and more about the
| fact that experimentation in adtech is fundamentally
| straightforward and occurs under far more idealized
| conditions - those you mentioned, plus massive sample
| sizes and easy iteration - than most academic research.
|
| Of course, this just reinforces your point that
| experimentation in adtech is largely not subject to the
| same issues that have fueled the replication crisis in
| academia.
|
| (I'm a data scientist but not in adtech.)
| baron_harkonnen wrote:
| > without any attempt to validate their investments.
|
| I've also worked in adtech, for quite a long time on all
| sides, and my experience is that far more companies do
| research to _justify_ their ad spend not validate it.
|
| I have managed plenty of A/B tests in my day, each one
| claiming to show some improvement, 10%, 15% etc (some, as you
| said, showing no improvement). Even though these tests are
| often run "correctly", essentially nobody goes back and asks
| "wait, we had a 10% increase multiple times in the past year,
| but is our <metric> really showing the _cumulative_
| improvement we expected? "
|
| The greatest trick in the industry is that because VC are
| pouring money into everything, everywhere, every metric
| appears to grow. At every startup, everywhere, pre-pandemic,
| numbers were going up because people were pouring money into
| the system.
|
| I've worked at companies who I know for a fact their adtech
| product cannot and does not work, yet their business
| continues to explode because in recent months nearly all ad
| spend has been on digital ads.
|
| I've talked to companies whose entire function is bidding
| optimization who literally do not understand how to optimize
| bidding given the information you have.
|
| Absolutely people are running "experiments" but the function
| of the "experiments" is to justify that the ad team is worth
| having, and then that the VP of marketing is doing their job
| and then that the CEO has hired some super smart people, and
| then that the VCs might have really found a unicorn. Everyone
| sees what they want and no one really wants to ask the
| question "wait, does this really work? are these tests really
| able to capture the complexity of the environment?" And if
| you are one of those ornery people that insists on probing
| into the details and seeing if any of this is working, you
| will eventually get fired.
|
| Ad tech is largely a scam, but a huge number of rich and
| smart people benefit from the illusion that it is not, so we
| continue to see experiments showing that everything works as
| expected.
| crakhamster01 wrote:
| I agree that there a lot of (smaller) players in the ad
| tech space who are scamming companies out of money. And
| especially if you've been in this industry for a while,
| this practice was much more prevalent a decade ago.
|
| I don't think your view is representative of how most F500
| companies, or many of the new DTC brands, invest on major
| ad tech platforms though (FB/G/Snap/etc.). Experienced
| marketers try to measure metrics as close to core business
| KPIs as possible, and comparing ads based off of simple A/B
| tests is increasingly becoming a technique of the past.
| Measuring the incrementality of ad campaigns through long-
| term holdout groups gives companies a much more accurate
| read of their investment, while bringing higher statistical
| rigor as well. So rather than looking for cumulative
| increases on <metric> after advertising for a year, you
| could instead point to group A (who saw no ads) and see
| that group B (who saw ads) drove a 1.5x higher <metric>.
|
| I'm not sure how you can say advertising is a scam when
| there are clear examples of popular brands that most likely
| wouldn't exist today without digital ads? Take Allbirds as
| an example. There are dozens of consumer shoe brands that
| are already in physical stores and have higher brand
| recognition; how can you argue that advertising didn't help
| them cut through the noise and grow their bottom line?
| ogre_codes wrote:
| > I work in adtech, and almost all companies run experiments
| in order to optimize their ad spend ... It's incredibly naive
| to think that companies are flushing half a trillion dollars
| a year down the toilet on advertising without any attempt to
| validate their investments.
|
| We have a very large and conspicuous example here that
| suggests that Uber hasn't been doing this.
|
| Running experiments like you suggest is difficult and to do
| them right requires some fairly specialized knowledge to do
| correctly. I'd doubt more than a small percentage of
| companies have the expertise to effectively run any kind of
| advertising experiment that returns useful data. Most
| businesses lack that knowledge and rely on metrics provided
| by the people selling the advertising--who are likely to
| provide self-serving numbers.
|
| While I'm sure some of the bigger F500 companies do a good
| job validating their ad spend, I _most_ companies don 't even
| know how. Certainly the majority of small businesses have no
| idea how effective their advertising spend is aside from very
| crude word-of-mouth feedback. I suspect this creeps way up
| into the Fortune 500 as well.
| zm262 wrote:
| Ads are somewhat like propaganda. There's no proving it will
| work or not in short terms, but nobody can deny that persistent
| propaganda has a long-term effect on the whole population. You
| have think about a kid/youth who listens to some propaganda for
| years when growing up. If say you show an ad for a new Apple
| product. A small part of it is to inform consumers about it,
| the longer larger part is to enforce the Apple brand which has
| been happening over many years. You can't say well it is not
| quite working so let's stop doing Ads.
| trophycase wrote:
| It's an arms race. In theory advertising should give you an
| edge over non-advertising competitors, but if everyone is doing
| it demand remains unchanged and also you're wasting money
| alibrarydweller wrote:
| I'm a fan of the podcast but one argument they cited seemed to
| have a pretty glaring error - they looked at the case where
| eBay was comparing incremental gain on search ads over no ads.
| It's methodologically hairy because eBay is a very major player
| with significant brand recognition.
|
| "When Tadelis was working for eBay, the company was in the
| practice of buying brand-keyword ads. Which meant that if you
| did an online search for "eBay," the top result -- before all
| the organic-search results -- was a paid ad for eBay."
|
| This doesn't show that advertising doesn't work per se, it
| shows that eBay didn't hire a competent ad buyer. Whether or
| not you can prove the efficacy of advertising as a whole, this
| is not a valid approach.
| samstave wrote:
| until you realize that ads are meant to make FB and Google
| rich, not you, you're going to have a bad quarter.
| srtjstjsj wrote:
| You are conflating value of the marginal ad with value of any
| ads at all.
| Nextgrid wrote:
| > No one is willing to run the experiments necessary
|
| The people that would have the power to run this experiment
| have their entire careers depending on things staying as-is.
| Running the experiment carries a significant risk of exposing
| that the advertising operations they're responsible for provide
| much less ROI than they pretend it does.
|
| The unwillingness of anyone to run such an experiment is
| already an answer. Why wouldn't someone jump at an opportunity
| to prove the thing/service they provide actually works, unless
| they were unsure about it themselves?
| jedberg wrote:
| Exactly. That's what the episode says too. The only people
| who could run the experiments hinge their entire career and
| industry on the results.
| [deleted]
| adwww wrote:
| I used to work in this industry.
|
| A small tech team investigated fraud on our platform and
| developed a system that was pretty robust at detecting and
| potentially shutting it down. But literally nobody was
| interested - even the people advertising don't want to know.
|
| The people spending money are typically networks, media
| buyers, ad agencies, etc, far removed from the actual brand.
|
| There are so many parties who want a slice of the brand's
| cash that they are all long past caring about whether the ad
| is being viewed by a human or not.
| walshemj wrote:
| Agency or client side?
|
| I assure you the big brands CFO's take a huge amount of
| interest in what is spent on advertising.
| adwww wrote:
| That's the issue - the CFO might care, but the staff
| actually delegated to spend the budget don't.
| syshum wrote:
| In my experience the Sales and Marketing teams of any
| large company have the loosest restrictions on how they
| account for their spending.
|
| Other dept;s like IT have to justify every penny, but
| Sales and Marketing not sooo much
| nkozyra wrote:
| I think there's a very loose belief that sales is how
| money is made, while they people that build and test
| products are pure expense.
|
| I've seen it not just in the phenomenon you describe, but
| also in layoffs and restructurings.
| tsjq wrote:
| Yes. Cost centre and profit centre.
| tsjq wrote:
| Yes. Sales and marketing : "profit centers" . Ever
| increasing budgets.
|
| Engineering , R&D, Manufacturing, Tech, Testing : "cost
| centers". Ever tightening budgets.
|
| MBA, Beancouting 101
| base3 wrote:
| I worked in adtech. I built a simple ML system that
| detected signals of fraud on our network. When I reported
| my findings execs told me the group that was facilitating
| the fraud was our only profitable division. Soon after, our
| company went bankrupt. My final paycheck was months late.
| adwww wrote:
| Sounds exactly like my former employer ha.
|
| IIRC our system wasn't even fancy ML - just finding known
| user IDs with identical timestamps over many simultaneous
| clicks / impressions on really diverse publishers.
| garciasn wrote:
| I work in the field. Incrementality testing is a big part of
| marketing measurement at any reputable agency. Any claims to
| the contrary are FUD.
|
| That said, companies like P&G, Airbnb, and Uber, which are
| oft-cited as examples of digital not being worth it, fail to
| understand their own brand recognition and organic power,
| built through prior marketing efforts, as key to their
| current standing.
|
| Sure, TODAY, it doesn't have the impact they'd like it to
| have but the investments PRIOR were key to ensuring their
| success.
| quacked wrote:
| Quit and do something that isn't fundamentally detrimental
| to everyone's quality of life.
|
| http://jacek.zlydach.pl/blog/2019-07-31-ads-as-cancer.html
| baron_harkonnen wrote:
| > Incrementality testing is a big part of marketing
| measurement at any reputable agency
|
| In a huge number of cases these tests are run by people
| that don't have the statistical background to property run
| and understand these tests, in the remaining cases there is
| almost never follow through to ensure that the results of
| the test have persisted _after_ the experiment.
|
| People will say "oh this test shows 10% improvement, and
| this one does too! and this one! and this one!" But then
| you should see a nearly 50% improvement just because of ad
| spend and you almost never do. Nobody ever check that all
| the numbers add up, they just want the numbers that someone
| reported to feel like they are sound enough to hold up to
| scrutiny but scrutiny is never applied.
| andrewjl wrote:
| > as key to their current standing.
|
| It seems like it would be important to measure this
| standing and turn down spend once it is reached. I can see
| how there's a lack of incentive to help large advertising
| spenders understand this.
| dasil003 wrote:
| Brand is a lot more than marketing spend, and not all
| brands are equal. Google and Facebook have companies that
| depend primarily on performance marketing spend over a
| barrel.
| TeMPOraL wrote:
| How do you determine a reputable agency though?
|
| I worked next desk to people running a small ad agency.
| Because we shared office (and I found them an intern), I
| got a very good look at how they're working. What I've seen
| can be summarized as: people who have zero clue or interest
| in statistics writing "reports", with "graphs" they don't
| even understand beyond "pointing up = good", proving
| positive ROI to customers - who also have zero clue or
| interest in understanding the numbers in the report, and
| not enough visibility into the whole funnel to
| independently check attribution. Both the agency and the
| clients were engaging in a shared and completely
| unjustified fiction of positive advertising return - and as
| long as both sides were happy, the money kept flowing.
|
| I've been long since suspecting a lot of advertising on-
| line looks like that. Every now and then, I see evidence in
| favor. Like that good ol' Optimizely debacle, where it
| turned out Optimizely was structurally optimized to help
| people make invalid A/B tests, that erred on the side of
| concluding the interventions were working[0]. And sure, big
| brands with some superstar ad teams probably do this right.
| But I think there's enough slack in most businesses that
| advertising spend can get quite far detached from actual
| ROI without anyone noticing (and with plenty of people
| happily riding the gravy train).
|
| --
|
| [0] - https://news.ycombinator.com/item?id=10872359
| johnrgrace wrote:
| Have you ever engaged with the large advertizing holding
| companies? They have teams of HIGHLY acomplished data
| scientists, boutique vendors for specific niches etc.
| Even if you don't pay for it there will be some people
| skilled at statistics looking at reports. If you pay for
| it, there will be data scientists doing analysis.
|
| The large ad firms deliver a very good product but it
| usually isn't cheap.
| srtjstjsj wrote:
| It would be fascinating if true if the big "brand name"
| companies whose entire business is based on charging more
| for the same commodity product as a generic store brand,
| but using advertising to justify the higher price in the
| customers' mind, weren't buying ads from people doing the
| same thing to them...
|
| The question isn't are the scientists good, the question
| is if the vendor is honest.
| TeMPOraL wrote:
| I haven't, and I don't doubt that's true (at least in
| many cases; I've learned not to underestimate the chances
| of big companies ending up running scams either).
|
| I've personally dealt mostly with the other end - the
| individuals and small agencies - and what I saw revealed
| total lack of necessary competences for the reports to be
| corresponding to reality. Perhaps it's understandable -
| after all, people who have the required knowledge likely
| end up working for big advertisers, or in entirely
| different fields. But small business owners don't pick
| these big advertising companies either.
| nicbou wrote:
| "It is difficult to get a man to understand something, when
| his salary depends upon his not understanding it!"
| Kyro38 wrote:
| ~ Upton Sinclair
| fortran77 wrote:
| And, unlike most Internet Quotes, this one is apparently
| real!
|
| https://quoteinvestigator.com/2017/11/30/salary/
| denton-scratch wrote:
| "If you believed something different you wouldn't be
| sitting where you're sitting."
|
| ~Chomsky to Andrew Marr.
| dllthomas wrote:
| > Why wouldn't someone jump at an opportunity to prove the
| thing/service they provide actually works, unless they were
| unsure about it themselves?
|
| Because everyone is already acting like they know it works,
| so the only way that experiment can change things is in a way
| that's bad for the person in question. In that situation,
| they should (from a local, selfish perspective) be resisting
| even if they're awfully sure it _does_ work (and perhaps even
| if they 're right!).
|
| Given that, I don't think the behavior has already given us
| an answer.
| [deleted]
| xapata wrote:
| The analysis is often performed by a different team, thus
| no conflict of interest.
| disgruntledphd2 wrote:
| Facebook's ad research team have run a lot of experiments.
|
| The goal was to demonstrate an impact of in-store sales
| from internet advertising. They did the first studies in
| about 2008-10, and have continued running these studies
| ever since.
|
| They even built a tool so that advertisers can run these
| studies, and get a sense for the incremental impact of
| their ad.
|
| Google have a similar (less full-featured) system.
|
| Really, it's the rest of the ecosystem that has much of the
| fraud, and I think that a lot of people in the industry are
| aware of this.
| pessimizer wrote:
| > The goal was to demonstrate an impact of in-store sales
| from internet advertising.
|
| So the goal was to advertise advertising. A more
| scientific goal would be to see if there was an increase
| of in-store sales from internet advertising. Instead they
| were looking to design experiments that would show a
| positive effect, with the goal of giving advertisers a
| dashboard so they could run those experiments themselves.
| hertzrat wrote:
| To let those advertisers do the experiments themselves,
| and to relate the campaign to in store sales, would
| require Facebook and google to share a ton lot of
| internet-user tracking data
| somedude895 wrote:
| Of course they'd say that.
|
| We've run Google's Local Campaigns, which are supposed to
| drive brick and mortar store visits, which they measure
| using GPS and "other signals". I checked with one of our
| most remote and least frequented stores, to see whether
| they could see any of the 100 daily visits that Google
| claimed to have generated, and they couldn't see a thing
| (avg daily visits were around 80 before during and after
| the campaign)
| masonic wrote:
| Heh. Just today, FB served me an ad claiming to be Macy's
| and talking about their closeout specials, accompanied by
| dozens of mourning comments. It was all phony.
| Daho0n wrote:
| A system to advertise how good FB's ad system is, built
| by FB who we know have fudged their numbers before? That
| isn't proof of anything.
| coliveira wrote:
| Not really, scientists for example also have their whole
| careers based on the truth of some theories that they use.
| However, they're willing to put them to proof in different
| ways. The reason they do so is that they have a high degree
| of confidence that these theories are true. This cannot be
| said of people doing advertisement.
| ssss11 wrote:
| I'm not exactly sure what you're trying to say.
| Scientists' whole careers are based on running hypotheses
| to prove or disprove their theories. That IS their
| career.
| mkr-hn wrote:
| And disproving a theory with lots of research backing it
| would be great. Imagine if someone found a huge hole in
| general relativity. There would be a boom in the grant
| writing industry.
| ACow_Adonis wrote:
| The reproduction crisis in sciences suggest the self-
| interest is pretty wide spread.
|
| And the social stigma in science of being someone who
| tries to take down, discredit, or disprove your
| colleagues/superiors/ competitors theories is pretty
| substantial: IME there has historically almost been a
| taboo against attacking our speaking negatively about
| publications and your own sciences + faculties practices.
|
| The saying of sciences advancing one funeral at a time
| doesn't exist because they're all such great skeptics and
| falsifiers, and current scientific practice is heavily
| biased towards positive findings and contains general
| publication biases.
|
| indeed there's actually a LOT of common ground with
| advertising self-interest, since a lot of publication in
| science is effectively just advertising your brand...
| accountofme wrote:
| Truth is relative. Sampling can skew results. Scientists
| are people too. We all have flaws.
| gspr wrote:
| > Truth is relative.
|
| This is a dangerous misconception to be spreading. It is
| not at all related to your other claims, namely:
|
| > Sampling can skew results. Scientists are people too.
| We all have flaws.
|
| These are of course correct statements. But they do not
| influence truth. They may well influence people's
| understanding of what the truth is, but that's different.
| kergonath wrote:
| Truth is an unhelpful concept anyway (in science at
| least). What's more useful is the likelihood to get a
| given result from a given experiment and the ability to
| make predictions.
|
| And yes, when we put things that way it brings a lot of
| possible issues with sampling, processing, and measuring
| (and who's doing the measuring). Some of these things
| would be harder to control for in a study of the
| effectiveness of advertising.
| hertzrat wrote:
| If you really believe truth is relative, walk to the
| grocery store tomorrow without wearing clothes and
| convince yourself that it will be fine. Or run a lighter
| under your hand - maybe it won't burn today? Of course
| you wouldn't to those things though because, at the end
| of the day, we rely on truth for everything we do. We
| just don't always know what it is. Relativism is not the
| same as "it's hard to figure out because it's so complex"
| kergonath wrote:
| Are you implying that the probability of someone going to
| a store named and getting out of it without harm is zero?
| There's plenty of photographic and video evidence of the
| contrary. Probably not the best example.
|
| Same for a lighter, there are many factors involved, and
| playing with lighters that way was a party trick where I
| grew up.
|
| We use truth as a concept every day as an approximation,
| but the universe is not bound to follow. Very unlikely
| things happen all the time.
| justapassenger wrote:
| It's like saying that no one who works on reliability of the
| systems is willing to run experiment to throw 100% errors for
| a month, because running experiment like that may show that
| reliability of the systems doesn't matter.
|
| And then using data from a one system that went down and
| nothing happened as a proof that systems reliability doesn't
| matter at all, and it's huge scam by engineers.
| kumarvvr wrote:
| Yep. Like the old adage goes, You cant make a man understand
| something, if his job depends on him not understanding it.
| hertzrat wrote:
| > The people that would have the power to run this experiment
| have their entire careers depending on things staying as-is.
|
| Any large company could invest in some experimentation,
| whether their marketing directors want it or not. It makes
| sense that at least a few do but just don't publish the
| results
| seppin wrote:
| This is no industry with as much snake oil BS as adtech.
|
| It also happens to be the sole form of revenue all of the
| largest tech firms enjoy.
|
| No wonder there hasn't been a real audit.
|
| Also, all those marketing execs buying all the ads would be
| out of a job too, so they aren't speak up either.
| kevinmchugh wrote:
| > It also happens to be the sole form of revenue all of the
| largest tech firms enjoy
|
| I don't think this is true unless you qualify it a bit.
| Apple, Amazon, Microsoft, don't make most of their money on
| ads. Even Google has other revenue streams.
| seppin wrote:
| > Even Google has other revenue streams.
|
| How long do they survive in their current form relying
| solely on them?
| kevinmchugh wrote:
| Days, probably, but that's not the point
| seppin wrote:
| It's exactly my point. Outside of Apple, all the biggest
| tech firms are 100% reliant on a form of income that is,
| at best, partially fraudulent. More realistically, almost
| entirely so.
| ogre_codes wrote:
| > The unwillingness of anyone to run such an experiment is
| already an answer. Why wouldn't someone jump at an
| opportunity to prove the thing/service they provide actually
| works, unless they were unsure about it themselves?
|
| Or they have run the experiment and the results haven't lines
| up with their own personal biases so they were discarded.
| johnrgrace wrote:
| The experments are run. Why don't you look at the work that
| comes out of the Advertizing research foundation.
| x0x0 wrote:
| Uber was just incredibly incompetent to not audit their ad
| spend at all.
|
| I worked at an ad company. It was an absolutely standard
| metric to eg geo-fence ads out of a state or two for 3 months
| to demonstrate the impact of ads. This isn't easily
| externally visible, but tests like this are standard
| practice.
|
| Particularly in the app install space, which is sketchy as
| hell once you stop buying from the top handful of vendors,
| buyers should be auditing by a couple million in annual
| spend. To get to $150m without looking hard at big chunks of
| their spend is just plain arrogance and/or incompetence.
| abhgh wrote:
| I partly work in this space, and I can confirm that geo-
| fencing over a time period is the probably the most
| transparent and convincing (to the client) way to do this.
| Essentially you mark out local regions (as small as zip
| codes or as large as states, or something else in this
| spectrum), and ensure that your advertisements only show
| within certain "fences". And then you compare old and new
| numbers within those fences.
|
| The technical aspect aside, there are a lot of "soft"
| factors that help: regular communication of easily
| consumable numbers/graphs/metrics to the client, calling
| out inconsistencies, etc. In other words, this is far from
| a fire-and-forget exercise; this can be an intense
| monitoring and client-engagement exercise.
|
| The regular client engagement sometimes helps you in
| pinpointing cause-effect in the observations too. For ex
| company X might decide to advertise less of product Y in a
| certain state Z because of new laws there. But the team
| you're interacting with might not be aware of this change,
| or might not be cognizant of its potential impact on an
| advt. campaign. Regular dialogue helps here since you might
| observe a change in sales trends, and bring it up in a
| meeting - and the client team might be able to then
| rationalize the change. This is healthy for both parties.
| throwaway201103 wrote:
| > Why wouldn't someone jump at an opportunity to prove the
| thing/service they provide actually works, unless they were
| unsure about it themselves?
|
| Because advertising in some form certainly works. If you can
| determine that approach "A" that everybody is doing is
| actually a waste of money but approach "B" is effective, then
| you can develop services around approach "B" and market them
| based on these findings.
| Nextgrid wrote:
| Nobody is arguing that advertising doesn't work _at all_ ,
| but my argument (which I think a lot of other people agree
| with) is that the effectiveness of online advertising (and
| maybe advertising in general) is overblown.
| masonic wrote:
| Advertising that _does not actually reach the claimed
| consumer_ , by definition, cannot possibly work.
| daniellarusso wrote:
| I had consulted for a gentleman that owns a one-word domain. He
| was using AdWords to direct traffic to his site, without any
| analytics.
|
| I added analytics and began tracking conversion rates (sales).
|
| I was able to reduce his ad-spend by 75% and maintain the
| conversion rates.
| ecf wrote:
| As someone who believes that ad tech is the primary force driving
| the ever growing consumer distrust of technology, I can't help
| but feel a little giddy reading this story.
| Snoozus wrote:
| I have this suspicion that mobile ads have way weaker effect than
| claimed. No-one in adtech has any interest in finding out.
| Marketers don't want to lose budgets or importance either. So a
| lot of money is wasted on annoying people. How sad.
| wpietri wrote:
| Makes sense to me.
|
| CEO: "We need to do something about growth!"
|
| Marketer: "Mobile ads are something!"
|
| CEO: "I read those are hot. Here's a bucket of money! Do lots
| of something so we have lots of growth!"
|
| [spending ensues]
|
| As the Uber story shows, a lot of money gets spent without
| anybody making sure that it actually works. The actual goal is
| not to have an effect. It's to be seen as taking bold action.
| If the business gets better, bonuses and promotions ensue, no
| matter what the actual cause. Cargo cult management.
|
| It sounds insane, but I'm sure it's rife. Years ago I was
| coaching at a Lean Startup weekend class. One team really
| killed it, rapidly testing product hypotheses through real-
| world testing. Their initial idea was quickly proven worthless,
| but they listened to users and came up with an idea that would
| sell.
|
| I kept in touch with one of those team members. He went back to
| his prominent, well-funded startup, excited to improve his
| company. But nobody wanted improvement. Execs wanted to sit in
| a big room, think big thoughts, and produce specs. The
| engineers were to implement those specs. But nobody would
| measure the effects of anything. Proof that a grand poobah's
| idea didn't actually pan out was deeply unwelcome. It slowly
| drove my pal mad and he quit. The company bumped along for a
| few years to a modest acquisition, but it never really lived up
| to the hopes.
| bastawhiz wrote:
| I've been playing a silly phone game for about a month now.
| Only last week I realized it has ads: I'd become so ad-blind
| that I completely ignored the banner ad they keep at the bottom
| of the window at all times. I only noticed it because it
| flickered when transitioning to another ad.
| jayd16 wrote:
| I'm certain they do want to find out. Adtech still wants to
| know where paying users are even if the total is less than
| they'd like to claim.
| PragmaticPulp wrote:
| Engaging random marketing consultants is a good way to waste
| money on ads.
|
| However, anyone engineering for advertising from the start of
| your distribution plans should be able to measure these things.
| It's not hard to track which signups came from ad clicks versus
| organic traffic. The problem is that most companies start out
| focused on their apps and simply assume advertising is a
| totally independent function that happens elsewhere in the
| company. Invest some time into including advertising as part of
| your signup process and it's really not that difficult to track
| LTV of customers who signed up via ads.
|
| In fact, that's how Uber confirmed this fraud. They noticed
| that some of these fake customers were clicking on the ads and
| getting signed up within seconds, which is something only bots
| can pull off. If the customers you're getting from ad signups
| aren't actually spending money in the app, you should know
| about this from basic analytics.
| Snoozus wrote:
| Even if you do this the ad-people will claim that showing
| people ads repeatedly will make them buy your product
| eventually. Maybe when they actually need such a product. At
| this point you cannot connect the events anymore. This effect
| is probably weak but not falsifiable.
| chrisdinn wrote:
| I think the problem is that the overwhelming majority of
| digital ad formats just don't work. Does anyone who works in
| digital ad tech genuinely believe that these formats work? I
| have been here for the last ten years and have come to believe
| they do not, certainly not comparable like traditional linear
| TV or print in their heydays.
|
| There are exceptions. I think Google search ad works so well
| it's eating the product. I think YouTube's TrueView is great
| for modern brand advertisers (safety issues aside). But by and
| large, banner ads, forced video pre-rolls, etc don't work. The
| negative message of the format offsets any message you try to
| convey.
|
| Yes, fraud is a part of this. But I think a lot of this
| evidence looks the same as if none of their targeted,
| performance-based advertising was doing anything at all, beside
| really weak branding.
|
| Genuinely interested to hear from people who disagree.
| georgeecollins wrote:
| Digital advertising is super effective for mobile ftp games.
| It is not a question if they work, it's a question if the
| game can earn enough to justify the cost. Companies in that
| space have a super smart team of economists and data
| scientist constantly checking when a mobile app is worth
| advertising.
|
| Someone in this thread said no one has proved to them that
| digital ads are ever worth it. My experience is that when
| they are you don't want to advertise it to potential
| competitors or the people who carry your ads.
| staticassertion wrote:
| Mobile devices tend not to have adblockers, so exposure might
| be a lot higher.
|
| Also, the only ads I've clicked are mobile ads. I've even
| installed apps via ad before - I've never once purchased an
| item from an ad online (but I've also run an adblocker for a
| decade).
|
| Ads certainly "work" by some metric, and some definition of
| "work", but I think the metric and definition is unclear.
| jackcosgrove wrote:
| The only ads I click on are mobile ads, and that's because
| many times the X to close them is too small. Other times
| the ad is jumping around my screen and it steals my
| fingerpress.
| chrisdinn wrote:
| I think CTD ads (click-to-download) are one of the
| exceptions. It's a great format for some cases, eg games.
| For game devs, trust that yours is addicting enough that
| you can safely show your users a competitor's game knowing
| they'll come back to you. For players, you were looking to
| play a game anyway and maybe you want to try something new.
| Click, download and play that instead.
| wasdfff wrote:
| Instagram ads for millenials are like flies to honey in my
| anecdotal experience. So many of my peers buy their
| furniture, dress shoes, clothing, water bottles, watches, dog
| leashes, pretty much everything in their lives from seeing
| some like-aged person use that thing on an instagram ad (and
| the product usually being pretty cheap). It blows my mind how
| successful these dime a dozen drop shipping companies based
| on instagram are with millenials and gen z, and buying like
| this will only be more normalized in the future as more
| people know someone who got something nice from that
| instagram ad.
| spideymans wrote:
| >It blows my mind how successful these dime a dozen drop
| shipping companies based on instagram are with millenials
| and gen z, and buying like this will only be more
| normalized in the future as more people know someone who
| got something nice from that instagram ad.
|
| Especially with stay-at-home orders due to the pandemic,
| everyone (well, not everyone... but hyperbole) now has
| their own drop shipping brands operated out of their
| basements, all selling the same cheap products off of
| AliExpress. Will consumers catch on to what is going on? Do
| they even care?
| MivLives wrote:
| Yeah I've noticed I've even been drawn to something because
| of the mindless scroll to that's pretty neat, the button to
| buy it is right in front of me.
|
| I suspect this really only works for more novelty things
| like clothing that are cheap enough to enough to impulse
| buy and of interest to image conscious people.
| qwerty456127 wrote:
| > overwhelming majority of digital ad formats just don't work
|
| Doesn't it? It may have miserable conversion rate, limited
| target audience but it apparently is commercially viable.
| People would hardly spend money on sending e-mail spam in
| 2020 if it didn't work.
| kbar13 wrote:
| if you read the twitter thread we see that uber was
| spending 10x more money than they should have on ads simply
| because they weren't auditing where their money was going
| towards.
|
| so there's evidence that people (incl uber, a market
| leader) do indeed spend money on ads even when it does
| nothing
| Hnrobert42 wrote:
| I got 0.66x, as in $100M out of $150M. I likely missed
| something. Where did you see 10x?
| chrisdinn wrote:
| $100M was labelled "fraud" in this example, but there was
| more waste uncovered in the remaining $50M that didn't
| get that label.
| rightbyte wrote:
| How do we not know that the spam is sent out by one sucker
| after the next that go until they realize it is not worth
| it?
| redisman wrote:
| Mobile games run on this. They have a target user
| acquisition cost and spend based on that. It seems to work
| for some very profitable companies. People shouldn't try to
| over read into this. Businesses can't run on irrationality
| for very long
| qwerty456127 wrote:
| Indeed. Mobile games. Perhaps the people who play mobile
| games probably would click an ad of another alike game or
| otherwise related content. They usually aren't mindful
| enough to prefer finding and choosing exactly what they
| need over just clicking an ad.
| chrisdinn wrote:
| I thought that at first. But like the original post points
| out, Uber was spending a lot of money, not just in absolute
| terms but in percentage terms, and it wasn't working for
| them.
|
| There's an allure to making something measurable and
| setting goals against it. Often, those goals take on a life
| of their own. That's what I am suggesting happened here, I
| guess.
| cm2012 wrote:
| Facebook and IG ads work. I agree that display network ads do
| not.
| chrisdinn wrote:
| Ya for sure. I was a Googler so my examples were biased,
| these aren't the only ad formats that work but there are
| fewer than most people (even in ad tech) realize.
| cm2012 wrote:
| Yep, even FB "audience network" ads suck and are fraud
| ridden. Newsfeed is a fundamentally great format for ads.
| 2sk21 wrote:
| However I have not logged into FB in six months because
| the actual content in my newsfeed is so toxic. I wonder
| if this will cause things to change, although it seems
| unlikely.
| trthomps wrote:
| I last logged into FB in 2017... never going back.
| janmo wrote:
| Interestingly mobile ads are typically cheaper to buy than
| desktop ones.
| andrewjl wrote:
| Does this mean that all of the so-called "small business needs
| it" arguments against durable federal privacy legislation are
| totally moot?
| TeeWEE wrote:
| This smells like BS... Uber can easily track user behaviour with
| their own metrics, and see how many users are actually real
| users.. No way this would get unnoticed...
|
| OR there is something really unhealthy going on at Uber.
| Qub3d wrote:
| Something unhealthy going on at Uber? That's never happened
| before...
|
| https://arstechnica.com/information-technology/2015/02/50000...
|
| https://www.wsj.com/articles/uber-to-pay-148-million-penalty...
|
| https://www.washingtonpost.com/blogs/the-switch/wp/2014/12/0...
| marcus_holmes wrote:
| I learnt an old adage while doing my MBA: "Half the money I spend
| on advertising is wasted; the trouble is I don't know which
| half." - attributed to John Wanamaker.
|
| Online advertising was supposed to fix this. You could never tell
| when a potential customer read a billboard, but you could
| absolutely determine when someone clicked on an ad.
|
| I don't know what happened. I suspect everyone got obsessed by
| tracking user behaviour and remarketing and all the bells and
| whistles.
| g42gregory wrote:
| Wow, that's quite a revelation. Uber turns off 2/3 of ads and
| metrics are the same. Eventually, with optimizations, they got
| down to 10% of previous spend without loss of revenue. I wonder
| if the Uber story is unique or it cuts across all advertisers.
| How would this affect Ad Tech industry?
| mrits wrote:
| The ad industry has always claimed that fraud doesn't matter
| because it is priced in. It's been over a decade since I worked
| in click fraud detection but I believe Google's numbers were
| around < 2-5% of clicks were fraud (someone here might have up
| to date numbers). So this _is_ a huge revelation from my
| perspective.
| ghaff wrote:
| Depending on the content of the ads, I could easily believe
| that anyone who is remotely the market for even the occasional
| Uber ride already has the app on their phone and, if they want
| a ride will either use Uber, whichever ride-share is cheapest,
| Lyft if it's available because they don't like Uber, or a
| taxi/limo in situations where that's more convenient.
|
| I guess you can offer promotions but then you're giving money
| away.
| xyst wrote:
| Impending crash - time to short the entire ad tech industry.
| st1x7 wrote:
| I just don't want to lose the web along with the ad tech
| industry though.
| Fordec wrote:
| I don't want to lose the web of the 90s and early 00s. But
| that one is mostly already gone.
|
| This version we're currently in, no it can die off for all
| I care.
|
| Bring on the disruption!
| vb6sp6 wrote:
| The web existed before the adtech industry. It will live
| after it.
| wasdfff wrote:
| As a smoking crater maybe. The web was orders of
| magnitude smaller before the adtech.
| hedora wrote:
| Yes, a smoking crater full of exotic diamonds.
|
| We don't need more internet content, we need a higher
| signal to noise ratio.
| vb6sp6 wrote:
| The web was small because it wasn't filled with ads,
| blogspam, clickbait, etc. So much stuff out there is just
| pure garbage.
| skinkestek wrote:
| yep, but it is mostly those parts I want back. I can
| almldt live fine with:
|
| - programming blogs that doesn't have ads
|
| - Wikipedia
|
| - three or four online newspapers/websites that I pay for
| anyway.
|
| - HN
|
| - all the old stuff: web rings and enthusiast web sites
|
| - I'd probably miss stackoverflow but I use that site
| less and less these days anyways.
|
| Most of the rest can burn and we'd maybe be better off.
| At least search results would be cleaner :-)
| thu2111 wrote:
| Wikipedia is constantly running ads. They're just
| "charity" donation ads so you don't think of them as
| such, but turn on the TV and you'll notice that charities
| advertise themselves to get donations all the time. It
| doesn't make it not advertising.
|
| As for HN, how long have you been using it? Are you aware
| it's ad supported? Some stories are ads, usually for
| hiring.
| skinkestek wrote:
| We were talking about adtech.
|
| You are allowed to think differently, but personally I'm
| fine with the banners on Wikipedia (except IIRC and AFAIK
| they pretended they were short on money while in reality
| they were expanding).
|
| I'm also fine with YC running job ads on YC.
|
| I'm however not fine with 100 - 1000 [1] ad and tracking
| networks pretending they have reason to log my browsing
| habits on a typical site.
|
| [1]: based on copying the list from "cookie banners" to
| Libre Office Calc and checking how many lines I got.
| jedberg wrote:
| > Are you aware it's ad supported?
|
| This is 100% wrong. HN is paid for by YCombinator. Yes,
| some of the posts are hiring posts, but no one is paying
| for those.
|
| What pays for HN is the success of the startups that YC
| invested in.
|
| > Wikipedia is constantly running ads.
|
| This is wrong too. They only run ads in November. The
| rest of the time the site is 100% ad free.
| idunno246 wrote:
| Working in iPhone games, our biz dev people made us integrate
| with the shadiest of ad publishers. But we required attribution
| and could track how much the users spent, so could stop
| spending on them quickly, which was the normal result. Most of
| the companies were surprised we wanted attribution and had to
| build something custom, which to me means at the time nobody
| else was tracking it so lots of customers must have been
| getting fleeced. From the tweet, it's crazy that they were
| spending 100m without tracking the quality of the users.
|
| Also worked in ad tech. There were some types of customers that
| cared about performance, but the largest were typically
| agencies and all they cared about was spending the budget they
| were given. Everybody knows this is happening, you can
| differentiate yourself slightly by doing better detecting it.
| But at the end of the day people really care about customer
| acquisition cost which includes the fraud, so if you had 0%
| fraud everyone would just raise their prices or margins
| Kalium wrote:
| > Also worked in ad tech. There were some types of customers
| that cared about performance, but the largest were typically
| agencies and all they cared about was spending the budget
| they were given.
|
| Large companies call it "brand" spending. Which is to say
| they're spending to maintain brand awareness. Measuring ROI
| would call the practice into question.
| jsnell wrote:
| > From the tweet, it's crazy that they were spending 100m
| without tracking the quality of the users.
|
| They were high quality users: Uber didn't pay for installs,
| but for installs + first ride. What's being alleged is that
| the ad networks were detecting a user installing the app, and
| fraudulently creating an ad display event to make it look
| like the install happened due to the ad.
| 0goel0 wrote:
| I like how some people in this thread are calling some
| transparency in adtech space "take down".
| kliments wrote:
| A solid organic marketing strategy is worth investing in, rather
| than pushing all your funds in traditional digital marketing.
| Traditional ads often feel forced, and internet users are keen to
| ignoring them.
| furyg3 wrote:
| Here's a nice article the correspondent did about the online
| advertising bubble. Not a lot of evidence of the efficacy of
| advertising, and few dare to run the one experiment that counts
| (pull all ads for a quarter and see what happens):
|
| https://thecorrespondent.com/100/the-new-dot-com-bubble-is-h...
| srg0 wrote:
| I wish more companies would try to find out the actual value of
| advertising and targeting. And it probably won't be as good as FB
| and GOOG would like us to believe.
|
| BTW, there was a recent episode of Freakonomics Radio which
| talked about this eBay experiment
|
| https://freakonomics.com/podcast/advertising-part-2/
| tehlike wrote:
| You can use third party measurement providers to validate the
| roi.
| jedberg wrote:
| They go into that in the podcast. ebay had one third party
| prove that the other third party was just making things up to
| validate the ROI.
| acfou wrote:
| this is a really good episode, worth a listen
| nceqs3 wrote:
| ^agreed
| vgeek wrote:
| https://corgilytics.com/content/do-online-video-ads-impact-l...
|
| This is a look at what a $200k Youtube ad buy will generate for
| a fictitious brand with 0 prior marketing efforts. Display
| advertising is so hard (if not impossible for many verticals)
| to get right.
| vmurthy wrote:
| Something for the HN crowd that goes beyond articles: A HBR
| article[0] which talks about an experiment that eBay did
| testing if digital ads are effective and the paper that the
| actual study[1] produced.
|
| [0] https://hbr.org/2013/03/did-ebay-just-prove-that-paid
|
| [1] http://conference.nber.org/confer/2013/EoDs13/Tadelis.pdf
| radium3d wrote:
| You need proper conversion tracking or you're gonna have a bad
| time
| Triv888 wrote:
| Cities discovered they'd been defrauded out of 2/3 of their taxi
| revenues... By Uber.... Looks like money is flowing...
| etempleton wrote:
| Because most advertising is not effective on a 1:1 basis. The
| clean, direct conversion funnel is in most industries and sectors
| a complete myth.
|
| Advertising is about awareness. All good marketing is long-term.
| Digital advertising has been sold (by overzealous marketers) as
| magical 1:1 sales machines. It is almost always not that.
|
| This is the hardest thing to convey to clients. Clients want a
| promise and a guarantee on their investment. The truth is there
| are no gurantees. But that is what clients want so they go with
| whoever promises the most the most confidently. The most
| confident ones are usually either lying or don't know what they
| are talking about.
| Ericson2314 wrote:
| I believe there is some overall culture-rotting efficacy, but
| it's such a depressing conspiracy: complete coordination
| failure with real problems, and yet a cartel of marginally
| negative-ROI ad spending to prop up consumerism?
| vorhemus wrote:
| That sounds like a religion: You don't know exactly what you
| get, there are no guarantees but if you really believe in it
| (and pay your marketing church tax) you'll probably end up in
| CTR heaven.
| dylan604 wrote:
| If you meet ad agency people, you will definitely get that
| cult-like vibe from them. There's a definite slimey feeling
| to any of their conversations regarding work. I overheard 2
| people from different agencies trying to one-up each other
| with their stories of how much of their client's money they
| spent on ridiculousness. It wasn't about how they could save
| their client money and then spend it in other areas. One
| person I met that worked in ad tech and I told him the
| efforts with extensions/private mode/vpn/etc to block as much
| of ad tech as possible. He was totally aghast that people
| would go to that much effort to block their "harmless" tech.
| Yet another Kool-aid drinker. I have a feeling chatting with
| any G/FB employee would be similar.
| veeenu wrote:
| I worked in wealth management up until recently and can testify
| this exact behavioral bias was to be found in almost every
| single client, and sometimes in professionals as well,
| especially during market downturns. It's likely to be a mix of
| several factors, such as the fact that losses have a much
| stronger emotional impact than gains of similar entity, or the
| fact that most people aren't really trained to reason
| probabilistically in an intuitive manner. It is easy to be
| lured in by someone promising the moon when most people won't
| settle for anything less.
| TedShiller wrote:
| Ads don't work
| [deleted]
| birdyrooster wrote:
| Yeah I think Google and other advertisers are great at predicting
| what people will buy and then shows them ads for it. That's
| different than showing a person an ad and changing their
| behavior, but to advertisers they can't know unless they
| experiment.
| [deleted]
| carlmr wrote:
| But that would still make their ad spend useful. Even if not in
| the traditional marketing sense.
|
| But if you can't see any change in business from 2/3 of ad
| spend at all it must be fraudulent.
| josefx wrote:
| > Yeah I think Google and other advertisers are great at
| predicting what people will buy and then shows them ads for it.
|
| Seems to be entirely subjective.
|
| I bought a new blade for a bread cutting machine on amazon, the
| last one lasted ~25 years. My current recommendations: blades
| for bread cutting machines.
|
| I also checked some Christmas decorations on Amazon, but didn't
| buy any. So next to the blades I get Christmas decorations
| recommended. January is a bit late for that, isn't it?
|
| I also bought a single server rack on eBay. Now I regularly get
| spam emails from eBay reminding me of new offers for server
| racks. Even the company I work for doesn't have that many, so
| why?
|
| In short I am not really convinced that these platforms are
| good at predicting what I want. Rather it looks as if they are
| good at showing me what I already have.
| spatley wrote:
| The answer to your confusion is that un sophisticated
| remarketing (showing ads for searched or purchased items) has
| in nearly all cases a measurable improvement on ROI.
| Improvements to filter out useless ad views are much more
| complicated and expensive. Advertisers actually don't care
| about any individual case, but buy on aggregate results.
| Snoozus wrote:
| Oh I don't think anyone is confused about why this happens
| or why it's still worth it. The next step we need to take
| is to agree that it is unethical to steal many people's
| time for a little reward.
| nobody9999 wrote:
| >In short I am not really convinced that these platforms are
| good at predicting what I want. Rather it looks as if they
| are good at showing me what I already have.
|
| While that's definitely true (I get ads from Amazon for stuff
| I've already purchased all the time too), in that case Amazon
| is leveraging their own marketing channels to support their
| own business -- which has, effectively, zero marginal cost to
| them.
|
| However, when advertisers buy space from Google or FB, that's
| not the case. There is a definite external cost to such ad
| buys.
|
| As such, being able to identify the "value" of such
| expenditures is (or can/should be) important to the
| advertisers.
|
| That said, much of advertising is based upon the idea of
| "top-of-mind awareness."[0]
|
| The idea being that if you are considering a purchase, the
| brand that comes to mind without prompting when considering
| that purchase will be preferred over brands of which you
| aren't immediately aware.
|
| Purchase decisions made on a whim or without any research are
| usually those which are low cost. Which is why companies like
| P&G, Coca Cola and like companies focus on "top-of-mind
| awareness."
|
| If you're going to buy a washing machine or a riding lawn
| mower, you're much more likely to do research than if you're
| going to buy a soft drink or a bag of chips.
|
| That said, the same "top-of-mind awareness" can be helpful
| even for big ticket items, as those brands may well be the
| first ones about which research may be done.
|
| Identifying how such advertising may impact purchase behavior
| is a complex topic, and unless you can quantify specific ad-
| views to actual purchases, doing so is generally speculative
| and is the subject of a great deal of quantitative market
| research[1].
|
| [0] https://en.wikipedia.org/wiki/Top-of-mind_awareness
|
| [1] https://en.wikipedia.org/wiki/Quantitative_marketing_rese
| arc...
| Aunche wrote:
| The probability that a random person would want to buy a
| blade for a bread cutting machine is nearly 0%. The
| probability that you will buy a blade for a bread cutting
| machine again is non-zero because you may be dissatisfied
| with your new one.
| panda888888 wrote:
| Agreed. Companies often don't understand the "directionality"
| of purchasing behavior.
|
| For instance, I recently bought a new iPhone directly from
| Apple, and I bought a case for it on Amazon. Now two months
| later, Amazon is recommending that I buy an iPhone (...which
| I bought two months ago from Apple).
|
| Buying a case an then waiting two months to buy the actual
| phone would be a very strange thing to do, but Amazon seems
| to think I should do this.
| eitland wrote:
| Remember this is the same Amazon that files C# and
| Javascript books under "Law books" etc, I have documented
| it: https://erik.itland.no/fun-with-amazons-ai-machine-
| learning
|
| And Amazon is definitely not alone: Google has been
| troubled with "AI" running rampant in search results for
| years, seemingly with no or very little QA.
| ghaff wrote:
| I would guess it's fairly hard to encode a lot of rules that
| are obvious to most people algorithmically. Amazon does
| encode a likelihood of repeat purchases to some degree; they
| offer a coffee subscription but not a weed whacker
| subscription.
|
| But besides doing something like "purchases >$100 are not
| likely to be repeat purchases," I would think it would be
| difficult.
| pas wrote:
| The usual reply to this is that Amazon shows you that
| because you might return it and then buy a new one, gift it
| to someone, etc.
|
| They show it because it "works" for them, not because it's
| wrong and they just can't somehow make sure they don't show
| something.
|
| Because even if 99% of people don't buy anything twice, 1%
| probably does for some reason, and that signal just trumps
| all the noise. (And that's why most of ad spending is
| bullshit, but since Amazon's cost [even with opportunity
| cost] is basically 0 on their own site, they'll continue to
| do this.)
| jqbx_jason wrote:
| It's not necessarily that the ads aren't effective but their
| reporting of ROI has been off in my experiences. I've been
| running attribution surveys on the e-commerce sites I own [1] and
| the results have never matched up with what FB or Google reports
| back. Some of it may just be bias but I can definitely how some
| rounding errors may start to creep in with large numbers.
|
| [1] https://www.zigpoll.com/examples/attribution-survey
| cush wrote:
| Apparently because they're being defrauded.
| melomal wrote:
| I am enjoying seeing this coming to light more and more. Paid Ads
| with FB and Google used to actually be really good, they worked
| really well but since the influx of Drop shippers, algo updates
| and everything else in between they have both got really
| expensive and drive far fewer results.
|
| I mentioned in another post on HN about Googles Quality Score of
| your ad based on 0-10 scale. There is no clear way to fix the
| issue, you just have to read Google's Docs and figure it out. In
| the mean time, you will be charged extra of the low-quality ad
| but it will be shown still. Now you are spending money, changing
| a headline here, changing a bit of text there and still you get
| 4/10 score.
|
| PPC has become nothing more than gambling with it almost feeling
| like 'If I just change one more headline I might get rich' - this
| is what it has felt like to me for a long time now.
| cm2012 wrote:
| Friends don't let friends do programmatic direct response
| advertising. Do it directly on the platforms yourself.
|
| I run an ad agency with relatively well known clients and I
| consider the word "programmatic" in a resume a negative
| correlation.
| raverbashing wrote:
| Care to elaborate more? What exactly is "programmatic direct
| response advertising"?
| cm2012 wrote:
| So programmatic means using a 3rd party ad tech tool to place
| your ads across all internet ad placements.
|
| Doing it directly means placing ads yourself on the biggest
| platforms (Facebook, google).
|
| Direct response just means "if you actually want
| results/ROI", as opposed to for nebulous brand goals.
| j00b19 wrote:
| Good to see this type of fraud being called out.
|
| I once worked for a company where we were tasked to create "fake
| users" to make it look like a website was getting way more
| traffic than it actually did on the premise of doing an "extended
| load test".
|
| Come to find out years later the person commissioning the fake
| users was trying to sell the website and wanted to validate their
| asking price -- with fake users and fake traffic.
|
| Long story short it didn't work out that well because eventually
| the algorithm running the fake users got entirely blocked out by
| whoever was the host at the time and the guy wasted his money.
|
| I just wonder how many times things like this have happened and
| people were very successful from it.
|
| Fake likes and fake posts by fake users who then are clicking
| real ads seems like the landscape nowadays =/
| reiska123 wrote:
| Yeah, not surprised at all here. What is surprising is that they
| actually found this out and acknowledged it.
|
| Used to work in the performance marketing team for one of the top
| 10 brands as an analyst/data scientist, and the reality is that
| the company politics and individuals' career ambitions top the
| science. Most of the time the work that gets visibility is spent
| on "creating stories around data for the leadership": marketers
| do not understand at all the data they are fed to by the
| advertising platforms. Also, running controlled A/B studies
| tended to show between 0 and 10% (this was rare, closer to 0%
| more common) causal impact on campaings making none of the
| marketing campaigns profitable in the sense that was used for
| performance evaluation.
|
| There is one key visicious loop keeping the game going:
|
| 1. The marketers want to show great numbers back to the
| leadership (internal storytelling). Their employment/bonuses
| depend on the number reported by the ad platform.
|
| 2. The ad platforms want more of your ad spend which can be
| achieved by showing better ROI in their platform.
|
| 3. Both the marketers and the ad platforms want to show as good
| numbers as possible, leading to a situation that nobody is
| incentiviced to measure true performance / correctly measuring
| performance.
|
| None of the A/B tests nor analyses about ad fraud went beyond the
| marketing director. One cool case was analyzing Google's
| DoubleClick ad logs for a bunch of campaigns that showed there
| were few cookies that received a significant % portion of the
| total ad spend - meaning that few "insividuals" received tens or
| hundreds of thousands of ad impressions.
|
| Nobody cared and this still goes on. It is such a toxic
| environment to work in I ended up changing career a bit.
| pugets wrote:
| Could some of this be because the given timelines are too short?
| They gave the example of Chase, which moved from 400,000 digital
| ads to only 5,000, but they declared there was no significant
| difference in business after "only a few days."
|
| As a person who has never used Chase, I'm not going to suddenly
| want to switch to them just because I saw a banner ad. That would
| be ridiculous. It's the sum of all the Chase advertisements I've
| seen in the past decades that have made me believe they're a
| popular and trustworthy bank.
| chrshawkes wrote:
| Does the idiocy of these companies surprise anyone? I had people
| tell me I can't stream videos... here it is... thousands of
| paying customers every month. The difference between Uber and I?
| I'm profitable. I'm coming after Udemy and Pluralsight.
| https://www.codehawke.com/all_access.html
| moonraker wrote:
| For anyone super interested in this topic (and the potential
| ramifications for Big Tech and society), Tim Hwang (former global
| public policy lead for artificial intelligence and machine
| learning at Google) wrote a wonderfully in-depth book about this.
| See the link below: https://us.macmillan.com/books/9780374538651
| kodeshpa wrote:
| True story, when I joined Uber, this was my team's first project.
| Our goal was to find unattributed spending and bring transparency
| in ad spend with automation and better tooling. AMA.
| cccspr wrote:
| It's amazing how large brands like Uber aren't tracking actual
| performance. There's "metrics" and then there's actual results. I
| worked at an ad agency on the HBO account and was shocked at how
| basic their digital team and our agency team was.
| kodeshpa wrote:
| True story, when I joined Uber, this was my team's first project.
| Our goal was to find unattributed spending and bring transparency
| in ad spend with automation and better tooling.Ask me anything.
| bigdict wrote:
| Together with https://news.ycombinator.com/item?id=25623858 it
| might appear like there's a coordinated takedown of ad tech
| companies going on.
|
| Google derives 80% of its revenue from ads, Facebook 99%. Imagine
| these giants coming down if it turns out that online ads aren't
| effective?
|
| EDIT: Tweaked the wording regarding the alleged "coordinated
| takedown" as a reaction to a comment.
| marketingtech wrote:
| The issue is, most online ads don't work EXCEPT for G and FB.
| That's why they're so dominant.
|
| The average third-party ad networks are junk, rife with fraud
| (ads that are never actually seen or clicked by a human), poor
| targeting, poor measurement, limited brand safety, and opaque
| billing.
|
| First-party ad tech provides much better control over these
| factors and can generally be offered cheaper because they can
| more effectively allocate their clients' budgets. In what other
| industries are the superior products cheaper than the junk?
| (not rhetorical - I'm curious if this exists in other
| industries)
|
| G and FB are the biggest first-party ad sellers, given that
| their total addressable audience covers most of the free world,
| with Amazon rapidly gaining ground. TikTok, Pinterest, and
| Snapchat are building clones of G/FB's ad tech by poaching a
| lot of their engineers (karma for G/FB cloning their consumer
| products...) and are also showing strong growth as first-party
| sellers.
|
| If you're a website/app that monetizes through a third-party
| network (including Google Adsense and Facebook Audience
| Network), you're going to see your revenues plummet in the
| coming months.
| Ericson2314 wrote:
| Good. Advertising is a terrible zero-sum industry that just
| distorts market activity. It has little place in capitalism or
| any other system.
|
| Exceptions:
|
| - _New_ products deserve some advertising. I would handle that
| like the patent system. Demonstrate your product is
| sufficiently different, and get access to some attention
| economy time slice.
|
| Some may say, well what about competition with existing
| products to bring down cost? Simple, get rid of stupid
| https://en.wikipedia.org/wiki/Monopolistic_competition and
| start selling things in unmarked tubs with a price tag.
| Cheapest one wins. Of course, there has to be quality control
| and avoiding regulatory capture with that, but stupid brands
| are not a good solution to that problem.
| strictnein wrote:
| Centrally planned economy that also controls speech, based on
| the patent system. This seems like quite the recipe for
| success.
| Ericson2314 wrote:
| Start with https://en.wikipedia.org/wiki/Cidade_Limpa. I
| don't think this will slippery slope if well done:
|
| - I choose the TV channel, website, etc. to visit, but
| public space I might have to walk through because it's the
| only option - In that public space it may be impossible not
| to see the adds - sight lines in public spaces are public
| property
|
| Now, one may ask "what about paying someone to verbally
| advertise in public space". I think that should remain
| legal, because that does seem like a slippery slope. I'm
| willing to risk that society won't collapse so far that
| that highly inefficient form of advertising became cheap
| enough with destitute surplus labor.
| Anon1096 wrote:
| What makes you say advertising is zero-sum? This doesn't seem
| to be the case at all to me.
|
| Take diamonds for example. Prior to the mid 1900s, diamonds
| weren't nearly as sought after as they are currently. It took
| the marketing and advertising efforts (among other efforts,
| like monopolizing the mining process) of De Beers to convince
| the public that diamonds should be highly coveted. It was
| advertising that pushed the public to think spending X
| months' salary on a diamond ring should be normal. De Beers
| is obviously highly derided, but this a pretty clear cut case
| that advertising is NOT zero sum. The value of diamonds went
| up because of advertising, and nothing else depreciated in
| value as a result.
|
| I won't even touch on your other points about unbranded
| goods, except to say that consumers definitely show
| preference for branded items, and I don't really see why that
| is a problem.
| Ericson2314 wrote:
| > diamonds
|
| I mean zero-sum in that advertising shifts spending from
| one area to another. Perhaps all the diamond ring money
| would have gone into other things.
|
| It's a hard point to prove or disprove, but even if
| advertising overall deceases the consumer saving rate, sure
| the vast majority of advertising cancels out. (I'm going to
| buy tide or downy, but not both.)
|
| > except to say that consumers definitely show preference
| for branded items
|
| Well these meaningless competing brands convey no
| information and waste tons of resources. And it's rather an
| embarrassment to Capitalism for the primary non-price
| information exchanged by market actors to be bullshit
| noise, even if it isn't a "real problem" compared to global
| warming or something.
| visarga wrote:
| > De Beers is obviously highly derided, but this a pretty
| clear cut case that advertising is NOT zero sum
|
| If you take into consideration the money wasted on
| overpriced stones, it's zero sum. How did people ever get
| engaged before De Beers?
| Anon1096 wrote:
| That is not at all what zero sum means. If you're going
| to use a widely-used term at the core of an argument, you
| should be sure you're doing so correctly.
| visarga wrote:
| So, advertising created value here by convincing people
| to give their money for shiny stones? Instead of, you
| know, investing in health, education or a vacation?
| Overall, was it a net win? On the one hand, one company
| makes money, on the other hand, many people waste
| significant resources for a symbolic gesture.
| texasbigdata wrote:
| Privately knowledgeable parties (not me) have been talking
| about this for ages. A close friend quoted the same %age as the
| podcast underlying the tweet did as being fake.
|
| By the way how impressive is the scammer level of
| sophistication. App level man-in--middle-esque (probably
| imprecise terminology) forging of attribution based on massive
| monitoring and siphoning of what otherwise would have been
| organic conversions. Super cool. And those were the ones they
| caught imagine what they didn't.
| ericol wrote:
| I don't think that's the case. If you browse HN somewhat
| regularly, you'll see that a lot of times when a post makes it
| to the top (Or close enough) it's very likely that a related
| post will make the rounds pretty soon.
|
| I think it's more related to people trying to ride the karma
| wave than "A coordinated takedown of ad tech companies". And it
| is effective, because it happens way too often.
| bigdict wrote:
| I agree, I remember reading an article or a comment
| explaining this phenomenon on HN, with examples.
|
| Nevertheless it would be interesting if the idea of digital
| ads being ineffective snowballed to the point where it became
| like a self-fulfilling prophecy, and led to the demise of
| large companies that we think of as "giants" or "monopolies".
| pydry wrote:
| Or a coordinated "strike" by major ad spenders.
|
| I'll bet that a lot of ad spend is zero sum. They'd
| probably rather share profits than boost google's.
| dang wrote:
| Yes, this was just a standard follow-up [1] and we did the
| standard counter-follow-up, which is to merge the threads.
|
| [1] https://hn.algolia.com/?query=follow-
| up%20by%3Adang&dateRang...
| bigdict wrote:
| Hi dang, I'm wondering is there a list of HN phenomena that
| you've noticed over the years?
|
| Examples would be:
|
| 1. follow-up submissions
|
| 2. an initial wave of critical comments followed by a wave
| of apologist comments
|
| 3. first page of comments occupied by a single top level
| comment with lots of descendants (you often post to draw
| attention to other pages of comments in these cases)
| dang wrote:
| There's no systematic list but I use links to HN Search
| (like in the GP) to refer to such patterns. There must be
| a hundred such categories by now. Eventually I may try to
| compile them into something more standardized.
| dylan604 wrote:
| > it might appear like there's a coordinated takedown of ad
| tech companies going on.
|
| Oh please let it be so, even though it's just a wild ass guess.
| Ad "tech" has ruined the internet (only slightly hyperbolic).
| Oh to be able to recover the "innocence" of the late 90s
| internet. Maybe I should just stop browsing so I can spend more
| time yelling at the kids to get of my lawn
| KONAir wrote:
| I am at a loss to this '90s innocent internet. It scared me
| into using adblockers for over 2 decades (which
| coincidentally makes the article and this whole thread
| completely alien to me).
| f430 wrote:
| You had to use an adblocker because advertisers went crazy
| with tracking and a lot of shady stuff.
|
| If you've been on various internet marketing forums, you
| will see that this is just a group of people who weren't
| smart enough to land a wall street jobs but morally
| unhinged enough to defraud businesses.
|
| I am already hearing about law firms sending out letters
| and emails to people who bought Google or Facebook ads in
| the past 10 years.
|
| With the new USGOV administration hawkish towards social
| media/tech (essentially ad revenue dependent cmopanies) and
| now seeing class action lawsuit against ad tech companies,
| my popcorn is being prepared in the microwave.
|
| People have no idea how lucrative ad click fraud is in the
| botnet market. It used to be that botnet operators DDOS for
| hire or install Dutch spyware toolbars, now with headless
| browsers and fingerprinting evasion it has become
| impossible to distinguish real ad impressions from fake
| ones.
|
| Your only tool to fight these fraudsters are statistics but
| over the past 10 years the "bad guys" (I don't know who is
| more evil, the people defrauding businesses legally or
| illegally) finally figured it out. They know if they are
| too greedy they will be caught so they now play the long
| milk game.
|
| It is incredibly lucrative. A single botnet victim can
| yield upwards of $2~4 in ad revenues from a variety of ad
| networks.
|
| _It is IMPOSSIBLE to distinguish real from fraud ad clicks
| /impressions since the introduction of headless browsers
| and fingerprint evasion_
|
| Somehow web scrapers/botnet operators have found the sweet
| spot. This is just like how the American Cosa Nostra
| working with Russian criminal groups were able to siphon
| off crude oil from the USGOV in the 80s.
|
| I miss the 90s when everything was more simpler and secure
| as a result. You can't hack an HTML document.
| ineedasername wrote:
| No need for a conspiracy: one popular article sparks the
| submission of something similar, and given there was enough
| interest to make the first one popular, it's not uncommon for
| another to become popular.
| f430 wrote:
| I see lot of anxious people from the ad industry commenting
| on these threads trying to convince the rest of us we are
| wrong.
|
| It's funny how quickly the word conspiracy is used by the
| party that has most to lose.
|
| It's more likely that people have spend the past 10 years
| buying into the online ad industry, got burned and finding
| out it wasn't because they weren't spending enough it was
| that they were defrauded.
|
| We should see class action lawsuits over the next 10 year
| horizon that will put a massive hit to the shady ad tech
| industry.
|
| Millions of small to big businesses were defrauded out of
| their ad spend and now the industry will simply make way to a
| whole new scam.
| coldtea wrote:
| > _it might appear like there 's a coordinated takedown of ad
| tech companies going on._
|
| Or, you know, somebody read the first article on HN, then found
| the other somewhere, and thought of posting it, as it relates
| to the same disucssion...
|
| Happens all the time with posting clusters (and the Baader-
| Mainhoff phenomenon).
| lasc4r wrote:
| Nice conspiracy theory bruh.
| ErikVandeWater wrote:
| People tend to upvote things related to what they've seen
| recently.
|
| It is in fact much more likely that Google decreases the
| visibility of articles that in any way tarnish Alphabet's
| reputation.
| Nextgrid wrote:
| I don't think there is a coordinated takedown; after all,
| ranting about it on HN wouldn't affect anything if advertising
| actually worked as designed and had the intended effect.
|
| The problem is that first off, people rightfully dislike
| advertising so it's expected for them to rant about it, second,
| regulation is being worked on (whether the GDPR, CCPA, or
| similar) that would thwart targeted advertising, so advertising
| is now also facing pressure from the government and not just
| from people ranting about it, and third, these articles talk
| about brands themselves having doubts about the effectiveness
| of their advertising efforts and the media rightfully reports
| on it.
|
| Ranting about ads by itself won't change much, but in this case
| it seems some advertisers themselves are having doubts as to
| how effective it really is and both the media and HN is
| reacting to that.
|
| > Google derives 80% of its revenue from ads, Facebook 99%.
| Imagine these giants coming down if it turns out that online
| ads aren't effective?
|
| Just because Google and Facebook are able to make a profit off
| their ads doesn't mean that their ads are actually good value
| and not overpriced, nor that the people in charge of assessing
| the ROI of these ads are incentivized to look into it (which is
| the point I'm arguing in the thread you linked). You can very
| well agree that online ads _are_ effective but still aren 't
| worth what they are currently priced at.
| jeffrallen wrote:
| Lay down with dogs, get fleeced.
| WalterBright wrote:
| Old joke: Advertising exec says: "I know I'm wasting 50% of my ad
| budget. I just don't know which half."
| sigmaml wrote:
| As with almost everything in life, there are multiple factors to
| take into account.
|
| We recently ran several drip campaigns, as well as a few fire-
| and-forget campaigns, together with corresponding ads through
| Google. There was a marked difference in customer uptake before
| and after the ads. We have also pretty regularly received
| feedback on our ads.
|
| In fact, that is what we have observed over the years. Customers
| are conscious of what the ads say, where they get placed, and -
| usually - can crosscheck the quality of the ad with that of the
| product.
|
| In my experience, it is rash to generalise and say that ads are
| not useful.
| mam2 wrote:
| Well people are not going to magically drink less coca because
| there's no ad. Best case is you get the effect 2 years letter.
| htwyford wrote:
| Tim Hwang wrote an excellent short book that deals with this,
| Subprime Attention Crisis:
| https://www.goodreads.com/book/show/50403486-subprime-attent....
| He addresses that most interactive advertising is never seen and
| prices are massively inflated. The attention is subprime, like
| subprime mortgages. One companies realize most of their ad money
| is being wasted, we might see massive recognizing in
| Google/Facebook valuation and in the rest of the economy as a
| result.
| doopy1 wrote:
| This book is the laughing stock of ad tech right now, it's got
| some good ideas, but it's 90% sensationalized and half-baked.
| The mortgage analogy is weak as well. This book is a money grab
| more than anything. It's an attempt at stirring the pot.
| drewwwwww wrote:
| do you know if anyone has written a detailed critical
| response?
|
| people in the industry it is about laughing it off i think is
| to be expected. i doubt most traders in mortgage
| securitization in 2006 would have agreed the sky was about to
| fall.
| doopy1 wrote:
| I saw a nice synopsis from a finance person on reddit on
| why the analogy to the mortgage issue is way off the mark,
| but I doubt I can find it again. My point is that there's a
| whole burgeoning industry in whining about how ad companies
| are evil, but it's not really quite so black and white.
| Balgair wrote:
| What 10% of the book is good?
| doopy1 wrote:
| I think calling attention to issues with ad tech is good,
| that's where my 1/10 score comes from.
| jacquesm wrote:
| Looking forward to Google ad Facebook doing some massive refunds.
| twotimestuesday wrote:
| I've been running on site attribution surveys[1] on a handful of
| brands that I work with and the results have been pretty
| surprising. Word of mouth tends to be overrepresented and FB
| underrepresented though there is probably some sample bias so
| it's far from a sure thing.
|
| [1] https://www.zigpoll.com/examples/attribution-survey
| mcnichol wrote:
| I hate that we use twitter to report on stuff...it feels like the
| worst medium to talk about meaningful issues and the easiest way
| to get things twisted.
| diarrhea wrote:
| This is now at 700 comments, and no one is talking about the math
| in the Twitter "thread". Found no mention in the Twitter replies
| either. Is it just me or is the math hilariously off?
|
| [0]: "10% of $150M is $15M". Correct, but do we need _a
| screenshot of a calculator_ for that, let alone Google? (why do
| people rely on an internet connection and Google for this?)
|
| [1]: Talking about "2/3", but putting in "0.75". So which is it?
|
| [2]: We are at $50M now. "Knock off" $20M, leaving us at $30M.
| Yet she puts in $20M into her Google calculator, gets 13.3% and
| calls it "a little over 1/10". Fair enough, but the real number
| is 30/150, so 1/5, 20%, _double_ of "1/10".
|
| Come on, this was not rocket science math! Should have double-
| checked before publishing, especially if you're a business
| consultant [3].
|
| 0: https://twitter.com/nandoodles/status/1345786303263219712
|
| 1: https://twitter.com/nandoodles/status/1345792380184760321
|
| 2: https://twitter.com/nandoodles/status/1345794089825021963,
| https://twitter.com/nandoodles/status/1345795168105066496
|
| 3: https://twitter.com/nandoodles/status/1345853158279565313
| jordache wrote:
| why are you so focused on people using the google calculator?
| They built it, people will come.
|
| who cares!?
| hinkley wrote:
| Edward Tufte seems to be here on earth to suffer for some
| offense in a previous lifetime. To know how badly statistics
| get abused, to be able to describe it, and be heard by a
| fraction of people who can't manage to fix the problem either.
|
| No wonder he fucked off to a farm to concentrate on sculptures.
| Philip-J-Fry wrote:
| I use google for maths because it's the fastest thing I can get
| to and TYPE my maths in without having to open a new
| application. You can even just type it in the search bar of
| Chrome/Edge and see the result immediately
| smnscu wrote:
| Both Windows and macOS support calculations in their
| respective system-wide search bars (Win key on Windows vs
| Cmd-Space for Spotlight on macOS). They both support pretty
| cool stuff like sqrt(9), 13^37, but Spotlight edges it
| slightly by also support bit shifting like 1 << 10 == 1024.
| throwaway_user6 wrote:
| Nice tip, I just realized spotlight has currency and unit
| conversions that I typically get from google.
| diarrhea wrote:
| Is this a Cortana feature? Nothing pops up for me (WIN
| key), and a search online reveals it seems liked to
| Cortana, which I seemed to have disabled.
| dockd wrote:
| Start typing "calculator" after pressing WIN.
| olyjohn wrote:
| Win+R - Type in "calc" hit enter. Works every time, not
| only when Windows search decides to work.
| vollmond wrote:
| I did not know this - thanks!
| tpetry wrote:
| It's ok to use google for calculations. But kind of strange
| to show a calculator screenshot as proof for a 10%
| calculation...
| ing33k wrote:
| Some one had mentioned it in the thread. Looks like it's
| deleted now.
| zapdrive wrote:
| Lol, women and maths don't work together. In her head 2/3 =
| 75%, because she never actually tried to understand fractions
| and only memorized them. Women are good at memorizing, not at
| understanding.
| eznzt wrote:
| >[0]: "10% of $150M is $15M". Correct, but do we need a
| screenshot of a calculator for that, let alone Google? (why do
| people rely on an internet connection and Google for this?)
|
| She knows her audience.
| swyx wrote:
| I want to give her the credit of making some sort of dramatic
| point, but yeah it felt a little condescending.
| ksec wrote:
| Thanks it was causing me headaches when I was reading the
| thread. I thought it was some marketing terms and calculation I
| had no idea about.
|
| What how much did they actually saved? Apology in advance
| because I really couldn't grasp what she was saying.
| V_9 wrote:
| Yes, but marketers don't really care about math. Only about the
| numbers!
|
| You would expect a few hiccups and a steep learning curve when
| the product they are trying to buy is a bid for visibility on
| insanely complex networks of platforms using said rocket
| science to guess where one's mind is at.
|
| Disclaimer: worked years in the space on the topic of
| performance, only one time ever have i seen an AB test
| correctly run and correctly understood by a client. Most
| requested false numbers because they couldn't understand the
| difference between branding, attribution and incremental sales.
| To be fair, neither could most anyone working in the field...
| Seems like that doesn't change too quick!
| kleiba wrote:
| _Yes, but marketers don 't really care about math. Only about
| the numbers!_
|
| This is hilarious.
| jiofih wrote:
| And sad. Same thing happens in data science now - people
| are happy to have _any_ number regardless of correctness.
| They just need something to report on and keep the work
| going.
| czep wrote:
| As long as data science remains subservient to Product,
| the inevitable result is cherry picking and post hoc
| rationalizing of some PM's intuition. To blame is the
| "embedded" model in which DS works within (and takes
| direction from) a cross functional team driven by a PM.
| helmholtz wrote:
| That famous saying known to those of us in scientific
| computing: The purpose of computing is insight, not
| numbers.
| iamacyborg wrote:
| Hah, exactly what I was writing about here
|
| https://www.jacquescorbytuech.com/writing/marketers-
| addicted...
| pc86 wrote:
| Hi, please don't do this. If the comments become just
| replies saying "I wrote about this on my blog!" with a
| link, they're unreadable. If you summarized your thoughts
| and posted it as its own comment, without a self-
| promotional link, I'm sure it would be very well received.
| iamacyborg wrote:
| Sounds fair! Thanks for the feedback. The article did
| spur an interesting discussion previously on HN when I
| published it but seems relevant again given the ongoing
| discussion.
|
| https://news.ycombinator.com/item?id=25016532
| pc86 wrote:
| This is one of those things that isn't a big deal in
| isolated instances, but becomes an issue if it gets more
| prevalent, so it's always hard to know when/if to even
| say anything :)
| MisterTea wrote:
| >(why do people rely on an internet connection and Google for
| this?)
|
| Because most computers lack a copy of bc in /bin.
| pc86 wrote:
| You think if every computer had bc in /bin, or the
| equivalent, most people wouldn't still be using Google for
| math?
|
| It's not the lack of tooling, it's the lack of knowing how to
| quickly get to the tooling. For most people, especially non-
| technical, Win+"calc"+enter is not intuitive.
| Ctrl+T+$formula+enter _is_. That 's the difference.
| maccard wrote:
| Win+calc+enter searches being for a calculator on my
| workstation, Win+cal+enter opens a calendar, and
| Win+calc+enter works fine for me! Yay!
| KingOfCoders wrote:
| I had the same experience when marketeers talk about
| statistics, all of the most basic errors are made (e.g. when
| A/B testing or channel attribution).
| Maro wrote:
| You are right, but also you asked for it by being pedantic:
| "common" should be "come on" :)
| antonvs wrote:
| Or "c'mon," if you want to abbreviate it.
| diarrhea wrote:
| Oh yes, fixed it.
| tstrimple wrote:
| > why do people rely on an internet connection and Google for
| this?
|
| It's faster than opening a dedicated calculator program. If
| you're in a browser already, just ctrl-t and type your
| equation.
| ogre_codes wrote:
| CMD-Space is just as quick and works system-wide. There is a
| Windows equivalent as well. Works when the net is down too.
| ljm wrote:
| As for the calculator screenshot, that kind of stuff feels like
| a consequence of having 'show your working' drilled into your
| head at school. Which is great to show your teacher that you
| understood the question and didn't plug it into a calculator,
| but unnecessary later on.
| danielscrubs wrote:
| Send it to your university professor and see how it goes.
|
| You can't really blame academia for this one.
| azmodeus wrote:
| academia != education
|
| The education system incentives students to be teachable to
| conserve teacher resources.
|
| Transparent calculations are more important to help folks
| with low numerical skills.
|
| I think this is actually a really hard challenge to
| communicate simple calculations easily to a wide audience.
| [deleted]
| [deleted]
| ohples wrote:
| I feel like a company like Uber could of been justified put the
| large majority of there ad budget into well placed physical ads
| in cities and airports.
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