[HN Gopher] I stopped advertising and nothing happened
___________________________________________________________________
I stopped advertising and nothing happened
Author : deeeej
Score : 490 points
Date : 2022-04-07 14:01 UTC (8 hours ago)
(HTM) web link (theantistartup.com)
(TXT) w3m dump (theantistartup.com)
| andhika wrote:
| trollied wrote:
| I don't understand why this has been upvoted. If you read the
| article in its entirety, there's no point whatsoever.
| jdrc wrote:
| That title thought
| bombcar wrote:
| People hate advertising and upvote anything that implies it is
| useless.
|
| Whilst most of HN is employed by advertising companies and
| their offshoots ...
| a4isms wrote:
| I did not read this as suggesting advertising is useless, the
| author says outright that it can help build up a critical
| mass of brand recognition.
|
| But the author's point is that once you reach that critical
| mass, advertising may begin to cannibalize your organic
| search results because users click on your ad instead of
| clicking on your site in the search results.
|
| I own a copy of "Ogilvy on Advertising" I bought in the
| 1980s. In it, David Ogilvy basically says, "test, test,
| test." That's the message here. Test. The advertising you're
| doing could be useless.
|
| I'm not sure I agree that when you reach a certain point, ALL
| advertising is useless. Maybe when you reach the point where
| most of your advertising has no ROI and is cannibalizing your
| organic SEO, you need to change your spend and try to find
| ways to get your ads onto search results that don't feature
| your site.
|
| If you find that works, you can then adjust your SEO and see
| if you can make that advertising go to zero ROI too. Lather,
| rinse, repeat.
| micromacrofoot wrote:
| It's not useless, it's predatory, deceiving, and outright
| hostile. I literally have to screen my entire network to
| avoid being tracked by it within my own home. I don't answer
| phone calls because of it. I have to screen media for my
| children so they're not manipulated by it.
| slivanes wrote:
| Sounds like you're heavily manipulated by it already.
| micromacrofoot wrote:
| I think you're intentionally being flippant at my
| expense, but it's impossible to live in society and avoid
| advertising's influence.
|
| Facebook and Twitter will adjust who you see content from
| to increase your likelihood of interacting with
| advertisement. As more and more social interaction
| happens online, this can influence who your friends are
| if you're not careful.
|
| I see no reason to deride someone trying to wrest back
| some control.
| ClumsyPilot wrote:
| 'Whilst most of HN is employed by advertising companies and
| their offshoots ...'
|
| If a man knowingly supports a cause that is against his
| financial interest, thats worth paying attention to
| kristofferR wrote:
| I agree, the post itself is borderline useless, but hopefully
| it will spawn an interesting discussion here.
| artursapek wrote:
| People don't read anymore
| paulcole wrote:
| Discussing the pointlessness of fields like marketing and
| advertising is catnip on HN.
| jgurewitz wrote:
| I think it's hard for people to appreciate just how much
| human behavior is driven by those fields.
| mirntyfirty wrote:
| I think society has been somewhat brainwashed into the
| importance of online marketing. I like scientific approaches
| that refute that. For example, I don't think that people
| should be following their dentists and plumbers on Facebook,
| Instagram, and Twitter.
| kristofferR wrote:
| > I like scientific approaches that refute that.
|
| No doubt, but this is as far away from scientific as it can
| get.
|
| "I stopped advertising. My sales rose at the same time.
| Advertising doesn't work" is basically the thesis, but his
| only "evidence" is an unreasoned assumption that the two
| things are casually linked instead of just correlated by
| the timing.
| mirntyfirty wrote:
| Agreed. I was being somewhat tangential to the article at
| hand and responding more to the catnip comparison. I can
| only recall a few articles that were particularly well-
| reasoned.
| yetihehe wrote:
| What do you mean there's no point? No point in ads - yeah. No
| point in article - they stated that ads are not universally
| working. Sometimes you don't need groundbreaking results to
| make an interesting article.
| ajkjk wrote:
| Er... sure there is. There's a whole 'lessons learned' section
| with a list of points.
| bcrl wrote:
| Sure there is. A healthy business' best assets are its
| customers, and happy customers will tell their friends about
| your business when it comes up appropriately. Word of mouth is
| worth far more than web advertising ever will be.
| a4isms wrote:
| The author made an excellent point in TFA:
|
| If you do your SEO right and use advertising to build up some
| brand recognition, you reach the point where your web site
| appears on the first page of search results alongside your paid
| ad for your web site.
|
| However, Google has designed their search results to encourage
| clicking on the ads, so many users who actually find you with
| search will click the ad you are paying for instead of the
| search result for your site.
|
| The author presents empirical evidence that not paying for ads
| doesn't reduce traffic, because users will click the site in
| the search results, instead of clicking the ad.
|
| That is very much a point, and one that can save people a lot
| of money if they test it and find their site adn advertising
| have the same dynamics.
| bombcar wrote:
| Until your competitors start buying ads under your name. And
| you have to buy ads back to counter-attack. And Google laughs
| all the way to the bank.
| a4isms wrote:
| Do you mean your competitors buying ads for their product,
| but using your product's name as keywords?
|
| Or do you literally mean your competitors buying ads that
| deceive the public into thinking they're clicking on your
| ad which will lead to your site, but it actually goes to
| their site?
|
| Those are two very different scenarios.
| bombcar wrote:
| The fighting is most fierce near communization, those
| edge cases where a brand name is becoming a common name
| for the item (think Kleenex).
|
| I suspect it's not actually as bad as people may think
| (if someone searches "Dominos" are they looking for any
| pizza place, or that particular one), but it does happen.
| rovr138 wrote:
| Both can be done.
|
| First one is more common. Second one depends on your
| industry and who your competitor is (sleaziness)
| aantix wrote:
| Is there a smart counter attack to this?
| ben-schaaf wrote:
| Try to drum up public outrage to get them to stop? Maybe
| if they use your trademark there's cause to sue?
| Otherwise good luck.
| dotandgtfo wrote:
| Branded search terms cost way more for competitors for
| reasons I can't be bothered getting into, most likely
| they are losing money by doing it. You can counter it by
| bidding yourself - which on branded search terms is
| usually dirt cheap. But ultimately, the only real counter
| is delivering a better service.
| [deleted]
| antattack wrote:
| His point is right at the top:
|
| _I was spending time optimising the 'bid' in automated
| advertising system, trying to get the best bang for buck.
|
| Why was I doing it? Everyone else seemed to be doing it.
|
| This was a terrible reason to do it._
| bwb wrote:
| Ya but a better lesson would be to do what has ROI. Ads work
| great, but you have to measure them, and you don't pay for
| traffic you get for free (such as your brand name).
| throwmeariver1 wrote:
| Good advertising works, good advertising is hard so hard that
| even advertising agencies are not able to produce it most of the
| time. It's more a question of time and space I always go for
| opportunistic advertising is there something in the aether or is
| there a trend coming up which my product perfectly fits? That's
| the time to ramp up ad spending. There just is no need to have
| campaigns running just to produce background noise. Nobody cares
| about it most of the time not even yourself.
| hownottowrite wrote:
| These optimizations are great if you're selling things people are
| looking for. However, when you're selling something people want
| but don't yet know it even exists, the problem is thornier.
| vmception wrote:
| ITT: ad spend koolaid drinkers that the online ad industry
| depends upon to attempt ad spend for every half baked idea
| soared wrote:
| Person who isn't an expert in advertising and doesn't know how to
| run tests makes conclusions about advertising by not doing proper
| testing.
|
| Exciting stuff. This is why you hire an electrician rather than
| doing your own electrical work. They actually know what they're
| doing.
| brutusborn wrote:
| I'm interested in how such testing works. What is wrong with
| his method of advertising-cold-turkey?
| soared wrote:
| The author doesn't provide and data or specific info on what
| they did, but a few general points:
|
| 1. Seasonality. It sounds like they're comparing a few months
| on to a few months off, which likely is affected more by the
| time of year than anything else. Year over year data would be
| a better comparison.
|
| 2. Attribution windows. If I serve you an ad, then "turn off
| my advertising", then you convert, depending on how you look
| at the data my ad either did drive the conversion or did not.
| Likely he's just looking at google analytics with default
| settings, so he's missing post-view data and assists.
|
| 3. It's not that difficult to run an actual test, and most
| advertising platforms give you tools and documentation on how
| to do so.
|
| 4. The author doesn't understand advertising from a technical
| perspective and most likely is not doing the analysis
| correctly. The big red flag is when talking about buying a
| display ad and it only driving 2 conversions. It sounds like
| a prospecting ad, which is top of funnel and is not supposed
| to drive post click conversions. I highly doubt they had an
| impression tracker on the ad and looked at post view data
| with different attribution models. Or even multichannel
| funnel reports in ga. Those would show the actual impact of
| the banner, not just 2 post click conversions.
|
| I don't mean to bash the guy but this post is rehashed all
| the time here and I end up reposting the same stuff.
| brutusborn wrote:
| Thanks for the detailed reply. I didn't interpret the
| parent as bashing, I think that it's good to be critical of
| these kinds of posts especially when the analysis is
| shallow and lacks data.
| [deleted]
| stingraycharles wrote:
| The point you're trying to make is valid, but it sounds very
| condescending and not very constructive.
|
| Perhaps you could share how you would have set up the tests
| instead, and how the OP could improve his?
| dotandgtfo wrote:
| It's hard to reason from his post, but it seems like he's
| spending money on branded search terms. E.g. queries that
| include his website in its name. The effectiveness of branded
| search terms is absolutely worth discussing, and it's pretty
| easy to run a small scale test on if it works by comparing
| organic and paid traffic after the fact.
|
| But the issue is that this article doesn't differentiate
| between branded and non-branded search terms. Did he run
| campaigns on non-branded searches like "Registration checker
| UK" to get build awareness of his service for new customers
| doing broad searches? Did he compare his organic non-branded
| search engine presence with his results when running paid
| ads?
|
| Also, his service doesn't seem like a great match for the
| advertising channel either. It's hard to turn a profit when
| your service costs PS8. The product - channel fit [0] doesn't
| seem right. So all in all, not such a great experiment.
|
| https://brianbalfour.com/essays/product-channel-fit-for-
| grow...
| rovr138 wrote:
| Not them, but this is the info we have; I
| was paying for in-search adverts across multiple search
| engines, I was commissioning custom made adverts to place in
| online used car market places. I was spending time optimising
| the 'bid' in automated advertising system, trying to get the
| best bang for buck
|
| My questions,
|
| * custom made for whom?
|
| * How did they select them?
|
| * When did they show up?
|
| * How were those terms selected?
|
| * What terms did they select and which performed better?
|
| * Did they track visits using different ones to see which had
| the best conversions?
|
| * Optimizing can be most impressions or for quality.
| Basically show to as many people as possible vs fewer but
| better conversion. We don't know here, but I see most people
| doing most impressions.
| bbarnett wrote:
| Knowing experts exist, and that test methods exist, does not
| the parent an expert make.
|
| Why would parent be able to share test methods?
| sbazerque wrote:
| This may be one of those famous last words, but friend, I do my
| own electrical work.
| marcosdumay wrote:
| Well, the engineering panels around here believe I'm
| qualified to do my own electrical work, but I wouldn't get on
| the bureaucracy of convincing my local power company.
|
| Anyway, home wiring is not hard, and many people do it for a
| living with a ridiculously low amount of qualification (and
| competence). If you are not touching the public wires, the
| safety rules are very simple and the odds are good that you
| can give them more care than somebody that has been doing the
| work every day for a decade.
|
| (But well, if you don't know how to do it safely, or if you
| won't be bothered to follow them, you shouldn't be doing it.)
| bwb wrote:
| My dad did as well... my job for many years as a child was to
| stand there with a broom in case it went bad. Be careful!!!
| quesera wrote:
| There's a difference between "doing your own electrical
| work" and "working on live electrical wires"!
|
| Although sometimes the latter happens.
|
| Rubber-soled shoes, one hand in back pocket at all times,
| non-conducting tools, and a helper with a wooden broom
| handle who knows mouth-to-mouth resuscitation ... these are
| all good recommendations. :)
| brimble wrote:
| The pros seem to give less of a shit about live wires
| than I do, from what I've seen. And I already give fewer
| shits than I probably should.
| thehappypm wrote:
| You're literally risking her life on those things, to
| save some money ?
| quesera wrote:
| I have no idea what you are talking about. I'm risking no
| one's anything.
|
| At worst, I'm acknowledging reality. Some people
| sometimes end up working on live wires. If you can't be
| talked out of this decision (or if it's legitimately not
| possible to avoid), a dose of caution is important.
|
| Asking an untrained non-adult to be ready with a broom is
| a fantastically bad idea though. In the worst case, the
| kid lives with the memory of uselessly smacking their
| parent's corpse with a broom while the air fills with the
| smell of ozone and burnt flesh.
| delecti wrote:
| Is "one hand in back pocket at all times" to avoid a
| circuit across your heart? And what is the wooden broom
| handle for?
| falcolas wrote:
| The way that electricity flows through a conductive
| medium, it doesn't matter if the circuit appears to
| "crosses your heart", because some portion of it will
| still flow through your heart regardless.
|
| Or, to put another way, you'll still see current at the
| heart even if it only flows through two fingers on the
| same hand. And even if it's a really small portion of the
| current, it doesn't take much to stop a heart.
|
| Plus, there are a virtually unlimited number of proven
| tools for seeing if the circuit is live (even if there's
| no current flowing) to rely on such dodgy methods.
| quesera wrote:
| Agreed that electrical potential is present in all points
| of a uniform conductor. And that it takes only a tiny
| amount of current to interrupt a beating heart (as low as
| 60mA).
|
| However it is not correct that the path of the current is
| not important.
|
| Current will not flow between two points of equal
| electrical potential. There are some complications in the
| modelling (skin is a better insulator than internal bits,
| bags of salty moist flesh and bones are not resistively
| consistent, etc), but you're still in a much better
| situation to reduce potential difference across your
| heart, if the external potential difference occurs
| between two fingers on the same hand, vs two fingers on
| opposite hands.
|
| OSHA says:
|
| > The currents that pass through the heart or nervous
| system are the most dangerous. ... If a hand comes in
| contact with an electrical component with current (and at
| the same time the other side of your body makes a path to
| the ground), this will make the current pass through your
| chest and possibly produce injuries to the heart and
| lungs.
|
| https://www.osha.gov/sites/default/files/2019-04/Basic_El
| ect...
| falcolas wrote:
| > However it is not correct that the path of the current
| is not important.
|
| I never claimed this. I claimed that even with the
| "safest" path through your body, the chance of your heart
| stopping is still there.
|
| My point is that it's never "safe" to do, and as a
| homeowner (and even for a vast majority of non-lineman
| electricians) you never _have_ to do it.
| quesera wrote:
| > I never claimed this.
|
| You absolutely did. You said it doesn't matter. It
| matters.
|
| And I never said anyone would _have_ to work on live
| wires. And I wouldn 't recommend it to anyone.
|
| Nevertheless, it does sometimes happen, and being a bit
| smart about it is a good idea.
| falcolas wrote:
| The wording from the post that started this discussion
| is:
|
| > Is "one hand in back pocket at all times" to avoid a
| circuit across your heart?
|
| To which I responded:
|
| > it doesn't matter if the circuit appears to "crosses
| your heart", because some portion of it will still flow
| through your heart regardless.
|
| Which, as we have by now agreed, is the case.
|
| The dispute is about whether that 'portion' is enough to
| kill you, which I avoided making concrete statements on.
| I didn't take a stance because the answer is "it
| depends". The variables that make up the answer are vast,
| and many folks have survived lightning strikes and died
| to static discharges thanks to those variables.
|
| > being a bit smart about it
|
| I will still contend that working on live wires with bare
| skin _at all_ is the opposite of "being a bit smart
| about it".
|
| If your really being smart about it, and can't avoid it,
| use tools and protective gear created explicitly for
| working with live electricity. Or call someone with that
| gear.
| quesera wrote:
| > Plus, there are a virtually unlimited number of proven
| tools for seeing if the circuit is live (even if there's
| no current flowing) to rely on such dodgy methods.
|
| Yes. Use those. But this discussion is about when you are
| working on live wires, and you know you are working on
| live wires.
| falcolas wrote:
| A homeowner will never have to do this. And an
| electrician has the ability to ensure they too don't have
| to ever work on live wires (despite many's insistence in
| doing so, something about machismo, etc.).
| quesera wrote:
| We agree on this.
|
| I have however had jobs where I really did have to work
| on energized equipment. Sometimes 480VAC 3-phase, but
| more commonly single-phase 230/240 VAC 50/60Hz or 120VAC
| 60Hz. I was appropriately trained for this work.
|
| Some homeowners are too stubborn to do the proper thing
| when handling electrical equipment. You're not going to
| change their minds!
|
| The precautions I mentioned previously were some of the
| more convenient and generally applicable rules that are
| taught to people who have to work with equipment that is
| less safe. If followed by stubborn homeowners, they will
| also be safer. That was my whole point.
| quesera wrote:
| Yes -- one hand does the work and is more likely to come
| into contact with energized wires or rails. If the other
| hand is supporting your lean against the conduit or
| enclosure (grounded), the path is through your heart.
| We're conditioned to use both hands for everything, so
| it's extremely easy to "forget" or "cheat just for this
| step" and use the other hand to balance, or hold, etc.
| Having your hand firmly in your back pocket is unfamiliar
| enough that we remember, and far enough that a quick
| instinctive response is interrupted.
|
| Wooden broom handle is a non-conducting lever that a
| helper can use to separate you from the energized
| equipment. The current can cause your hand muscles to
| spasm in a "gripped" position, so the broom handle might
| need to be applied with some force. This is a last-resort
| catastrophic situation response.
| [deleted]
| marginalia_nu wrote:
| Seems like an expert in advertisement would have a vested
| interest in the outcome of the experiment.
| soared wrote:
| You can use 3rd party tools to conduct tests so they are not
| affected by the outcome.
| marginalia_nu wrote:
| The tools are irrelevant when the person using them has an
| interest in demonstrating a particular outcome.
| soared wrote:
| The person running the test wants to spend their money
| effectively, not find out that their advertising is
| working. Running a test and finding something isn't
| working is a positive result - it means you can move your
| money elsewhere and drive more sales.
| marginalia_nu wrote:
| Right, but the experiment in this case is to find out
| whether the job of the person running the test actually
| makes the difference. Basically, whether they are a scam
| artist or not.
| tut-urut-utut wrote:
| It's a nice anecdote saying that people should validate their
| assumptions before continuing. In this case, the author proved
| that advertisement doesn't work for him, and that he can turn it
| off, at no loss.
|
| One point though, this business seems well established. At that
| point, turning off advertising may not be so damaging. What would
| be interesting to know is, would he reach his current
| profitability if he didn't start with advertising, and depending
| on the organic search from the get go?
| a4isms wrote:
| The author says right in the article that paid search is
| valuable for bootstrapping when you have no or few users, which
| suggests that the author does not think they would have reached
| their current profitability without some paid search early on.
| BurningFrog wrote:
| Another conclusion could be that he was doing bad advertising,
| and should have improved it.
| judge2020 wrote:
| Probably the best case for no advertising is Tesla: they still
| did loads of marketing, just not any direct web/tv/etc
| advertising.
| chmod775 wrote:
| >and depending on the organic search from the get go?
|
| You don't even need search, as some businesses to which search
| and ads are essentially useless haven proven. Think of
| closed/invite-only community platforms: they will have little
| value to anyone who just gets there via an ad or search, since
| they have no entryway to any community.
| Mountain_Skies wrote:
| Though only in a single industry and an n=1 case, we got to see
| what would happen if a movie went into wide release with no
| advertising. Would enough people see the movie poster or listing
| for what's playing at the theater and be curious enough to see
| the movie? Or would the lack of advertising doom it?
|
| 'Delgo' was released to theaters on over 2000 screens with an
| all-star cast in December of 2008 and virtually no marketing
| budget. It averaged roughly two paying customers per showing.
| More people saw Conan O'Brien making jokes about it on his show
| than saw it in the theaters. Though critically panned as
| derivative and several years out of date with its CGI, movies
| with far worse reviews have done much better. The real difference
| seems to be that no one knew that it existed.
|
| That said, a new Star Wars movie with no advertising likely would
| still end up with plenty of ticket buyers. Existing brands can
| much more easily get away with taking their foot off the media
| buying accelerator but how long could they do it before a slow-
| down occurred? Seems like Marvel and DC still purchase lots of
| advertising for their well-known and currently popular
| franchises. What would happen if they stopped? Not sure if we'll
| ever know since they're unlikely to take that risk.
| thehappypm wrote:
| Advertising is pretty important for commodities. When you can
| 10,000 movies, advertising can have a huge lift to nudge you.
| Same with food. If there's a dozen kinds of sour cream at the
| store, an ad might lift one brand hugely.
|
| Probably less valuable for industries with less competition.
| Like do I really need to see an Apple ad? Is not seeing one
| gonna make me go Android?
| bee_rider wrote:
| That seems like a very specific case, though.
|
| Looking at wikipedia for this movie (which I'd never heard of),
| the all-star cast was: Freddie Prinze Jr., Jennifer Love
| Hewitt, Anne Bancroft, Chris Kattan, Louis Gossett Jr., Val
| Kilmer, and Malcolm McDowell.
|
| Apparently development started in 1999 (so the cast makes
| sense), and animation started in 2001... 2001 -> 2008 is pretty
| bad timing I think, both in terms of just raw number of years,
| and also in terms of... I mean those were pretty busy years in
| terms of CG, right?
|
| I bet whoever owned MGM in 2008 found it in their stack of
| stinkers and figured "why not shovel it out the door?" Movies
| seem like a bad example for this sort of thing as a result --
| big investment, want to recoup some of it, but sometimes a
| failure is pretty obvious, so why invest further in a big (and
| one-off) ad campaign?
| msavio wrote:
| To summarize the article: "I paid to show up both in the paid
| (SEA) and organic (SEO) search results. I switched off the first
| and the other one is still there!"
|
| For some unknown reason he seems to be surprised by that.
| aerosmile wrote:
| The authors of that HBR article along with a few others [0][1]
| should be ashamed of themselves. They keep perpetuating a false
| narrative that really hurts our community's know-how in how to
| build and scale businesses.
|
| Why is it a false narrative? The basic premise is simple: company
| X spends money on ads, then turns those ads off and finds that
| the revenue does not change. Then the conclusion is made that ads
| don't work. On the surface, it seems like sound logic, and that's
| why articles like that do find their way into reputable
| publishers.
|
| But allow me to make an analogy that will hopefully highlight how
| absurdly oversimplified that takeaway is:
|
| Company X decides to switch from PHP to Go, and in the process
| ends up with all sorts of bugs due to how the new garbage
| collector works. This costs the company a lot of money, and the
| conclusion is made that Go is a shitty programming language.
|
| What both of these cases have in common is that neither takes
| into the account the proficiency level of the operator. It's
| somehow intuitively obvious that as you trade programming
| abstractions for performance, you will require a higher level of
| developer proficiency to extract that performance. But nobody
| makes that connection in the marketing world. The often quoted
| examples of marketing calamities, Ebay and Uber, have marketing
| budgets in the 100s of millions, which can be only deployed using
| multi-channel strategies. In other words, you might give 10% of
| that to Pinterest, and might be delighted to see that Pinterest
| reports a 300% ROAS. But it turns out that Pinterest will also
| report on a much longer lookback window than other platforms, and
| will use a different attribution model than, say, Facebook or
| Google. If you turn off your Pinterest spend and discover that
| the reported 300% ROAS was not accurate, it doesn't mean that ads
| don't work - it means that Pinterest had bad incrementality, and
| that it was some other platform that deserves all the credit. In
| short, in the days, weeks and sometimes months that it takes for
| a customer to convert, Pinterest had some impact, but much less
| than its in-platform figures indicated. You can measure
| incrementality using 3rd party vendors like Measured.com. The
| fact that Ebay's and Uber's marketing teams were apparently not
| doing that is inexcusable.
|
| In some cases, the lack of ad performance is not just channel-
| specific, but true across most channels and sometimes even across
| the board. For example, some purchases are triggered by
| emergencies, and that's where search channels outperform TV and
| social. And in other cases, your customers just cannot be reached
| by ads at all - eg: military contracts. I am sure we can come up
| with many more examples that seem to show that ads don't work.
| But what those examples really show is that there's a certain
| amount of minimum qualification to make ads work, and a lot of
| people simply lack those qualifications.
|
| That's alright, a lot of people also lack experience in Golang,
| but at least they think twice before making all sorts of
| assertions about the viability of that programming language. Not
| so much when it comes to marketing topics - somehow there's this
| belief that if a certain ad channel didn't work for you with your
| specific value prop and your specific expertise in this field,
| this is somehow relevant to everyone else. I can see how newbies
| can make that mistake. But for Rand Fishkin or the CMOs of Ebay
| and Uber to fall into that trap... blows my mind.
|
| [0] https://www.forbes.com/sites/augustinefou/2021/01/02/when-
| bi... [1] https://sparktoro.com/blog/something-is-rotten-in-
| online-adv...
| istinetz wrote:
| > The basic premise is simple: company X spends money on ads,
| then turns those ads off and finds that the revenue does not
| change. Then the conclusion is made that ads don't work. On the
| surface, it seems like sound logic
|
| It is sound logic.
|
| OP repeatedly clarifies that not all ad spend is bad, that it's
| just for his specific case.
| saltminer wrote:
| There are several companies I am a regular customer of which
| I found via advertisements. If they stopped their ad spend,
| their revenue might not go down (I know I would keep buying),
| but if they never had ads to begin with, I wouldn't have
| spent hundreds of dollars on their products, nor would I have
| recommended their products to my friends. One ad click
| generated several repeat customers and thousands in revenue
| over the span of three years - that's a good return on
| investment, one your analytics probably doesn't capture, and
| one which you certainly wouldn't notice if you stopped your
| ad spend.
|
| And that's the rub, isn't it? Advertising absolutely can
| work, but the numbers can be very deceiving, to the point
| that I'd bet most companies cannot say with any degree of
| certainty that their advertisements drives new sales, much
| less provide hard numbers on how effective their ad spend is.
| Amasuriel wrote:
| The logical conclusion is that THOSE ads don't work, not that
| ads don't work in general.
|
| I am no fan of digital advertising, but there is a lot of
| variation on ad platform, targeting, ad content, ad space etc
| that will make a massive difference in effectiveness of the
| dollars spent.
| Tobani wrote:
| It _could_ be that those ads created some sort of brand
| awareness and that the downside might not be realized for
| quite some time. I 'm not saying that that is the case
| here, but it could be another interesting thing to
| investigate, although it wouldn't really be easy to
| objectively measure.
| saltminer wrote:
| Patek Philippe knows a thing or two about this. It's been
| years since I've seen their ads, but I still remember
| them.
|
| https://www.hodinkee.com/articles/untold-story-patek-
| philipp...
| loceng wrote:
| Indeed, brand advertising is a thing - specifically to
| reenforce and make that brand "brighter" or have more
| strength in the person's psyche, so it stays familiar.
| The concept of advertising at its foundation is often
| taught that you must distribute the value of the spend
| over say 10 months, e.g. you're primed for that long
| and/or may act on the ad you saw 10 months prior.
| tomrod wrote:
| My take is that advertising may work globally, in that if any
| advertising occurs it may have an effect, but each player is
| a fringe in the advertising market and may have their tide
| lifted simply by domain awareness of advertiser topics.
|
| Ad effectiveness for specific brands may be complete bunk.
| But advertising effectiveness for a product space may do well
| to raise awareness.
| [deleted]
| nocturnial wrote:
| > company X spends money on ads, then turns those ads off and
| finds that the revenue does not change. Then the conclusion is
| made that ads don't work.
|
| Did you even read the article?
|
| They said this in point 1 (!), the one of their first points of
| their conclusions was that advertisement is adviced for start-
| up companies.
|
| They explicitly said their conclusion wasn't that ads didn't
| work. I find it hard to believe you read the article and
| somehow not read that part.
| [deleted]
| [deleted]
| mindcrime wrote:
| > Did you even read the article?
|
| Please don't do that. It goes directly against the HN
| guidelines[1] and makes the site less pleasant for everybody.
|
| _Please don 't comment on whether someone read an article.
| "Did you even read the article? It mentions that" can be
| shortened to "The article mentions that."_
|
| [1] https://news.ycombinator.com/newsguidelines.html
| [deleted]
| dfadsadsf wrote:
| >And in other cases, your customers just cannot be reached by
| ads at all - eg: military contracts.
|
| Overall I agree with what you wrote but I just to highlight
| that you can absolutely target military contracts with ads. If
| you visit Washington, DC you will see ads for fighter jets,
| missiles and random obscure military systems by Raytheon and
| other contracts at bus stops. Guess what - military planners
| and decision makers live in DC and use public transport. While
| conversion rate is minuscule, you need only one multi-billion
| military contract to pay for a lot of ads.
|
| Digitally you can target by geo location (Pentagon/military
| bases/installations) or even for example microtarget places
| where key senators live. Lots of options.
| jdlyga wrote:
| Traditional advertising is becoming less and less effective. The
| brands that are having the most success right now use TikTok.
| They don't necessarily advertise, but instead create content on
| the platform. It comes off a lot more genuine. For example,
| Duolingo and their creepy giant stuffed owl stalking people who
| didn't do their Spanish lessons:
| https://digiday.com/marketing/how-duolingo-is-using-its-unhi...
| schleck8 wrote:
| Duolingo also interacts with the community in the comments
| under random videos
| clearleaf wrote:
| No matter how much the internet gets "sanitized" or "civilized"
| it's embedded in my DNA to never trust any online ad. The first
| thing my brain does on a new page/screen is separate the real
| parts from the junk, and I don't even perceive the junk anymore.
| It's become an instinct that causes me to skip or miss sections
| in text books because if they get cute with the formatting it can
| trigger the same reflexes. If I were to break this habit
| completely (not that I want to) I don't think I have it in me to
| ever believe a product or company in an online ad is even real,
| let alone legitimate. That's just how I see online ads. I don't
| trust any ads but if it's on TV or a billboard I at least believe
| it's a real if scum sucking company.
| robertlagrant wrote:
| Very glad to see this article on a used car startup included the
| phrase "your mileage will vary."
| Razengan wrote:
| I've only ever seen defense of advertising by the people working
| in the advertisement industry or those exploiting ads, as seen by
| the comments here.
|
| Every other human on this planet is fucking annoyed by ads, or
| has evolved a blind spot for them and ignores them.
|
| When was the last time anyone in your social circle said, "I saw
| an ad for it, let's buy that!"?
|
| The ads racket employs some of the worst of societal ills:
| Manipulation, deception, greed, vandalism of public spaces,
| wasting people's time without their consent, all to advocate a
| cycle of endless consumption... not to mention how some ads
| systems are just a front for spying.
|
| If an individual displayed these behaviors, he or she would be
| considered extremely creepy and disgustingly _clingy_ (SIT HERE
| and PAY ATTENTION to me for 30 seconds!) but the ads industry
| literally selects for and rewards these traits on a massive
| scale.
|
| Please, stop this _guessing game_ of violating people's privacy
| trying to figure out what they want to see and when it should be
| forced upon them, and just develop better search
| /filter/discovery/consensual recommendation systems: Let us TELL
| YOU what we want, dammit.
|
| But of course that would only benefit the product creators and
| service providers and consumers, not the ads people whose
| livelihood depends on flattering the naked emperor for his non-
| existent clothes, so here we must suffer.
| youngtaff wrote:
| "Last year, a study by the UK's ISBA found that almost half of
| every advertising dollar spent on tracking-based programmatic
| advertising is eaten by the adtech ecosystem before it reaches a
| publisher"
|
| https://www.euractiv.com/section/digital/opinion/advertising...
|
| https://www.isba.org.uk/knowledge/executive-summary-programm...
| softwarebeware wrote:
| Oh man! I remember reading awhile back that the same thing
| happened at eBay. eBay actually performed the same experiment and
| found that people were not finding eBay through ads. At least not
| enough to matter. If anyone has a source for this, let me know. I
| can't find the link I had on it.
| innagadadavida wrote:
| This article is basically an advertisement! However, not everyone
| can get promoted to front page of HN. Just wondering how the OP
| get his story upvoted so much.
| jyu wrote:
| advertising arms race. if you're a startup with millions in ad
| spend and a mandate to spend it in a couple years, how do you
| spend these millions? the same way all the other startups do, by
| dumping into google, instagram (fb), amazon.
|
| makes me wonder how many of these same VC's also own large
| positions in said advertising companies?
| onpensionsterm wrote:
| It seems like a disproportionate amount of ad spend is protection
| money to avoid the Don't Be Evil mob from selling your trademark
| to your competitors. A search for Total Car Check should not
| return competitors above the website itself.
| bschne wrote:
| There's also an arms race thing going on if others start buying
| ads for things you'd rank highly for
| pradn wrote:
| This both enriches Google, impoverishes name-brands, and allows
| new entrants to compete.
| TheCapn wrote:
| I get that impression sometimes too. I had a comment a couple
| years ago on this site about how dumb it is that when I search
| for "TeamViewer" the first result is an ad for TeamViewer...
| why are they paying to advertise above their own page?
|
| But someone pointed it out, if they aren't paying for that ad
| spot, then RealVNC, or LogMeIn, whoever else is competing will.
| Seems ridiculous.
| bmelton wrote:
| It's also not necessarily guaranteed that it is in fact
| TeamViewer running the ad for TeamViewer.
|
| It's a pretty common marketing practice to arbitrage referral
| benefits so that you might sign up for a product that offers
| cash referral bonuses of (let's say) $5 per signup. An
| affiliate marketer may take some petty cash and run some
| experiments, determine that ~5% of the people will sign up to
| an ad with highly effective copy, so then now they can run
| ads, potentially pay higher rates per click than TeamViewer
| does, and make a little passive income on the side.
| clearleaf wrote:
| I'm pretty sure they do this because sometimes google returns
| the right sites seemingly by complete accident. Have you ever
| submitted a search, and there's a result for the right site,
| but it's to an irrelevant subdomain or archive section?
| Sometimes google gets me into parts of a website that users
| aren't supposed to be able to navigate to. Google has exposed
| weird personal files to me that were stored on commercial web
| sites multiple times, yet it couldn't return the actual
| intended entry point for those exact same websites. I have no
| choice but to assume malice over stupidity here.
| cwkoss wrote:
| Google has figured out a "legal" way to monetize one company's
| trademark to that company's competitors. Really makes a mockery
| of the trademark system.
|
| I'd imagine if google didn't have such well financed lobbyists
| and lawyers, there would have been legal concessions years ago
| to eliminate this practice.
| pb7 wrote:
| Why not? It's a free market. Compete on product, not obscurity.
| whatever1 wrote:
| I stopped eating for a day and nothing happened. Therefore, food
| is useless.
| uxamanda wrote:
| Seems like a good reminder that invalidating a hypothesis is
| sometimes easier than validating it.
| yubiox wrote:
| I am blown away that online ads work at all. I just assume every
| ad is a scam.
| teewuane wrote:
| Great article with a REALLY great summary about fixing problems
| by subtracting and not always just by adding. Thanks for the
| share!
| JimmyRuska wrote:
| Recently, I was using facebook ads for awhile. The CPC was
| inexpensive, I had many signups to my site.
|
| However after 2 days, 0% of the facebook signups stayed on the
| site vs 50% of the Google Ads signups. Even if your metrics look
| good for the ad, make sure you add additional tracking.
| photochemsyn wrote:
| Some of the best products don't need advertising at all.
| Raspberry Pis for example, I actually cannot recall ever seeing
| an ad for a Raspberry Pi. Word of mouth, seeing examples of it in
| use - now you might call a Youtube video on how to set up a Pi as
| a headless server on your local network 'guerrilla marketing' or
| something, but I rather doubt that was paid for, people just like
| showing off their little Pi projects.
| tomrod wrote:
| To be fair, they have had a whole slew of "submarine" news
| releases on them. That tends to be a form of "earned content"
| advertising.
| AussieWog93 wrote:
| >I actually cannot recall ever seeing an ad for a Raspberry Pi
|
| You hear about them in the media all the time, though. I'd be
| shocked if they didn't have a solid in-house PR team.
| thatguy0900 wrote:
| Aren't pis in a constant state of shortage? I remember when I
| bought mine I could only get two at a time. I wonder if there's
| any value at all in advertising in that state.
| fbrchps wrote:
| Devil's Advocate; Raspberry Pis don't use _traditional_
| advertising, but they advertise a whole lot. Your example of
| the YouTube video -- while yes the channel may have gone out
| and purchased the device based on word of mouth because it was
| cool, there 's an equally likely chance that the Ras Pi
| foundation sent out devices to traditionally "smaller" channels
| since they want to create that word-of-mouth advertising
| feeling, despite spending a whole lot of money on advertising.
|
| This could be because they know that their demographic is
| precisely the type to avoid traditional advertising, be it
| because they run ad-blockers, or don't consume media with built
| in advertising like television, etc. Or maybe it's because they
| know that those smaller channels have significant viewer
| overlap with their target demographic, so why bother with
| trying to find these customers yourself when someone else
| already has them (for lack of a better term) captive?
|
| I've personally seen Ras Pi's mentioned in "niche" magazines a
| few times, usually when a new generation of the device comes
| out. That's 100% advertising, although I prefer it to a generic
| "buy our thing" ad, because at least they go into detail
| showing me what exactly it can do for me.
| jordache wrote:
| rasppi is a niche product. There will never be mass consumer
| appeal. Just like how you don't see advertisement for Ergodox
| keyboards. Even if they spent money on ad campaign, it will
| likely not move the revenue needle
| epicide wrote:
| Maybe we need more products that don't target mass consumer
| appeal.
| version_five wrote:
| I think it's relatively uncontroversial that advertising is
| a "strategy" for either low quality, not needed, or
| undifferentiated offerings, and that when looking at how a
| company goes to market, there is a choice of putting $ into
| advertising or into a better product.
|
| I generally use advertising as a proxy for inverse utility.
| It would definitely be better to have more products that
| targeted being good, as opposed to ones that target
| influencing people to buy them.
| ghaff wrote:
| >I think it's relatively uncontroversial that advertising
| is a "strategy" for either low quality, not needed, or
| undifferentiated offerings, and that when looking at how
| a company goes to market, there is a choice of putting $
| into advertising or into a better product.
|
| You mean like iPhones? Because Apple certainly
| advertises.
|
| I'm not sure your statement applies broadly to automobile
| advertising either.
| jordache wrote:
| what does your point got to do with my argument - How the
| cited example of rasp-pi is not a strong argument for
| usefulness of ads
| epicide wrote:
| I think you and I are in agreement. By not focusing on
| mass market appeal, raspi isn't reliant on massive
| (traditional) ad campaigns.
|
| I see this as a feature, not a bug.
| bwb wrote:
| Why? Can you explain that thought process? i.e. everything
| should be niche? Like toothpaste for devops engineers who
| want their teeth to grow in the dark when they are around 2
| or more wifi networks?
| xanaxagoras wrote:
| I mean, I would buy that.
| bwb wrote:
| ah crap, i just raised a 4 million angel round due to
| your response :)
| epicide wrote:
| > i.e. everything should be niche?
|
| This is _not_ what I said.
|
| My thought process is that I personally would like to see
| more products with a higher focus on being good for a
| smaller group of people, rather than cheaper and /or
| worse but aimed at a huge audience. [0]
|
| Focusing on delivering a good product to a smaller
| audience allows you to have tighter feedback loops and
| create more useful iterations because of that. You can
| also usually charge more. Personally, there are a lot of
| product spaces that I currently prefer or would prefer
| spending more for higher quality. But I don't always get
| that option due to the obsession with casting a wide net,
| as it were.
|
| Do I expect this to happen organically? No, market forces
| seem to heavily incentivize races to the bottom.
|
| [0]: NB my use of relative statements and not absolutes.
| Going from one extreme to the other likely won't produce
| a net positive.
| tanjtanjtanj wrote:
| Funnily enough I purchased an Ergodox EZ after clicking
| through an ad for it. I actually see this a lot with "niche"
| products (audio equipment, home automation, keyboards, etc)
| where I will have never seen an ad for anything in that
| product category but once I start going to the hobbyist and
| store pages for such products I get inundated with ads for
| one specific offering in that category for a week or two
| before all of my ads go back to what the usually are.
| bbarnett wrote:
| No one advertises on the modern web, to "mass appeal".
|
| If they are, they're doing it wrong. Ads are far more
| targeted than that.
| digitallyfree wrote:
| The Pi is a hobbyist device, so yeah. But something like the
| Ergodox could definitely become popular if video game
| streamers used it, if there were displays in computer stores,
| etc. It's an interesting product but many people (like me)
| simply haven't heard of it.
| sam0x17 wrote:
| version_five wrote:
| That got really personal really fast for no reason...
| spiderice wrote:
| For the record, GP edited their original comment without
| acknowledging it. Originally said something like "You're
| an idiot if you think Raspberry Pi is a niche product". I
| only point it out as it is very unfair to ninja edit
| after you already have a reply.
| sam0x17 wrote:
| So sick of people on this site being dismissive of
| anything that couldn't become "amazon scale" when they
| often have no idea what the actual market conditions are
| for said thing, as demonstrated by their comments and
| general attitude. The aloofness should go in the opposite
| direction, if anything.
| swader999 wrote:
| Can anyone here remember an add they saw yesterday or one they
| clicked on this year? I can't...
| tetsusaiga wrote:
| >In the end I decided the only real way to tell if what we were
| doing was working, was to turn it all off, for several months to
| see if there was a measurable difference.
|
| _What?_
|
| If this person genuinely thinks that there is no way to measure
| an ad's performance while it is running, they are either too
| ignorant to be in business, or they hired someone who lied to
| them.
| yobbo wrote:
| > this person genuinely thinks that there is no way to measure
| an ad's performance while
|
| This is the case in many situations. The time between initial
| visit to site to conversion can be weeks, months, or years.
| Meanwhile, customers will visit site from various platforms.
| There is no way of attributing value to a single click, it
| needs to be approximated as an aggregate.
| civilized wrote:
| One problem is the ad industry is quite good at finding ways to
| take credit for conversions that would have happened
| regardless, and analytics are all systematically biased in a
| way that conveniently maximizes the ability to do so.
|
| The idea to simply turn off ads and see the effect is born of a
| healthy distrust of ad analytics industry bluster.
| josefresco wrote:
| > One problem is the ad industry is quite good at finding
| ways to take credit for conversions that would have happened
| regardless
|
| This is a great counter-point when someone mentions "use
| conversion tracking!" Conversion tracking is great, but not
| if they store a cookie for 7/15/30 days and "award" the
| conversion to the ad, when the customer took a different and
| varying path to purchase. Sure the ad contributed "some" to
| the conversion, but not 100%.
| civilized wrote:
| I strongly suspect they sometimes show the ad and credit it
| for the conversion _after_ the user shows initial interest
| in some specific product, i.e. when the user was already
| highly likely to buy _before_ seeing the ad. This would
| explain why you 're often flooded with ads for something
| after you search for it, go to its website, or purchase
| something there. (We've all had that experience of buying
| something and then being tailed by ads for that thing for
| weeks afterwards, even though no sane person would think we
| were going to buy that thing again in such a short time
| frame.)
|
| A story to illustrate: there was once a pizza store that
| had two guys go out into the city to distribute promotional
| coupons. The coupons had codes on them so the business
| could attribute sales to each coupon distributor. John went
| out into the city and tried his best to drum up new
| business. Chad stood next to the door of the pizza place
| and handed a coupon to anyone who was walking in. After a
| month, 98% of the coupons used were from Chad. Chad got a
| big bonus and John was let go.
| LightHugger wrote:
| Companies that sell ads will do everything they can to convince
| you there is a measurable difference, but often while the
| metrics presented to the client are real, they do not always
| translate to real world impact.
|
| There is no easy way to determine whether this is the case
| without just comparing when the ads are on and off and somehow
| dealing with the confounding variables, which isn't easy.
| [deleted]
| yojo wrote:
| If you're full e-commerce the only metric that really matters
| is conversions. How do you know your ads aren't just taking
| credit for customers who were going to buy anyway?
|
| You can get great CTR and conversion rate running ads against
| your brand name. But if your SEO is sound you're pretty much
| just canibalizing your organic traffic.
|
| I'm not aware of a way to determine whether an ad just claimed
| credit for a customer it didn't earn. I'm interested to learn
| though.
| boplicity wrote:
| > How do you know your ads aren't just taking credit for
| customers who were going to buy anyway?
|
| If you can't answer that question, then you're not running a
| proper advertising campaign. You're just throwing money
| around blindly. Plenty of people _do_ have good answers to
| that question, though. Unfortunately, plenty of people _don
| 't_.
| Strom wrote:
| > _If you can 't answer that question, then you're not
| running a proper advertising campaign._
|
| What is this proper advertising campaign? Does it include
| turning off ads for terms that rank organically high
| anyway?
| boplicity wrote:
| > What is this proper advertising campaign
|
| Well, for our business, proper advertising campaigns have
| opened new channels for growth, allowing us to reach new
| people, and build our email list significantly, with a
| predictable ROI. It's pretty easy to tell if an ad is
| working when you turn it on, and your email list growth
| rate instantly doubles -- and all the traffic is coming
| from a new traffic source. (Obviously, if we were to run
| Google ads on search traffic, we would check whether our
| organic search traffic dropped when we turned the ads on,
| but that's a different point.)
| Strom wrote:
| > _It 's pretty easy to tell if an ad is working when you
| turn it on, and your email list growth rate instantly
| doubles -- and all the traffic is coming from a new
| traffic source._
|
| Maybe for a real tight definition of _instantly_ , but
| generally this is not true. Imagine the following
| scenario:
|
| 1. You run an ad for ComapnyName.
|
| 2. An enthusiastic customer promotes your business in a
| local bar.
|
| 3. The bar attendees search for CompanyName and click on
| the first result.
|
| Because you ran an ad for CompanyName, the first result
| is going to be your ad. You will see very nice ROI on
| that ad. What you won't see in any stats, is that these
| people would have probably found the organic link anyway,
| because they were already motivated and searching for
| CompanyName in particular.
|
| > _Obviously, if we were to run Google ads on search
| traffic, we would check whether our organic search
| traffic dropped when we turned the ads on, but that 's a
| different point_
|
| That wouldn't help either in this imaginary scenario,
| because these bar attendees are a spike in traffic. Plus
| if the ad has been running for a longer period, then you
| won't have accurate organic search traffic stats anymore
| either, because it's already cannibalized.
| boplicity wrote:
| > Imagine the following scenario
|
| "Imagination" is the core of the problem here. Plenty of
| people are imagining various scenarios, whereas people
| with successful advertising campaigns are just raking in
| the money -- no need for imagination.
|
| I've turned off plenty of ads when they stopped working.
| I didn't need to turn them off to discover they stopped
| working.
|
| Sure, you can imagine a dozen scenarios where an ad
| campaign doesn't work. Fortunately, I've managed to learn
| how to focus on the reality of the situation -- and have
| reaped the rewards in the process.
|
| > you won't have accurate organic search traffic stats
| anymore either, because it's already cannibalized.
|
| That' not true for us -- as I said before, a successful
| campaign for us brings in new sources of traffic from new
| marketing channels. One of the early lessons I learned
| was to _not_ cannibalize what 's already working. For
| example, we grew our Facebook Page (and email list) from
| scratch, when we had no Facebook traffic, by using
| Facebook advertising.
|
| Operating under different brands -- even just for testing
| purposes, is a one another of the way we deal with this.
| Of course you can continue to _imagine_ scenarios where
| we might be making mistakes. I do that as well -- it 's
| called planning. Though, none of that really matters
| until money is spent (and made or lost).
| Strom wrote:
| First let me say that ads in general definitely work, I'm
| definitely not arguing against that.
|
| What I'm talking about in specific is search ads where
| the ad is for a term that ranks organically high anyway.
|
| It's not just imaginary either, I've done a lot of over-
| the-shoulder customer observing. Just recently I saw a
| friend search for "dropbox" and then click on the first
| result in Google, which is a paid ad by dropbox for
| dropbox. They rank #1 anyway!
|
| Now in dropbox's case it might be worth it, because they
| have enough competitors who would like to steal that ad
| spot. However for most businesses that's not the case for
| their top terms.
| jefftk wrote:
| _> How do you know your ads aren't just taking credit for
| customers who were going to buy anyway?_
|
| The word for this in the business is "incrementality", and
| there are several ways of measuring it. The simplest
| conceptually, is that you run two ads to two random groups of
| users: one for the product and one for something irrelevant
| like a charity. Then you compare conversions between the two
| groups.
|
| (There are fancier ways to do it that don't require you to
| spend half your budget on an irrelevant ad, but that's the
| basic idea.)
| yobbo wrote:
| > is that you show two ads: one for the product and one for
| something irrelevant like a charity.
|
| This is would be another experiment that does not test what
| you need to in order to demonstrate some sort of causality.
| jefftk wrote:
| Why doesn't that demonstrate causality? It is a
| randomized controlled trial.
| yobbo wrote:
| The control would be to not show ads. This was tried in
| the article, with time as the variable to partition the
| control groups.
| toast0 wrote:
| Unless you control the ad platform, you can't make a 'no
| ads' control group; if you want to track the user, you've
| got to show them some ad; so an unrelated PSA is an ok
| option.
| jefftk wrote:
| Time doesn't work very well. There are lots of reasons
| why you will see different behavior at different times,
| so it really only works if you are trying to check
| something with a very large effect size.
|
| Much better is to run your control group and experiment
| group in parallel, like I described above.
|
| Is your objection that showing ads for something
| irrelevant could affect whether the user converts?
| whimsicalism wrote:
| Here's a question I have about this experiment.
|
| So the experimental setup is: you create an ad for your
| product, you create an ad for your charity, then you
| compare the populations of people who click on your ad
| for your product with the population of people who click
| on your ad for the charity and see if there is any
| difference in conversion rates between the two
| populations.
|
| How do you ensure that the people who see/click on your
| product ad aren't already a population more likely to
| convert to your product than the population of people who
| see/click on your charity ad? Sure, you can target the
| same groups of people - but that only goes so far, the ML
| algorithms backing the ad selection process will still
| preferentially show your charity ad to people likely to
| click on charity ads and show your product ad to people
| likely to click on your product ad.
|
| I am unfamiliar with how these experiments work on the
| advertiser side. Incrementality is easy to measure on the
| platform side if advertisers report conversion metrics to
| you.
| jefftk wrote:
| ML messing with you is an important consideration when
| you are trying to run this sort of experiment on a
| platform that you don't understand very well. The most
| simplest reliable way to run this experiment is to give
| the ad network an HTML creative that looks like:
| <script> var treatment =
| readTreatmentFromCookie(); if (!treatment) {
| treatment = Math.random() < 0.5 ? CONTROL : EXPERIMENT;
| writeTreatmentToCookie(treatment); }
| if (treatment === EXPERIMENT) {
| showAd(PRODUCT); } else {
| showAd(CHARITY); } </script>
|
| The creative is opaque to the network, which means it's
| not going to be able to do anything fancy like you're
| describing.
|
| Many networks offer the ability to run a fully supported
| incrementality study, where they effectively use one
| company's ads as a control for another's, but this is a
| version of an experiment that you can run even if you
| don't trust the ad network at all.
| whimsicalism wrote:
| People's behavior changes drastically with time. Showing
| no ad for your product seems like a sufficient control?
| tomrod wrote:
| But then you have no control measure in most platforms,
| as you cannot track them?
| whimsicalism wrote:
| Attribution is not my area of expertise. But could you
| not track them to see if they convert? This is possible
| both on the advertiser side and the platform side,
| provided the advertiser reports conversions to the
| platform.
| tomrod wrote:
| You'd want to flag whether and how you captured them.
|
| If you have offline channels directing you to a website
| as well, like television or print, it can get messy
| unless architected properly.
| tetsusaiga wrote:
| Thanks for adding this-- I definitely failed in my
| explanation by not talking about _how_ one runs such tests.
| whimsicalism wrote:
| I work in ads. You appear to be one of the few people on
| this thread who actually knows what they're talking about.
|
| +1 to everything you've said.
| [deleted]
| Griffinsauce wrote:
| > one for the product and one for something irrelevant like
| a charity.
|
| Those are extremely different, how does that prove
| anything?
| pedrosorio wrote:
| If you chose "not to show ads" to the control group, all
| the slots of the control group where you would have shown
| ads will have ads you don't control, including your
| competitors' ads.
|
| If you show a neutral ad, you know exactly how much
| seeing your brand in ad drives revenue compared to seeing
| an irrelevant ad.
| jefftk wrote:
| The goal in showing an ad for something irrelevant is to
| have a control group: one where it is very unlikely that
| your interaction is going to affect their purchasing your
| product.
| yojo wrote:
| Thank you. I wasn't aware of this, it makes perfect sense.
| m3047 wrote:
| The article suggests that they are comparing between two
| placements: the organic search placement and the paid
| placement (ad). I don't see any explanation why that is
| invalid. Indeed the literal meaning of incrementality would
| suggest a comparison of f(A) and f(A,B). Not quite
| "sampling with replacement", but if that's heresy to you
| you're welcome to quit reading now.
|
| The protocol for doing so would involve studying what
| happens when the ad is present versus when it is not. The
| goal is conversion, scrupulously defined as people who
| click one or the other and subsequently purchase. Total
| conversion could go up, down, or stay the same. The only
| way the ad "wins" is total conversion increases, and even
| then maybe. If organic conversions went up when the ad was
| present you'd have a research problem! (The effect could be
| time-based, i.e. "awareness", or it could be a confounding
| externality.)
|
| The protocol you suggest would seem to be removing the
| organic placement when the ad is present, that is: one or
| the other. On its face this sounds more "researchy" to me.
| Putting feasibility aside, it would plausibly be attractive
| to an advertising professional, but I would espect the
| customer to ask "why?" and I don't see the answer to that
| question. What's the motivation for this approach? I can
| see that it makes the advertising professional's
| contribution crystal clear, but why should the customer pay
| for it?
|
| But hey I don't have 30 years of advertising experience,
| nor do I consider myself a statistician or machine learning
| expert. I do however have over 30 years of experience as an
| internet plumber and (more importantly here) data sous
| chef, so I've tasted a lot of ingredients in a lotta stews
| and have a solid grasp of experiment design and causality.
|
| You work for the customer: consider that some avuncular
| advice.
| jefftk wrote:
| The problem with the approach in the article is that
| there are lots of reasons conversions can vary over time
| that are unrelated to what you're trying to study. If you
| have to use time to distinguish treatments, your best
| option is to alternate time periods (ex: one day on, one
| day off). But you can almost always run your two groups
| simultaneously, giving them different treatments, which
| allows you to eliminate the effect of timing noise.
| tomrod wrote:
| Yaye for A/B testing!
| tetsusaiga wrote:
| I agree that only conversions matter, but you should be able
| to track whether a customer originated from an ad click vs.
| SEO, whether they clicked one ad and had 4 sessions since,
| etc.
|
| While it's not a perfect system, you should know with a
| reasonable degree of accuracy how many dollars you get back
| for every dollar you put in to ad spend.
|
| As far as the SEO traffic issue, this can also be accounted
| for once you have scaled your ads beyond the levels of what
| SEO could yield. At low budgets this can be more of an issue,
| at high budgets much less so.
| Nextgrid wrote:
| > whether they clicked one ad and had 4 sessions since,
| etc.
|
| That's not trivial to do, both from a technical point of
| view (browsers - rightfully - fight these kinds of tracking
| attempts) but also legal (GDPR mandates that the customer
| opts into this kind of tracking but they have no incentive
| to do so).
| tetsusaiga wrote:
| You're right, this is actually a lot harder to recently,
| with the iOS updates that occurred a year or so ago. It's
| a space that evolves very quickly.
|
| But this is a good place to point out that, yes - there
| is nuance to all of this - and I didn't really mean to
| turn it into a thesis on online advertising (lol) so much
| as to say:
|
| It's still easy to be more accurate than "Turn it off and
| see what happens".
|
| Even a semi-sophisticated media buyer is going in with a
| plan, and some method of measurement.
| m3047 wrote:
| GDPR doesn't stop me from having ad1.example.com and
| ad2.example.com landing pages. Aspirationally perhaps,
| but technically no. I think this is different from
| fonts.gstatic.com in that it doesn't need to follow
| people around the internet and it's also not info
| necessarily going to a third party.
| yojo wrote:
| I don't know how counting sessions or source of click
| matters. You still don't know whether the customer would
| have ultimately found you without the ad.
|
| Put another way, the only way to tell if a customer will
| still find you without the ad is to not run the ad.
|
| If you have sufficient traffic you might be able to measure
| this by turning your ad spend down rather than off and
| measure the bottom line impact. But other than gross spend
| changes there's no way of telling for sure that the ads do
| anything.
| tetsusaiga wrote:
| > You still don't know whether the customer would have
| ultimately found you without the ad.
|
| Sure, maybe 100 customers would eventually find you. But
| if you buy the traffic, you can make them all find you on
| the same day.
|
| > But other than gross spend changes there's no way of
| telling for sure that the ads do anything.
|
| I'll use the most fundamental example:
|
| If someone clicks your ad and buys the product during
| that session, you know the ad worked. If you keep
| increasing your ad budget every day, and you are
| consistently returning $2 for every $1 you spend, you
| know it's working. Turn off the ads, and the revenue goes
| away. You'd be surprised how many people make their
| living doing this.
| thrwy_ywrht wrote:
| >If someone clicks your ad and buys the product during
| that session, you know the ad worked
|
| This is not as clear as you make it seem. Let's say
| there's a hypothetical product that a consumer only buys
| once every 5 years. If someone clicks your ad and then
| immediately buys the product... what if they would have
| bought it anyway, tomorrow, or 5 minutes from now,
| without the ad? How can you test that counterfactual?
|
| If I buy cat litter online once a month every month for 5
| years by going to example.org/catlitter -- but then they
| decide to start advertising on facebook, so now I click
| the facebook ad once a month to buy cat litter from the
| same site, are the ads "working"?
| tetsusaiga wrote:
| The idea is because it's happening at scale. If you're
| getting hundreds or thousands of customers per day, the
| likelihood of this happening gets lower by some
| statistical proportion, especially if you don't have the
| organic exposure.
|
| Also, definition of working: You make more than you
| spend, and if you stop the ads, you stop making as much.
|
| That said, I'm not arguing for 100% accuracy either. It's
| certainly not. Simply that it's possible to be more
| accurate than not, which leads to profitability.
|
| One more also- a comment above about how I failed to
| mention I'm not talking about paid search ads so much as
| other types like FB, YouTube, banners, etc.
| yobbo wrote:
| > [...] Turn off the ads, and the revenue goes away.
|
| This is the experiment from the article. It showed that
| ads did not affect revenue.
| philote wrote:
| This is like the paid search results that come up when
| you search for a specific company name. The company's
| site is just below those paid results, but often the same
| site is in the paid results but they are further up so
| are more likely to be clicked.
| Strom wrote:
| > _you should be able to track whether a customer
| originated from an ad click vs. SEO_
|
| That's easy to track, but answers the wrong question. It
| answers whether the person clicked on the ad or the organic
| link. What we actually want to know is whether this person
| would convert even without seeing an ad. The only way to
| answer whether a person would still convert without seeing
| an ad is to make sure that they don't see an ad.
| tetsusaiga wrote:
| My major failure in this thread was not specifying from
| that start that I'm not so much talking about paid search
| ads (google ads), as much as I mean FB, YouTube, etc.
| That's the arena where you've really gotta question if
| you're competing with yourself.
|
| On the flip side of that, most of HN seems to think
| purely in terms of paid search ads, when there are many
| other types of online advertising that exist, and that
| don't have this issue baked into them.
|
| Such is the nature of internet dialogue, I guess lol.
| Strom wrote:
| That's a good point. It's a lot harder to cannibalize
| organic traffic with non-search ads.
| m3047 wrote:
| Are you conflating a call to action on a channel you
| already control with advertising? Because in that case
| you might try f(A), f(A,B) and also f(B): could be a
| synergistic effect, or they could just click on anything.
| Closi wrote:
| > I agree that only conversions matter, but you should be
| able to track whether a customer originated from an ad
| click vs. SEO, whether they clicked one ad and had 4
| sessions since, etc.
|
| An ad-click could have been an organic click if the ad
| wasn't there though, which is where the complexity is.
|
| The ad might have great conversion, but if the customer
| would have clicked an organic link that navigated to your
| site anyway then the ad is taking credit for an organic
| sale.
| tetsusaiga wrote:
| While you're not necessarily wrong, the distinction lies
| in how many people see you organically.
|
| If I get 100 organic impressions/day, and then spend $N
| to get 500/day, I'm speeding the process up, and nearly
| guaranteeing to get in front of people who would never
| see me organically.
|
| *Note: I'm largely not talking about paid search ads.
| Those are definitely an area where you can end up
| competing with yourself. Sorry to anyone who I replied to
| earlier, and wasn't clear enough on this with.
| [deleted]
| dangerface wrote:
| > How do you know your ads aren't just taking credit for
| customers who were going to buy anyway?
|
| If you are doing advertising right you build a funnel from
| awareness through to conversion and track every part of it so
| you then a/b test your adverts and channels.
|
| Getting advert channel fit is the key to success and can only
| be done by testing and measuring your adverts. The fact that
| op couldn't measure the effectiveness of their adverts shows
| they weren't doing this and their bad outcome should be 100%
| expected.
|
| If you are just buying adverts in the hope you get more
| conversions then you are putting those adverts out to die.
| Burn your money you will probably get more eyes for doing
| that than untested adverts.
| whimsicalism wrote:
| This is now impossible to do on iOS devices.
| bschne wrote:
| Well that works in some ways, but it can also be very hard to
| disentangle the actual causal impact of an ad campaign! Absent
| running an experiment, you don't really know if people would or
| would not have bought through some other channel without your
| campaign.
|
| The most striking example is probably the experiment Tadelis
| convinced eBay to run on their brand-name ads, though the
| subtlety applies to less obvious cases of questionable ad spend
| too -- https://faculty.haas.berkeley.edu/stadelis/Tadelis.pdf
| tetsusaiga wrote:
| I'll just reference my other replies to the first part here,
| but thank you for that link too. I'll have to give it a read
| when I have more time later today
| gk1 wrote:
| Don't pretend attribution is simple or solved. If that were
| true there wouldn't be dozens of attribution products, who are
| still far from perfect.
|
| The Dunning Kruger effect is strong in marketing. The more you
| learn about marketing the more reason you have to be unsure.
| m3047 wrote:
| _How would you measure this:_
|
| Does this ad improve conversion compared to not having the ad
| at all?
| dehrmann wrote:
| > Over 85% of our organic search traffic comes from users typing
| in our brand name - Total Car Check. If they see an advert at the
| top of the organic search results, for the user, its just a
| shortcut to get to the site, especially since Google started
| putting organic search results below the fold in many search
| results, except it would cost us money to buy a user who was
| going to find us anyway.
|
| Sure, but you wouldn't want your competitor to effectively rank
| #1 for your brand. I've always viewed this like an extortion
| racket.
| atestu wrote:
| Absolutely! I remember Basecamp's CEO tweeting about this
| https://twitter.com/jasonfried/status/1168986962704982016
|
| In the replies Google says: "we don't restrict trademarked
| terms as keywords. We do restrict trademarked terms in ad text
| if the trademark owner files a complaint"
|
| It's a gamble on the strength of your brand to not buy that ad.
| I think it makes sense that eBay can do away with it, because
| people typing "eBay" in Google will scroll down for eBay, they
| won't click on "Company X - Best eBay alternative." Most brands
| aren't that strong...
| theartfuldodger wrote:
| Summary:
|
| I ran online advertising myself with no knowledge or experience
| and it did not go well.
|
| How surprising!
|
| For context, for over a decade across thousands, maybe tens of
| thousands of campaigns, a 30% increase in sales and leads has
| been a low benchmark that is easily achieved within 60 days of
| acquiring a client with few exceptions. As the space has become
| more congested, it has not become more congested with capable
| people, actively identifying lower competition mid to end funnel
| terms has remained a very stable and reliable method. You'll also
| find that so few digital advertisers are actively modifying and
| testing landing pages and expanding that inventory of landing
| pages based on what their conversions teach about their audience.
|
| The language of the article makes it clear he never should have
| added a credit card to an ad account.
| muaytimbo wrote:
| A lot of comments, probably from marketers with a vested interest
| in the status quo, seem to make the argument "better marketers
| would achieve better results." But I haven't seen a single
| citation arguing that 1) advertising works at all or 2)
| differential impacts from different marketers.
| vgeek wrote:
| 90%+ of marketers are bad at their job, but since everyone else
| is, too, it doesn't seem to matter.
|
| New/incremental sales (think brand agnostic, high funnel terms
| with intent like boston electrician or cleveland mortgages) are
| out there, but their costs typically approach the lead's
| intrisnic value. If you are paying $10/click and converting 10%
| of clicks to leads, you're at $100 for a lead. Of those leads,
| if you close 25%, you're at $400 acquisition cost. Maybe great
| for a SaaS or insurance company with a high LTV, but awful for
| a plumber with an average call of $250. At this point, paid ads
| are basically a game of trying to out-optimize your click to
| lead and lead to sale funnels relative to your competitors
| unless you want to give all of your margin to an ad network.
| lkxijlewlf wrote:
| Couldn't this really be a case of, they're so well known now that
| they don't need to advertise? If the did this when they started,
| probably things would be different.
| Traster wrote:
| Honestly, this genre of "Look! We don't do X!" topics on HN
| recently have been a little absurd. Advertising has it's place.
| If you're buying ads on your own brand name then yes, you're
| wasting your time, but since advertising is quite expensive I
| would've thought you would put some effort into doing it well.
| It's the same thing for the unit testing article and the article
| about staging environments. Yes, if you do something badly, it's
| probably going to be worse/more expensive/slower than not doing
| it at all. But the whole genre could be concisely summarised as
| "Be concious of where you are focusing your efforts".
| aldebran wrote:
| If you don't buy ads in your brand name your competitor might
| and May encourage users to try them instead. Even if you lose
| 5% each time, that can build up.
|
| Companies do this all the time. Even for something like App
| Store submissions. People use their competitor name as a
| keyword to increase their top of funnel.
| Traster wrote:
| I'm sure it happens, but you've got to be looking at that as
| a pure cost. You're not generating any revenue from people
| searching your brand, and you're paying significant sums for
| click through on people who already had the intention to come
| to you. In some ways I could see the normal position being
| "We only advertise on our competitors brands" because atleast
| that way you are picking off your competition, not bidding up
| people who already wanted to come to you.
| st3ve445678 wrote:
| My experience is similar. I tried on and off for several years to
| get some traction on adwords to suppliment my organic. I learned
| everything I could, tweaked campaigns over time. Nothing.
|
| I then hired a reputable certified adwords company. Again,
| nothing. Literally almost zero conversions over a good period of
| time. I really wanted it to work, but had to stop the losses
| after many months of trying.
|
| It could just be my industry though, I know some people do make
| it work for their business. So I guess try it, but watch for
| results and don't fool yourself for too long if nothing is
| working.
| com2kid wrote:
| > My experience is similar. I tried on and off for several
| years to get some traction on adwords to suppliment my organic.
| I learned everything I could, tweaked campaigns over time.
| Nothing.
|
| When I was running my hyper-local startup, my best conversion
| rate was through reddit ads on the city subreddits.
|
| Super targeted Facebook ads also worked.
|
| I didn't even try adwords, wrong ad product for the job.
|
| IIRC email sign ups were costing me like ~20-25 cents each.
| Reddit ads were obscenely effective.
| adamsmith143 wrote:
| I think major brands in particular are wasting a lot of money on
| ads. For example searching Macbook in google returns an ad for
| apple.com as the first result and the same exact link as the
| first non promoted link. Why on earth is Apple paying for an ad
| in this case? It's literally wasted money. I can't imagine that
| having an ad link above the real link gives them any revenue
| delta
| quadrangle wrote:
| I probably hate ads more than most people but when _I_ hear or
| see an ad, it _kills_ my willingness to engage with a business. I
| mean, this isn 't _entirely_ conscious. I was thinking about
| whether my kid would like those creative boxes from KiwiCo that I
| heard good things about organically. Then, I heard an ad for them
| on a podcast, and I noticed a new extra resistance and hesitation
| to buy anything from them.
|
| I don't want to be a sucker for ads. I don't want to support
| businesses that support our ad-polluted world. With my limited
| capacity to donate directly to creative work (which I'd
| incidentally rather do as part of a coordinated general public
| than just unilaterally), I favor donating to those who forgo ads
| rather than reward or support anything that accepts ads.
|
| Now, I've hated ads for a long time. But I was still surprised
| how much I no longer feel fine considering KiwiCo. Now that I
| heard their ad, I feel like I don't want to be one of those
| people who is seen as following ads, and I don't want to support
| them. I imagine there's other products that don't budget as much
| for ads that I should go out of my way to seek out instead.
|
| So for anyone like me, if you do paid ads, you just _harmed_ your
| credibility with me.
| Kiro wrote:
| Everyone thinks they're immune to ads.
| psyc wrote:
| https://youtu.be/3oTR5o9nUzI
| newaccount74 wrote:
| > I heard good things about organically...
|
| The problem is that even if ads don't affect you personally,
| they affect people around you, and the people who "organically"
| tell you about stuff just tell you about things they saw in
| ads.
| Razengan wrote:
| No, nobody has told me about stuff they saw in ads. Almost
| all the things I have ever paid for, have been found one of
| these ways:
|
| * Randomly: I don't care what toothpaste or soap etc. I get,
| I just grab the closest/cheapest thing off the shelf.
|
| * While manually searching for specific traits, ingredients
| or features.
|
| * Habit/Lack of choice: Coke and Pepsi are the only colas of
| their type available in most places.
|
| * Via word-of-mouth by people who found them the same ways.
| This includes asking for recommendations on online forums
| etc.
| cwkoss wrote:
| When you notice a product being advertised, it means that part
| of the price of that product/service is being redirected from
| focusing on quality to manipulation.
|
| The amount something advertised is inversely correlated with
| value.
| saulpw wrote:
| Ads work subconsciously. By the time you're looking for a new X
| and go shopping, you'll recognize company A making an X and it
| will register as a viable option, only because you heard about
| it somewhere--having forgotten that you saw their ad and vowed
| never to buy something from such a money-grubbing corporation.
| Also, basically everyone has to advertise these days, so good
| luck finding an X made by a company who doesn't advertise. If
| you do, in a year or two you'll be extolling the virtues of
| this wonderful product that you can no longer buy because the
| company went out of business.
| exyi wrote:
| At least it's not hard to find companies which don't
| advertise too much. I don't get angry by one poster on a
| tram, but I get really upset when an entire site is flashing
| with the ad, when the ad is an outright lie, ... And I'm
| certain I remember (at least some of) those. I hope I'm not
| alone, voting with wallet seems to be our only way out of ad-
| ridden world :/
| armchairhacker wrote:
| I don't believe the "ads work subconsciously" bs. Whenever I
| plan to buy something I a) look it up beforehand or b) (if
| it's a routine purchase like groceries or household
| essentials) follow some method like brand name, second
| cheapest, iterate between different brands, etc.. b could be
| influenced by subconscious advertising but i just don't think
| so, and anyways, most of the things that are heavily
| advertised (car insurance, expensive stuff, apps) are things
| I'm going to research before buying.
|
| I do think advertising works, it works because there are
| unaware people who do impulse buy expensive things and buy
| whatever they see. Lots of people probably aren't going to
| research what olive oil or smart TV is the best, they just
| want to get their shopping done. And, kind of like how IAPs
| work because some people will spend thousands of dollars on
| them, some people spend thousands of dollars on impulse buys.
| boplicity wrote:
| Personal experience with KiwiCo: They were absolutely wonderful
| for a while, especially during pandemic lockdowns.
| Unfortunately, they've gone significantly downhill in recent
| months, with kits just not being of the same quality, so we
| cancelled our subscription. Maybe we'll try them again in a
| couple of years, maybe not.
| ghusto wrote:
| This is fantasticality fortuitous. I was just discussing this
| very thing with somebody close to me.
|
| He's worked for many years to become the number one in his field
| -- let's say he's a performer of sorts. He's a _very_ hard worker
| and it's all paid off for him, he's the top hit for when you
| search for what he does. So naturally, he's frustrated at paying
| what he says is about 10% of his income to advertising.
|
| I said he could probably get rid of the ads now, if he's already
| at the top, but then we began to wonder. I wouldn't put it past
| Google to start pushing his results down, just to get him to
| spend again.
|
| I'm well aware all the negative terrible things Google has been
| doing in the last years has likely just left me a little
| paranoid, but what do you guys think?
| cwkoss wrote:
| Google ads, at scale, gradually transform into a protection
| racket.
| adlorger wrote:
| the answer here is about the competitive space that he's in and
| whether his competitor is buying brand terms around his area.
| if not, he's probably fine and he can use his organic strength
| to stay tops.
| dna_polymerase wrote:
| Especially in online advertising measuring your success is rather
| simple. So at any point in time you should be able to have
| numbers to show for your efforts.
|
| While the article sounds promising the lack of data really makes
| it useless.
| irrational wrote:
| TLDR seems to be, advertising might be helpful when you are
| starting out, but once you are established it is probably a waste
| of money.
| willmadden wrote:
| I had the EXACT experience with both adwords and facebook
| budgets. I kept remarketing on but cut the other campaigns and
| our growth rates didn't change, and our CAC dropped like a rock.
| The key word rates in our industry are ridiculous because we have
| overfunded competitors throwing away money trying to funnel
| customers into higher margin products. We were literally throwing
| money away competing for keywords with companies that have
| different cost structures.
| sdoering wrote:
| What I missed from the article was the question if the author
| measured the goal performance of their advertising. Also the ROI.
| Additionally it is (or should be) common knowledge to check if
| you are canabalizing your SEO results because in your niche you
| are not working against other organic search results or
| advertising of your competitors.
|
| Because this would have potentially shown from the get go if
| advertising in this case was unnecessary or if it supported the
| business until SEO had cached up.
| sngz wrote:
| freakanomics podcast has two part episode touching upon all the
| debates / arguments going on in this thread
|
| https://freakonomics.com/podcast/does-advertising-actually-w...
|
| https://freakonomics.com/podcast/does-advertising-actually-w...
| sourabhsybero wrote:
| The best way is always putting right efforts. Ads and paid
| campaigns are never long lasting for any business. The genuine
| ways may take time but the best for long term business.
| syngrog66 wrote:
| long ago ran a little computer game company. early on I'd spend
| <awkwardly-large-amount> on Google advertising, and that channel
| resulted in say a <= $100 revenue over company lifetime
|
| I'd then go spend say $200 to attend a game convention, with my
| own private little display booth, and... it resulted in >$200 in
| revenue from game sales. (forget numbers exactly but it was far
| better return than buying Google search ads ever was.)
|
| granted it might have been because my Google ad
| placement/messaging was not tuned ideally -- who knows. But I
| always value concrete results over theory or might-have-beens.
| and so its effected my views on advertising ever since
| civilized wrote:
| It's pretty obvious why this site didn't need advertising. It had
| good SEO, and SEO is what matters for this kind of website.
| Someone in the UK who wants to check a car will Google it and
| they will find this website.
|
| Other channels are probably much less impactful. I care about
| checking a car when I want to check a car, and at that time I
| will search for that service. I don't care about checking a car
| when ad guys want me to care about checking a car. I'm not going
| to subliminally remember to use TotalCarCheck when I buy a car
| because I saw an ad weeks ago. I'm going to Google it and I'm
| going to go to the top result.
|
| And yet the ad people in these comments are getting all their
| hackles up that anyone would dare question the value of
| advertising _in each and every and all possible situations._
| Obviously if it 's not working for you, you just aren't doing it
| right and you need to pay top dollar for some Ad Professionals to
| get in there and fix it for you.
|
| Seems a little insecure to me. Is it so hard to admit that some
| businesses just don't benefit that much from certain kinds of
| advertising?
|
| Or maybe because the ad industry is a Paperclip Maximizer, and
| admitting something like that might fail to maximize the
| paperclips, it cannot be admitted?
| stevespang wrote:
| kristofferR wrote:
| > The chart above shows our average conversion per cost over the
| lifetime of our adverts. The average was 3.25, meaning we were
| being told for every PS1 we spend, a user spent PS3.25. Sounds
| amazing right? Just spend more money on adverts, surely. Nope. We
| turned off all adverts. Sales increased.
|
| This isn't really valuable without more and better information.
| The post is almost totally devoid of data.
|
| For all I, and maybe he, knows, sales might have increased more
| if he kept advertising.
| marcosdumay wrote:
| You can't do an statistically correct test on everything. At
| some point you have to just assume something (yeah, even when
| doing a formal test).
|
| Here he assumed that, given there was no new fact on the short
| period he analyzed, he could expect short term trend to stay
| the same if he did nothing. It's a perfectly reasonable
| assumption.
| gw67 wrote:
| Why not excluding the brand name as negative phrase keyword?
| wellokpetejr wrote:
| > In the end I decided the only real way to tell if what we were
| doing was working, was to turn it all off, for several months to
| see if there was a measurable difference.
|
| This is how he should have started. It's called incrementality.
| You have a control group with no ads and you compare against a
| group shown ads. Then you can measure lift.
|
| This is Marketing 101.
| VoidWhisperer wrote:
| One thing that this article doesn't mention and I'm curious
| about: while the author didn't see it in this case, if you are in
| a much more competitive niche, if you completely stop ad pay,
| what is stopping google from then displaying a competitor who is
| still paying them for ad space at the top of a search result
| related to your brand/market niche where you are otherwise the
| first non-ad result?
| sam0x17 wrote:
| The nonexistence of a competitor in many cases. But yes you've
| hit the dirty secret of search ads -- they are often a highway
| toll to receive the traffic you would probably already receive
| barring fierce competition
| johnx123-up wrote:
| IIRC, Google had a rule that you cannot bid on trademark names.
| Not sure if that changed lately.
| [deleted]
| deeeej wrote:
| Hi, original author here. Great point. In fact other firms
| seems to be able to get away with even using your brand-name in
| their advertising. Simply put, nothing stops this, and it will
| happen. It comes down to how confident the customer is looking
| specifically for you and not anyone else. In competitive
| niches, this could be tricky, but if they searched on your
| brand name, there is a high chance they'll dig to find your
| website.
| dazc wrote:
| Nothing, which is why you may get to the point where you're
| advertising to protect your brand rather than advertising to
| build your business.
| throwaway2048 wrote:
| I find it completely plausible that advertising is a zero sum
| game for the reason above, and a negative sum game when you
| consider the externalities and the money spent on it.
| Disruptive_Dave wrote:
| These posts are always useless without relevant information.
| Convince me that you know *how* to advertise and then tell me
| that it "didn't work" and we can have an actual conversation
| about it. Author didn't even show the actual ads! Targeting,
| timing, copy, creative, landing pages, retargeting, follow-up...
| Give us something to work with here.
| jgurewitz wrote:
| These articles typically come in the form of, I was paying for my
| brand name when I was number one on organic search. I wasn't
| validating any of my other ad spend, I stopped and didn't see any
| negative impact, therefore advertising doesn't work/is a scam.
|
| As someone who's worked in the industry a while, I agree that
| it's a sad state of affairs generally but when people extrapolate
| that this means all advertising is bs it's just not true.
| Fundamentally business orders should track results from their ads
| the same way they look at impact anywhere else in their business.
| evancoop wrote:
| "Half the money I spend on advertising is wasted; the trouble
| is I don't know which half."
|
| - John Wanamaker
| charcircuit wrote:
| John Wanamaker died in 1922 long before the age of internet
| advertising where it became much easier to figure out which
| half it is.
| fictionfuture wrote:
| I run analytics company and (off the record) we detect roughly
| 75% of paid traffic as bots, w 50% of the remaining in iframes
| chasebank wrote:
| What's your analytics company?
| VBprogrammer wrote:
| When I think of online ads the first thing that comes to mind
| is patio11 and his blogs on Bingo Card Creator. If the profit
| from conversions is above the cost per click the you are
| printing money hats.
|
| The difficulty is that to get there you have to carefully
| steward your own little flock of PPC campaigns in the same way
| that someone might pick stocks or a professional gambler picks
| a horse.
| 1vuio0pswjnm7 wrote:
| The pertinent question is what percentage of advertising is
| "BS".
|
| We are still in the infancy of the internet and its one
| dominant usage, the www. It is possible people are overspending
| on www and "in app" advertising because no one is sure what
| methods or amounts of spending are truly necessary.
|
| It is a similarly sad state of affairs when people extrapolate
| the success of some companies engaging in www advertising as a
| business to mean that current trends towards purchasing www
| advertising are all backed by objective, empirical evidence and
| will persist indefinitely. Looking at what has been revealed
| through litigation against Google and Facebook,1 it appears
| there is a substantial amount of opaqueness (non-transparency)
| required for these internet advertising companies to remain
| successful.
|
| 1 Not to mention what will be disclosed in the future.
| totalview wrote:
| Someone who runs a startup here. Marketing has become so
| congested on the same platforms that most people are becoming
| "sign blind" to all of it. Anything squeezing my boarders on my
| mobile or desktop sites just causes my eyes to look for the "X"
| button. Older clients I work with in large industries don't
| trust or click on any of it, and their company blue coat
| filters stop you if you accidentally do.
|
| Marketing isn't all bad. But if your answer to spreading the
| word about you product comes down to spending money on banner
| ads, pop ups, or anything else that would annoy you away from
| looking at your own product...
| squeaky-clean wrote:
| I used to work in airfare marketing systems, one of our
| biggest sellers was Instagram ads with prices inserted into
| the ad graphic hourly. I have no clue what kind of person
| sees an ad for "cheap flights to {destination}" and then
| clicks the ad and impulse-buys their tickets, but they exist.
| A surprisingly high number of them.
| ebiester wrote:
| It's people like me who had it on their to-do list and it
| was a reminder to do it later.
| saiya-jin wrote:
| Yeah but you didn't do it via the ad if I understand
| correctly. I would never ever do that, regardless of the
| price or any other fact. As mentioned above, I never
| click on them by principle, same as I never watch TV
| programs full of ads. Firefox with ublock origin blocks
| 95% of ads, for the rest I see if there is quick X to
| remove them or ignore them hard. If its too annoying I
| leave the page and go for competition.
|
| The best ad could theoretically achieve with person like
| me is that I would go to ie skyscanner and check current
| situation.
| aidos wrote:
| You're not the general public. Most people don't even use
| ad blockers. Those of us on HN are a different breed in
| that regard.
|
| Also, even clicking it and then returning later works for
| the advertisers.
| bjelkeman-again wrote:
| But I think people at HN are the exception to how ads are
| used.
| swores wrote:
| If you end up buying a ticket you found in skyscanner on
| the same device then they'll (often) attribute, or
| partially attribute, that sale to the ad view even if you
| didn't click (obviously only if you aren't adblocking or
| if they're getting around your blocking).
| Workaccount2 wrote:
| I knew a guy who would serially impulse buy things off
| Instagram. I don't know about plane tickets, but his
| apartment was full of random shit he bought off his feed.
| Just alone he was probably covering the bandwidth cost of
| his entire town.
| lostlogin wrote:
| If you could find a few of these people, being a middle
| man for advertising campaigns targeting them would be one
| sleazy side business.
| whimsicalism wrote:
| This is already a thing.
|
| To be honest, any of the advertising schemes being
| dreamed up here in the comments section of HN are already
| a thing.
| sammalloy wrote:
| > I knew a guy who would serially impulse buy things off
| Instagram.
|
| No lie, Insta knows what I want to buy before I know, and
| it's very scary. I'm not an impulse buyer by any stretch
| of the imagination, but their advertising is some of the
| best I've ever seen anywhere on the internet.
| girvo wrote:
| That should not be surprising considering who owns them
| and how much data they have on us.
| Nimitz14 wrote:
| In europe casually flying somewhere is fun, cheap and very
| accessible if one works remote (or one can just go for a
| weekend). Not everyone plans things in advance.
| janesvilleseo wrote:
| If this was part of a retargeting campaign it would
| probably be a good audience too.
| no_wizard wrote:
| would you say so called "influencer" / "creator" marketing is
| more valuable nowadays as a result? Getting people behind you
| who have a trusted audience seems like the only way to combat
| this problem, I just don't know that its a serviceable
| business per se?
| WYepQ4dNnG wrote:
| I still can't wrap my head around the fact that people are
| actually "influenced" by influencers. I have never trusted
| anyone and anything. When it comes to spend MY MONEY I do
| my own research, period.
| godshatter wrote:
| When you watch people for cumulative hours, you get an
| idea of who they are. You get a feel for who is a normal
| Joe that gained an audience because of their passion for
| a topic and who is just someone following trends trying
| to gain follower just to gain followers. You also get an
| idea of whether or not they really know what a vpn is.
|
| If I see a product I've never heard of before advertised
| to me by someone I trust to some degree, I'll check it
| out. I almost never buy because I have years of shields
| built up to stop myself from buying crap at the drop if a
| hat, but there are occasions where I will buy if I like
| the product enough after researching it. Those times are
| rare, though.
|
| I don't watch videos from most people who could be
| described as "influencers", though. Mostly small creators
| who have an interesting take on something and are
| passionate about it.
| dfxm12 wrote:
| _When you watch people for cumulative hours, you get an
| idea of who they are._
|
| And you get an idea of their tastes & whether or not you
| share the same tastes. Back in the day, if Siskel & Ebert
| gave a film two thumbs up, I would probably go see it.
| Not because they were on the TV, not because of some
| credentials they may or may not have had, but because
| over time, I've found out that I generally liked the
| films they gave two thumbs up, and life is too short to
| "do my own research" on all the movies playing this
| weekend.
|
| Of course, this doesn't mean I would go out and buy a car
| if they were in the commercial for it, but I might have
| thought about getting a movie related product they hawked
| (microwavable popcorn? Special edition VHS/DVD? I
| dunno...).
| cute_boi wrote:
| Regarding doing own research I think this approach works
| for many products that are cheap to purchase. But, this
| approach fails badly when you have to purchase items that
| are expensive and one time purchase. How do I pick good
| washing machine? I can only purchase washing machine, or
| chimney, or smart TV only 1 time, so I can't do research
| unless I am determined to burn money.
|
| I do agree with influences. These guys can sway people
| and make people to purchase ersatz product and has
| ability to do shenanigans.I think people should be
| cognizant while watching "influencers".
| jgurewitz wrote:
| Where do you do your research?
| achenatx wrote:
| Have you never read something on here, then checked it
| out? What if paul graham recommends it?
|
| I guarantee people have influence over you, just not the
| hipster influencers you are thinking of.
| seibelj wrote:
| Yeah but if you like Shaq and he tweets "hey this
| basketball is the best one I tried" then some fraction of
| his followers will just trust Shaq on the theory he
| wouldn't hurt his reputation. Why not buy the Shaq ball?
| WYepQ4dNnG wrote:
| Because he ads that basketball because he is being payed
| to do so.
| aaaaaaaaata wrote:
| because his last 80 products were kind of shit
| [deleted]
| ipaddr wrote:
| Because he hasn't played in years and whatever ball he
| used was the official nba ball at the time. Most people
| would buy the official ball not a random ball.
|
| If you are talking shoes then people will buy to be
| associated with that player.
| extropy wrote:
| Your time and mental effort are limited. And your own
| research is not that effective in areas you have little
| working experience.
|
| In my experience a lot of older people (40+) increasingly
| rely on advice/influencers to drive their product
| decisions.
| pempem wrote:
| Thats a wonderful thing but I think you know its quite
| rare.
|
| Influencing is nothing new though the medium change has
| allowed for a preponderance of people to become
| influencers to smaller and smaller networks, we've always
| relied on proxy information if only on where to start
| research.
|
| It applied to the clothes we choose, the movies of which
| we might consume the trailers and then reject, the
| research we do. The universe of awesomeness and crap
| which we create as a species is multitudes larger than
| any person could just navigate via pure first order
| research.
|
| We all need signposts. While I abhor marketing and think
| hard about how to avoid or reduce its impact on me, its
| just not fully avoidable.
| nonameiguess wrote:
| What does your research consist of? When Steve from
| GamersNexus posts a video of him benchmarking a bunch of
| different cases with temperature gauges and the exact
| same internal hardware and workloads to tell me which one
| cools the best, I can try to independently reproduce
| those results myself, but that requires purchasing all of
| the cases, so there is no gain there. If he turns out to
| have been lying, I lost the money anyway.
| whatshisface wrote:
| That's because _you_ have the antibodies. The people who
| closely follow influencers and who do not realize what
| the influencers are doing to them, lack those antibodies.
| This is a sad time to be a person who browses the
| internet without any jadedness or paranoia.
| krapp wrote:
| >I have never trusted anyone and anything. When it comes
| to spend MY MONEY I do my own research, period.
|
| ...so you're "influenced" by whatever sources you
| research, which means, having reached any conclusion at
| all, you trust at least some of them.
| WYepQ4dNnG wrote:
| I trust my judgement based on all the information I have
| gathered. Then I check with friends and people that I
| trust, certainly not the random dude on youtube that ads
| the best blender 2022.
| liber8 wrote:
| I genuinely can't tell if this is satire or not. Assuming
| it's not, unless your "own research" consists of actually
| buying a wide swath of competing products and testing
| them against each other, then at some point you are
| indeed relying on "influencers", whether those
| influencers are Consumer Reports, Amazon reviews, your
| parents/neighbors/friends, etc.
| WYepQ4dNnG wrote:
| I might trust Consumer Reports, parents/neighbors/friends
| but not some random dude on youtube...
| grumbel wrote:
| I think that depends a lot on how that marketing is
| actually done. Just having an influencer read an ad text or
| insert a prerecorded segment feels just as annoying as
| regular ads, sometimes even more as there is no Skip-button
| or adBlock that can make it go away quickly.
|
| Actual products reviews, even when they are not all
| positiv, on the other side I find extremely effective. Same
| for behind-the-scenes video that show you how a product is
| made and tested. As what an ad should ideally do is really
| just show me that the product exist and what it can do.
| That's all I care about and that's what most regular ads
| completely fail at.
|
| Even if I go hunting for the actual websites of a product,
| they never contain the information I am looking for. I find
| it completely ridiculous how bad most ads are in that
| regard. I don't even expect much, size, photos from all
| angles, photos of stuff that's in the box. Really basic
| stuff. Most Youtuber's will include that in their unboxing
| and product reviews, companies very rarely do.
|
| Trust is important, but you don't just gain that by having
| popular influencer read your lies, you gain that by not
| lying in the first place. Few companies seem to realize
| that.
|
| That said, I am a sample size of one and other people will
| make purchase decisions differently.
| EricE wrote:
| >Even if I go hunting for the actual websites of a
| product, they never contain the information I am looking
| for. I find it completely ridiculous how bad most ads are
| in that regard. I don't even expect much, size, photos
| from all angles, photos of stuff that's in the box.
| Really basic stuff. Most Youtuber's will include that in
| their unboxing and product reviews, companies very rarely
| do.
|
| This! It's all about the basics!
| sillysaurusx wrote:
| Absolutely. I still subconsciously reach for NordVPN
| because of how good internet historian is at plugging it. h
| ttps://youtube.com/playlist?list=PLiccjfD_3pHAp-f3aNlf94BXW
| ...
| aspenmayer wrote:
| Internet Historian made better content for his Nord ads
| than many creators make for their main content.
| hi_im_miles wrote:
| Trust is the biggest thing missing from most forms of
| advertisement. I know I will gladly check out a product
| that a YouTuber I enjoy recommends, but banner
| ads/prerolls/TV ads/etc feel like a scam reel.
| hguant wrote:
| This is huge. There's a YouTuber I've been following for
| a stupidly long time, and if he recommends something, or
| even is sponsored by someone, I'll check them out. Same
| thing with acoup.blog - if there's a book recommendation
| there, I'll check it out in a heartbeat. Why? Because
| they've spent a long time developing trust with their
| audience. The YouTuber has been absolutely brutal about
| products, and has been extremely open about how people
| have tried to influence him one way or another when he's
| doing reviews. The author of acoup.blog has similarly put
| a lot of work in establishing his bonafides, so when he
| says a work is good or important, I know what he means by
| that.
| lotsofpulp wrote:
| I trust YouTubers (or whatever celebrity) even less than
| banner ads.
|
| I know a pharmacist on Instagram that quit being a
| pharmacist and started hawking health supplements in
| between semi useful posts, mixing bullshit with truth and
| trashing the credibility of their qualifications.
| jgurewitz wrote:
| There's a fun model I built once upon the level of
| monetization versus trust building activities a given
| YouTuber/influencer should do maximize monetization over
| any given time period. You can model the decay in
| audience trust per monetization.
| UnpossibleJim wrote:
| I have clicked on more banner ads (though few) about
| products I didn't know about, than I would ever be swayed
| by an "influencer", which is the new term for celebrity
| shill.
|
| Pop ups, however, have made me NOT buy products I would
| have otherwise be interested in, lol. But I'm a spiteful
| person.
|
| EDIT: I take some of that back, maybe. I do look at car
| experts on YouTube, and listen to their opinion. I guess
| they might be considered "Influencers". I was wrong.
| Beltiras wrote:
| It depends. I play MTG Arena. There's a slew of overlay
| apps that give you access to extraneous information. Best
| advertising dollars I've seen spent are Jim Davis's plugs
| of Untapped.gg. Not only is he using the app himself, he
| raves about it all the time. He's worth every penny they
| pay him. Tossing money blindly at influencers just because
| they have a following is not a good strategy, you still
| have to validate that it's a proper way of getting the
| right eyeballs on your product.
| jgurewitz wrote:
| Law of shitty click through rates.
| https://www.google.com/amp/s/andrewchen.com/the-law-of-
| shitt...
|
| The best marketing comes from strong value props in an area
| people are open to hearing them. The magic of Facebook (and
| Google although now less so) is the ads are extremely
| relevant, to people who are open to hearing them.
|
| The backlash against ads is because they work, when done
| properly.
| whimsicalism wrote:
| > Older clients I work with in large industries don't trust
| or click on any of it, and their company blue coat filters
| stop you if you accidentally do.
|
| A small but significant proportion do click on any of it.
| groby_b wrote:
| If that's your business plan, you should take a long hard
| look in the mirror though.
| bduerst wrote:
| It also sounds like this person's startup is B2B, which has
| an entirely different set of advertising strategies than
| something consumer focused.
|
| Anything that involves clicks (display, search, social) are
| _typically_ not the most effective advertising tactics when
| your buying decision makers number so few, but that doesn
| 't rule out other advertising activities.
| jgurewitz wrote:
| Agreed. The more SMB your product is the closer the
| chance ads will work, but further up the size and ACV
| scale and you are simply wasting your time until you
| become a brand name in your domain.
| grantsch wrote:
| B2B early stage companies selling a high ticket
| service/product need to be focused on sales activity.
|
| Ads are a distraction. It's the seemingly easy way out
| but there's no way out of selling early stage.
| renewiltord wrote:
| Agree in general but you can also construct a quick
| Account-Based Marketing approach using the input data
| that you use to construct a prospect list. Outsource the
| actual campaign and you can have that run in parallel to
| your sales work.
| whimsicalism wrote:
| You use ads in B2B to build leads, then you follow up
| with marketing/sales. Certainly you wont get a conversion
| with display ads, but on certain providers they can help
| feed into the start of your funnel.
| grantsch wrote:
| I'm sure it can help in conjunction with sales. Of course
| it can augment other activity.
| [deleted]
| dangerface wrote:
| Channel fit is a huge thing, if you are trying to sell a
| large ticket item like web servers via banners you are
| wasting your money, if you are trying to sell dog beds with
| banner ads on a pet forum you will be very profitable.
| squeaky-clean wrote:
| I was looking up vintage race car prices recently (like the
| kind I'd only dream of affording) and saw a banner ad for
| an individual selling a collection of his. I clicked the ad
| thinking it would lead me to a website and it was just a
| phone number that my phone asked if I wanted to call! No
| info on what cars he had for sale, just his personal phone
| number. I wonder if he's ever made a sale through those
| ads. I considered calling to see what would happen but it
| was 3am
| joshstrange wrote:
| > most people are becoming "sign blind"
|
| It's to the point now that I sometime miss content that I
| skipped over because I thought it was an ad. The worst case
| of this is opening a news article about something that
| happened on video and all I want to do is watch the video. Is
| it the top video? Rarely, I scroll right past that and look
| for something in the body. More than half the time it's a
| video that's in a tweet (thankfully easy enough to pick out)
| but sometimes I have to look closer at what I dismissed as an
| ad to find out if it's what I'm looking for. What's
| infuriating is when I go back to the top video, hit play, sit
| through an ad, then I get some generic news or computer-
| generated-type reading/text of the article in video form.
| tetsusaiga wrote:
| Exactly, all this does is prove they never knew how to run ads
| to begin with.
|
| It never ceases to amaze me how many people/businesses have no
| idea what performance advertising is.
| dylan604 wrote:
| >It never ceases to amaze me
|
| This comes across as an arrogant view point. Would you know
| how to take off the heads of the engine in your car and
| rebuild it? No? Wow! I'm amazed that you'd have no idea how
| to do something that isn't your direct line of work.
|
| People running small businesses that are so wanting for ad
| buys to work for them don't spend years honing their
| performance advertising skills. They don't even spend time
| looking it up to know it's a thing (first time I've heard
| this phrase myself). They see all of the advertisng they are
| subjected to about why buying ads is important, and so they
| start where they can.
|
| Instead of making fun of people for not knowing something
| that they shouldn't need to know about, why not corner the
| market by providing non-insulting services to get them the
| results they need? Or at the least, be able to point people
| in the direction of where to get those services?
|
| Condescension for the sake of patting yourself on the back is
| just gross.
| tetsusaiga wrote:
| You are totally correct, thank you-- I addressed this to
| jjulius above, since they pointed out the same thing.
| Sometimes one must be reminded not to be flippant on the
| internet, it's all too easy, and I don't want to be that
| person.
|
| >Instead of making fun of people for not knowing something
| that they shouldn't need to know about, why not corner the
| market by providing non-insulting services to get them the
| results they need? Or at the least, be able to point people
| in the direction of where to get those services?
|
| You're right. We all know the value of the person who makes
| complaints without offering solutions.
|
| If anyone reads this and would like some honest help in
| this area, send and email to the address in the 'about' on
| my profile, and I'll try to point you in the right
| direction (It only looks sketchy because it's a forwarding
| address, I'm sure you understand.)
| dangerface wrote:
| > why not corner the market by providing non-insulting
| services to get them the results they need?
|
| That market doesn't exist because it requires buy in from
| the business, businesses that see the value in targeted and
| performance driven advertising do it in house because its
| so valuable, other businesses just don't do it because they
| see no value in it and they see no value in it because they
| don't do it.
|
| Advertising works when its targeted but most businesses see
| advertising as just trying to shout as loud as possible.
| They take this theory and shout at every one they meet
| hoping this will convert them to a customer and are amazed
| when shouting at people has the effect of driving them away
| rather than pulling them in.
|
| They come to the conclusion that advertising doesn't work
| not that its there technique, they shouted so loud and at
| every one how could anyone possibly shout louder or at more
| people? and when they stopped shouting sales went up!
| obviously advertising doesn't work.
| jjulius wrote:
| >That market doesn't exist because it requires buy in
| from the business, businesses that see the value in
| targeted and performance driven advertising do it in
| house because its so valuable, other businesses just
| don't do it because they see no value in it and they see
| no value in it because they don't do it.
|
| All that sounds like to me is that the company providing
| OP's posited "non-insulting services" would just need to
| make sure they're marketing their product correctly and
| demonstrating value properly.
| dylan604 wrote:
| >That market doesn't exist because it requires buy in
| from the business, businesses that see the value in
| targeted and performance driven advertising do it in
| house because its so valuable, other businesses just
| don't do it because they see no value in it and they see
| no value in it because they don't do it.
|
| That goes against the entire concept of the advertising
| agency though. If advertising is so important, why staff
| it out to a 3rd party when you could do it in house? If
| this in house thing was the way to go, why is Maddison
| Ave so powerful?
| tomrod wrote:
| > they never knew how to run ads to begin with
|
| This feels like a no true scotsman. I have doubts that the
| vast majority of digital advertising platforms do anything
| other than clutter websites, waste bandwidth, annoy people,
| and pay a small slice of tech employees. I'm open to seeing
| research on the topic (and I am pretty sure there is some),
| but what I've read is that most advertising has insufficient
| statistical power, thus confidence of advertising outcomes
| being anything but random flukes is low.
| jklinger410 wrote:
| It's funny to me that everyone has a "take" on advertising,
| and yet 99% of the successful B2C brands, including multi
| billion dollar international ones, continue to advertise.
| Every platform that starts as ad-free gets pressured to
| allow ads and most of them acquiesce.
|
| It's not that these companies love throwing their money
| away. Maybe there's just something they know that you
| don't?
|
| Maybe it's that getting your product in front of the right
| people at the right time has immense value. And many
| platforms have opened up spaces for you to attempt to do
| that if you pay them for the space. Maybe paying for the
| wrong space at the wrong time is a waste of money.
|
| Maybe determining the right place and time to get in front
| of people is a skill as well as an entire profession. Maybe
| that entire profession can't be reduced to an absolute
| binary of does it work or doesn't it.
|
| Just some thoughts.
| taeric wrote:
| To be fair, many of the most expansively marketed
| companies pretty much exist for the sake of marketing, it
| seems.
| jklinger410 wrote:
| What is the benefit of them funding an entire industry of
| marketers if none of it works?
| taeric wrote:
| Depends what you mean by "doesn't work."
|
| Though, I suppose it often matters what you think of as
| marketing. Is it marketing for Coke to license their
| image to shirts and other products?
| dazc wrote:
| > 'It's not that these companies love throwing their
| money away. Maybe there's just something they know that
| you don't?'
|
| Those companies that have a Sign-up for our email and get
| 10% off your first order pop-up, you mean?
|
| Those companies paying for clicks to 404 pages or 'this
| item is out of stock', etc?
|
| Those companies that ask you if you have a discount
| coupon just before you enter your card details for
| something you are already buying?
|
| I get your point but I wouldn't assume big companies
| always know what the are doing when it comes to
| advertising. Sometimes they employ lots of people and
| some of those people don't actually have a clue what they
| are doing.
| importantbrian wrote:
| I agree with your broader point that you shouldn't just
| assume large brands always know what they're doing but
| other than the 404 example I'm not sure these are
| actually indications of companies not knowing what
| they're doing.
|
| > Those companies that have a Sign-up for our email and
| get 10% off your first order pop-up, you mean?
|
| I get that this can be annoying but plenty of companies
| do A/B tests and find that it works for them. I suppose
| it could mean they're just following some fad and don't
| know what's going on, but it doesn't have to mean that.
| This is especially true for companies that have long
| sales cycles or are in categories where lots of
| comparison shopping is common. Getting someone into your
| email funnel can be more important than anything else.
|
| > Those companies that ask you if you have a discount
| coupon just before you enter your card details for
| something you are already buying?
|
| Where else in the funnel would you have them apply their
| coupon? Maybe my perspective is different because we do a
| lot of offline advertising, but if someone comes into the
| site off of a print coupon they're going to expect to be
| able to put it in somewhere and get their discount. If we
| don't put it in the order flow they're either going to
| not purchase or we're going to get a lot of customer
| service calls from people trying to redeem their coupons.
| dazc wrote:
| Fair comment. I think we can agree there are case where
| such things can be used to great effect but that there
| also are businesses throwing money around and hoping
| something sticks.
|
| One big mistake businesses make is seeing another
| business doing something and assuming it must be working.
| Which is one of the points the OP was making.
| chillacy wrote:
| > Those companies that have a Sign-up for our email and
| get 10% off your first order pop-up, you mean?
|
| I've seen this type of thing improve conversion immensely
| at a startup I worked at, and it sets up the starts of a
| drip marketing campaign.
|
| Many of these are the natural results of A/B testing and
| experimentation, which is why many companies arrive at
| the same result.
| jklinger410 wrote:
| What is the opposite of argumentum ad populum? No one
| likes this thing because I do not like this thing.
| tomrod wrote:
| Bandwagon.
| jklinger410 wrote:
| I'm sure the executives at these big corporations would
| love to see stock prices go up if they could find a few
| extra million dollars per quarter in useless revenue
| negative activity that they could easily cut while having
| no impact on sales.
| hnaccount141 wrote:
| I have no idea whether advertising works or not, but I
| see this "successful businesses do it, therefore it it
| works" argument applied to so many different things and
| it always baffles me. Besides not having much substance
| beyond an appeal to authority, I don't think I've ever
| seen an example of a company that doesn't engage in some
| number of financially wasteful behaviors with dubious or
| at least unquantifiable value.
| dundarious wrote:
| The vast majority of successful B2C brands are owned by
| companies like Unilever, or are Apple, etc. I don't think
| there's an easy comparison between the ad goals and
| spending of these companies and those of smaller B2Cs
| trying to get off the ground. Maybe your own
| justification is comparing Apples to oranges, pun
| intended, and besides the point.
| time_to_smile wrote:
| I'm very curious if you work in advertising/adtech,
| otherwise your "take" is no different than the ones
| you're criticizing.
|
| I have worked on the data side of a pretty wide range of
| roles across the marketing/adtech spectrum for over a
| decade and think their is a lot of good reason to be
| skeptical of the claims of the advertising world.
|
| Tim Hwang is also an insider in this industry and wrote
| an entire book (The Subprime Attention Crisis) on the
| issues with the current state of advertising. I work in a
| very different area from Tim (he's legal) but I can tell
| you that book almost bored me with how obvious all of his
| complaints where.
|
| > It's not that these companies love throwing their money
| away. Maybe there's just something they know that you
| don't?
|
| I've seen the data that many of these companies don't. As
| many others have said, simply dismissing advertising as a
| "scam" is too extreme, however there are a lot of really
| big issues in the industry and extreme skepticism of the
| advertising industry is well warranted.
|
| The reasoning of "if the system is fundamentally broken,
| then why are so many people participating in it?" is
| easily dismissed with any of the major financial crises
| we've seen. This same logic could be falsely applied to
| the pre-2008 financial crisis "if these ratings are so
| wrong then why are so many experts putting so much money
| in them?"
|
| Personally I don't know anyone who works on the "how the
| sausage is made" side of advertising that isn't at least
| somewhat skeptical of the whole system.
| jklinger410 wrote:
| I work in advertising and know how the sausage is made.
| However I don't have equity in an ad agency, I don't
| profit off of promoting advertising. I participate in
| these conversations to help people understand. Also
| because they often piss me off.
|
| > The reasoning of "if the system is fundamentally
| broken, then why are so many people participating in it?"
| is easily dismissed with any of the major financial
| crises we've seen.
|
| The financial crisis was about companies making money,
| which they love to do. Advertising ad spend is about
| companies spending money, which they hate to do. Unless
| someone can explain why everyone wants to subsidize
| advertising agencies and ad platforms.
|
| > Personally I don't know anyone who works on the "how
| the sausage is made" side of advertising that isn't at
| least somewhat skeptical of the whole system.
|
| Skeptical of what, exactly? If you use 3rd party
| impression and click tracking tools, attribution modeling
| software, and statistically significant testing, I am
| genuinely confused as to what there is to be skeptical
| of.
|
| I think the people who say they know "how the sausage is
| made" and still hold skepticism of "the whole system" are
| maybe not as knowledgeable as they may think.
|
| In good faith, I am definitely skeptical of a few things.
| Whether ad platforms are really trying to prevent spam.
| How 3rd party DSP audiences are built and why they think
| people are ok with using them having no idea how they are
| made. Whether or not apps and devices really are spying
| on people. Whether people are aware of what "privacy"
| means from an advertising perspective.
|
| But I'm not skeptical about the users that come to my
| site or which marketing efforts are working or not
| working.
| gnicholas wrote:
| > _The financial crisis was about companies making money,
| which they love to do. Advertising ad spend is about
| companies spending money, which they hate to do. Unless
| someone can explain why everyone wants to subsidize
| advertising agencies and ad platforms._
|
| Advertising is certainly in the interest of the ad
| agencies, and the employees of companies whose job is to
| either manage outside advertising or develop/execute
| advertising in-house. It's possible there could be a
| company with a lean team of advertisers, doing just the
| type of work that makes sense. But within any
| organization, leaders want to have larger teams because
| it is seen as a marker of respect. It also allows a
| leader to command a higher salary.
|
| I don't know if these forces are sufficient to have spun
| the entire advertising industry out of nothing. But I do
| know that there are significant forces looking to build
| up advertising both inside and outside of companies.
| [deleted]
| tetsusaiga wrote:
| I appreciate your thoughtful criticism of this.
|
| The reason I say this though, is because if they knew how
| to run ads properly they would have been tracking their
| results from the start, and would have known much earlier
| whether they were getting a return on their investment.
|
| If your only way of measuring advertising results is to
| "turn it off", you're just flying blind, and one can't
| expect success with a (lack of) strategy like that.
|
| That said, you are not wrong that a meaningful percentage
| of advertising is being run with similarly insufficient
| statistical power, and to that I would say those businesses
| are also incorrect, for the most part. I delineate because
| at some point, say when you're Apple or Microsoft, you are
| so big that "brand awareness" advertising takes over
| performance advertising. For the most part though, I'd say
| those aren't the types of businesses we are discussing in a
| context like this one.
| Retric wrote:
| Tracking advertising effectiveness is ridiculously
| difficult and multiple people inside and outside your
| company are incentivized to overstate impact.
|
| Statistical power for example assumes independence which
| can be very difficult. Great you spend X million to
| convince people to buy an AC in March, did you actually
| benefit or would those same customers want an AC as soon
| as the first heat wave hit? Spreading demand can be
| useful, but it's also really easy to to draw false
| conclusions from statistics if you don't understand the
| domain.
|
| And that's just one of the many pitfalls involved.
| tomrod wrote:
| You hit the nail on the head, for the record. Thank you!
| tomrod wrote:
| How do you know any strategy is attributable to success
| or failure without testing it?
|
| Pre/post analysis may be temporally correlated but this
| isn't proof because you haven't captured a baseline
| comparison.
|
| A/B and MAB testing are helpful but not magic bullets.
|
| Shapley values (marginal impact) is a nice mathematical
| outcome to have for multitouch attribution but as usually
| implemented is only a single statistic and can be a fluke
| without additional testing.
| cj wrote:
| > The reason I say this though, is because if they knew
| how to run ads properly they would have been tracking
| their results from the start
|
| Part of the problem is your brand keywords will typically
| show up as being one of your best converting keywords.
| staticautomatic wrote:
| A problem in what sense?
| jefftk wrote:
| It's a problem in that those keywords are some of the
| places where you are at least likely to be generating
| counterfactual conversions: most of that traffic was
| probably coming to anyway.
| VBprogrammer wrote:
| A phenomenon which reminds me of the canonical
| survivorship bias story. In WWII they conducted studies
| to determine where the bullet holes where on aircraft
| which returned from bombing sorties, in order to
| determine which parts of the aircraft required armour. It
| took a statistician to point out that they actual needed
| to armour those places where they rarely saw damage on
| returning aircraft, as those parts are most likely the
| parts where being hit caused the aircraft to not return
| at all.
|
| Sometimes it requires a bit of a leap of imagination in
| order to resolve these things.
| tomrod wrote:
| Causal inference has made a lot of improvements since
| WWII, and "if" the advertising company knows what they
| are doing they run effective A/B or MAB testing; that
| said, _statistical power is typically low_ because of
| insufficient sample size for individual companies.
|
| You could pool all ads together, but since each
| advertising company is independent you get into all kinds
| of weird path dependencies.
|
| While I wouldn't claim to be an adtech practitioner, I
| did at one point help a few F500 work through conceptual
| models of multitouch attribution and other statistical
| issues. These are very nontrivial issues -- proving
| advertising effectiveness is very difficult!
| bduerst wrote:
| >This feels like a no true scotsman.
|
| It's not though.
|
| Appealing to effeciency is not an appeal to purity, which
| is what a _no-true scotsman_ is.
|
| A no true scotsman in this regard would be more along the
| lines of redefining advertising to not include any
| activities that OP described, i.e. OP wasn't doing _true_
| advertising. GP is not doing that here, because GP is
| acknowledging that OP is doing advertising, but doing it
| _poorly_.
| tomrod wrote:
| It felt like one because the original comment puts anyone
| who doesn't willingly support advertising claims as not
| knowing how advertising works. The classification creates
| a false dichotomy whose classification is "only a group
| that does not know advertising would do X."
|
| These are hallmarks of a no-true scotsman.
| jgurewitz wrote:
| If you spoke to any growth marketer worth their salt at any
| D2C company they will have incrementality testing and split
| tested traffic to prove without a shadow of a doubt that
| advertising works. The real challenge is scaling without
| losing efficiency.
| Terry_Roll wrote:
| As someone who has run ads across a variety of mediums,
| online and offline, some products benefit from being in the
| public consciousness, others dont. Identify which products or
| services benefit from certain types of advertising will help
| enormously otherwise its just throwing good money after bad.
|
| The OP's point 1 fails to recognise the filter bubble though,
| I think some SEO companies capitalise on this, but it simply
| works like this, if you keep googling your website, Google
| will eventually make it one of the top links in the result
| for YOU, not anyone else and for some website
| owners/companies, thats enough for them, and it doesnt bring
| in any more sales or revenue.
| [deleted]
| civilized wrote:
| Oh, don't worry, those of us with a stats/research background
| know just how sloppy the data and arguments are.
| mcv wrote:
| Advertising is definitely a lot more complex than simply:
| spend more money on it -> sales go up.
|
| When tobacco ads were banned, tobacco companies started
| making more profit, because they had to spend less on
| advertising. Turned out their advertising was mostly to steal
| customers from each other, and didn't really lure in new
| users. So the ban actually helped them.
| jefftk wrote:
| Short-term, yes. Long-term, I think no? Tobacco advertising
| typically focused on making smoking cigarettes seem cool
| and glamorous, and banning the ads may well have been a
| large component of why it no longer seems so.
| logifail wrote:
| > Tobacco advertising typically focused on making smoking
| cigarettes seem cool and glamorous, and banning the ads
| may well have been a large component of why it no longer
| seems so
|
| That's one hypothesis. Another is that we've known for
| ages that tobacco smoke causes disease[0] since[1]
|
| > Lung cancer was once a very rare disease, so rare that
| doctors took special notice when confronted with a case,
| thinking it a once-in-a-lifetime oddity. Mechanisation
| and mass marketing towards the end of the 19th century
| popularised the cigarette habit, however, causing a
| global lung cancer epidemic. Cigarettes were recognised
| as the cause of the epidemic in the 1940s and 1950s, with
| the confluence of studies from epidemiology, animal
| experiments, cellular pathology and chemical analytics.
| Cigarette manufacturers disputed this evidence, as part
| of an orchestrated conspiracy to salvage cigarette sales.
| Propagandising the public proved successful, judging from
| secret tobacco industry measurements of the impact of
| denialist propaganda. As late as 1960 only one-third of
| all US doctors believed that the case against cigarettes
| had been established. The cigarette is the deadliest
| artefact in the history of human civilisation. Cigarettes
| cause about 1 lung cancer death per 3 or 4 million
| smoked, which explains why the scale of the epidemic is
| so large today. Cigarettes cause about 1.5 million deaths
| from lung cancer per year
|
| and the world finally woke up to that.
|
| [0] https://www.cdc.gov/tobacco/basic_information/health_
| effects... [1]
| https://tobaccocontrol.bmj.com/content/21/2/87
| jjulius wrote:
| >It never ceases to amaze me how many people/businesses have
| no idea what performance advertising is.
|
| Yikes, that's incredibly unfair and arrogant.
|
| It's amazing to you that, because most people don't have to
| actually employ performance advertising, they don't know what
| it is? That someone whose passion is cooking, and decides to
| open a restaurant, might not have that advertising knowledge?
| That someone - in the case of the OP - whose focus is writing
| software that helps research an automotive vehicle's life
| history, might not know everything you do about advertising?
|
| C'mon now.
| tetsusaiga wrote:
| No you're right, as someone who takes these things
| seriously, I should hold myself to a higher standard than
| to paint in such broad strokes. Thanks for checking me
| there.
|
| Allow me to rephrase from a more compassionate perspective:
|
| I don't expect any of these people to devote the type of
| effort that I have into this knowledge.
|
| But I _do_ wish they knew this stuff, because with even a
| little bit of this knowledge, they could have the power to
| make their own restaurant /software
| shop/insert_small_business more successful than it
| otherwise could have been... which may even be the
| difference between them successfully running said business
| vs. having to take a job they don't like.
|
| Ultimately, it's a _be the change you wish to see_
| situation, I suppose.
| jjulius wrote:
| Fair, and I appreciate your honest response! Life needs
| to see more positive discourse like this. :)
| dleslie wrote:
| I would love to see solid evidence that advertising for an
| established product is meaningfully effective at increasing
| revenue beyond the cost to produce it.
| nfriedly wrote:
| Yeah... I hate advertising for a few reasons, including
| aesthetics and warped incentives. But one of the big ones is
| that it works. It works on me. Even when I know I'm being
| manipulated, I can't entirely stop it.
| tomrod wrote:
| Surely this is only occasional.
|
| I recall precisely one ad that caught my eye. I did not buy
| the product, but I liked it. It was for a men's watch after
| discussing with my spouse how I might need a watch at some
| point (Facebook is creepy that way, almost certainly
| monitoring microphone at the time, if not continually).
| nfriedly wrote:
| Well, I don't know about you specifically, but I think the
| average person is more affected by advertising than they
| realize.
| tomrod wrote:
| So folks assert.
| Lamad123 wrote:
| Internet ads are garbage.. I would pay attention to a well-made
| radio or tv ad, but online ads just the scum of earth!! My eyes
| skip over embedded text ads and I don't have the patience to
| see a video ad.. Ad blockers take care of most of that!!! I
| don't know how this scam "industry" keeps getting away with
| robbing businesspeople who are supposed to be smarter than the
| rest of us!!! The only form of advertising I am kinda OK with
| and believe might work is those sponsored ads by youtubers or
| affiliate links and the like..
| [deleted]
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