What do we really know about the effectiveness of digital advertising? • Hacker News Board

Re: What do we really know about the effectiveness of digital advertising?

#171

Post by sushid » Wed, Nov 06, 2019, 10:58 PM UTC

onlyrealcuzzo wrote: post #104

bryanmgreen wrote: post #74

Earlier quoted context omitted.

I think that's a self-preservation tactic for many that often backfires. Most non-marketing management people want immediate and huge results... which are both hard to quantify and impossible to get without overspending or having an insanely lucky idea that goes viral. Naturally this leads to asking for a bigger budget and promising bigger results, then KPIs aren't met for X, Y, Z reasons, then they're forced to just…

I'd be nervous to work for a company where one of the co-founders isn't a marketer. Marketing is usually one of the biggest line items for a business. When your marketing team has little incentive to actually deliver, they're likely to ask for a ton of money only to add impressive things to their resumez, not really to deliver on their promises to the business. If a founder is in charge of marketing, s/he's got a lot…

> I'd be nervous to work for a company where one of the co-founders isn't a marketer.

I'd be nervous if there were a co-founder who is a marketer (unless it's literally a marketing startup).

Take a look at some of the hottest tech companies right now (recent IPO, FAANG, pre-IPO, YC darlings). Would you be really afraid to work for a FAANG, or hot recent IPOed companies like Zoom or PagerDuty, or pre-IPO companies like Stripe or Flexport because of the (co)founders' non-marketing background?

Re: What do we really know about the effectiveness of digital advertising?

#172

Post by graycat » Wed, Nov 06, 2019, 10:58 PM UTC

colechristensen wrote: post #32

moltensodium wrote: post #3

Maybe this is just a generational thing, but I still have never clicked on an ad. I hate ads. I don't know anyone who likes them. I don't know anyone who has intentionally clicked on them. I have literally never met anyone who places any value in advertising at all. Everyone hates it with 100% of their being. It is the garbage we all just sort of accept exposure to as some sort of fee for existing online. Who are all…

I have clicked on ads. I wish ads were better or more relevant, I find myself spending unreasonable amounts of time looking for things which should be more easily found - a problem which could be solved with better advertising. You could advertise books/shows/movies to me (based on your current search, your wish list, your past purchases, you might be interested in ...) because I'm certain there are plenty of books I…

> there are plenty of books I would be interested in which I don't know exist ...

> The problem there is I'm generally only going to be interested in long tail items, ...

Yup. For that problem, did some original applied math based on some advanced pure math prerequisites and wrote the software for the math and for the corresponding Web site -- software appears to run as intended. Need to add some data and do an alpha test.

So, I am regarding your problem as a need for better Internet content (yes, including information about books, etc. not strictly ON the Internet) discovery and recommendation, and I'm regarding those as special cases of a much more general approach to Internet content search.

My work is to give you the content with the meaning -- artistic, utilitarian, political, technical, etc. -- you have in mind. So, I believe I've made progress on the meaning of content; a key here is some of the pure math.

Yes, my techniques should do much better at getting you the meaning YOU (extreme personalization) want than any top 40 style lists.

My view is that Google and Bing do REALLY well on about 1/3rd of the problem; I'm going for the other 2/3rds. Where Google and Bing work well, my work is NOT better. My work should be better in the 2/3rds.

I intend to announce an alpha test here on HN ASAP. Will look forward to the HN reactions.

At least initially, my site won't be very comprehensive. I intend to concentrate initially on fine arts, finance, nature, and a few more.

Yes, my Web site will be free to users and ad supported with my unique (methods and data) and hopefully especially effective ad targeting.

Yes, my work stands to be relatively good on user privacy: There are no logins; I make no use of HTTP cookies; and search results for a user have nothing to do with any history about the user; e.g., any two users doing the same search at the same time (before I update the data, say, say once a week) will get the same results.

Maybe someone will like it!!

Re: What do we really know about the effectiveness of digital advertising?

#173

Post by braindeath » Wed, Nov 06, 2019, 10:59 PM UTC

jagged-chisel wrote: post #77

rifung wrote: post #53

Earlier quoted context omitted.

> At the end of the day, advertisers and viewers can't possibly care what video it's showing on as long as they're getting the right target audience. This isn't true? Advertisers certainly do care. They don't want their ad dollars to be spent paying publishers for content that's controversial because it makes them look bad. It also has the potential to damage their brand. This actually happened and is what led YouTub…

> ... advertisers ... can't possibly care what video it's showing ... I read this as 'advertisers don't care about the particular topic of the ad in general.' They don't care if you're watching a DIY home fixit video, or a coder streaming his working session, as long as you're a target for diapers and they're advertising diapers.

And it sounds like the person you’re responding to is countering this very premise.

“They don't want their ad dollars to be spent paying publishers for content that's controversial because it makes them look bad.”

Re: What do we really know about the effectiveness of digital advertising?

#174

Post by CharlesColeman » Wed, Nov 06, 2019, 11:00 PM UTC

jameslk wrote: post #113

jessefrederik wrote: post #100

Earlier quoted context omitted.

Hi this is the author of the article. You're just making the exact mistake this article is about: you assume people who click on your ad and then buy something, bought something BECAUSE of your ad. From the article: "Suppose Luigi’s Pizzeria hires three teenagers to hand out coupons to passersby. After a few weeks of flyering, one of the three turns out to be a marketing genius. Customers keep showing up with coupons…

The effects may be low but what is the alternative? You suggest there's a digital advertising bubble but to have a bubble with the assumption it will burst, you need to show that advertisers can achieve a better return by doing something else. There's no digital marketing bubble more than there is a traditional advertising bubble. There IS however a conflict of interest in advertising that's caused by the agency whic…

> but to have a bubble with the assumption it will burst, you need to show that advertisers can achieve a better return by doing something else.

To burst a bubble, you don't have to show them something that works better, you just have to convince them to stop drastically overpaying for what they've been buying.

Re: What do we really know about the effectiveness of digital advertising?

#175

Post by mbesto » Wed, Nov 06, 2019, 11:01 PM UTC

jessefrederik wrote: post #100

tacon wrote: post #99

This is a rather unimpressive article. Yes, brand advertising is a disaster, just like it has always been. But to say that all digital advertising has unknown ROI is ridiculous. Digital direct response advertising allows very accurate ROI calculations. (Admittedly, a lot of advertisers are not applying the tools to their advantage. They call that the "Google stupid tax". Ditto these days on Facebook.) And direct resp…

Hi this is the author of the article. You're just making the exact mistake this article is about: you assume people who click on your ad and then buy something, bought something BECAUSE of your ad. From the article: "Suppose Luigi’s Pizzeria hires three teenagers to hand out coupons to passersby. After a few weeks of flyering, one of the three turns out to be a marketing genius. Customers keep showing up with coupons…

> It's the same in online marketing, you often target people who are searching for say a pair of shoes.

FYI - you're not clearly delineating between capturing intent, prospecting, and branding. Worse, your using intent capture as a catch-all for all advertising. That's not how it works.

> Pizzerias do not attract more customers by giving coupons to people already planning to order a quattro stagioni five minutes from now."

The alternative is that the Pizzeria does zero promotion and those who are interested in "ordering a quattro stagioni five minutes from now" end up going to somewhere that does.

Ads, on Google specifically, is a zero sum game with an auction based fee structure which mostly is about capturing potential customers' intent to buy. This is the true "evil" of Google, as you basically are forced to pay a tax on all online intentions to purchase via a search from Google (it's also why Google is so scared of Amazon...hence, Google Shopping)

> and that it's hard to know ROI, because true advertising effects are tiny if you measure them in an experimen

It's impossible to know equivocally why a person makes a purchase, digital, traditional, or otherwise. Theres a lot of research on this topic but until its conclusive, we'll never have a "true" ROI.

Re: What do we really know about the effectiveness of digital advertising?

#176

Post by josh2600 » Wed, Nov 06, 2019, 11:01 PM UTC

buboard wrote: post #127

Great to see an article like this. This subject is almost suspiciously under-researched by journalists. There 's definitely something rotten in the promises that internet advertising has become somehow more effective. If that were true, wouldn't businesses notice? Wouldn't they spend a bigger part of their revenue on ads ? Wouldn't that return even bigger ROIs? Yet businesses spend roughly the same for over a century…

https://techcrunch.com/2019/06/11/internet-trends-report-201...

Please review page 22 to see that there has been a significant shift towards digital advertising since 2010.

Re: What do we really know about the effectiveness of digital advertising?

#177

Post by H8crilA » Wed, Nov 06, 2019, 11:04 PM UTC

josh2600 wrote: post #176

buboard wrote: post #127

Great to see an article like this. This subject is almost suspiciously under-researched by journalists. There 's definitely something rotten in the promises that internet advertising has become somehow more effective. If that were true, wouldn't businesses notice? Wouldn't they spend a bigger part of their revenue on ads ? Wouldn't that return even bigger ROIs? Yet businesses spend roughly the same for over a century…

https://techcrunch.com/2019/06/11/internet-trends-report-201... Please review page 22 to see that there has been a significant shift towards digital advertising since 2010.

His point is that the total spending is approximately constant (controlled for the size of the economy I presume).

Re: What do we really know about the effectiveness of digital advertising?

#178

Post by FussyZeus » Wed, Nov 06, 2019, 11:05 PM UTC

user5994461 wrote: post #121

FussyZeus wrote: post #103

Earlier quoted context omitted.

This feels like a multi-billion dollar industry in which every entity involved has the ability to sink the entire thing, and simply stated, nobody does because they all make money from it.

Marketing departments are burning money like mad. It's google and other brokers that make a ton of money.

I mean most ad-tech firms can be considered successes by Silicon Valley's standards, and why would the marketing departments of corporations blow the whistle? They're making money too, probably twice a week, direct deposited.

Re: What do we really know about the effectiveness of digital advertising?

#179

Post by kposehn » Wed, Nov 06, 2019, 11:05 PM UTC

josephjrobison wrote: post #170

A very easy way to break this argument is to not look at huge known companies like eBay and Amazon, but brand new companies 1-2 years old that have grown almost entirely by online ads. Eventually word of mouth kicks in, but there are plenty of smart operators that built their entire brand and revenue off of ads. Works best in online direct to consumer brands.

Reliably someone comes along every few months to question digital ads. I always come back to analyses of incrementality as the real proof.

Take an audience of X people. Divide them in two. Show ads to your test group, don't show to control. Watch your business grow and gauge the lift between the two audiences.

The companies that know how to advertise at scale do this constantly and can gauge the real effect of their ad dollars. Facebook, Google and others make these tests possible in their platforms, while other software suites such as Impact Altitude and VisualIQ allow you to do this kind of analysis and testing as well.

In the end, most of it proves out to be incremental. There are notable exceptions of course, but when are there not?

Re: What do we really know about the effectiveness of digital advertising?

#180

Post by tardo99 » Wed, Nov 06, 2019, 11:06 PM UTC

FussyZeus wrote: post #103

SaberTail wrote: post #58

From the article: > Marketers are often most successful at marketing their own marketing. I've seen this play out at places I've worked. After raising a funding round, marketing sold the leadership on letting them burn the lion's share of it, even though launching new marketing campaigns was never on the list of reasons we initially went out to raise money.

This feels like a multi-billion dollar industry in which every entity involved has the ability to sink the entire thing, and simply stated, nobody does because they all make money from it.

You just described most of human endeavor.