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Uber discovered they’d been defrauded out of 2/3 of their ad spend

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Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#31

Post by ishjoh »

janmo wrote: post #21
ryanSrich wrote: post #9

I’m not sure if this is equivalent to fraud. But I’ve recently discovered that 99.9% of the website visitors to my new startup’s website are just random @gmail addresses from India and China - most of which are coming from Google ads. We don’t spend much, about $100/m mostly to keep our #1 ranking in Google (which I think helps), but it does seem fraudulent. If I turn the ads off, the traffic from those IPs drops off…

With Google ads you can select the countries where you want the ads to run in. If you go worldwide and chose to maximize clicks, Google Ads will mainly run them in India and other emerging countries because it's much cheaper to get clicks from there.

I also had a small Google ad spend ($350 over 3 weeks), that I setup to run exclusively in the USA, and had the same experience where IP addresses recorded by hotjar were all from India, all new signups from the ad spend were '.gmail' email addresses and although I had about 100 signups not a single one entered a credit card.

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#32

Post by jedberg »

Nextgrid wrote: post #30
jedberg wrote: post #20

There was a freakonomics podcast recently about advertising (online and traditional). No one can actually prove it has any ROI at all. No one is willing to run the experiments necessary. In the few cases of natural experiments, where ads got turned off for some people by accident, there was no change in buying behavior. https://freakonomics.com/podcast/advertising-part-1/ https://freakonomics.com/podcast/advertising-…

> No one is willing to run the experiments necessary The people that would have the power to run this experiment have their entire careers depending on things staying as-is. Running the experiment carries a significant risk of exposing that the advertising operations they're responsible for provide much less ROI than they pretend it does. The unwillingness of anyone to run such an experiment is already an answer. Why…

Exactly. That’s what the episode says too. The only people who could run the experiments hinge their entire career and industry on the results.

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#33

Post by chrisdinn »

cm2012 wrote: post #28
chrisdinn wrote: post #13

Earlier quoted context omitted.

I think the problem is that the overwhelming majority of digital ad formats just don’t work. Does anyone who works in digital ad tech genuinely believe that these formats work? I have been here for the last ten years and have come to believe they do not, certainly not comparable like traditional linear TV or print in their heydays. There are exceptions. I think Google search ad works so well it’s eating the product.…

Facebook and IG ads work. I agree that display network ads do not.

Ya for sure. I was a Googler so my examples were biased, these aren't the only ad formats that work but there are fewer than most people (even in ad tech) realize.

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#35

Post by rriepe »

jedberg wrote: post #20

There was a freakonomics podcast recently about advertising (online and traditional). No one can actually prove it has any ROI at all. No one is willing to run the experiments necessary. In the few cases of natural experiments, where ads got turned off for some people by accident, there was no change in buying behavior. https://freakonomics.com/podcast/advertising-part-1/ https://freakonomics.com/podcast/advertising-…

“Half the money I spend on advertising is wasted; the trouble is I don't know which half.” - John Wanamaker

Half was true in his time (a century ago) but I think our numbers are way worse.

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#36

Post by kbar13 »

qwerty456127 wrote: post #19
chrisdinn wrote: post #13

Earlier quoted context omitted.

I think the problem is that the overwhelming majority of digital ad formats just don’t work. Does anyone who works in digital ad tech genuinely believe that these formats work? I have been here for the last ten years and have come to believe they do not, certainly not comparable like traditional linear TV or print in their heydays. There are exceptions. I think Google search ad works so well it’s eating the product.…

> overwhelming majority of digital ad formats just don’t work Doesn't it? It may have miserable conversion rate, limited target audience but it apparently is commercially viable. People would hardly spend money on sending e-mail spam in 2020 if it didn't work.

if you read the twitter thread we see that uber was spending 10x more money than they should have on ads simply because they weren't auditing where their money was going towards.

so there's evidence that people (incl uber, a market leader) do indeed spend money on ads even when it does nothing

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#37

Post by arbuge »

aetherson wrote: post #11
SteveGerencser wrote: post #8

I'm not surprised by this a all. I do PPC for a living and I find that a lot of ad spend is totally wasted on paying for clicks that you would have gotten anyway, especially on Google and on Mobile devices. A lot of big brands bid on, and pay for, their brand terms because someone at some point told then that they should. So when a person uses search to find Uber, they get an ad first, then a regular listing second.…

In fairness, I've worked at several places that engaged in this practice, and they're perfectly clear that they're paying for clicks that they'd likely get for free. The theory is that if they don't do this, their competitors buy this ad space and steal some of their organic traffic, and/or that they're just bidding up the cost of that space to make their competitors less efficient. Now, that theory may not be cost-e…

That theory can easily be tested by turning off the ads in question and seeing what actually happens. Can always turn them on again later if needed.

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#38

Post by spockz »

aetherson wrote: post #11
SteveGerencser wrote: post #8

I'm not surprised by this a all. I do PPC for a living and I find that a lot of ad spend is totally wasted on paying for clicks that you would have gotten anyway, especially on Google and on Mobile devices. A lot of big brands bid on, and pay for, their brand terms because someone at some point told then that they should. So when a person uses search to find Uber, they get an ad first, then a regular listing second.…

In fairness, I've worked at several places that engaged in this practice, and they're perfectly clear that they're paying for clicks that they'd likely get for free. The theory is that if they don't do this, their competitors buy this ad space and steal some of their organic traffic, and/or that they're just bidding up the cost of that space to make their competitors less efficient. Now, that theory may not be cost-e…

The solution to this would be to have a very authoritative site for a query show above any ads.

Re: Uber discovered they’d been defrauded out of 2/3 of their ad spend

#40

Post by raverbashing »

cm2012 wrote: post #24

Friends don't let friends do programmatic direct response advertising. Do it directly on the platforms yourself. I run an ad agency with relatively well known clients and I consider the word "programmatic" in a resume a negative correlation.

Care to elaborate more? What exactly is "programmatic direct response advertising"?
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