Uber discovered they’d been defrauded out of 2/3 of their ad spend • Hacker News Board

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

#51

Post by undreren » Sun, Jan 03, 2021, 7:37 PM UTC

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…

DHH of Basecamp had a long twitter thread about this. Their competitors bought “basecamp” as a keyword for google ads, effectively forcing basecamp to pay to stay #1 on searches for basecamp.

Google has/had no policies restricting this, unless of course, you guessed it, the keyword you are squatting is “google”.

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

#52

Post by [deleted] » Sun, Jan 03, 2021, 7:37 PM UTC

birdyrooster wrote: post #23

Yeah I think Google and other advertisers are great at predicting what people will buy and then shows them ads for it. That’s different than showing a person an ad and changing their behavior, but to advertisers they can’t know unless they experiment.

[deleted]

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

#53

Post by ryanSrich » Sun, Jan 03, 2021, 7:37 PM UTC

ishjoh wrote: post #31

janmo wrote: post #21

Earlier quoted context omitted.

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.

Yeah, same here. We have done some spam mitigation, but we still get so many bogus sign ups and form submissions. In this instance, who is committing the fraud? Is it Google to ensure you spend your entire budget? I don’t see anyone else benefiting from these bots and click farms. We’re so small and new that it can’t be a competitor.

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

#54

Post by Hnrobert42 » Sun, Jan 03, 2021, 7:37 PM UTC

kbar13 wrote: post #36

qwerty456127 wrote: post #19

Earlier quoted context omitted.

> 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

I got 0.66x, as in $100M out of $150M. I likely missed something. Where did you see 10x?

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

#55

Post by staticassertion » Sun, Jan 03, 2021, 7:38 PM UTC

chrisdinn wrote: post #13

Snoozus wrote: post #3

I have this suspicion that mobile ads have way weaker effect than claimed. No-one in adtech has any interest in finding out. Marketers don't want to lose budgets or importance either. So a lot of money is wasted on annoying people. How sad.

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.…

Mobile devices tend not to have adblockers, so exposure might be a lot higher.

Also, the only ads I've clicked are mobile ads. I've even installed apps via ad before - I've never once purchased an item from an ad online (but I've also run an adblocker for a decade).

Ads certainly "work" by some metric, and some definition of "work", but I think the metric and definition is unclear.

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

#56

Post by nicbou » Sun, Jan 03, 2021, 7:38 PM UTC

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…

"It is difficult to get a man to understand something, when his salary depends upon his not understanding it!"

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

#57

Post by dorkwood » Sun, Jan 03, 2021, 7:38 PM UTC

I read a news article yesterday that had the same ad repeated roughly 20 times. Would the metrics show a separate impression for every one of those ads I scrolled past?

Also, despite the repetition, I don't remember what it was for. I think it had a photo of a woman outdoors.

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

#58

Post by kerng » Sun, Jan 03, 2021, 7:38 PM UTC

Might be a possibility to disrupt the ad business. FB and Google might be paid tons of money for providing little value or maybe even toxic value.

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

#59

Post by dllthomas » Sun, Jan 03, 2021, 7:38 PM UTC

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…

> Why wouldn't someone jump at an opportunity to prove the thing/service they provide actually works, unless they were unsure about it themselves?

Because everyone is already acting like they know it works, so the only way that experiment can change things is in a way that's bad for the person in question. In that situation, they should (from a local, selfish perspective) be resisting even if they're awfully sure it does work (and perhaps even if they're right!).

Given that, I don't think the behavior has already given us an answer.

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

#60

Post by cortesoft » Sun, Jan 03, 2021, 7:38 PM UTC

kmeisthax wrote: post #43

I think a lot of this was already obvious to slightly-savvy mobile app users. Look at pretty much any free-with-ads app; a majority of the ads are going to be ads for other free-with-ads apps, many of which you already have installed. The thing is, outside of the Internet most ad spend is for marketing ubiquity, not direct response. You don't really buy, say, TV advertising with the expectation of getting so many cli…

The point of traditional advertising IS pretty much to waste money, similar to how the point of a peacock's tail feathers are to waste resources... it is a signal to potential partners (business or romantic) that they are so capable they can waste resources. It is a signal of bonafides.