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

#81

Post by austinpena » Sun, Jan 03, 2021, 7:45 PM UTC

arbuge wrote: post #37

aetherson wrote: post #11

Earlier quoted context omitted.

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.

Google Ads also has a built in report for seeing uplift of ads + organic and organic only

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

#82

Post by austinpena » Sun, Jan 03, 2021, 7:45 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.

Physical location only or location of interest included?

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

#83

Post by st1x7 » Sun, Jan 03, 2021, 7:45 PM UTC

xyst wrote: post #6

g42gregory wrote: post #4

Wow, that’s quite a revelation. Uber turns off 2/3 of ads and metrics are the same. Eventually, with optimizations, they got down to 10% of previous spend without loss of revenue. I wonder if the Uber story is unique or it cuts across all advertisers. How would this affect Ad Tech industry?

Impending crash - time to short the entire ad tech industry.

I just don't want to lose the web along with the ad tech industry though.

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

#84

Post by disgruntledphd2 » Sun, Jan 03, 2021, 7:45 PM UTC

dllthomas wrote: post #59

Nextgrid wrote: post #30

Earlier quoted context omitted.

> 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…

Facebook's ad research team have run a lot of experiments.

The goal was to demonstrate an impact of in-store sales from internet advertising. They did the first studies in about 2008-10, and have continued running these studies ever since.

They even built a tool so that advertisers can run these studies, and get a sense for the incremental impact of their ad.

Google have a similar (less full-featured) system.

Really, it's the rest of the ecosystem that has much of the fraud, and I think that a lot of people in the industry are aware of this.

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

#85

Post by Razengan » Sun, Jan 03, 2021, 7:46 PM UTC

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-…

I’ve thought and said so before: The ads racket is be a case of the emperor with no clothes, at best.

At worst, it’s a front for building “profiles” of everyone.

I can’t recall the last time I bought anything -because- of an ad.

If anything, ads have sometimes actually put me OFF from buying something!

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

#86

Post by redisman » Sun, Jan 03, 2021, 7:46 PM UTC

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.

Mobile games run on this. They have a target user acquisition cost and spend based on that. It seems to work for some very profitable companies. People shouldn’t try to over read into this. Businesses can’t run on irrationality for very long

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

#87

Post by cm2012 » Sun, Jan 03, 2021, 7:46 PM UTC

raverbashing wrote: post #40

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"?

So programmatic means using a 3rd party ad tech tool to place your ads across all internet ad placements.

Doing it directly means placing ads yourself on the biggest platforms (Facebook, google).

Direct response just means "if you actually want results/ROI", as opposed to for nebulous brand goals.

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

#88

Post by disgruntledphd2 » Sun, Jan 03, 2021, 7:48 PM UTC

im_down_w_otp wrote: post #63

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-…

Gabriel Leydon of Machine Zone spoke to the general topic at Code/Media back in 2016. Basically discussing that they'd gone through the trouble of building internal expertise and tools for optimizing their ad spend to better ensure specific outcomes they desired/required in a way that would inevitably lead to more sophisticated ad buyers and putting a nail in the coffin of traditional media advertising. https://www.y…

Alternatively, they dumped hundreds of millions of dollars into ads based on a wildly unrealistic notion of a customer lifetime (much like the rest of Silicon Valley).

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

#89

Post by coliveira » Sun, Jan 03, 2021, 7:48 PM UTC

dllthomas wrote: post #59

Nextgrid wrote: post #30

Earlier quoted context omitted.

> 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…

Not really, scientists for example also have their whole careers based on the truth of some theories that they use. However, they're willing to put them to proof in different ways. The reason they do so is that they have a high degree of confidence that these theories are true. This cannot be said of people doing advertisement.

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

#90

Post by fortran77 » Sun, Jan 03, 2021, 7:48 PM UTC

JeanMeche wrote: post #79

nicbou wrote: post #56

Earlier quoted context omitted.

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

~ Upton Sinclair

And, unlike most Internet Quotes, this one is apparently real!

https://quoteinvestigator.com/2017/11/30/salary/