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

#281

Post by tempsy » Sun, Jan 03, 2021, 9:39 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-…

it’s funny how trillions of dollars in market cap are built on top of some service with unprovable and questionable value.

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

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Post by SheinhardtWigCo » Sun, Jan 03, 2021, 9:39 PM UTC

nickphx wrote: post #106

ryanSrich wrote: post #53

Earlier quoted context omitted.

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.

Some "bots" perform searches and click on ads to build a "user profile" for the browser.

...so that they can bypass Google’s captcha.

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

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Post by legitster » Sun, Jan 03, 2021, 9:40 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 work in digital marketing and this episode made me want to tear my ears off.

First of all, they didn't differentiate between display or PPC advertising. PPC you only pay if the user actually engaged with the ad. Nearly all of the anecdotes they used where about online display advertising - a known crock.

And we absolutely run experiments all the time! In fact, we tie our ad spend directly to conversions. If anything, the market is too efficient - it's really hard to get more than what you are paying for.

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

#284

Post by monkeybutton » Sun, Jan 03, 2021, 9:41 PM UTC

megablast wrote: post #272

st1x7 wrote: post #73

Earlier quoted context omitted.

> Sure, you're never going to know exactly how many people you advertised to would have organically, eventually found your product and bought it. But that honestly doesn't seem that important compared to the other metrics... Wait, why wouldn't that be important? It seems like the most important question since it asks whether advertising has any significant impact at all.

Does advertising create an increase in buying your product. That’s the most important question.

At least with ecommerce one can track users that have seen and/or clicked on ads with what they have purchased and return on ad spend can be calculated.

But yes, the question still is: does it raise intent or did the user already want the thing, googled it, and clicked on the first result (which is your ad, above the organic results that also lead to your online store)?

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

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Post by lincolnq » Sun, Jan 03, 2021, 9:42 PM UTC

onlyrealcuzzo wrote: post #198

azornathogron wrote: post #107

Earlier quoted context omitted.

> All big companies do this. Except Uber, apparently? Or would the method you're talking about not have discovered that something fishy was going on? (I don't work with ads so I don't know the limitations of the type of experiment that you're talking about)

It would work for some of Uber's ads. From the article, it looks like they were frauded mostly by in-app ads. And they were paying for installs - not actual trips. So, no, Uber's advertising here is a little different than (I think) the majority of companies. They are mostly paying for installs rather than sales / conversions. A lot of newer "app" companies could be in similar situations. Though, honestly, this seems…

Hang on though, in the linked thread they said that the fraud was incurred at the point of real users signing up for uber -- when they type uber into the app store search (e.g. an organic install), the ad network fraudulently takes credit for it at that point. So "enough analytics/logging" would not do the trick here - I think they would have noticed if a certain type of ad wasn't leading to trips, as you are pointing at.

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

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Post by TeMPOraL » Sun, Jan 03, 2021, 9:42 PM UTC

pnw_hazor wrote: post #128

mumblemumble wrote: post #94

Earlier quoted context omitted.

It's critically important for adtech companies' customers, since it's an essential part of determining return on investment. But it's also critically important for both adtech companies and data scientists who work in the space to direct people's attention away from those sorts of metrics. You generally don't want to call the attention of the person who signs your paycheck toward the fact that it's all but impossible…

This is creeping pretty close to the legal definition of fraud. But advertising has had a fair amount of safe-harbor carve-outs for over a 100 years or so that are not available to other industries. So it is no surprise it continues today. edit: I hate to say it but the auto-downvoters here on HN are approaching reddit levels. Everything I said above is true.

This is the industry whose job is to manipulate and deceive people. It should surprise no one that, if they do that to others, they'll do that to themselves as well.

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

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Post by ppeetteerr » Sun, Jan 03, 2021, 9:42 PM UTC

offtop5 wrote: post #260

I actually did find a few products which I used for at least a short while, on Facebook. If I had to guess, hyper targeted digital ad spend is very effective, but you'd have to sell very high margin products to come out ahead.

I believe the article is mainly around third-party websites displaying ads, not FB. I agree that Insta, FB, and Google ads are effective, but only on their own properties. I ran Google ads for an ecomm project and quickly disabled the affiliate site ads since they generated garbage traffic.

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

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Post by hermitcrab » Sun, Jan 03, 2021, 9:44 PM UTC

ryanSrich wrote: post #53

ishjoh wrote: post #31

Earlier quoted context omitted.

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.

IIRC sometimes bots will click on random ads to try to obscure the nefarious other things they are doing. You are just collateral.

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

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Post by Ericson2314 » Sun, Jan 03, 2021, 9:45 PM UTC

TheOtherHobbes wrote: post #215

kortilla wrote: post #150

Earlier quoted context omitted.

How is Coca Cola rent seeking? How about Apple? I suspect you aren’t using that term correctly but maybe I’m missing something.

Coca Cola sells water with flavouring and quite astonishing amounts of sugar. Apple sells nice devices made by what might as well be slave labour. Both are propped up - actually maintained - by huge and vastly expensive brand management strategies. The criticisms of individual campaigns here are missing the point. It's not about micro ad spend, but the perception of value and manipulation of behaviour created by the…

Because the ideology of capitalism is "cooridation failure, whatever", It sure would be nice to find a way for one of those companies to freeload off the culture-shaping the others do, and bring the whole enterprise crashing down!

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

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Post by wonnage » Sun, Jan 03, 2021, 9:46 PM UTC

st1x7 wrote: post #73

onlyrealcuzzo wrote: post #50

You can A/B test ads pretty easily, and this is quite common. With some degree of statistical certainty, you can tell how one ad performs to another. You don't have control over your SEO results as well - but you can also measure against SEO traffic with a high degree of certainty. All big companies do this. Sure, you're never going to know exactly how many people you advertised to would have organically, eventually…

> Sure, you're never going to know exactly how many people you advertised to would have organically, eventually found your product and bought it. But that honestly doesn't seem that important compared to the other metrics... Wait, why wouldn't that be important? It seems like the most important question since it asks whether advertising has any significant impact at all.

There's still value in getting people to buy now instead of maybe buying later.