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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

#331

Post by lern_too_spel »

specialist wrote: post #324
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 get downvoted whenever I propose digital advertising bubble will pop once people wise up to the fraud.

The ad buyers aren't smart enough to measure the actual effectiveness of their ads, and the ad sellers are not incentivized to teach them how to do it. This can go on for an arbitrarily long time.

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

#332

Post by jedberg »

mlthoughts2018 wrote: post #319
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-…

This is really, really not true. Advertising lift has been well studied, especially in metastudies spanning hundreds of digital campaigns across Facebook and Google. These are independent academic metastudies, with hundreds of millions of impression data samples. Positive lift in the range of 0-20% is very common, and many statistical aspects of causal inference on ad impacts are well understood. Negative lift and fl…

Did you read the transcript the for episode and the associated links and notes?

They back up their claims with studies of their own as well as metanalysis.

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

#333

Post by cortesoft »

cbsmith wrote: post #77
cortesoft wrote: post #60

Earlier quoted context omitted.

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.

It's also an important signal to consumers.

Yeah, that was who I meant by 'business partners'

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

#334

Post by TeMPOraL »

Ericson2314 wrote: post #289
TheOtherHobbes wrote: post #215

Earlier quoted context omitted.

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!

Trademark laws exist to prevent such freeloading. In this context, they ensure only the ones paying for the culture-shaping can benefit from it.

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

#335

Post by jedberg »

legitster wrote: post #283
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 anythin…

But the experiments you run pit one ad type or channel against another. Have you ever run any experiments comparing ads to no ads?

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

#336

Post by Judgmentality »

PragmaticPulp wrote: post #209
johnrgrace wrote: post #187

I work at a fortune 50 company, a top 10 advertizer. We have a universal holdout poplation that NEVER recieves any directed/targeted marketing that serves as a control group for many marketing programs. Further in more mass areas there are direct A/B tests that go on. There is a very strong awareness of campaigns that are measurable with ROI's and other programs that are general branding that you can see the impacts…

Measuring as spend ROI is standard practice on any large scale ad campaign. The trick about having a holdout population is a neat twist. It boggles my mind when HN commenters start claiming that measuring ad campaigns is impossible or that ads are universally ineffective. Anyone who has spent time working with large ad campaigns should know the tools and methods used to measure these things. I suspect the HN sentimen…

> I suspect the HN sentiment comes from a common feeling among techies that they are somehow immune to influence from advertising, combined with a high adoption rate of ad blockers.

I don't believe this at all. The reason I am skeptical of the effectiveness of advertising is despite engaging with dozens of people over the years, I have never had a single person provide me with convincing evidence that it works. Instead, they simply repeat "but of course it works!" similar to your comment.

So, where is the evidence?

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

#337

Post by ben509 »

karaterobot wrote: post #201
rm999 wrote: post #71

Back in the early 2010s I worked in ad tech on a data science team, and one of the things we were pushing for was causal A/B testing; basically turn off a campaign's advertising to a % of people and correlate it with sales to measure ROI. As we were kicking this off I was at a conference chatting with an executive at another ad tech company. His response: "oh yeah I know a guy who tried that, he's not in the industry…

Did they leave the industry because they realized their product wasn't providing a positive ROI, or were they fired for pointing that out to other people? I think the former is probably what you mean, I just want to be sure.

Yeah, it could be that many startups try to do advertising ethically, realize that it doesn't work, and drop out. That's necessarily going to leave all the firms willing to sell snake oil behind.

You can get firms selling stuff that doesn't work that are "trusted" simply because they've been around for years; there are plenty of distinguished brands selling homeopathic remedies, audiophile speaker cables, timeshares and MLM schemes.

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

#338

Post by marcus_holmes »

I learnt an old adage while doing my MBA: "Half the money I spend on advertising is wasted; the trouble is I don't know which half." - attributed to John Wanamaker.

Online advertising was supposed to fix this. You could never tell when a potential customer read a billboard, but you could absolutely determine when someone clicked on an ad.

I don't know what happened. I suspect everyone got obsessed by tracking user behaviour and remarketing and all the bells and whistles.

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

#339

Post by Aeolun »

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.

If you are sinking $100M in, I sure hope it’s having some effect.

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

#340

Post by paulsutter »

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-…

Ecommerce sites have very fine grained measurement of their advertising spend and know exactly the ROI (which is why they focus so much on retargeting)
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