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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

#441

Post by reiska123 »

oli5679 wrote: post #169

This is pretty interesting study at Ebay. https://www.nber.org/system/files/working_papers/w20171/w201... They tested the counterintuitive claims by performance marketers that 'brand' keywords (containing Ebay) had the highest ROI. They did an experiment and found that, contrary to attribution model, these Ebay keywords resulted in ZERO incremental sales, although they were clicked on by many people that purchased. T…

Yeah, I remember this one. Worked in top 10 brand performance marketing team as analyst/data scientist and brought this up to our marketing director.

I have never been shot down so quickly in my career. Very toxic environment to work in.

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

#442

Post by Nextgrid »

MattGaiser wrote: post #312
objclxt wrote: post #304

Earlier quoted context omitted.

That’s a rather naive way of looking at how corporations work. If you’re the head of marketing and go to the CFO and say “hey, we found a way to get the exact same results we currently get but at half the cost” you can bet you will be rewarded for it.

Depends. Are you sticking with that company or do you want to shop your resume around?

And given the terrible career advancement options in our industry it makes total sense to optimise for "resume value" as opposed to "business value" since your resume will compensate you much more (in the next company you're going to end up at) than contributing to your current company where you'll end up with a pitiful statutory raise.

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

#443

Post by andrewjl »

secondcoming wrote: post #437
andrewjl wrote: post #419

Earlier quoted context omitted.

That still doesn't address the GP point, advertising doesn't matter if you can get customers coming to you organically. Business size changes the odds of that, irrespective of that if the customers would have come to you anyway (and there are ways to know this!) then the ad spending was largely a waste.

You misunderstand what advertisers are trying to achieve. It's about Brand Awareness. They just want their brand out there and seen. Even click-throughs aren't as important as they once were. Coca-Cola still advertise when they probably don't need to.

I understand the distinction between advertising and building brand awareness. It doesn't sound like Uber was doing the latter. It also doesn't take away that if you're advertising to an audience who'd have come to you anyway, you're wasting your money.

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

#444

Post by jedberg »

mgraczyk wrote: post #356
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 completely false. Large advertising platforms have many A/B tests that show significant differences in consumer behavior between groups that receive different ad treatments. Ads might be less efficient than some believe, but it's super easy to see that they "work", and advertising platforms do it constantly.

That's comparing one type of ad or channel to another.

But none of them test "no ads" vs "ads".

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

#445

Post by Nextgrid »

mttddd wrote: post #438
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.

Ya anecdotal for sure but a ton of my friends bought their significant others some new fangled thing they only heard about because they saw it on Instagram. HN loves to bash marketing (and FB/google) but it has never been easier to spin up your own shoe company and easily advertise and get customers (e.g, allbirds).

I've also seen and personally know people who bought crap off Facebook ads and ended up either being scammed or with a product below what the ad promised.

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

#446

Post by vorhemus »

etempleton wrote: post #292

Because most advertising is not effective on a 1:1 basis. The clean, direct conversion funnel is in most industries and sectors a complete myth. Advertising is about awareness. All good marketing is long-term. Digital advertising has been sold (by overzealous marketers) as magical 1:1 sales machines. It is almost always not that. This is the hardest thing to convey to clients. Clients want a promise and a guarantee o…

That sounds like a religion: You don't know exactly what you get, there are no guarantees but if you really believe in it (and pay your marketing church tax) you'll probably end up in CTR heaven.

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

#447

Post by Fordec »

st1x7 wrote: post #83
xyst wrote: post #6

Earlier quoted context omitted.

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.

I don't want to lose the web of the 90s and early 00s. But that one is mostly already gone.

This version we're currently in, no it can die off for all I care.

Bring on the disruption!

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

#448

Post by Ericson2314 »

Anon1096 wrote: post #386
Ericson2314 wrote: post #307

Earlier quoted context omitted.

Good. Advertising is a terrible zero-sum industry that just distorts market activity. It has little place in capitalism or any other system. Exceptions: - New products deserve some advertising. I would handle that like the patent system. Demonstrate your product is sufficiently different, and get access to some attention economy time slice. Some may say, well what about competition with existing products to bring dow…

What makes you say advertising is zero-sum? This doesn't seem to be the case at all to me. Take diamonds for example. Prior to the mid 1900s, diamonds weren't nearly as sought after as they are currently. It took the marketing and advertising efforts (among other efforts, like monopolizing the mining process) of De Beers to convince the public that diamonds should be highly coveted. It was advertising that pushed the…

> diamonds

I mean zero-sum in that advertising shifts spending from one area to another. Perhaps all the diamond ring money would have gone into other things.

It's a hard point to prove or disprove, but even if advertising overall deceases the consumer saving rate, sure the vast majority of advertising cancels out. (I'm going to buy tide or downy, but not both.)

> except to say that consumers definitely show preference for branded items

Well these meaningless competing brands convey no information and waste tons of resources. And it's rather an embarrassment to Capitalism for the primary non-price information exchanged by market actors to be bullshit noise, even if it isn't a "real problem" compared to global warming or something.

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

#449

Post by ransom1538 »

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…

"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."

Nope.

You need a unique id for an AB test AND apple wont give this to you. No company is going to give you a click/tap id. Android might. This is so inaccurate I don't know where to start. Apple has turned off all unique ids that work across an AB test [1] cross platform. You would need on the ground mobile ad experience to know this.

https://www.invoca.com/blog/what-is-idfa-and-why-apple-kille...

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

#450

Post by dylan604 »

marketingtech wrote: post #412
nabla9 wrote: post #387

Earlier quoted context omitted.

It's not about clicks or traffic. The real issue is selection effect vs. advertising effect SEO traffic benchmarks don't measure the right ting or show real ROI. FB or Google don't want you to measure the right thing. Traffic to the website has licks, purchases and downloads that are happening anyway (selection effect) and clicks, purchases and downloads that would not have happened without ads (advertising effect) m…

These are pretty easy to measure on Google or FB with their "lift study" tools and a conversion pixel. The lift tools will let you create a holdout group of X% of people who should be targeted by your ad. They won't see the ad, but you can still measure the rate at which they convert on your site. Then, you can compare that conversion rate to the rate of people who actually saw/clicked the ad. Conversion pixels are n…

> They won't see the ad, but you can still measure the rate at which they convert on your site.

This sounds like such an assumption. There's no guarantee that any one person will ever "convert" on your site. That's such an ugly carrot that FB/G are dangling in front of you. "If you spend enough money with us, we'll eventually show your ad to someone that will absolutely buy your product. Pinky swear, just keep putting coins in the slot to continue".

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