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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

#471

Post by mikeryan »

joe_the_user wrote: post #299
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.

The thing about the "advertising doesn't matter" argument is that there are situations where advertising absolutely matters - when a company is just starting out and there's no way they can get organic referrals, when the public is unaware of their existence, etc. Moreover, most companies started small at some point so advertising and maintaining advertising made sense up to a point. And if we look at those companies…

I don't think there's a large "advertising doesn't matter" camp. For most the real question is around the efficacy of certain types of ad buys, ad targeting, SEO efficacy and the amount of fraud in the system.

The real problem is that for large companies with brand awareness they're starting to find a lot of their spend may not be generating revenue. Ebay in the Freakonomics podcast turned of about $100M in ad spend with no loss of revenue. But smaller, companies usually don't have the staff/knowledge necessary to know how and where to use their ad dollars.

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

#472

Post by tnt128 »

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-…

Depending on what kind of advertising you are talking about. Direct response advertisers measure ads to the cents. And they know exactly what the ROI is and where the customer is coming from.

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

#473

Post by aerosmile »

dylan604 wrote: post #450
marketingtech wrote: post #412

Earlier quoted context omitted.

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 puttin…

Nobody can predict the future, but it's a lot better to inform your predictions based on historic performance than on no data at all.

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

#474

Post by OmarShehata »

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-…

They mention the common retort to this which is very bizarre to me: "If online ads don't work, then huge companies wouldn't spend billions of dollars on them. Therefore they must work. You academics are just missing something."

Ok, how does those companies know it works? They don't have any real data to show that it does, just the fear that if they stop they'll lose a lot of business.

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

#475

Post by vmurthy »

srg0 wrote: post #242

I wish more companies would try to find out the actual value of advertising and targeting. And it probably won't be as good as FB and GOOG would like us to believe. BTW, there was a recent episode of Freakonomics Radio which talked about this eBay experiment https://freakonomics.com/podcast/advertising-part-2/

Something for the HN crowd that goes beyond articles: A HBR article[0] which talks about an experiment that eBay did testing if digital ads are effective and the paper that the actual study[1] produced.

[0] https://hbr.org/2013/03/did-ebay-just-prove-that-paid

[1] http://conference.nber.org/confer/2013/EoDs13/Tadelis.pdf

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

#476

Post by Barrin92 »

joe_the_user wrote: post #299
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.

The thing about the "advertising doesn't matter" argument is that there are situations where advertising absolutely matters - when a company is just starting out and there's no way they can get organic referrals, when the public is unaware of their existence, etc. Moreover, most companies started small at some point so advertising and maintaining advertising made sense up to a point. And if we look at those companies…

>when a company is just starting out and there's no way they can get organic referrals, when the public is unaware of their existence, etc.

I don't think I ever saw a Whatsapp or Telegram advertisement in the first few years of their existence. There's a lot of software in particular that gets around by word of mouth alone.

Necessity for advertisement seems correlated to how unclear it is what advantage your product has for the consumer. If you make something that's like X but twice as fast or twice as cheap you don't need advertisement.

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

#477

Post by lumost »

pas wrote: post #142
lumost wrote: post #72

Earlier quoted context omitted.

It's unclear how this experiment would be done. In the case of brand advertising, it's likely that brand awareness would decay over some period of time and in turn purchase behavior would change. It's not currently possible to run an A/B experiment with a hold out group of potential customers across all channels, let alone for any longer duration experiment. So how can we separate cause and effect? (although pay per…

Come up with some new product that requires some personal data for usage (eg. age, gender/sex, address). Start to advertise this in just one country to one demographics, and look how many out-of-target orders you get. Maybe it's even enough if you simply just sell it via mail order, you can then look at the addresses. There's probably a natural information spread in any market (word of mouth, trade magazines), and th…

For most vendors, not possible to accurately target age/sex/address online. They will certainly sell you the option, but they won't tell you how accurate the data is - or they will provide it a high accuracy with extremely low coverage.

To see this in action - spend a day watching pitbull videos on youtube and see how many spanish language ads you'll get.

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

#478

Post by jqbx_jason »

It's not necessarily that the ads aren't effective but their reporting of ROI has been off in my experiences. I've been running attribution surveys on the e-commerce sites I own [1] and the results have never matched up with what FB or Google reports back. Some of it may just be bias but I can definitely how some rounding errors may start to creep in with large numbers.

[1] https://www.zigpoll.com/examples/attribution-survey

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

#480

Post by dylan604 »

earthboundkid wrote: post #262

The only sane way to do advertising is to do what’s done on TV: you buy a time slot based on estimated impressions and then a third party auditor (Nielsen) uses surveys to get a better after the fact number. Doing sales based on server traffic is just pointless. You get what you pay for (a server moving bits around), and not a damn thing more.

Are Nielsen surveys still a thing? Every single device that displays a video signal to you has been tracking what you watch since way before ad tech became a thing. The companies collecting that data then profit from that collection.

As an anecdote, I have AT&T Gigaverse. I primarily only watch recorded material on the DVR, and only watch sporting events live. However, once I'm done watching a signal from my "cable box", I switch it over to my external media device on a different input on my TV. The cable box stays on whatever that channel it was on for however long it takes before the cable box goes into screen saver. Someone is getting skewed ad view counts by 1 as my cable box displayed it but nobody saw it.

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