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The new dot com bubble is online advertising (2019)

thecorrespondent.com

161–170 of 176 posts

Re: The new dot com bubble is online advertising (2019)

#161
post #132

Earlier quoted context omitted.

> What will it take for this advertising bubble to pop? Browsers shipping with uBlock Origin included.

Browsers want to be popular with users, but they also want websites to make money: if sites can't make money, there is no web to browse.

> they also want websites to make money

By allowing them to abuse their users?

> if sites can't make money, there is no web to browse

There are other ways to make money other than advertising. If they insist on ads, they should disappear.

Besides, not everyone creates a website for profit. Sometimes people just have something interesting to say. The web used to have a lot of those before these commercial interests started infesting it.

Re: The new dot com bubble is online advertising (2019)

#162
Not a fan of advertising (online or otherwise, wish online wasn't exclusively...targeted) (tax it!) but bubble accusations seem unfounded. It's possible to find negative or uncertain returns to spend but that doesn't make a bubble.

Relatedly the first and third results for https://hn.algolia.com/?q=bubble are https://news.ycombinator.com/item?id=17060085 (2018 GDPR Will Pop the Adtech Bubble; didn't happen) and https://news.ycombinator.com/item?id=10572863 (2015 The Adtech Bubble; the end was not nigh).

Re: The new dot com bubble is online advertising (2019)

#164
post #45

Earlier quoted context omitted.

We haven’t “solved” user hostility because the industry still relies on user data collection and tracking on a massive scale with default opt in rather than opt out. Consumers are spooked by that and the industry has (by and large) failed to convince them of the utility of targeted advertising. It’s the original sin of online ads that nobody really wants to address. Because of that, we have a lot of rather shady play…

I feel like there is a distinction between targeting ads based on the profile you've created on their site (say, Facebook) and targeting ads by tracking users all over the internet.

Almost every web property with a significant user base uses “identity resolution” to personalize ads. Without regulations forbidding organizations from doing this it’s not going to stop.

Re: The new dot com bubble is online advertising (2019)

#165
post #148

Earlier quoted context omitted.

I assume there must be some effect in getting new drinkers. I’ve tried lots of colas. I’m never buying a Pepsi if there is Coke. I will always buy soft drinks in this order: Cherry Coke, Cherry Dr Pepper, Dr Pepper, Coke, maybe I’ll just have water. At this point no amount of advertising will change my mind.

This is a common anti-pattern when smart people start thinking about (brand) advertising. “I have such strongly held opinions about my favorite soda! No amount of advertising will change my mind. I am immune to advertising!” And then they go to the grocery store, and remember their girlfriend told them to pick up some fabric softener, which they know nothing about. So they look on the shelf and they think “Ok, Downy,…

This is precisely my point about getting new buyers but couldn’t think of the terms. There must be some clear up shot to spending so much on advertising.

Re: The new dot com bubble is online advertising (2019)

#166

Earlier quoted context omitted.

I can make at least three people IRL that do this regularly. My business has had huge success with promoted listings on eBay. People will gladly pay 20% more for a sponsored item rather than scroll down literally one inch to get better organic results. Even if these people are a tiny minority population-wise, they make up a disproportionate percentage of people that waste money on frivolous or overpriced goods.

Intriguing! I am new business, and my online ads campaign seen by 4000+ people produced maybe about 2 installations. Appealing to people in real life was much more effective for me. I know my target audience is in the hundreds of thousands but I just cannot reach them through more or less blind online ads.

As someone else pointed out in a different thread, it depends a lot on what your product is. If you're selling something aimed at a highly tech-literate, "elite" audience, ads will likely be much less effective than if you're selling, say, decorated cupcakes.

Re: The new dot com bubble is online advertising (2019)

#167

Earlier quoted context omitted.

I'm sure 99% of Apple users would be happy with a popup on first use of Safari that asked "would you like to block adverts?". It would be no skin off Apple's nose.

Even if they end up being blocked by many ad funded sites?

I never cared about what that website had to say that much in the first place. If the entire web gets killed because of this, I'll go read a book.

Re: The new dot com bubble is online advertising (2019)

#168
post #67

The article explains why eBay shouldn't advertise against the term "eBay", all very logical. ... Until a competitor starts advertising against the the term "eBay". At which point, online advertising becomes protection money.

This is the strongest antitrust case against Google in my opinion. They are the monopoly search engine. Tons of people google a website name instead of typing in the URL. Tons of people don't know the ads are actually ads and Google is making it harder to tell them apart from the every year[0]. It's basically like the mafia telling you to fork over money or else they put up your competitors' billboards in front of yo…

This is also an issue in Apple's app store.

Re: The new dot com bubble is online advertising (2019)

#169

This sounds great and I want to believe it, but it feels like another case of someone saying the sky is falling when it clearly hasn't. What will it take for this advertising bubble to pop? Is it even a bubble?

Funnily enough, the ad based tech companies have the most reasonable stock prices. Facebook and Google are massively profitable, still growing at double digit rates, and each have only mid twenties PE ratios (the same as Caterpillar Heavy Equipment, or electric utilities like ConEd and PG&E). Meanwhile there are companies out there like Lordstown Motors, Lucid, and Nikola, which have never sold a product but have bil…

Years ago, I read a book that categorized the development of consumer products in a three-phase evolution:

Phase 1 - Small firms serving whatever they could shove out to market in a scattershot way. Think of the early 1900s automakers who made 30 cars each before closing or merging away.

Phase 2 - Volume scale products are established which rolls over much of the market with economies of scale and price-first design. The Ford Model T is the canonical example.

Phase 3 - Brands get established to target different consumer niches rather than direct price competition. Think of the golden era of GM where there was more or less a clear market segment and message behind Pontiac vs. Chevrolet vs. Buick.

I think many investors see EVs as a "Phase 1" product-- they're willing to bite on hype and random bad ideas, because they expect someone is going to execute big to become the Phase 2 market leader, or even end up as a focused, high-margin Phase 3 brand. We don't know who that is now, so bet on everyone!

On the other hand, there's an equally compelling argument that EVs are less a new market and more a variant of the overall automotive business that's already reached "Phase 3". Existing brands know their places and markets already, so there may not be that much realignment as they replace fuel tanks with batteries.

Tesla has proven it's possible to muscle into the market, but a lot of that was by identifying an unserved niche (the luxury consumer-covetable EV, instead of the minimal-for-legal compliance EV intended to sell to government fleets) which provided enough volume and high-margin sales to bootstrap their play. They couldn't have competed by trying to sell the Model 3 in 2012.

Re: The new dot com bubble is online advertising (2019)

#170
post #13

I remember reading this article back in 2019 when it was originally written. Unclear why it is being dusted off now when it is still just as wrong as it was then. Yes, it is probably hard for a large, well-known brand like eBay or Procter & Gamble or Coca-Cola to measure their return from online advertising. If Coca-Cola stopped all advertising for 1 week, would anything really change? Probably not. And it’s not as i…

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