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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

#691

Post by kirill5pol »

nl wrote: post #602
swiley wrote: post #576

Earlier quoted context omitted.

We're probably not in your target market but most people here probably know anything marked with "ad" is very likely to contain malware and probably won't click it even if they think it goes where they want.

This isn't true. Google search ads are rarely malicious - Google does a pretty good screening them.

I have recently been getting straight up spam (“you won 1 million dollars!” type) as ads in Gmail. No idea how these managed to show up when these would have been easily marked as spam if it was an email.

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

#692

Post by croes »

cm2012 wrote: post #519
croes wrote: post #514

Earlier quoted context omitted.

By that logic any lottery winner could argue that lotteries are a great pension plan.

If they consistently win lotteries year after year with a good ROI, sure. Not sure how that comparison works.

Ever heard of survivor bias? Let me make an example: I choose 2048 random addresses. I choose I random company on the stock market. Half of the addresses I send a email stating the stock will rise in the next month, the other half the stock will fall. After a month I check the stock and disgard the addresses where my prediction was wrong. Than I repeat the previuos steps until only one address is left. Now ask him about my expertise on the stock market.

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

#693

Post by ashtonkem »

nutanc wrote: post #522

We did a similar kind of experiment some time back and found both FB ads and Google ads were doing jack shit for us. Google was better. FB ads were absolutely useless. So we stopped our ad spend. We observed no change in our customer acquisition. Another way these ad engines extract money out of you is by allowing competitors to bid for your brand name keyword. Try searching for Ozonetel on Google. There will be six…

Honestly, the way that ad companies treat brand specific search terms has a whiff of fraud to me. Surely Google is well aware that by the time an end user is searching for a brand, they have no interest in anything else; they just forgot the specific URL. If I ever found docs encouraging such behavior, I'd upgrade it from "whiff" to "pants on fire".

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

#694

Post by kevinmchugh »

seppin wrote: post #579
Nextgrid wrote: post #30

Earlier quoted context omitted.

> No one is willing to run the experiments necessary The people that would have the power to run this experiment have their entire careers depending on things staying as-is. Running the experiment carries a significant risk of exposing that the advertising operations they're responsible for provide much less ROI than they pretend it does. The unwillingness of anyone to run such an experiment is already an answer. Why…

This is no industry with as much snake oil BS as adtech. It also happens to be the sole form of revenue all of the largest tech firms enjoy. No wonder there hasn't been a real audit. Also, all those marketing execs buying all the ads would be out of a job too, so they aren't speak up either.

> It also happens to be the sole form of revenue all of the largest tech firms enjoy

I don't think this is true unless you qualify it a bit. Apple, Amazon, Microsoft, don't make most of their money on ads. Even Google has other revenue streams.

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

#695

Post by crossroadsguy »

nutanc wrote: post #522

We did a similar kind of experiment some time back and found both FB ads and Google ads were doing jack shit for us. Google was better. FB ads were absolutely useless. So we stopped our ad spend. We observed no change in our customer acquisition. Another way these ad engines extract money out of you is by allowing competitors to bid for your brand name keyword. Try searching for Ozonetel on Google. There will be six…

That's at least something related being offered :)

When I searched for a very specific pillow type (and added country name to the search to get local results) I get this as first result on Google https://i.imgur.com/Fxx9b80.png. It's a mattress/pillow start-up/brand in India. The ad shows the exact thing I am looking for.

But when I click, and I am redirected to the actual product page https://i.imgur.com/eI6sNtJ.png that has none of these features and the product description is completely different from what it shows on Google Search result page.

I had reported this to Google sometimes back and nothing changed in their SEO gymnastics the last time I had checked a couple of weeks later.

I think what they are doing is fraud (wrong? unethical?). But what really annoyed me is it wasted a lot of my time as I thought I was doing something wrong and probably they actually had the product I am looking for.

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

#696

Post by baron_harkonnen »

garciasn wrote: post #125
Nextgrid wrote: post #30

Earlier quoted context omitted.

> No one is willing to run the experiments necessary The people that would have the power to run this experiment have their entire careers depending on things staying as-is. Running the experiment carries a significant risk of exposing that the advertising operations they're responsible for provide much less ROI than they pretend it does. The unwillingness of anyone to run such an experiment is already an answer. Why…

I work in the field. Incrementality testing is a big part of marketing measurement at any reputable agency. Any claims to the contrary are FUD. That said, companies like P&G, Airbnb, and Uber, which are oft-cited as examples of digital not being worth it, fail to understand their own brand recognition and organic power, built through prior marketing efforts, as key to their current standing. Sure, TODAY, it doesn’t h…

> Incrementality testing is a big part of marketing measurement at any reputable agency

In a huge number of cases these tests are run by people that don't have the statistical background to property run and understand these tests, in the remaining cases there is almost never follow through to ensure that the results of the test have persisted after the experiment.

People will say "oh this test shows 10% improvement, and this one does too! and this one! and this one!" But then you should see a nearly 50% improvement just because of ad spend and you almost never do. Nobody ever check that all the numbers add up, they just want the numbers that someone reported to feel like they are sound enough to hold up to scrutiny but scrutiny is never applied.

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

#697

Post by seppin »

kevinmchugh wrote: post #694
seppin wrote: post #579

Earlier quoted context omitted.

This is no industry with as much snake oil BS as adtech. It also happens to be the sole form of revenue all of the largest tech firms enjoy. No wonder there hasn't been a real audit. Also, all those marketing execs buying all the ads would be out of a job too, so they aren't speak up either.

> It also happens to be the sole form of revenue all of the largest tech firms enjoy I don't think this is true unless you qualify it a bit. Apple, Amazon, Microsoft, don't make most of their money on ads. Even Google has other revenue streams.

> Even Google has other revenue streams.

How long do they survive in their current form relying solely on them?

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

#698

Post by ogre_codes »

crakhamster01 wrote: post #610
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-…

> No one can actually prove it has any ROI at all. No one is willing to run the experiments necessary. This is entirely false. I work in adtech, and almost all companies run experiments in order to optimize their ad spend (everything from Ad A vs Ad B, to Ad vs No Ad, to Channel A vs Channel B, and more). This isn't to say that advertising always produces ROI. Quite often, experiments will be run that will show a cer…

> I work in adtech, and almost all companies run experiments in order to optimize their ad spend ... It's incredibly naïve to think that companies are flushing half a trillion dollars a year down the toilet on advertising without any attempt to validate their investments.

We have a very large and conspicuous example here that suggests that Uber hasn't been doing this.

Running experiments like you suggest is difficult and to do them right requires some fairly specialized knowledge to do correctly. I'd doubt more than a small percentage of companies have the expertise to effectively run any kind of advertising experiment that returns useful data. Most businesses lack that knowledge and rely on metrics provided by the people selling the advertising—who are likely to provide self-serving numbers.

While I'm sure some of the bigger F500 companies do a good job validating their ad spend, I most companies don't even know how. Certainly the majority of small businesses have no idea how effective their advertising spend is aside from very crude word-of-mouth feedback. I suspect this creeps way up into the Fortune 500 as well.

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