3 ms·

A US/UK ad impression is worth 10x more than an ad impression in Indonesia. It is that simple.

dogma1138 11y ago
I don't think that anyone argues that it doesn't the value of an ad impression is directly tied to the purchasing power of the audience it's presented to. That said this is "somewhat" mitigated with local ad partners. People from Indonesia will receive ads that are provided by local ad partners and while their spot will still be considerably cheaper this is regional pricing rather than pure valuation. A US user is just as worthless for an Indonesian advertiser as an Indonesian user is to a US advertiser. Companies have regional pricing to deliver products to markets that cannot afford it movies and games cost considerably less in China, Russia, South America etc. than in N. America or Europe, ads are no exception. Also whats up with Indonesia? they have a GDP 4 times that of say Ireland, the individual income is still quite low but as far as Indonesia as a country goes they probably have bigger purchasing power than many European nations. Also it really depends on what you advertise because in many places you can't disregard income inequality if you are talking about countries with ~300M> people they might have more "rich" people than many other smaller European nation so while the average purchasing power within a country isn't that impressive it's actual purchasing power might be quite considerable. One thing that I've at least noticed on the few ads i did managed to receive while being in China, HK, India and the Philippines is that instead of ads for Spotify, GoPro, or Clash of Clans I've received ads for luxury watches and high end cars more likely than not because due to the income inequality in said countries if you are accessing content from a high end device you aren't just middle class you are very wealthy as many of those countries don't really have a traditional middle class (China has one now and it's one of the biggest consumer of luxury goods in the world). The Ad market is complicated, I wouldn't just go around sticking prices to users from different countries because it's much harder to estimate that, logic that works in western developed nations quite often fails everywhere else.
- johansch 11y ago
  > I don't think that anyone argues that it doesn't the value of an ad impression is directly tied to the purchasing power of the audience it's presented to. Your editing errors aside, what else is there to say? Why are you still arguing? It makes no sense.
- johansch 11y ago
  > Also whats up with Indonesia? they have a GDP 4 times that of say Ireland, the individual income is still quite low but as far as Indonesia as a country goes they probably have bigger purchasing power than many European nations. If you don't understand the difference between GDP and GDP per capita, I don't even know where to begin.
  - dogma1138 11y ago
    I don't think you understand how income inequality works. If you think it's a problem in the west then you have no idea how it works in developing nations. The top 20% of the income bracket in Germany makes only 4.2 more on average than the bottom 20% in China it's 20-30, in many African countries it's 40-50.
    - johansch 11y ago
      I still think you have no idea how the concept of an arithmetic average works.
      - eamsen 11y ago
        It looks like he does have an idea. The average is influenced by outliers, so in cases with high income inequality, it does not necessarily represent central tendency well. In such cases, the median (or other percentiles) can be used for more accurate representations of economic power.
- johansch 11y ago
  > That said this is "somewhat" mitigated with local ad partners. People from Indonesia will receive ads that are provided by local ad partners and while their spot will still be considerably cheaper this is regional pricing rather than pure valuation. You are either stupid or drunk. Cheers!
abakker 11y ago
Are most advertisers advertising english language products in english speaking countries? I don't know if this is the case or not, but I would hazard that english language companies demand more ads because they are in more mature markets, and therefore face more competition. In Indonesia, there are many people, but fewer companies advertising there because the market is less mature and consumer choice is more limited/demands less advertising. Ads sell because they lead to other consumer action. Not for the sake of showing people banners. So, no, it isn't that simple.
- dogma1138 11y ago
  Advertisements are very localized some one from Thailand will not see ads in many cases which are aimed at say US buyers neither would Germans, and in most cases not even Brits, Australians or even Canadians.
  - abakker 11y ago
    Exactly. I was responding to the claim that the price of ads was necessarily correlated only the wealth of buyers. It is on average correlated to the expected return a given company expects to get in terms of products sold / conversions. So I agree with you. If I advertise to sell something in the US (where I am, where my company does business, where I am willing to ship goods, etc.) then ads in Thailand are worth $0. Not because the people there are poor, but because I don't do business in Thailand.
    - johansch 11y ago
      You are overthinking it. It is this simple: Rich people have more money to spend than poor people. This is not a guess from my end - I spent a decade working on this and had (mostly very proprietary data) at at hand.
megablast 11y ago
Right, but what if it costs 1/100th?

I don't think that anyone argues that it doesn't the value of an ad impression is directly tied to the purchasing power of the audience it's presented to. That said this is "somewhat" mitigated with local ad partners. People from Indonesia will receive ads that are provided by local ad partners and while their spot will still be considerably cheaper this is regional pricing rather than pure valuation. A US user is just as worthless for an Indonesian advertiser as an Indonesian user is to a US advertiser. Companies have regional pricing to deliver products to markets that cannot afford it movies and games cost considerably less in China, Russia, South America etc. than in N. America or Europe, ads are no exception. Also whats up with Indonesia? they have a GDP 4 times that of say Ireland, the individual income is still quite low but as far as Indonesia as a country goes they probably have bigger purchasing power than many European nations. Also it really depends on what you advertise because in many places you can't disregard income inequality if you are talking about countries with ~300M> people they might have more "rich" people than many other smaller European nation so while the average purchasing power within a country isn't that impressive it's actual purchasing power might be quite considerable. One thing that I've at least noticed on the few ads i did managed to receive while being in China, HK, India and the Philippines is that instead of ads for Spotify, GoPro, or Clash of Clans I've received ads for luxury watches and high end cars more likely than not because due to the income inequality in said countries if you are accessing content from a high end device you aren't just middle class you are very wealthy as many of those countries don't really have a traditional middle class (China has one now and it's one of the biggest consumer of luxury goods in the world). The Ad market is complicated, I wouldn't just go around sticking prices to users from different countries because it's much harder to estimate that, logic that works in western developed nations quite often fails everywhere else.

johansch 11y ago
> I don't think that anyone argues that it doesn't the value of an ad impression is directly tied to the purchasing power of the audience it's presented to. Your editing errors aside, what else is there to say? Why are you still arguing? It makes no sense.
johansch 11y ago
> Also whats up with Indonesia? they have a GDP 4 times that of say Ireland, the individual income is still quite low but as far as Indonesia as a country goes they probably have bigger purchasing power than many European nations. If you don't understand the difference between GDP and GDP per capita, I don't even know where to begin.
- dogma1138 11y ago
  I don't think you understand how income inequality works. If you think it's a problem in the west then you have no idea how it works in developing nations. The top 20% of the income bracket in Germany makes only 4.2 more on average than the bottom 20% in China it's 20-30, in many African countries it's 40-50.
  - johansch 11y ago
    I still think you have no idea how the concept of an arithmetic average works.
    - eamsen 11y ago
      It looks like he does have an idea. The average is influenced by outliers, so in cases with high income inequality, it does not necessarily represent central tendency well. In such cases, the median (or other percentiles) can be used for more accurate representations of economic power.
johansch 11y ago
> That said this is "somewhat" mitigated with local ad partners. People from Indonesia will receive ads that are provided by local ad partners and while their spot will still be considerably cheaper this is regional pricing rather than pure valuation. You are either stupid or drunk. Cheers!

abakker 11y ago

Are most advertisers advertising english language products in english speaking countries? I don't know if this is the case or not, but I would hazard that english language companies demand more ads because they are in more mature markets, and therefore face more competition. In Indonesia, there are many people, but fewer companies advertising there because the market is less mature and consumer choice is more limited/demands less advertising. Ads sell because they lead to other consumer action. Not for the sake of showing people banners. So, no, it isn't that simple.

dogma1138 11y ago
Advertisements are very localized some one from Thailand will not see ads in many cases which are aimed at say US buyers neither would Germans, and in most cases not even Brits, Australians or even Canadians.
- abakker 11y ago
  Exactly. I was responding to the claim that the price of ads was necessarily correlated only the wealth of buyers. It is on average correlated to the expected return a given company expects to get in terms of products sold / conversions. So I agree with you. If I advertise to sell something in the US (where I am, where my company does business, where I am willing to ship goods, etc.) then ads in Thailand are worth $0. Not because the people there are poor, but because I don't do business in Thailand.
  - johansch 11y ago
    You are overthinking it. It is this simple: Rich people have more money to spend than poor people. This is not a guess from my end - I spent a decade working on this and had (mostly very proprietary data) at at hand.

megablast 11y ago

Right, but what if it costs 1/100th?