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"Instead of plastering every available inch with an advert, showing restraint and allowing few ads on a platform will likely increase their effectiveness and va

"Instead of plastering every available inch with an advert, showing restraint and allowing few ads on a platform will likely increase their effectiveness and value." In the age of A/B testing, this is just incredibly stupid logic. If Myspace has 17 ads on a page, it's most likely because multivariate testing showed that 17 was the optimal number in terms of their eCPM. It's always humorous when some guy with a blog assumes he knows better than the company with a zillion page views per day and access to abundant performance metrics.

AlexBlom 17y ago
I don't see why there cannot be AB testing with fewer ads. The point I was working towards was that there is so much clutter we ignore most of them. That means Myspace may earn more money but the ads are not as effective. As soon as a more efficient channel is found Myspace is dumped. We see this issue happen over and over.
- byrneseyeview 17y ago
  A/B testing as in: Case A is showing one ad, case B is showing two. B wins. Then Case A is showing two, and Case B is showing 3. Sixteen tests later, they hit their peak revenue. Actually, they probably leave some money on the table: they'll get a higher net present value if they reduce the number of people who quit in disgust, and for some people, the disgust from ads is cumulative. Thus, 20 ads might get them more revenue per page, but fewer page views in the future.
  - AlexBlom 17y ago
    Understood. I'm not talking about effectiveness for the publisher but for the marketer. As a consumer the more ads I see in a single space the more likely I am to remember none of them. My point is that there is a balance and ad rates are falling in over-populated mediums because we know that the better chance people have of seeing the ads the higher chance we have of catching their interest. A startup I am watching which is trying this is influads.com
    - mattmaroon 17y ago
      Well of course the marketer would benefit if their ad was the only one on the page. They would benefit enough to pay Myspace not to run the other 16 though. Ad rates are falling (in some areas, not in all) because supply is growing faster than demand. Also more ads are appearing on less intent-focused sites, like Facebook, and branding ads always pay peanuts compared to direct sales.
  - deleted 17y ago
    [deleted]
jimbokun 17y ago
"If Myspace has 17 ads on a page, it's most likely because multivariate testing showed that 17 was the optimal number in terms of their eCPM." There probably have been a lot of models showing that asset prices will not go down more than x%, because they have not gone down more than x% anytime in the last n years for which we happen to have data. Similarly, 17 ads on a page might maximize eCPM today. But it is also possible that showing 17 ads on a page today could lead to fewer users visiting the site tomorrow. In other words, it is difficult to design an A/B test that takes into account long term effects on your business.
- btilly 17y ago
  Actually designing those tests is easy. The trouble is that in order to run them you need to be tracking data over a long period of time, and executives lack the necessary attention span. The second problem is that one of the costs of excessive advertising is to your brand. And testing things that affect your brand is something that A/B testing is not good for.
_delirium 17y ago
They probably have done A/B testing, but often it's over very short periods. It may be that 17 ads is better than 5 ads in a 2-week test, but over a year period underperforms, which is somewhat hard to test. In particular, it's fairly hard to A/B test over multiple sessions in a way that consistently assigns the same users to group A v. group B each time they visit the site, to measure long-term/cumulative effects, like the hypothesized "more ads over an extended period induces ad-blindness". With logged-in users, a site like MySpace could do that, but then you run into additional social problems: if over an extended period some people are getting 5 ads and some people are getting 17, the people getting 17 are going to start noticing and be angry.
- deleted 17y ago
  [deleted]
robryan 17y ago
Well myspace has always been in the business of cashing in, I doubt they factor in a long term profitability when they decide that this is the optimal amount of ads on a page.
mbreese 17y ago
You're assuming that they are acting rationally or testing at all... just because they have a zillion pages views per day doesn't mean that they operate like it. Perhaps they do A/B testing, but I think it's a leap to assume that they do.
- mattmaroon 17y ago
  No, it's such a well-established principle among high-traffic sites that it's a leap to assume they don't.
mikecane 17y ago
>>>If Myspace has 17 ads on a page, it's most likely because multivariate testing showed that 17 was the optimal number in terms of their eCPM. No. Just because something is being done doesn't make it either the right thing to do or indicative of the way it should be done. Just look at the financial mess we're in. All of that was based on the same kind of thinking.

AlexBlom 17y ago

I don't see why there cannot be AB testing with fewer ads. The point I was working towards was that there is so much clutter we ignore most of them. That means Myspace may earn more money but the ads are not as effective. As soon as a more efficient channel is found Myspace is dumped. We see this issue happen over and over.

byrneseyeview 17y ago
A/B testing as in: Case A is showing one ad, case B is showing two. B wins. Then Case A is showing two, and Case B is showing 3. Sixteen tests later, they hit their peak revenue. Actually, they probably leave some money on the table: they'll get a higher net present value if they reduce the number of people who quit in disgust, and for some people, the disgust from ads is cumulative. Thus, 20 ads might get them more revenue per page, but fewer page views in the future.
- AlexBlom 17y ago
  Understood. I'm not talking about effectiveness for the publisher but for the marketer. As a consumer the more ads I see in a single space the more likely I am to remember none of them. My point is that there is a balance and ad rates are falling in over-populated mediums because we know that the better chance people have of seeing the ads the higher chance we have of catching their interest. A startup I am watching which is trying this is influads.com
  - mattmaroon 17y ago
    Well of course the marketer would benefit if their ad was the only one on the page. They would benefit enough to pay Myspace not to run the other 16 though. Ad rates are falling (in some areas, not in all) because supply is growing faster than demand. Also more ads are appearing on less intent-focused sites, like Facebook, and branding ads always pay peanuts compared to direct sales.
- deleted 17y ago
  [deleted]

jimbokun 17y ago

"If Myspace has 17 ads on a page, it's most likely because multivariate testing showed that 17 was the optimal number in terms of their eCPM." There probably have been a lot of models showing that asset prices will not go down more than x%, because they have not gone down more than x% anytime in the last n years for which we happen to have data. Similarly, 17 ads on a page might maximize eCPM today. But it is also possible that showing 17 ads on a page today could lead to fewer users visiting the site tomorrow. In other words, it is difficult to design an A/B test that takes into account long term effects on your business.

btilly 17y ago
Actually designing those tests is easy. The trouble is that in order to run them you need to be tracking data over a long period of time, and executives lack the necessary attention span. The second problem is that one of the costs of excessive advertising is to your brand. And testing things that affect your brand is something that A/B testing is not good for.

_delirium 17y ago

They probably have done A/B testing, but often it's over very short periods. It may be that 17 ads is better than 5 ads in a 2-week test, but over a year period underperforms, which is somewhat hard to test. In particular, it's fairly hard to A/B test over multiple sessions in a way that consistently assigns the same users to group A v. group B each time they visit the site, to measure long-term/cumulative effects, like the hypothesized "more ads over an extended period induces ad-blindness". With logged-in users, a site like MySpace could do that, but then you run into additional social problems: if over an extended period some people are getting 5 ads and some people are getting 17, the people getting 17 are going to start noticing and be angry.

deleted 17y ago
[deleted]

robryan 17y ago

Well myspace has always been in the business of cashing in, I doubt they factor in a long term profitability when they decide that this is the optimal amount of ads on a page.

mbreese 17y ago

You're assuming that they are acting rationally or testing at all... just because they have a zillion pages views per day doesn't mean that they operate like it. Perhaps they do A/B testing, but I think it's a leap to assume that they do.

mattmaroon 17y ago
No, it's such a well-established principle among high-traffic sites that it's a leap to assume they don't.

mikecane 17y ago

>>>If Myspace has 17 ads on a page, it's most likely because multivariate testing showed that 17 was the optimal number in terms of their eCPM. No. Just because something is being done doesn't make it either the right thing to do or indicative of the way it should be done. Just look at the financial mess we're in. All of that was based on the same kind of thinking.