4 ms·

Think of TV and other traditional media. The content is created to attract people which are turn sold to advertisers as a commodity. If you're looking at specif

by 12xo 7y ago

Think of TV and other traditional media. The content is created to attract people which are turn sold to advertisers as a commodity. If you're looking at specific content, you are being targeted, by the content and any appropriated ads depending on who is buying at the time. All without individual tracking and targeting. Seeing an ad for something like a keyboard on a site about cooking is wasteful in so many ways. Mostly due to the inherit waste/loss in the ad stack and market. Too many middlemen taking too many %s of the pie to add what is in essence, a small lift in performance for the advertiser. Who really has no choice but to spend more if they want to increase their goals. The problem is that the internet became about gaming a false metric to make money. Success was measured by metrics like Impressions... The entire market is very wasteful and exists without a proper market forces to balance the costs. Facebook, Google make up their pricing. There is no transparency in the demand, they just choose a price, take a large % of the value, (or all) and have no incentive to change course. Most people better receive random, contextual driven ads than specific targeted ones. They interact with something similar to the content rather than to their specific browsing history. The thing that FB figured out, was they could combine content into ads and also sell ads against that content. Taking hold of the whole enchilada.

olegious 7y ago
I think you're missing a few key points: 1) "Success was measured by metrics like Impressions" - advertisers need to get smarter and link advertising to bottom line results. If you can't tie ad spend to improvement in sales, then why are you spending money? 2) "The entire market is wasteful and exists without proper market forces" - the entire point of programmatic advertising is each impression is sold in an auction, so it can be a very efficient way to buy advertising. The problem is when there are too many middle men between the advertiser and the audience taking a cut, this is why "supply path optimization" is becoming a big thing in the industry by helping you answer "how can I get to my audience with the fewest people in the middle?" 3)TV and traditional media wasn't necessarily the most efficient way to advertise, the "spray and pray" approach. Advertisers and TV networks are beginning to realize this, that's why a more and more of the ads you're watching on TV are actually placed there via programmatic advertising and the percentage is only rising.
- 12xo 7y ago
  Take a look at your microwave oven and ask yourself why it has so many buttons. 99% of the time you are using it for one thing only. To heat an item for 15, 30, 60 or N seconds. On high. Yet every single microwave is full of dozens of other buttons. Multiple other functions. Lots of features, bells and dings. Why? Because somewhere along the way, people thought they needed these extra features to sell their product. They thought they added value. But in the end, they do not add value to 99% of their users or their actual use. They are superfluous and yet, they remain on every microwave oven sold. This is what digital ads have become. A kluge of processes and jargon chasing a rainbow of perfect, efficient ad delivery. Something that is impossible to achieve. With the FB and Google and Amazon, owning the sell side market, you do not have a balanced marketplace. They are not adjusting the cost of the imp, conversion, or click or engagement or the N based on efficiency, or competition, or depreciation over time. They are in fact doing the opposite. They are adjusting the price based on none of those things. Only their ability to sell all those buttons, those features and those extras... And in the end, the advertiser just wants to sell more of X or achieve more of Y for as little as possible.
  - jefftk 7y ago
    Microwaves offer additional features because it's really cheap, some of us like them (defrost is great!), and the features don't get in the way for users who don't need them. I don't think this is a useful analogy.
    - 12xo 7y ago
      That's why these features are on every single one. They are cheap. Their costs went down over time... And just like digital, there are only a few manufactures. Have digital ad costs decreased over time as supply as increased?
    - pen2l 7y ago
      Correct me if I'm wrong, but defrost is just a microwave for a very long time, right? Why _not_ just microwave by typing 5 minutes? Or instead, why shouldn't the microwave have less abstruse buttons like "1 min", "2 min", "5 min" which grant you the opportunity to seamlessly jump to trying to use your intuition to figure out the timing you want instead of this vague "defrost" button which... I'm still not sure what it does.

by 12xo 7y ago

olegious 7y ago

I think you're missing a few key points: 1) "Success was measured by metrics like Impressions" - advertisers need to get smarter and link advertising to bottom line results. If you can't tie ad spend to improvement in sales, then why are you spending money? 2) "The entire market is wasteful and exists without proper market forces" - the entire point of programmatic advertising is each impression is sold in an auction, so it can be a very efficient way to buy advertising. The problem is when there are too many middle men between the advertiser and the audience taking a cut, this is why "supply path optimization" is becoming a big thing in the industry by helping you answer "how can I get to my audience with the fewest people in the middle?" 3)TV and traditional media wasn't necessarily the most efficient way to advertise, the "spray and pray" approach. Advertisers and TV networks are beginning to realize this, that's why a more and more of the ads you're watching on TV are actually placed there via programmatic advertising and the percentage is only rising.

12xo 7y ago
Take a look at your microwave oven and ask yourself why it has so many buttons. 99% of the time you are using it for one thing only. To heat an item for 15, 30, 60 or N seconds. On high. Yet every single microwave is full of dozens of other buttons. Multiple other functions. Lots of features, bells and dings. Why? Because somewhere along the way, people thought they needed these extra features to sell their product. They thought they added value. But in the end, they do not add value to 99% of their users or their actual use. They are superfluous and yet, they remain on every microwave oven sold. This is what digital ads have become. A kluge of processes and jargon chasing a rainbow of perfect, efficient ad delivery. Something that is impossible to achieve. With the FB and Google and Amazon, owning the sell side market, you do not have a balanced marketplace. They are not adjusting the cost of the imp, conversion, or click or engagement or the N based on efficiency, or competition, or depreciation over time. They are in fact doing the opposite. They are adjusting the price based on none of those things. Only their ability to sell all those buttons, those features and those extras... And in the end, the advertiser just wants to sell more of X or achieve more of Y for as little as possible.
- jefftk 7y ago
  Microwaves offer additional features because it's really cheap, some of us like them (defrost is great!), and the features don't get in the way for users who don't need them. I don't think this is a useful analogy.
  - 12xo 7y ago
    That's why these features are on every single one. They are cheap. Their costs went down over time... And just like digital, there are only a few manufactures. Have digital ad costs decreased over time as supply as increased?
  - pen2l 7y ago
    Correct me if I'm wrong, but defrost is just a microwave for a very long time, right? Why _not_ just microwave by typing 5 minutes? Or instead, why shouldn't the microwave have less abstruse buttons like "1 min", "2 min", "5 min" which grant you the opportunity to seamlessly jump to trying to use your intuition to figure out the timing you want instead of this vague "defrost" button which... I'm still not sure what it does.