6 ms·

> Overall advertising budgets are not dominated by the effectiveness of advertising, but by adversarial spending by their competitors. This is absolutely not t

> Overall advertising budgets are not dominated by the effectiveness of advertising, but by adversarial spending by their competitors. This is absolutely not the case. Google’s biggest ad clients achieve pretty incredible ROI (called ROAS) on each dollar they spend. And they track these obsessively—I supported a large travel client that had a small (but highly skilled) engineering team dedicated exclusively to their SEM bidding and monitoring systems. The reason digital advertising is so valuable is pretty exclusively related to attribution and tracking. If companies weren’t sure they could make so much money with their spend, their budgets would absolutely drop.

betenoire 6y ago
Advertising has existed without this feature in other mediums forever
squeezingswirls 6y ago
'When Big Brands Stopped Spending On Digital Ads, Nothing Happened. Why?' https://www.forbes.com/sites/augustinefou/2021/01/02/when-big-brands-stopped-spending-on-digital-ads-nothing-happened-why/ https://www.forbes.com/sites/augustinefou/2021/01/02/when-bi...
- fingerlocks 6y ago
  What happens when small brands don't spend on digital ads? Nothing Happening is the worst possible outcome.
  - squeezingswirls 6y ago
    I do believe small brands can get more ROI using social media than wasting their money on digital ads.
    - doctor_eval 6y ago
      Isn't part of the problem that Facebook limits the reach of accounts once they get to a certain size? My understanding is that they basically block you from broadcasting to your friends. The ROI of a small business is then limited because after a point you have to effectively pay for digital ads anyway. Matthew Inman posted about this https://twitter.com/Oatmeal/status/923250055540219904 https://twitter.com/Oatmeal/status/923250055540219904 As an aside, this also reflects on the honesty of their ad campaign about supporting small business. If they really cared about small business they wouldn't make them pay to reach the audience they created on their platform.
      - squeezingswirls 6y ago
        That's a good point. I didn't know about that, and I'll have to think about it. Anyway paying FB's mafia style extortion probably isn't the solution.
kibwen 6y ago
Companies obsess about these metrics because they don't want their ROI to be less than their competitors', because that would put them at a competitive disadvantage. It's not in doubt that individual-targeted advertising is more effective than than the alternatives; by eliminating user tracking you would be decreasing ROI across the board, but that's fine because, again, all that you're fighting for is a higher ROI than your competitors. And to reiterate, it's not like consumer dollars are just vanishing into the ether; every dollar a consumer makes either gets spent or saved, and regardless of the ROI of a specific ad campaign they've still got to buy dish soap or diapers or what have you. Just because advertising ROI drops does not mean that the company revenue/profit will drop; if it did, that probably means another company has better ROI (and if they can do so, and as long as they're not tracking users, then good for them!).
- kortilla 6y ago
  This model is based on the assumption that ads are for things the consumers already know about. This is not correct. Example: I type “housing insurance” into Google and the “organic” results are dominated by the mega insurance companies. Without targeted advertising, the ads are also dominated by mega insurance companies because they have the biggest advertising budgets. With targeted advertising, I can see an ad from a provider specific to my location that I didn’t know existed who offers way better rates because of the different risk pool. The same applies for thousands of other products/services that are localized. Similarly, the ads for someone interested in DIY vs someone who is happy to pay for skilled labor are drastically different when you search “drywall repair”.
  - somedude895 6y ago
    > Without targeted advertising, the ads are also dominated by mega insurance companies because they have the biggest advertising budgets. > With targeted advertising, I can see an ad from a provider specific to my location that I didn’t know existed who offers way better rates because of the different risk pool. The same applies for thousands of other products/services that are localized. You're talking about geo targeting here, which imo should still be possible. That's an in-the-moment targeting akin to an advertiser choosing to show their ad on a local news site. This doesn't require extensive tracking and profiling of users.
fingerlocks 6y ago
At least someone in this thread gets it. Ad tracking really is about attribution, personalized ads are secondary nice-to-have. This is how small businesses figure out their advertising budget. Where are our customers coming from, or more importantly, where are they not coming from, so we know where to spend or not spend our limited resources? But I’m not surprised this isn’t pointed out more often. The hardcore privacy zealots really blow up when you try to explain that it’s mostly innocuous.
- bordercases 6y ago
  The tracking technology itself has a much wider scope of application than "small businesses focusing their development budget". Ads are used as a commercial justification for broadening the larger ability to surveil.
- josephg 6y ago
  It can be mostly innocuous. And I feel no sympathy for facebook’s business model here. I don’t want my attention to be bought and sold like a horse between faceless companies. I’d much rather pay $1/year to WhatsApp than have the content of my personal life analysed by the world’s marketing teams. I want to be the customer, not the product. I want the software I use to be primarily designed around my needs - not the needs of advertisers.
- danShumway 6y ago
  Because (all other concerns and objections aside) the intent doesn't matter. Apologies for the crude analogy, but if I install a camera in your bathroom and say, "okay, technically I could watch you poop, but the only reason I'm actually doing this is to figure out when you're out of toilet paper", that explanation won't leave you satisfied. Similarly, if someone is tracking me across the web and trying to link my identity across multiple sites/devices, I don't really care whether or not they're worried about attribution. The concerns about attribution are secondary to the fact that they're still watching everything I do online.
  - fingerlocks 6y ago
    Filming me defecating in the privacy of my home is not comparable to a quasi-anonymous unique value traveling from my computer to another. Also, please remember that this conversation is very specifically about Facebook's access to the Apple IDFA, not about general web tracking or other data vacuuming issues. The fact that these two separate issues get conflated is part of the problem.
majormajor 6y ago
You aren't necessarily disagreeing - their ROI would be even better if their competitors were spending less. Or, flipping it: if some advertisers are extremely effective, that pushes up the price for the ones that aren't.
ogre_codes 6y ago
> This is absolutely not the case. Google’s biggest ad clients achieve pretty incredible ROI (called ROAS) on each dollar they spend. Yet overall advertising spend is relatively flat. It's just shifted from one media to another. Advertising will not collapse. Companies budgets for advertising is fairly flat as a percentage of revenue. Who get advertising dollars will shift, but even there, not too much. Nor will we see more advertising. Sites have already bloated sites beyond the capacity of what most people will accept. What will likely happen is more special interest content will continue to slip behind paywalls... much as it was in magazines and specialist journals you paid for prior to the web.
ogre_codes 6y ago
> This is absolutely not the case. Google’s biggest ad clients achieve pretty incredible ROI (called ROAS) on each dollar they spend. It's their job to figure out how to best advertise, not mine to hand it to them on a silver platter at my own expense. This is my data, information about me, which they are stealing without my knowledge and profiting from. If someone asked me if they could snoop around in my personal affairs for money, the price would be a hell of a lot higher than the big fat zero I get in return here. Whatever Google or Facebooks' advertising ROI is, does not make it ethical or interesting to me. Credit cards get the benefit of knowing where I shop, but at least I know when and how they are getting that information. Likewise, cellular service. It's a price we pay for ubiquitous access to information. But I would cut them bot off as well if there were some way I could. It's parasitic and it's zero benefit to me.

betenoire 6y ago

Advertising has existed without this feature in other mediums forever

squeezingswirls 6y ago

'When Big Brands Stopped Spending On Digital Ads, Nothing Happened. Why?' https://www.forbes.com/sites/augustinefou/2021/01/02/when-big-brands-stopped-spending-on-digital-ads-nothing-happened-why/ https://www.forbes.com/sites/augustinefou/2021/01/02/when-bi...

fingerlocks 6y ago
What happens when small brands don't spend on digital ads? Nothing Happening is the worst possible outcome.
- squeezingswirls 6y ago
  I do believe small brands can get more ROI using social media than wasting their money on digital ads.
  - doctor_eval 6y ago
    Isn't part of the problem that Facebook limits the reach of accounts once they get to a certain size? My understanding is that they basically block you from broadcasting to your friends. The ROI of a small business is then limited because after a point you have to effectively pay for digital ads anyway. Matthew Inman posted about this https://twitter.com/Oatmeal/status/923250055540219904 https://twitter.com/Oatmeal/status/923250055540219904 As an aside, this also reflects on the honesty of their ad campaign about supporting small business. If they really cared about small business they wouldn't make them pay to reach the audience they created on their platform.
    - squeezingswirls 6y ago
      That's a good point. I didn't know about that, and I'll have to think about it. Anyway paying FB's mafia style extortion probably isn't the solution.

kibwen 6y ago

Companies obsess about these metrics because they don't want their ROI to be less than their competitors', because that would put them at a competitive disadvantage. It's not in doubt that individual-targeted advertising is more effective than than the alternatives; by eliminating user tracking you would be decreasing ROI across the board, but that's fine because, again, all that you're fighting for is a higher ROI than your competitors. And to reiterate, it's not like consumer dollars are just vanishing into the ether; every dollar a consumer makes either gets spent or saved, and regardless of the ROI of a specific ad campaign they've still got to buy dish soap or diapers or what have you. Just because advertising ROI drops does not mean that the company revenue/profit will drop; if it did, that probably means another company has better ROI (and if they can do so, and as long as they're not tracking users, then good for them!).

kortilla 6y ago
This model is based on the assumption that ads are for things the consumers already know about. This is not correct. Example: I type “housing insurance” into Google and the “organic” results are dominated by the mega insurance companies. Without targeted advertising, the ads are also dominated by mega insurance companies because they have the biggest advertising budgets. With targeted advertising, I can see an ad from a provider specific to my location that I didn’t know existed who offers way better rates because of the different risk pool. The same applies for thousands of other products/services that are localized. Similarly, the ads for someone interested in DIY vs someone who is happy to pay for skilled labor are drastically different when you search “drywall repair”.
- somedude895 6y ago
  > Without targeted advertising, the ads are also dominated by mega insurance companies because they have the biggest advertising budgets. > With targeted advertising, I can see an ad from a provider specific to my location that I didn’t know existed who offers way better rates because of the different risk pool. The same applies for thousands of other products/services that are localized. You're talking about geo targeting here, which imo should still be possible. That's an in-the-moment targeting akin to an advertiser choosing to show their ad on a local news site. This doesn't require extensive tracking and profiling of users.

fingerlocks 6y ago

At least someone in this thread gets it. Ad tracking really is about attribution, personalized ads are secondary nice-to-have. This is how small businesses figure out their advertising budget. Where are our customers coming from, or more importantly, where are they not coming from, so we know where to spend or not spend our limited resources? But I’m not surprised this isn’t pointed out more often. The hardcore privacy zealots really blow up when you try to explain that it’s mostly innocuous.

bordercases 6y ago
The tracking technology itself has a much wider scope of application than "small businesses focusing their development budget". Ads are used as a commercial justification for broadening the larger ability to surveil.
josephg 6y ago
It can be mostly innocuous. And I feel no sympathy for facebook’s business model here. I don’t want my attention to be bought and sold like a horse between faceless companies. I’d much rather pay $1/year to WhatsApp than have the content of my personal life analysed by the world’s marketing teams. I want to be the customer, not the product. I want the software I use to be primarily designed around my needs - not the needs of advertisers.
danShumway 6y ago
Because (all other concerns and objections aside) the intent doesn't matter. Apologies for the crude analogy, but if I install a camera in your bathroom and say, "okay, technically I could watch you poop, but the only reason I'm actually doing this is to figure out when you're out of toilet paper", that explanation won't leave you satisfied. Similarly, if someone is tracking me across the web and trying to link my identity across multiple sites/devices, I don't really care whether or not they're worried about attribution. The concerns about attribution are secondary to the fact that they're still watching everything I do online.
- fingerlocks 6y ago
  Filming me defecating in the privacy of my home is not comparable to a quasi-anonymous unique value traveling from my computer to another. Also, please remember that this conversation is very specifically about Facebook's access to the Apple IDFA, not about general web tracking or other data vacuuming issues. The fact that these two separate issues get conflated is part of the problem.

majormajor 6y ago

You aren't necessarily disagreeing - their ROI would be even better if their competitors were spending less. Or, flipping it: if some advertisers are extremely effective, that pushes up the price for the ones that aren't.

ogre_codes 6y ago

> This is absolutely not the case. Google’s biggest ad clients achieve pretty incredible ROI (called ROAS) on each dollar they spend. Yet overall advertising spend is relatively flat. It's just shifted from one media to another. Advertising will not collapse. Companies budgets for advertising is fairly flat as a percentage of revenue. Who get advertising dollars will shift, but even there, not too much. Nor will we see more advertising. Sites have already bloated sites beyond the capacity of what most people will accept. What will likely happen is more special interest content will continue to slip behind paywalls... much as it was in magazines and specialist journals you paid for prior to the web.

ogre_codes 6y ago

> This is absolutely not the case. Google’s biggest ad clients achieve pretty incredible ROI (called ROAS) on each dollar they spend. It's their job to figure out how to best advertise, not mine to hand it to them on a silver platter at my own expense. This is my data, information about me, which they are stealing without my knowledge and profiting from. If someone asked me if they could snoop around in my personal affairs for money, the price would be a hell of a lot higher than the big fat zero I get in return here. Whatever Google or Facebooks' advertising ROI is, does not make it ethical or interesting to me. Credit cards get the benefit of knowing where I shop, but at least I know when and how they are getting that information. Likewise, cellular service. It's a price we pay for ubiquitous access to information. But I would cut them bot off as well if there were some way I could. It's parasitic and it's zero benefit to me.