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> So much of the advertising business has always been about convincing the entire rest of the economy that they desperately need more advertising in order to co

> So much of the advertising business has always been about convincing the entire rest of the economy that they desperately need more advertising in order to compete, regardless of any actual stats on ROI. I've never worked with anyone that doesn't measure ROI or ROAS. I'm not arguing that some companies don't need to spend so much on advertising or that it's not needed for some but there's a pretty clear measure. > Is online advertising—and in particular, the hyper-targeted advertising that fuels the industry's insatiable hunger for every last drop of personal data—worthwhile? In my experience in eCommerce marketing is that both Meta and Google are steering advertisers towards massive audience campaigns that aren't hyper-targeted. They might be doing hyper-targeted advertising but it's no longer as recommended as it once was. All that said, I use ad blockers and I think data should not be hoovered up without consent or awareness and sold without consent. On my personal site and even my online shop I don't use GA or any other third party tool (hosted on Shopify so they inject some things).

danaris 3y ago
There are ways to estimate advertising ROI, but so much of what ads are attempting to do is inherently unmeasurable without a tightly controlled study, particularly given the highly chaotic nature of the economy and people's behavior. Fundamentally, there are two "sides" of advertising ROI you can try to measure: the individual, and the aggregate. They each have serious challenges. At the individual level: sure, some people see an ad, say "hey, I want that!" and go buy it. But that's definitely nowhere close to the majority of purchases—even online—and it's very unlikely to be a very high percentage of ad-influenced purchases. Much more often, the ad gets the product into your brain, and then later, when you're shopping, you see it and say, "hm, maybe I should get it," never consciously realizing that the ad caused or contributed to that. Thus, any kind of consumer survey will be unable to capture more than a tiny fraction of ad-influenced purchasing. At the aggregate level: what you're trying to measure here is simply your sales numbers over time. And except for the very largest of companies, sales numbers will be pretty noisy. That means it's very hard to tell for sure whether this ad or that one worked, or if any of them had any direct effect on sales at all. (That's particularly true for the subtly-influenced purchases I described above; those might happen months after an ad campaign starts.) Is it totally impossible to measure ROI? No, it's not. But it takes a lot of work, and has a fairly high degree of inherent uncertainty. The old saw "half of all advertising dollars are wasted—we just don't know which half" is very relevant here.

danaris 3y ago

There are ways to estimate advertising ROI, but so much of what ads are attempting to do is inherently unmeasurable without a tightly controlled study, particularly given the highly chaotic nature of the economy and people's behavior. Fundamentally, there are two "sides" of advertising ROI you can try to measure: the individual, and the aggregate. They each have serious challenges. At the individual level: sure, some people see an ad, say "hey, I want that!" and go buy it. But that's definitely nowhere close to the majority of purchases—even online—and it's very unlikely to be a very high percentage of ad-influenced purchases. Much more often, the ad gets the product into your brain, and then later, when you're shopping, you see it and say, "hm, maybe I should get it," never consciously realizing that the ad caused or contributed to that. Thus, any kind of consumer survey will be unable to capture more than a tiny fraction of ad-influenced purchasing. At the aggregate level: what you're trying to measure here is simply your sales numbers over time. And except for the very largest of companies, sales numbers will be pretty noisy. That means it's very hard to tell for sure whether this ad or that one worked, or if any of them had any direct effect on sales at all. (That's particularly true for the subtly-influenced purchases I described above; those might happen months after an ad campaign starts.) Is it totally impossible to measure ROI? No, it's not. But it takes a lot of work, and has a fairly high degree of inherent uncertainty. The old saw "half of all advertising dollars are wasted—we just don't know which half" is very relevant here.