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> In some businesses, there simply is no other way. For example recently I heard from some online dating services I don't think advertising is necessary for an

> In some businesses, there simply is no other way. For example recently I heard from some online dating services I don't think advertising is necessary for an online dating service. For example, quite a few of my friends are on OK Cupid, and as far as I know they don't do much advertising. "Advertising is a tax for being unremarkable" is a really succinct way of putting it.

Tichy 18y ago
Even if you can be successful without advertising, it seems a bit silly to be against it. If you know that by investing 100000$ in advertising, you can earn another 1000000$ in revenue, why would you not do it? Just because it loses you points in the indie scene? I used to be all negative about advertising, but I changed my attitude since I realized that nature itself relies heavily on advertising. A beautiful flower is advertising, too. Even a flower has to announce "I am here" with colors and odors. Maybe in some cases a "social recommendation mechanism" is also at work (like the bees who inform other bees about food sources), but without such a mechanism, how are your clients going to discover you?
- sokoloff 18y ago
  One example answer is that if your gross margin is anything under 10%, you shouldn't spend $100m in advertising for $1mm in marginal revenue. Doesn't happen often in software, of course.
  - Tichy 18y ago
    I admit you have lost me here - why should one not make that investment?
    - sokoloff 18y ago
      Let's say your gross margin is 9%. You spend $100K in advertising. You get an additional $1000K in revenue, on which you make a 9% profit. You bank $90K profit from this. You're $10K worse off for having done that advertising.
      - Tichy 18y ago
        OK - not so used to terms like "gross margin" ;-)
- cabalamat 18y ago
  I'm not against advertising.
papersports 18y ago
OK Cupid is free and freemium, isn't it? I think a free product or service is in trouble if it has to advertise. Perhaps the quote should read: "Advertising is a tax for being unremarkable, and/or not free."

Tichy 18y ago

Even if you can be successful without advertising, it seems a bit silly to be against it. If you know that by investing 100000$ in advertising, you can earn another 1000000$ in revenue, why would you not do it? Just because it loses you points in the indie scene? I used to be all negative about advertising, but I changed my attitude since I realized that nature itself relies heavily on advertising. A beautiful flower is advertising, too. Even a flower has to announce "I am here" with colors and odors. Maybe in some cases a "social recommendation mechanism" is also at work (like the bees who inform other bees about food sources), but without such a mechanism, how are your clients going to discover you?

sokoloff 18y ago
One example answer is that if your gross margin is anything under 10%, you shouldn't spend $100m in advertising for $1mm in marginal revenue. Doesn't happen often in software, of course.
- Tichy 18y ago
  I admit you have lost me here - why should one not make that investment?
  - sokoloff 18y ago
    Let's say your gross margin is 9%. You spend $100K in advertising. You get an additional $1000K in revenue, on which you make a 9% profit. You bank $90K profit from this. You're $10K worse off for having done that advertising.
    - Tichy 18y ago
      OK - not so used to terms like "gross margin" ;-)
cabalamat 18y ago
I'm not against advertising.

papersports 18y ago

OK Cupid is free and freemium, isn't it? I think a free product or service is in trouble if it has to advertise. Perhaps the quote should read: "Advertising is a tax for being unremarkable, and/or not free."