4 ms·

It's not at all obvious that advertisers are going to pay for performance, where I assume you mean buy ads on a cpa basis. There's risk, and someone will bear,

by x0x0 11y ago

It's not at all obvious that advertisers are going to pay for performance, where I assume you mean buy ads on a cpa basis. There's risk, and someone will bear, and get paid to bear, that risk. If advertisers buy on a cpa basis, they pay more for the privilege. And frankly (imo) that's all for small to medium advertisers anyway. Bigger advertisers buy 3 month ios and, if you don't perform, don't reup. My experience at a large DSP is this: no-one comes in as a big account; they're all grown. You get $50k for 3 months and told to demonstrate performance. If you do, your account managers call up and demand 3-5x the money. Wash rinse repeat. You do get $3-$5mm/year accounts, but they all started under $100k/3 months. And in any case, all DSPs / ad networks will be measured on a cpa basis. Don't perform, and next quarters ios don't materialize. They're just not sold cpa. If you aren't aware, btw, there are huge fights about attribution - last view is ridiculous but what most people use, leading to all sorts of gaming behavior particularly in light of cookie churn.

ChuckMcM 11y ago
I am aware of the fights, and cookie churn is a symptom of the a challenging and, to my way of thinking, a not very good way of identifying origination. Lets say I'm content provider A, I get your ad and it has an encrypted URL that lands back on my site. When it lands on my site I can decrypt it and know who sent that click to me and note it. Then, on conversion, pay that person. The challenge this system has is that it doesn't let you throw your ads into a distribution bucket and wait for them to land on some site that is buying some traffic from some traffic provider. You have to know the sites (and presumably their IP addresses) where it lands. I need a relationship between the site showing the ad, and me. Then I can be sure that anyone who clicks on that ad, and then buys something from me, I can credit the sale to that site. What is useful (and to some extent different) about this scheme is that you can compute ad spend against revenue generated. There is no 'fraud' because you don't pay unless someone "converts" (the term for making transaction). What it does do however is cut off all the shady ad networks and packagers and skimlinkers and what not because they don't add value for a large brand like Macy's or Target or Amazon. So a blog like TechCrunch with a relationship with Target can give target an exact number of how much business has arrived at Target because of their ad on Techcrunch stories. And Target can compute exactly how much revenue the clicks that landed there from TechCrunch generated. And from their existing understanding of life time value of a customer who has landed on their site and made a purchase, they can price the value of that advertisement fairly precisely. TechCrunch gets feedback on how much their ads are worth to Target and can choose to make every ad a target ad if they think it will maximize revenue, base on the performance not on the click through rate. Target could lie about conversions, but that would be self defeating in the long term (they want people to land on their site and want people to carry their advertising). If we learned anything from the meteoric rise of Google as an advertising behemoth it is that people will pay for metrics and demonstrable results. If you can provide the best metrics and the best results, you win.
- x0x0 11y ago
  Your encrypted URL scheme solves nothing as far as I can see. We can already track eg the retargeting provider that brought cookie X in. That's not the problem. The problem is (1) multiple retargeting providers repeatedly bring user X in (2) once user X clears his or her cookie and becomes user Y, we no longer have a way to target ads to him or her. If he or she then revisits the site, our analytics become confused and that user is entered anew into a retargeting pool. (3) user X is exposed to ads from multiple ad partners. Who owns the conversion? Fractional share / time decay / last view through? We can track the partners that showed this user an ad (up to cookie churn), but somehow must apportion the credit. Users regularly repeatedly visit a site and are exposed to multiple ads before converting -- that's a big part of the debate over who gets credit. The above problems become more acute as you exhaust retargeting and move to lookalikes or other forms of prospecting.
  - ChuckMcM 11y ago
    I happen to think trying to cookie someone is going to ultimately be unsuccessful, and as you point out multiple people feel they have a claim on the conversion. My guess is that will simplfy, kick out everyone in the middle except the content site and the advertiser. I can be totally wrong here, but that is my best guess at what will happen.
    - x0x0 11y ago
      ok, but in a cookieless world, how do I identify people to target? The current flow is this: advertiser pushes 1-party data into an exchange or ad network, either directly or via a dsp or dedicated company ala liveramp or via retargeting partner. This can be as simple as "target this user" or very complex, eg catalog integrations ala tellapart. With no cookie, how can an exchange or network know that anyone wants to show an ad to this viewer? The other possibility is a single company sees all / has global ident ala fb and google on mobile. Also, you keep coming back to multiple parties having a claim on a conversion. That is fundamentally unrelated to cookies. It's this: multiple parties showed an ad to a user. Forget, for now, how that user was identified. If that user then converts, which partners get how much credit?

by x0x0 11y ago

ChuckMcM 11y ago

I am aware of the fights, and cookie churn is a symptom of the a challenging and, to my way of thinking, a not very good way of identifying origination. Lets say I'm content provider A, I get your ad and it has an encrypted URL that lands back on my site. When it lands on my site I can decrypt it and know who sent that click to me and note it. Then, on conversion, pay that person. The challenge this system has is that it doesn't let you throw your ads into a distribution bucket and wait for them to land on some site that is buying some traffic from some traffic provider. You have to know the sites (and presumably their IP addresses) where it lands. I need a relationship between the site showing the ad, and me. Then I can be sure that anyone who clicks on that ad, and then buys something from me, I can credit the sale to that site. What is useful (and to some extent different) about this scheme is that you can compute ad spend against revenue generated. There is no 'fraud' because you don't pay unless someone "converts" (the term for making transaction). What it does do however is cut off all the shady ad networks and packagers and skimlinkers and what not because they don't add value for a large brand like Macy's or Target or Amazon. So a blog like TechCrunch with a relationship with Target can give target an exact number of how much business has arrived at Target because of their ad on Techcrunch stories. And Target can compute exactly how much revenue the clicks that landed there from TechCrunch generated. And from their existing understanding of life time value of a customer who has landed on their site and made a purchase, they can price the value of that advertisement fairly precisely. TechCrunch gets feedback on how much their ads are worth to Target and can choose to make every ad a target ad if they think it will maximize revenue, base on the performance not on the click through rate. Target could lie about conversions, but that would be self defeating in the long term (they want people to land on their site and want people to carry their advertising). If we learned anything from the meteoric rise of Google as an advertising behemoth it is that people will pay for metrics and demonstrable results. If you can provide the best metrics and the best results, you win.

x0x0 11y ago
Your encrypted URL scheme solves nothing as far as I can see. We can already track eg the retargeting provider that brought cookie X in. That's not the problem. The problem is (1) multiple retargeting providers repeatedly bring user X in (2) once user X clears his or her cookie and becomes user Y, we no longer have a way to target ads to him or her. If he or she then revisits the site, our analytics become confused and that user is entered anew into a retargeting pool. (3) user X is exposed to ads from multiple ad partners. Who owns the conversion? Fractional share / time decay / last view through? We can track the partners that showed this user an ad (up to cookie churn), but somehow must apportion the credit. Users regularly repeatedly visit a site and are exposed to multiple ads before converting -- that's a big part of the debate over who gets credit. The above problems become more acute as you exhaust retargeting and move to lookalikes or other forms of prospecting.
- ChuckMcM 11y ago
  I happen to think trying to cookie someone is going to ultimately be unsuccessful, and as you point out multiple people feel they have a claim on the conversion. My guess is that will simplfy, kick out everyone in the middle except the content site and the advertiser. I can be totally wrong here, but that is my best guess at what will happen.
  - x0x0 11y ago
    ok, but in a cookieless world, how do I identify people to target? The current flow is this: advertiser pushes 1-party data into an exchange or ad network, either directly or via a dsp or dedicated company ala liveramp or via retargeting partner. This can be as simple as "target this user" or very complex, eg catalog integrations ala tellapart. With no cookie, how can an exchange or network know that anyone wants to show an ad to this viewer? The other possibility is a single company sees all / has global ident ala fb and google on mobile. Also, you keep coming back to multiple parties having a claim on a conversion. That is fundamentally unrelated to cookies. It's this: multiple parties showed an ad to a user. Forget, for now, how that user was identified. If that user then converts, which partners get how much credit?