[HN Gopher] As YouTube traffic soars, YouTubers say pay is plumm...
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As YouTube traffic soars, YouTubers say pay is plummeting
Author : lladnar
Score : 244 points
Date : 2020-04-13 14:50 UTC (8 hours ago)
(HTM) web link (onezero.medium.com)
(TXT) w3m dump (onezero.medium.com)
| agigao wrote:
| I (might) sound arrogant but never understood this industry, the
| value of it (other than financial). Feels quite embarrassing to
| me.
|
| Would love to hear opinions.
| bluGill wrote:
| I have several times bought something from an ad because it
| clued me into a solution to my problem that I had not known of.
| If my cat isn't catching all the mice I keep having to get more
| cats and try to get them to stop fighting or suddenly I
| discover mousetraps from an ad and I get a whole new solution
| that I didn't know about.
| [deleted]
| seibelj wrote:
| You have a business or a product that no one knows about. So
| you need to make people know about it. Enter - advertising
| [deleted]
| fullshark wrote:
| People don't have perfect information, advertising is crucial
| to inform your customers that you exist and have something of
| potential use to them.
| thehappypm wrote:
| Well, imagine you create a 1-person startup. You make the
| perfect tool, but you have no customers. How do you acquire
| them? You can try pumping your own personal network,
| organically market yourself every chance you get (like
| HackerNews comments or Facebook posts). However you can, with a
| relatively low investment, reach an order of magnitude more
| users with digital advertising. Your startup makes a great
| product, right? So you'll naturally acquire at least some of
| the users who see your ads.
| sys_64738 wrote:
| Is that bad?
| stanmancan wrote:
| I run a website that gets decent ad revenue (usually around
| $2,000/month) and so far month to date in April is down 54%
| versus the same day last month, and March was already down 14%
| from February. CPC for March was $0.60 but April is only $0.30 so
| far. Traffic, CTR, and fill rate haven't changed, just
| drastically lower CPC.
| itronitron wrote:
| seems like the perfect time for popular youtubers to move to a
| different platform
| CryoLogic wrote:
| Lots of YouTube animators have been moonlightning on Anim8
| (https://www.anim8.io) as of recently :)
|
| If you are an animation fan you should give it a shot.
| robotnikman wrote:
| Nice to see there is a site for animators to post videos
| since youtube shafted them with their ad policies requiring
| longer videos
| dageshi wrote:
| Their audiences won't move, youtube is the anchor site for
| video content.
| ortusdux wrote:
| Are there better paying alternatives?
| toomuchtodo wrote:
| https://watchnebula.com/
| 3fe9a03ccd14ca5 wrote:
| Some channels get more views in a day on a single video
| than these platforms get _visitors_ in a week.
| jankyxenon wrote:
| This feels like you may get a mighty big slice of a
| microscopic pie.
| toomuchtodo wrote:
| No different then existing artist platform economics
| (although Nebula is geared towards content creators, not
| pushing ads such that Youtube is).
|
| If you're expecting more, build your own brand and video
| hosting platform, and develop whatever individual brand
| value you can from your audience. Otherwise, them the
| breaks of more content available than one can consume in
| a lifetime (see: abysmal Spotify artist revenue). IMHO,
| content creator driven platforms at least give you a
| chance to extract more value than you could from Youtube
| (due to creator<->YouTube/Google power dynamics).
| gexla wrote:
| Can you explain further? Is this a better paying
| alternative to Youtube?
|
| But aren't we really talking about Adsense? If we're
| talking about Adsense, aren't we really talking about the
| overall capabilities of the system?
|
| Is there any alternatives to Adsense? No, if Adsense isn't
| working for you, then you're looking for a totally
| different approach for monetizing your content.
|
| But we still haven't arrived to the fundamental issue,
| which is that we're in the midst of a global economic
| meltdown. A lot of Adsense buyers are pulling out and
| that's driving down the market for ads.
|
| I'm not a marketing guru, but I'm guessing that advertising
| spend in general is one of the first things to get cut
| during difficult economic times.
|
| Does Nebula address this? Are they giving away helicopter
| money? Perhaps the service can open a portal into another
| dimension where COVID-19 has never happened (or maybe not
| for a couple of months, so we can get some quick partying
| in.)
| coopsmgoops wrote:
| Nebula is a competitor to YouTube that was created by a
| bunch of YouTubers in the educational video space. It's a
| paid subscription only model.
|
| I have a subscription but for some reason it doesn't
| scratch the same itch as YouTube even though it has a lot
| of the same content that I watch on YouTube. It may be
| because there isn't much Nebula only content so I might
| as well just check one website instead of two. I also
| don't think it has comments. And all round just isn't as
| slick of an experience as YouTube.
|
| Also by design not just anyone can upload to it and so I
| belive it will probably be quite limited in its growth.
| gexla wrote:
| If it's subscription only, then it's not a better paying
| alternative. It's a different monetization method
| altogether. Thanks for the clarification on how the
| service works. That's interesting, I'll check it out.
| Spivak wrote:
| Yes and no. They're out there and exist but you hit the
| treadmill that is customer acquisition. Any additional moneys
| you make by publishing off YouTube you'll pay to someone else
| to get a viewership. If you already have a large organic
| viewership you might be able to make the switch less painful
| but I doubt you'll be able to start from zero.
|
| You'll probably have to be on YT for exposure and then direct
| people off the site. Ironically a lot of TikTok-ers are
| trying to use the same trick to move their followers to YT
| for better pay.
| tyfon wrote:
| Wow I'm quite out of the loop here.
|
| TikTok pays money for videos? I thought it was pure
| "instagram but with music and videos" for kids. Not that
| I've used instagram either but at least they don't seem to
| pay people. Or do they? :)
| Spivak wrote:
| Nah, it's similar to IG in that regard so TikTok-ers go
| the standard sponsorship route or try to direct people
| to, say YT, for more consistent revenue.
|
| However, TikTok is has a pretty substantial adult
| audience. There are quite a few niche communities that
| have just organically moved to TikTok: cosplay, makeup,
| and digital art are some obvious ones.
| bdcravens wrote:
| Parent comment was saying that TikTokkers are monetizing
| by trying to move their fans to their YouTube channel.
| tehwebguy wrote:
| No, there is currently no similar alternative that pays
| anything in the realm of YouTube ad rev.
| yakshaving_jgt wrote:
| Well the ad quality is garbage, IME.
|
| > This is a cardinal sin of EDM
|
| SKIP AD FROM MASTERCLASS.COM
|
| > We live in strange times
|
| SKIP AD FROM MASTERCLASS.COM
|
| > Little Red Riding Hood... Let's start the story a different
| way!
|
| SKIP AD FROM MASTERCLASS.COM
|
| These adverts never end. They are relentless. There _must_ be
| something wrong with the platform.
| gexla wrote:
| You ought to look at the ____in my spam box. Yet it keeps
| coming in, it 's relentless. Even crazier, someone is actually
| paying out of pocket for the resources to send this stuff.
|
| Have you seen how horrible those Nigerian scam things are?
|
| WHY would they do such a thing!??
|
| ROI maybe? They are bringing in a slice more money from the ads
| than they are spending?
|
| Not everyone works the same as you. As an HN reader, I bet you
| dig data like many of us do. And I bet a lot of people working
| with Google Ads can show you data which show a positive ROI.
| frosted-flakes wrote:
| The Nigerian prince scam emails are supposed to look
| horrible. It's a filter: if you're smart enough to notice the
| numerous grammar and spelling errors, you're smart enough to
| not be duped, and so they're not interested in you. They only
| want gullible people to reply.
| djtriptych wrote:
| Masterclass has hacked the algorithm. Their ads are pretty
| great and I feel like I'm learning a little and often watch the
| entire thing, even if I have no interest in paying for the full
| course.
| acomjean wrote:
| I've watched a few MasterClass ads whole way though. They
| have some funny bits and are well produced. My favorite was
| the DJ who has the mouse helmet(Deadmau5): noting from
| personal experience, if you are uncomfortable on stage it
| helps to wear a giant helmet.
|
| Here's a link if you want to watch a 2 minute ad (if youtube
| is to be believed 31 million people have watched it.)
|
| https://www.youtube.com/watch?v=dtj6dDARgfQ
|
| I've skipped a fair number too.. They are long.
|
| I have no idea how they get experts in certain fields to do
| these classes.
| Fellshard wrote:
| That, and they're selling something that people are vastly
| more likely to check out at this moment in time, so all they
| really need to do is bid a bit higher than all the others who
| have tuned their bids down.
| gherkinnn wrote:
| Yup. Masterclass and Grammarly ads get me every time. I have
| zero interest in becoming an author but I can't but help to
| watch them to the end. Except that one "Anita the boss across
| the room" ad. God, I hate it.
| scottLobster wrote:
| Really? I haven't done a survey of Masterclass ads but I've
| had the opposite experience. Every one of them seems to be
| 90% highly-produced "inspirational" fluff with maybe one or
| two interesting one-liners that may or may not be bullshit.
|
| Haven't actually taken a course myself. I'll admit their ads
| got me to check out their site given the big names they've
| managed to attract, so they did their job, but it looks like
| their programs are yet another "we'll sell you lectures with
| zero practical exercises or applications for $X/month so you
| can sound smart at parties" service.
|
| I guess it _might_ be useful for 17 year olds picking a
| college major or exposing people to brand new topics, or
| professionals already in the relevant field looking for tips,
| but that 's about it. Watching Penn & Teller's Masterclass
| isn't going to teach you how to be a professional magician,
| Aaron Sorkin isn't going to teach you how to be a
| professional screenwriter, and Chris Hadfield isn't going to
| teach you how to be an astronaut or engineer. It's like
| paying $180 to read the back of the book of a profession.
| djtriptych wrote:
| Yeah this is fair.
|
| But there are so many topics I know almost nothing about
| that would be interesting to get an exponent to ELI5.
|
| Negotiation / Photography / Writing / Fashion. I know next
| to nothing about all these things. The ones I do know a
| little about, say chess, may not be as enriching but I
| don't mind watching Kasparov go over the basics...
|
| Really I haven't bought it and I'm not sure why. If I could
| pick an episode from the chess class it'd help me decide
| but doesn't seem like that's possible.
| ratww wrote:
| Oh, man... I've watched quite a few of those
| Masterclasses and all the ones I saw are pretty much
| badly conducted interviews and anecdotes, with zero
| structure or preparation. Even the editing leaves a lot
| to be desired. A professional journalist/interviewer
| would cut most of them to 1/3 of the length.
|
| Most of the content sits in this weird intersection of
| being completely useless to beginners and being too basic
| for intermediate/advanced practitioners. For $180 it's
| not even useful for parties, it's just a long interview
| for fans of the person.
| [deleted]
| FireBeyond wrote:
| Yeah, I watched Annie Liebowitz on "how to be a
| photographer". There was some discussion on moods and
| moments, which is fine.
|
| Ironically, what I learned was that most of the time, she
| works more as a creative director - she's at a laptop.
| Someone else is pressing the trigger, and then in post
| processing, someone else is doing that too, to her
| direction.
| DanBC wrote:
| Recently I got _flooded_ with ads from CEX (a shop the buys and
| sells second hand goods). I know CEX, I buy and sell to CEX,
| they don 't need to advertise to me. But I was getting the same
| 5 ads over and over and over and over.
|
| I had to click the little (i), then "stop seeing this ad".
| dleslie wrote:
| This is why I exclusively view Youtube with adblockers, and
| prefer to view it with NewPipe or VLC+ytdl.
|
| I'm not opposed to ads at the beginning and end, but numerous
| _jarring_ cuts in a ten minute video to play a couple of ads
| every two or three minutes? No thanks.
| maurys wrote:
| There is the option to use YouTube Premium though. It's not
| too expensive (yet), and with the number of cooking and tech
| videos I'm consuming right now, it seems worth it.
| dleslie wrote:
| YouTube Premium doesn't offer any protection for anonymity
| and freedom from their suggestion algorithm. That makes it
| inferior to NewPipe and ytdl.
| falcolas wrote:
| It does, however, reward content creators for their
| efforts (at about 100x the value of an ad view). That
| makes it far superior to NewPipe and ytdl, to me.
| blhack wrote:
| That is really great to know and will likely result in me
| re activating my YouTube red (premium? Whatever it's
| called now) account.
| catalogia wrote:
| I'd sooner buy channel merch and let a tshirt company
| take a middleman cut than let google take that middleman
| cut. Patreon being the middleman is also preferable to
| further enriching google.
| [deleted]
| mardifoufs wrote:
| I think this is really moving the goalposts. It seems
| like a lot of people who are vehemently anti advertising
| and ask for alternatives aren't really interested in
| them. Being anti advertising is totally understandable,
| but it's weird to see people who don't truly want to pay
| for ad free content talk about how invasive ads are.
| Infinitesimus wrote:
| Do you have anything against subscribing to the platform? (If
| you can afford it)
| SyneRyder wrote:
| Not sure if this has changed, but the last time I tried the
| YouTube Premium trial, they heavily pushed their own
| content (eg Scare PewDiePie) which was so completely
| opposite from anything I watch on YouTube, I felt I'd just
| replaced one ad experience with a worse one that I was
| paying for. I'd rather see the non-stop Masterclass ads (at
| least they were often relevant) than see PewDiePie
| everytime I log in.
| micael_dias wrote:
| They do promote YouTube premium videos in the beginning
| but after a while you stop seeing it if you don't consume
| it. I think it took a week max for premium videos to
| leave my recommended content (it was a while ago I
| started my subscription) .
| eropple wrote:
| If you click the X on the YouTube Premium bar on the
| homepage, it goes away forever. Or at least, it did for
| me.
| dleslie wrote:
| I pay for other platforms, even ones with free options
| (CBC), and so I am definitely open to it.
|
| But I distrust Google and don't want to serve them more
| data than is necessary.
| falcolas wrote:
| I would be outright shocked if Google is unable correlate
| video viewing habits via direct downloads to a Google
| account. Especially since they (google, facebook, et.al)
| have already demonstrated the ability to strongly
| correlate IP traffic with an account (active or shadow).
| dleslie wrote:
| To stop feeding personal data to Google completely one
| must stop using the internet, stop using credit cards,
| stop filling out warranty cards, and so on. They vacuum
| up personal data from every possible commercialized
| database they can access.
|
| But I can at least refuse to use a Google account, and to
| serve a tracking cookie. I'd have to live off the grid
| and in the woods to stop feeding them any data.
| jessedhillon wrote:
| This really is the tiniest violin. You're commiting
| piracy, plain and simple, and your justification is that
| your (unverifiable) terms of access aren't being met.
| rcxdude wrote:
| Yeah, but will they bother? It's a pretty small fraction
| of traffic which even uses an ad blocker, let alone a
| completely different client.
| mgninad wrote:
| Why don't you subscribe to YT premium. If there is a way to
| remove ads a support the platform, why not do that?
| [deleted]
| dx87 wrote:
| Subscribing gives a worse experience than blocking the ads.
| If you're subscribed and accidentally open another youtube
| video, it'll pause the currently playing video with a
| message saying that a video is playing in another window.
| falcolas wrote:
| It doesn't for me, and hasn't. Perhaps this is a browser
| or addon behavior?
| crocodiletears wrote:
| Consumer Activism's a good reason. Petty and insignificant
| as it may be, I became fed up with YouTube's content
| policies and search censorship for news topics, cut my red
| subscription, and put the money I had been giving toward my
| most watched channel's patreons. Newpipe and Skytube have
| been my go-to clients since.
| josteink wrote:
| > I'm not opposed to ads at the beginning and end, but
| numerous _jarring_ cuts in a ten minute video to play a
| couple of ads every two or three minutes? No thanks.
|
| This problem is a solved problem. It's called YouTube
| Premium.
| ISL wrote:
| Masterclass has a huge market right now. Lots of people with
| time on their hands who would like to do something productive
| with their time.
|
| Studying, in general, is a great use of this time.
| cma wrote:
| You can pay for premium and get 0 ads.
| CamJN wrote:
| No you can't, not until youtube forbids videos with burned in
| ads and sponsored shit and paid mentions and all that
| garbage.
| autokad wrote:
| I pay for youtube premium and its totally worth it, but I
| do hate those vids that put advertisements into them. At
| least some put it at the end which I am ok with
| dr_zoidberg wrote:
| I've seen a lot sponsored by Brilliant.something or so.
| Usually kurzgesagt, but on others too. I guess it must be
| a good ROI paying those high-profile channels for the
| ammount of subscriptions they must reel in.
| JoshTriplett wrote:
| That's what the "unsubscribe" button is for.
|
| (And what future video adblockers will be capable of.)
| shultays wrote:
| There is already an extension thac blocks sponsored
| parts. I think it was called sponsor block. Works very
| well
| falcolas wrote:
| That's not YouTube's job. Just as it's not a theater
| owner's job to forbid product placement in movies. Remember
| Pepsi in WWZ?
| adrianmonk wrote:
| I don't disagree, but that doesn't seem related to the recent
| dip that correlates with COVID-19.
| gherkinnn wrote:
| I've gotten equally annoyed and recently got a trial account
| with Nebula. (no affiliation whatsoever)
|
| It's nice as there are none of the YT ads, no comments, I can
| download things, and I get to support some Youtubers I actually
| enjoy watching.
| andarleen wrote:
| Add ads to "gaia" - pseudo science video platform cashing in on
| people's ignorance. Cant get rid of its ads.
| dr_zoidberg wrote:
| Seen a few of those, but then Masterclass superseded them.
| That and Wix, trying to get me to make a web page super
| easily...
| ghaff wrote:
| The MASTERCLASS.COM ads crack me up quite a bit. If it were
| prominent people in their fields talking about how they work,
| their craft, etc. OK. Still unlikely to pay for it but OK.
|
| But instead I see ads that seem to be claiming they'll teach me
| ballet, screenwriting, and all sorts of other things that
| absolutely don't lend themselves to broadcast online
| instruction even if the person teaching _is_ extremely talented
| and well-known.
| gumby wrote:
| > ...ads that seem to be claiming they'll teach me ballet,
| screenwriting, and all sorts of other things that absolutely
| don't lend themselves to broadcast online instruction...
|
| Hey, if you want to get established one way is to conquer a
| niche others aren't going after, right?
|
| It's a kind of "look for your keys under the streetlight"
| theory for market selection....
| mrfusion wrote:
| I think the flat earth movement would die off if youtube stopped
| paying out.
|
| I don't think anyone would have an incentive to make the videos
| anymore and without fresh content believers would lose interest
| and Eventually evidence of a round earth (plus peer pressure)
| would build up and outweigh their older ideas of flat earth.
| ancarda wrote:
| I pulled my YouTube Premium subscription once I was furloughed,
| along with Spotify and Netflix. I imagine many have done similar
| things to cut down on expenses.
| scottmcleod wrote:
| more inventory and demand than advertisers.. CPM falls. What do
| they expect?
| scottmcleod wrote:
| Things will course correct
| kleer001 wrote:
| Reality has a funny way of reasserting its self.
| [deleted]
| LatteLazy wrote:
| Lots of questionable citations (and many "facts" with no
| citations at all) here...
| 1024core wrote:
| Could it be because companies are cutting advertising budgets and
| freezing all non-essential spending?
| bkraz wrote:
| Data point from Applied Science: view count is constant over last
| 90 days. Ad revenue is down maybe 10%. Patreon is up slightly.
| Patreon has always been a really good idea for YT creators, and
| it's even better now.
| coopsmgoops wrote:
| Hey Ben, love your videos. Do you think your audience might be
| served different advertisements then the bulk of YouTube, and
| hence your revenue is more stable?
| bkraz wrote:
| Yes, I think that may be true. It's fairly opaque even to us
| creators -- I don't know which ads are served, or how many
| people click, etc. Patreon has been a huge help, and if it
| gets high enough, I'll probably turn off ads altogether.
| ilikehurdles wrote:
| The whole advertising industry is imploding during this pandemic.
| I mean, it was falling apart before with privacy regulations and
| browsers fighting an industry that put all their eggs in the
| "personalized targeting" bucket, but performance is exceptionally
| bad now.
|
| It kind of makes sense. There are ads for products you can't buy
| at stores that are closed, for cars you won't need to commute
| with, insurance you're already not using, other goods that won't
| ship for a month, and small gadgets that are totally out of
| stock; and that's assuming the person viewing the ad isn't
| avoiding spending due to financial risks.
|
| If ads aren't converting viewers into customers, it doesn't
| matter if there are 2x or 20x more viewers than there were
| before, the ad placements are just worth less.
| cecja wrote:
| There is a difference between shitty seo and online marketing
| and advertising.
| jimbob45 wrote:
| Side question: are the car insurance paybacks not a canary that
| they're hitting their max possible profit? Aren't they doing
| extremely well?
| SubparUser wrote:
| I work in DS for a car insurance company, from the inside the
| returning of premium seems more of a 'pr goodwill' type of
| thing than anything else. As soon as one company did it, they
| sort of all wanted to follow suit in order to preserve
| optics.
|
| There really isn't a limit to profits such as, 'we can only
| make $500 off of this policy anything over that we would have
| to refund'
| philipov wrote:
| What is DS? If I google it, I get "Diplomatic Security" and
| that can't be right.
| RandomBK wrote:
| Data Scientist
| BrentOzar wrote:
| Data science?
| philipov wrote:
| Nah, no one uses an initialism to refer to Data Science!
| I'm betting it's Direct Sales.
| csytan wrote:
| I'm curious as well. Maybe it's Direct Sales?
| vsskanth wrote:
| Apparently car insurance companies are regulated in the sense
| that they can only charge based on the risk they are taking.
| since accidents are down, they might be charging too much and
| have to refund. So I guess profit margins are more or less
| constant.
|
| That doesn't however stop you from acquiring more customers
| and increasing absolute profit.
| SubparUser wrote:
| This pretty of close, but a little off. You are correct
| that they are heavily regulated because auto insurance is
| mandated by law, but mainly pertains to what they are
| allowed to charge for. In the US, each state has a DOI that
| checks over models that car insurance companies use to
| charge people. There are a lot of rules about what can and
| can not be rated on. There isnt really a lever for 'I want
| this much profit' other than the base rate they charge.
| _Edit_ : (The comment below me is correct. I was getting a
| little hand-wavy. In general every part of a insurance plan
| will be scrutinized and has to be well supported. Insurance
| companies need to justify why there is a surcharge for some
| characteristic of a policy, this is what stops companies
| from just raking in money) They have to make an argument to
| the DOIs for why their base rate is what it is, so they
| cant really increase it for no reason.
|
| The other comment in response about loss ratio is correct
| jcrben wrote:
| Close, but not quite. Most states have a statute which
| says "rates shall not be inadequate or excessive". Pretty
| much all rate filings I've seen include a return on
| equity (ROE) in their analysis, and states review that in
| light of above statute.
|
| States have pretty broad powers and I could see them
| forcing a disgorgement if they felt so inclined.
|
| Source: I was a state insurance regulator for the Alaska
| Division of Insurance for a few years
| vsskanth wrote:
| since you said you were a regulator, hope you don't mind
| another question.
|
| This model seems to be doing a fairly good job keeping
| auto insurance costs under control. Is this regulatory
| model also being applied to health insurance ?
|
| If yes, why isn't it controlling healthcare costs ?
|
| If no, why not ?
| jcrben wrote:
| I focused on property & casualty but yes, the statute
| usually applies to health insurance, and I think the ACA
| further codified it as a requirement.
|
| While I haven't done a deep dive recently, I doubt health
| insurance administrative expenses and profit are the main
| driving factor in health insurance costs. Losses
| (utilization multiplied by price) are the main driving
| force. You can look up rate reviews at
| https://ratereview.healthcare.gov/ and probably view the
| entire filings on the state DOI website, altho these
| filings are usually not really as accessible as they
| should be.
| vsskanth wrote:
| thanks
| rmnoon wrote:
| Will let the parent reply but at a high level (at least
| for comprehensive insurance) there is a) a fairly
| competitive market (and comparison shopping is possible)
| for car repairs and b) a limit to the cost of a repair
| (the value of a new comparable car) that we don't / won't
| place on human lives.
| phonon wrote:
| Yep, that's about it. Or even worse, from the carrier's
| POV, regulators would take the higher profits from this
| year to regulate rates for the future (carriers file their
| target "loss ratios" with states, and if it deviates
| substantially, prices have to be adjusted).
| jakub_g wrote:
| It's already happening in US:
|
| https://www.npr.org/sections/coronavirus-live-
| updates/2020/0...
|
| Also in France one big insurer started paying people back,
| with government asking the other companies to do the same.
|
| https://www.lemonde.fr/economie/article/2020/04/02/coronavi
| r...
| baybal2 wrote:
| > The whole advertising industry is imploding during this
| pandemic. I mean, it was falling apart before with privacy
| regulations and browsers fighting an industry that put all
| their eggs in the "personalized targeting" bucket, but
| performance is exceptionally bad now.
|
| You couldn't have said it better
| ozim wrote:
| I see it as an opportunity for smaller businesses to be
| noticed. People will check stuff online and might notice your
| brand... Though yeah you would have to stand out to be
| remembered.
| dredmorbius wrote:
| Newspapers are being hammered.
|
| Local big-city paper ran several days with virtually no ads.
| Sport and Entertainment sections still carry none, though a few
| are appearing in the news and. business pages. And of course,
| obituaries -- or as they're called in the biz, "former
| subscriber appreciations".
|
| Even the Sunday edition inserts were reduced to a single
| druggist's circular.
|
| Even with increased eyeballs, ad buys are likely down and both
| business and people are avoiding all possible expenditure.
| vsskanth wrote:
| What about the massive increase in views from people being
| stuck at home ? wouldn't that lead to a higher ROI when people
| eventually spend ?
|
| In terms of ad spend reduction, How would this compare to
| regular media advertising spend (TV etc.) ?
| ProAm wrote:
| Why would you advertise if no one is buying? Unless your
| maintaining brand recognition you're just wasting money.
| tanilama wrote:
| > wouldn't that lead to a higher ROI when people eventually
| spend
|
| That will depend on whether people will have that money to
| spend economy bounces back. I am not optimistic, restaurants
| or hospitality industry are going to suffer for a long time.
|
| And Youtube ads are sold upon delivery, I don't think they
| will be retrospective revenue share, which is impossible (the
| conversion is intractable).
| code4tee wrote:
| Most executives are very short term thinkers and thus while
| your logic makes sense it's generally not how most people
| think. They need cash now so they cut first and think later.
|
| You're right that some smart execs will run into the fire as
| everyone is fleeing, buying up cheap adverts for a long term
| investment. There are some signs of this with a few companies
| seemingly increasing spend to take advantage of the cheap
| prices. Purely anecdotally I noticed a lot more adverts from
| Scott's on lawn care products. Their pitch is basically "hey
| so the lawn care guy is on lockdown... go to our site and
| we'll ship you fertilizer and tell you how to apply it."
| dahdum wrote:
| Cutting non-performance marketing spend like brand frees up
| cash they need to stay afloat. It's short term thinking by
| necessity.
|
| The execs running into the fire with ad spend to take
| advantage aren't any smarter than the rest, just better
| positioned for the pandemic. I doubt virtually any of them
| prepared or planned for this scenario.
|
| Though from my experience there'll be lot of companies out
| there cutting short cycle high ROAS campaigns, throwing the
| baby out with the bath water.
| bluGill wrote:
| Nobody prepared for this pandemic. However smart
| executives have prepared for something because every few
| years something unusual happens and having a flexible
| plan to work with makes you come out better than your
| competitors in the end.
| gruez wrote:
| off topic: why should they be on lockdown? There shouldn't
| be any infection risk from a guy working solo outdoors.
| myself248 wrote:
| Because it's apparently hard for the people writing the
| lockdown orders to differentiate between a solo lawn guy
| or gardener, and a four-dudes-in-one-pickup lawn crew.
| bluGill wrote:
| The same 4 guys in the truck are low risk so long as they
| never mix crews.
| kaitai wrote:
| Some states are looking at easing restrictions on
| lawncare/landscaping/etc.
|
| To all the folks saying "4 guys in a truck is low-risk"
| that's only true if they're the same 4 guys every time
| and they're not all living with other people... for
| instance if one lives with a nurse and another with a
| nursing-home health aide, then, well, not so great, huh.
| bryanrasmussen wrote:
| well there might be risk for the guy traveling from his
| house to yours. Also there may be other reasons why they
| think people can't have the lawn guy come by but they
| think it might not be nice to say, like people laid off
| still want to keep their lawn looking good but don't want
| to pay for a guy to come do it.
| azernik wrote:
| No, the logic _doesn 't_ make sense. When you're in a
| liquidity crunch, you _should_ be cutting short term costs.
| bpodgursky wrote:
| Maaaybe there's a longer window for brand awareness
| advertising, but for advertising directed at clickthroughs
| (most retargeting), advertising that doesn't end in a sale is
| a wasted ad.
| jldugger wrote:
| > What about the massive increase in views from people being
| stuck at home ? wouldn't that lead to a higher ROI when
| people eventually spend ?
|
| Not when you're paying per impression? The way to think of
| this is good old supply and demand. There is a lot more
| supply of ad slots, and a general decrease in demand. Both of
| these directly mean lower ad rates.
| ecpottinger wrote:
| No, once people have time to really look around they discover
| many of the channels they were subscribing to are not that
| great. They them move their viewing to more and other
| channels.
|
| Also I noticed a number of the youtube channels I use to
| watch because they have useful information and I was learning
| from them have now reached the end of their knowledge. Thy
| are now posting fluff to try and get me to keep coming back,
| but I don't want to waste my time watching a 30 minute video
| to get 5 minutes of useful information.
|
| One channel I watch use to only post about 1 hour long
| videos, now they have cut back and often only post a 5-7
| minute video so I keep coming back. One the other hand
| another channel used to and still posts 1-2 hour long video,
| I don't bother going there anymore. The host is smart, but he
| takes too long to get to the point of the video, I have other
| uses of my time.
| kombucha111 wrote:
| What channels are you drifting away from?
| gundmc wrote:
| > In terms of ad spend reduction, How would this compare to
| regular media advertising spend (TV etc.) ?
|
| TV as deals are often worked out O(months) in advance. I
| expect they've seen drops in bookings, but you won't see as
| agile of a reaction to the pandemic in Television.
| lotsofpulp wrote:
| Even though the deals were worked out, unless the money has
| already changed hands, I'm betting all the terms are up for
| renegotiation in exigent circumstances like these. I doubt
| it's in the interest of the broadcasters to stick it to
| their customers in these times, if they want their
| customers to stay alive.
| pheug wrote:
| > What about the massive increase in views from people being
| stuck at home ? wouldn't that lead to a higher ROI when
| people eventually spend ?
|
| That would lead to lower ROI as operating costs are increased
| to serve those extra users. Sure, with more users they'll
| serve more ads, but as total spend by advertisers is
| shrinking those ads will go off at bargain prices, it's
| simple math.
| adrianmonk wrote:
| Nobody really knows for sure where the economy is headed when
| we enter the sorta-normal-again phase.
|
| Anything is possible. It might be another Great Depression
| that takes years to recover from. Or maybe once this external
| force (quarantine) is removed, things will mostly bounce
| back.
|
| So those advertising dollars might have a good ROI or they
| might not. At a time when revenue is down (even if just
| temporarily) and some companies are laying off employees, it
| doesn't make a lot of sense to spend money on something that
| might or might not be worthwhile.
| user5994461 wrote:
| Well, we now know it's not going to get to normal for a
| while.
|
| France has just announced extending the lockdown one full
| month. UK has just announced they won't end the lockdown in
| the coming weeks, with no dates formally given (it was
| expiring today).
| adrianmonk wrote:
| I agree we aren't ready to even _start_ the process of
| getting back to quasi-normal. But the question was about
| a long-term advertising strategy for "when people
| eventually spend".
|
| I'm saying that "when" isn't a given; instead, it's an
| "if". Companies (whose cash flow just tried up) don't
| want to spend on "if".
| bdcravens wrote:
| > wouldn't that lead to a higher ROI when people eventually
| spend ?
|
| There is an opportunity now to invest and come out ahead in
| the long run. Most companies are conserving and cutting back
| right now, given the uncertainty.
| jakub_g wrote:
| From the article:
|
| > ...channel traffic, increasing by 15%
|
| > ...one in four media buyers and brands have paused all
| advertising for the first half of 2020, and a further 46%
| have adjusted their spending downwards
|
| > Digital ad spending is down by a third, according to the
| IAB -- a slightly less painful drop than the traditional
| media's 39% cut
|
| Traffic is up but ad spending is down more than the traffic
| increase.
| wolco wrote:
| Which makes it a great time to advertise if you are brand
| building.
| raverbashing wrote:
| I think this is visible even as a consumer.
|
| Lately I've been seeing a lot of (allegedly) dropshipping
| advertisements for "home gym" equipment, from "brands"/"stores"
| with no recognition.
|
| Sure I'll buy this from you. Especially something that's heavy
| and from an ad teaming with jpeg artifacts and a non-local
| currency. I'm sure I won't pay an arm and a leg for shipping
| and I'll have no issues with a brand that has 3 posts on
| instagram.
| thow16161 wrote:
| There are a lot more people at home right now, but many are out
| of work and spending less. An increase in eyeballs don't always
| translate to an increase in revenue.
|
| My girlfriend is a camgirl, and she tells me that while she has
| more people in her "room", they are tipping less and she's making
| less.
| rock_hard wrote:
| Camgirls making less money might be the one true metric of how
| consumer behavior is changing
| [deleted]
| cm2187 wrote:
| Silicon valley discovering advertising is pro-cyclical. Which may
| not have been obvious in 2008 when the big tech companies were
| ramping up their platform in the middle of a crisis.
|
| The other thing that is known to be pro-cyclical: luxury
| products. I am looking at you Apple. Again 2008 was the ramp up
| of smartphones, I don't think it informs us much on how high
| margin smartphones will do in a severe recession.
| bb123 wrote:
| Hmm I am not sure that Apple's products are really luxury
| products any more. For many many people they are quite
| essential.
| umeshunni wrote:
| Smartphones are essential. $1000 smartphones are luxuries.
| askafriend wrote:
| They are not luxuries to the extent you're implying. Your
| lifeline needs to be dependable and high quality. People
| inherently understand the value of tools and paying for
| something that'll get the job done reliably.
|
| People spent in aggregate way more to accomplish fewer
| things before the iPhone (or equivalent high-end Android
| phone).
|
| My smartphone is my primary camera, my communication
| device, my transportation lifeline, my business operations
| lifeline, etc etc.
|
| I can't afford for this one thing to be the point of
| weakness. $1000 is extremely cheap relative to the value I
| get out of it - it would be a waste of time and money for
| me to skimp here. Not to mention, once you're in the
| ecosystem, breaking your workflow is extremely expensive so
| there's an element of lock-in.
|
| Apple are in a stronger position than anyone gives them
| credit for.
| sitdownyoungman wrote:
| the smartphone is the computer. at $1000 many consumers use
| it for all of their daily needs, many of which ironically
| have nothing to do with phonecalls.
| macintux wrote:
| I recall reading that some newspapers have gone out of business
| due to the advertising crash. This is hardly surprising.
|
| Ripples gonna ripple.
| iso947 wrote:
| Lower circulation too - a friend is an editor of a major UK
| magazine, their subscriptions are up massively, but not enough
| to offset the drop the copies normally sold at airports,
| railway stations, service stations and local shops, let alone
| the massive drop in adverts
| coopsmgoops wrote:
| My local paper has shut down for the time being which is a
| shame. Hope it can bounce back but you can lose so much steam
| of staff have to leave and you might lose your office. There is
| a lot of permanent damage being done.
| ghaff wrote:
| "Soars" seems like a rather hyperbolic description of the 15%
| rise given in the article. I'm not really that surprised. Yeah,
| people are out of work and social activities are curtailed. But a
| lot of people are also home-schooling and many of us just working
| like we normally would. I've shifted activities around because
| I'm not traveling but I'm certainly not watching YouTube all day.
| throwaway2048 wrote:
| 15% growth when you are already ontop of a saturated market is
| a big deal.
| Wingman4l7 wrote:
| Interesting, because it seems like I've been seeing an increase
| in ad displays at the _end_ of videos (not running a Pi-hole yet
| so I 'm still seeing ads on mobile). Anecdata, I know.
| larrywright wrote:
| Probably related: all of the ads I'm being shown on Facebook and
| Instagram the last few weeks are really low quality. I'm assuming
| the ad inventory is really low right now and therefore rates have
| plummeted, making ads for sketchy products more cost effective. I
| think the quality of YouTube ads has gone down as well, but it's
| not nearly as bad as Facebook and Instagram.
| draw_down wrote:
| Yes, the bottom is currently falling out of the advertising
| market. If your income is based on ads, my condolences!
| mandelbrotwurst wrote:
| YouTube's algorithm adds another wrinkle to how many creators,
| especially smaller ones, are likely to be negatively impacted by
| the fact that much of our collective attention is on the
| coronavirus.
|
| YT and other socials have essentially been creating a whitelist
| of who is "trusted" to speak about coronavirus, allowing them to
| capture audiences by promoting their content and opting to not
| display and essentially censor that of smaller, independent
| ("fake") voices.
| scared2 wrote:
| Totally expected. I was actually expecting that this pandemic
| would be a test to the current business model of the internet.
|
| Business closed means no need to advertise, no ads means no need
| to turn on servers... But apparently it seems to be ok so far.
| tanilama wrote:
| On the other side, as part of the entertainment community, they
| are at least sustaining some of their income, which I would
| consider good under the current climate.
| HashThis wrote:
| What percent of YouTube's revenue goes to YouTubers?
| code4tee wrote:
| When companies struggle the first thing they tend to pull is
| advertising. Need some help making this quarter's numbers? Pull
| all the TV adverts for a few weeks. "Go dark" as insiders say.
|
| Short term this is all standard. The long term danger for Google
| and others is when lots of companies realize they probably didn't
| need to make all that spend in the first place. That big "reset"
| is a new normal that advertising dollar driven tech companies
| will need to adjust to.
| TAForObvReasons wrote:
| It's a prisoners dilemma of sorts: if one company reduces ad
| spend the others arguably benefit, and the only way to sustain
| lower rates is if every company in an industry agrees to reduce
| ad spend. When things return to normal, that dynamic won't go
| away
| ragebol wrote:
| I really don't think ads have a significant impact at all.
| How much is your buying affected by ads, really? Do you
| really buy a different eg. toothpaste rather than the one you
| typically get due to ads or because it's some percent off
| this time and it's also just okay toothpaste?
| BurningFrog wrote:
| The standard counter question is:
|
| "Did you ever buy a tooth paste brand that didn't
| advertise?"
|
| Ideally you answer "no...", while a look of sudden
| realization comes over your face. Individual results may
| vary.
| vonmoltke wrote:
| Other than generic store brands, I haven't seen a
| toothpaste brand for sale that _didn 't_ advertise, so it
| isn't a really a fair or informative question.
| BurningFrog wrote:
| I think you're staring _right_ at the point, without
| seeing it...
| vonmoltke wrote:
| I don't see a point except "everybody is doing it". While
| I don't agree with the person you are responding to, I
| don't think this is really evidence to the contrary or
| says anything much about the value of advertising.
| jeltz wrote:
| Not really. There could be multiple possible reasons why
| everyone is advertising. Everyone buying ads does not
| necessarily prove that ads work. I personally think they
| do, but that is not any proof.
| freepor wrote:
| Well there's your comparison. The store brands are
| chemically basically identical to the brand names. But
| their market share is relatively low. So the advertising
| must do something.
| karatestomp wrote:
| Packaging and shelf placement probably do a lot of the
| work, compared with, say, web ads about toothpaste.
| vonmoltke wrote:
| I didn't make the claim it didn't. I was just reacting to
| that particular rhetorical question.
|
| On this subject, though, there is more at play than just
| advertising. First is availability; smaller stores won't
| have a private label option available at all, so some
| chink of the market is not open to them.
|
| Second is quality; this is not as much an issue with OTC
| pharmaceuticals since it's all about the active
| ingredient, but for products where more than just the
| active ingredient matters (like flavor or consistency)
| there is sometimes a quality difference. There definitely
| is with food.
|
| That said, I frequently buy store brands over name
| brands. I also buy some "name brands" that I have never
| seen an advertisement for.
| Fauntleroy wrote:
| Depends on the type of ad. Random preroll on a YouTube
| video? nah... Stealthy paid review / article? maybe...
| finiteloops wrote:
| There's no long term risk to google and other ad exchanges
| because the advertisers are in a prisoners dilemma.
|
| If the advertisers collude or trust that the competitors won't
| increases ad spend, the relative market share stays the same
| and all companies participating enjoy increased margins.
|
| The first company to break gains market share, so as a result
| they all "overspend" and google is the only one that benefits.
|
| The worst part is the cost of google's margin is baked into
| product pricing, so the end result is we pay more to have the
| companies compete to advertise to us.
| aherhe4haeahe wrote:
| You are referring to the game-theory model of advertisement
| spending; but when game-theoretic decisions are made
| stochastically over time, it becomes a congestion game[1]
|
| [1] https://en.wikipedia.org/wiki/Congestion_game
| tmpz22 wrote:
| OR ads aren't that effective in the first place and the whole
| industry is a house of cards propped up by middleman making
| their fat margins convincing people ads are necessary...
| pembrook wrote:
| I've noticed HN often has two opinions about advertising
| depending on the day of the week:
|
| 1) It's an unchecked, all-powerful evil, making people buy
| or believe in things they don't want or need by hoarding
| their data
|
| or
|
| 2) It's a giant ineffective scam that stupid companies who
| aren't led by engineers waste VC money on
|
| The two are diametrically opposed, yet, I've seen the same
| person argue #1 on Monday when it fits the narrative, and
| then on Tuesday start arguing #2--blissfully unaware of how
| both cannot be true at the same time.
|
| Could it be, that both 1 and 2 are wrong, and that
| advertising spend is simply reduced during recessions in
| reaction to the reduction in spending by consumers? Why pay
| money to acquire customers when the customers aren't
| willing to spend money on new products?
| AnthonyMouse wrote:
| It's possible for both 1 and 2 to be _right_.
|
| Suppose that if you're peddling cheap junk and snake oil,
| advertising is effective, because nobody will have heard
| of your product by word of mouth (no one would recommend
| it and previous victims are ashamed to admit being
| suckered), but if you spam enough people you'll reach
| enough suckers to exceed the advertising expense.
|
| But if you're peddling a popular and quality product,
| everyone has already heard of it and additional
| advertising has low marginal utility because you were
| going to get most of the sales anyway.
|
| This furthermore doesn't get you out of the prisoner's
| dilemma, because even if buying advertising is only
| break-even rather than profitable, your competitor is
| doing it so you have to do it too or they gain a volume
| advantage over you and use that to kill you on unit
| pricing. But then you all do it and all that happens is
| that everyone pays money to cancel each other out.
| pembrook wrote:
| Except, in the real world there's more than just A)
| unknown snake oil and B) high quality products with
| perfect awareness.
|
| Your model only includes products on the narrows of each
| extreme. In the middle is the wide spectrum of _most_
| products...the ones that don 't meet either description.
|
| Even if you make the exact same product as a competitor,
| there is no prisoner's dilemma if you're targeting a
| different niche market to sell that product to. Perfect
| competition does not exist in the real world. The only
| thing that comes close might be a commodity like oil or
| water. But even water can be targeted to different
| segments of the market.
| AnthonyMouse wrote:
| > Except, in the real world there's more than just A)
| unknown snake oil and B) high quality products with
| perfect awareness.
|
| There doesn't have to not exist more than A and B. If A
| and B both exist then 1 and 2 are each true and the
| further existence of C and 3 don't change that.
|
| Moreover, even if some additional classes exist, the two
| examples are still central and problematic, not least
| because they're more likely to represent a higher
| percentage of ad spending.
|
| The first because advertising is the only way to sell
| crummy products, since the only way to get anyone to
| recommend it is to pay them to, so their incentives to
| use it are higher.
|
| And the second because the existence of the prisoner's
| dilemma is what drives up the ad spend on both sides. If
| you're targeting a niche that no one else is then you buy
| a small amount of advertising, reach those customers,
| make your sales and are done. If you're locked in a
| prisoner's dilemma with a direct competitor, you spend a
| little so they spend a little so you spend a little more
| until you're all spending a huge amount. And the fact
| that you're selling Fords and they're selling Chevys and
| they're not completely identical products doesn't really
| matter when they're both still cars.
| friedman23 wrote:
| It's amazing the lengths people go to reduce things into
| two dimensions.
|
| popular and quality product vs cheap junk and snake oil
| (and presumable unpopular)
|
| An honest person would note all possible combinations in
| their simplified model of businesses seeking advertising
|
| 1. popular products with bad quality
|
| 2. popular products with good quality
|
| 3. unpopular (or unknown) products with good quality
|
| 4. unpopular products with bad quality
|
| And of course the real world is more complex than this.
|
| your analysis is bad and wrong.
| wdevanny wrote:
| The parent comment was presenting one possible reason to
| explain the grandparent's observation. They were not
| trying to perfectly describe the real world, but only to
| point out that two seemingly conflicting points of view
| can be reconciled. I think the parent probably wrote
| their comment starting with the same thought as you: that
| the real world is more complex than a simply stated
| opinion.
|
| Saying "your analysis is bad and wrong." comes off as
| dismissive and I think you should read the HN Guidelines.
| mywittyname wrote:
| Well, we are a collection of people with our own
| independent thoughts and feelings on subjects, so it
| shouldn't be a surprise that some people feel the
| opposite of others are a variety of subjects.
|
| Though, to be honest, I don't think I've heard #2. I
| think any rational person understands that advertising
| has some degree of effectiveness. After all, many bright
| minds from a variety of hard sciences have spent decades
| of their lives, and extraordinary sums of money studying
| human behavior for the explicit purpose of selling more
| shit. Many of the largest companies in the world are
| advertising companies; before Google and Facebook there
| was the TV and Radio giants, who were massive, in spite
| of pretty serious regulations.
|
| None of this would have happened if advertising wasn't
| effective. At some point in time, people would have
| realized it didn't work and spent their money elsewhere.
|
| There are two big issues that I see:
|
| 1) More views have driven down bids for ad views. The ad
| industry is largely driven by companies bidding for
| views, so without a large influx of cash, the spike in
| views was going to depress ad impression prices.
|
| 2) Consumers have less discretionary money to spend, even
| if they wanted to, so the ROI on each view/click is going
| down.
|
| Each of those alone would be cause for concern, but
| combined, they do pose a significant issue for Google,
| Facebook, and smaller content creators.
| roywiggins wrote:
| They absolutely could both be true. Maybe 90% of
| advertising doesn't work, but the remaining 10% does, but
| nobody can tell which. It's a lemon market.
| robocat wrote:
| > the two are diametrically opposed
|
| Your (1) is effective advertising that works, and your
| (2) is ineffective advertising that is a waste of money.
|
| It is perfectly OK to know that both exist, and to argue
| against both.
| xabotage wrote:
| I find myself generally unaffected by advertising and
| would normally fall into the "waste of money" camp, until
| I started hanging out more with non-engineering types.
| Seeing them made me realize A) advertising does work, at
| least for a critical mass of people, and B) advertising
| doesn't take away their ability to judge a product, no
| matter how well targeted it is. I've even found they have
| a superior ability to judge products and services than I
| do at times because they intuitively jive with the
| marketing in a way that my engineering brain doesn't
| (they can piece together subjective qualities about a
| product/service being marketed to them, and I just think
| "show me the specs and price." Both approaches have
| benefits and downsides).
| timClicks wrote:
| What's interesting in that statement to me is that you
| don't consider the spec sheet to be advertising.
| Therefore, you feel that you're "unaffected" by it.
| codexon wrote:
| Sometimes it isn't as nefarious as convincing people to
| buy a product they wouldn't normally buy, and simply just
| showing the right people that your product exists.
| roywiggins wrote:
| I bought precisely one item from a Facebook ad, because
| it was the exact kind of item I had been looking for and
| failed to find. I was really pleased.
|
| But it happened _one time_. Now I get ads for chicken
| feet sellers on Alibaba.
| ethbro wrote:
| Maybe it's an unchecked, all-powerful evil that hoards
| people's data, ineffective at making people buy or
| believe in things they don't want or need?
| jonny_eh wrote:
| > I've seen the same person argue
|
| Really? You remember who says what on HN?
| nostrademons wrote:
| Comment histories are public. It's not hard to look at
| their /threads page and see what they were saying a day
| ago.
| searchableguy wrote:
| Not sure if this is correct but my hypothesis is that the
| difference between those threads is that in
|
| A. They are thinking of what they consider an average
| user (most likely stupid, blissfully unaware of tracking
| and how companies are controlling him) whilst using ad
| blockers themselves or relative strong measures to avoid
| tracking.
|
| B. They are thinking of themselves as the customer to
| some extent and knowing that they don't ever click on ads
| as often, it's most likely wasted money.
|
| Again, I am not completely sure but it feels like the
| person is thinking of different subject in A and B when
| analysing.
|
| C. It could be that the plan is to make Google look evil
| in both cases. By robbing both you and companies out of
| their money and data.
| pascalxus wrote:
| There was an article written up about ebay and how they
| paid 20 million$ per year for that first google slot for
| certain keywords.
|
| Then some consultant came to Ebay and proved, without a
| doubt that the ads don't work. So, they created a test:
| they removed the 20 million $ worth of ads for that top
| slot and watched the traffic afterwards, it was pretty much
| unchanged! It's because All those people that clicked on
| those ads, were going to come to ebay anyways, despite the
| ads, not because of the ads.
| friedman23 wrote:
| > OR ads aren't that effective in the first place
|
| Is this what you want to believe or do you have data to
| back it up?
| TA129875 wrote:
| Advertisers aren't idiots, they measure the effectiveness
| of their ad dollars. If they couldn't show a positive ROI
| they wouldn't keep spending money on it.
| tonyedgecombe wrote:
| I'm fairly confident many advertisers don't have a clue
| about the effectiveness of their ad spend. This isn't
| helped by all the dark patterns in the Adwords control
| panel, every new option they introduce is defaulted in
| their favour.
| thehappypm wrote:
| Does this sound like a real scenario?
|
| CMO: We spent $100,000 on AdWords.
|
| CEO: What was the ROI?
|
| CMO: No clue.
| sidlls wrote:
| Of course not, but that doesn't mean the "analysis" used
| to derive the numbers the CMO presents justifies the
| claims.
| karatestomp wrote:
| Considering how terrible almost everyone seems to be at
| measuring things generally, or at setting up the
| conditions for meaningful measurement, or getting buy-in
| for more effective measurements because they come at some
| cost and "what Jim's been doing seems fine" (it
| absolutely _is not_ ) I'm skeptical that advertising
| folks are somehow much better at this than everyone else,
| and if they're not _a lot_ better then they're still
| fairly bad.
| ipsum2 wrote:
| Google is a hundred-billion dollar company precisely
| because it allows advertisers to see how effective their
| cost per sale (or action) is, compared to TV or newspapers,
| where advertisers are flying blind.
| hardtke wrote:
| Measuring the effectiveness of brand advertising on
| YouTube is more difficult that measuring TV/newspapers.
| TV and newspapers have higher repetition at an individual
| consumer level so the "which newspapers do you read?" or
| "which programs do you watch?" survey questions work.
| Additionally TV and newspapers have older audiences who
| are both more tolerant to ads and susceptible to brand
| advertising. YouTube is not particularly effective for
| CPA advertising so the technologies from other Google ad
| products are not that relevant.
| thebean11 wrote:
| Why would you need a survey question to track YouTube
| habits? Google already has that data, why wouldn't they
| just correlate that to a future purchase you make?
| ethbro wrote:
| Because reconciliation across sessions and platforms is
| non-trivial. Especially with browsers become increasingly
| adversarial (aka pro-privacy).
|
| https://www.quora.com/How-can-I-reconcile-Facebook-
| advertisi...
| hardtke wrote:
| Statistically reliable purchases studies are very
| challenging. People have multiple credit cards and
| sometimes pay cash. If you are buying a car you don't put
| it on the credit card. Additionally, you have multiple
| cookies/MAIDS that may or may not be associate with the
| same person/credit card. Even companies with Google or
| Facebook resources can't get this to work reliably. If it
| is a direct response advertiser, of course, you tell
| Google/Facebook that a purchase is made, but these
| advertisers are not the bulk of the market and many
| advertisers don't want to give Google that data.
| thehappypm wrote:
| This is actually untrue. Have you ever seen a survey in a
| YouTube ad, asking a question like "have you ever heard
| of Brand Z?" That's one of several mechanisms for
| measuring brand awareness lift, seeing the lift in recall
| over a control group.
|
| Likewise, many advertisers aren't doing brand campaigns,
| they're doing direct response, that is, trying to get
| people to directly click to their site and convert.
|
| Finally, advertisers on video sites tend to pay per
| "completed view" for some definition of completed view,
| usually at least a significant chunk of the video and not
| just the first few seconds before the skip button
| appears.
| xiphias2 wrote:
| Advertising is effective as long as you have lots of VC
| money to compete with other competitors by overspending.
| It's far less effective if the company has to be
| profitable.
|
| The future of ad revenue will depend on when the VC bubble
| will pop. As long as the interest rates stay 0%, it's not
| over yet.
| freepor wrote:
| I had a whole company that I sold to an FAANG that only
| existed because of Google Ads. It solved a very niche
| technical problem that you could never go and market on a
| billboard -- the target customer was too niche. But with
| Google Ads I could find them Googling "How to do X to file
| type Y" and sell them my software right at that moment.
| codexon wrote:
| Ads really work. I have a hard time believing there's any
| company that put effort into having decent ads and found
| that they did nothing.
|
| The only question is if they are fairly priced. It could be
| argued that they were overpriced due to over-funded
| companies overbidding on them trying to growth hack and bot
| traffic being mixed in.
| edmundsauto wrote:
| Possibly true, although the ad industry has survived a
| number of significant transitions
| (print/radio/tv/digital/placement), plus 2 primary
| incarnations (direct & branding). Over the same time, the
| industry has gotten much more sophistication in measuring
| return on ad spend. All while growing by leaps and bounds.
|
| I certainly conceded it's possible that your statement is
| true. I'm skeptical of most marketers claims. However, I
| have to acknowledge the scope of the deception if indeed it
| is a house of cards.
|
| That's a lot of smart people wasting a lot of money in a
| lot of different ways over a century of the biggest growth
| phase experienced by civilization.
| naravara wrote:
| >Over the same time, the industry has gotten much more
| sophistication in measuring return on ad spend. All while
| growing by leaps and bounds.
|
| The trick is, the ad industry people are the ones who
| design all the KPIs that determine the efficacy of ad
| campaigns. So there's a bit of a self-serving incentive
| there that could be degrading the quality of the
| information.
|
| There is clearly some evidence that ad spending does
| help, particularly with building brand awareness and
| goosing demand. I think the jury is still out on how much
| and to what extent specific user tracking/targeting
| strategies work though.
| [deleted]
| oarabbus_ wrote:
| Ads aren't effective in the first place? How do you justify
| such a statement?
| Spivak wrote:
| I know, it's bonkers that people hold this position when
| so many startups live and die by their customer
| acquisition rents.
|
| Do you think startups like Casper and Blue Apron want to
| hundreds of dollars just to get a single person in the
| door to buy something and pray they stay for at least 6
| months / don't return the thing just so they can hit
| their break-even point? Like if this was all a house of
| cards it would have collapsed by now since there are
| millions of eyes trying desperately to reduce the need
| for their ad spend.
|
| So yeah, that quirky overproduced Doritos TV ad probably
| isn't doing all that much but for businesses that don't
| already have a critical mass of mindshare it's your
| lifeline.
| thehappypm wrote:
| It's definitely important for Doritos. Walk into a
| convenience store and you'll see a bazillion brands of
| chips, most of which are healthier or tastier than
| Doritos. Yet time and time again people go for the old
| faithful brands. You stop doing brand advertising, that
| dries up.
| AmericanChopper wrote:
| This is only true for established brands, selling products
| that don't change, in saturated markets. Even then it's only
| partially true, because the markets themselves are always
| changing (chances are at least somebody in the world drank a
| coke for the very first time today). It also doesn't account
| for the fact that even if all those factors are truely static
| (or close enough), that product differentiation strategies
| can still be used successfully (which is again something you
| see coke doing a lot). That paradigm really only applies to a
| very specific type of advertising, under very specific market
| conditions, and doesn't apply to the majority of the worlds
| advertisers.
| bpodgursky wrote:
| The most obvious case of the Dunning-Kruger effect is when
| random HN commenters think that nobody in marketing is capable
| of using data-driven metrics. I don't think you appreciate how
| numerical modern marketing is -- marketers use conversion
| rates, A/B tests, attribution, and a lot of other techniques to
| actually calculate the ROI of advertising.
|
| What you're describing may have been the case, in a number of
| companies, five years ago, but it's just not meaningful now-
| days. Companies spend marketing dollars because marketing
| dollars work.
|
| Any other interpretation is ideology-driven wishful thinking.
| You might not like marketing, but it's silly for the conclusion
| to be "thus, the entire field is made of people who don't know
| what they are doing".
| huac wrote:
| ah but how do you really know if any of those numbers are
| causal? marketers need to account for multi-touch
| attribution, if a customer sees an ad on one platform and
| converts on another, or if they do it ten minutes outside of
| your conversion window.
|
| there certainly are a lot of numbers in adtech and marketing.
| whether or not those actually relate to causal impact, across
| the industry, is not definitively answered. very few players
| (on the supply and demand side) have the scale and ability to
| properly do incrementality testing.
|
| personally, i think people don't want to know the real
| results. if the numbers say it's not broken, why risk your
| job?
| summerlight wrote:
| > very few players (on the supply and demand side) have the
| scale and ability to properly do incrementality testing.
|
| https://support.google.com/google-ads/answer/6394265
|
| Actually Google is preparing it as a product, so I would
| guess the result was generally positive? FB also has a
| similar product as well.
| huac wrote:
| google and facebook are not "most players" -- they own
| walled gardens for measurement, it's much harder to do
| measurement on open web auction placements.
|
| the google page you linked also says, "you won't be able
| to continue using this model if your data drops below
| 10,000 clicks on Google Search or below 400 conversions
| for the conversion action within 30 days." depends on
| what your market/CTA is, but a lot of SMB likely don't
| hit these thresholds. similarly with FB, my understanding
| is that you have to go through an account rep to set it
| up and that the minimum spend is fairly high to qualify.
|
| i think that these measurements are possible to do with a
| reasonable level of certainty, but they require a
| particular set of circumstances to pull off.
| bluGill wrote:
| Those are real concerns that I have no insight on if they
| are accounted for. I know that they can be accounted for
| and have been. TV and newspaper ads have been doing it for
| years where for obvious reasons they can't track where or
| when you saw the ad. McDonald's runs ads on those platforms
| anyway.
| huac wrote:
| yeah you can try, for print/OTT the most common way to
| estimate lift is with DMA segmentation, compare lift in
| the DMA's which saw the ad versus the DMA's which didn't.
| but how do you pick the right DMA's to pair, etc. it's
| hard and i think most people don't do it right; again, it
| requires very large n to do correctly, which requires
| very large budgets.
|
| mcdonalds is actually one of the savvier players here,
| they know that it's hard to quantify brand advertising if
| you only go off in-store purchases, so they spent very
| heavily to promote their app and develop a consumer-brand
| relationship there. now, if you see a mcdonalds ad on
| youtube, they can (try to) match your youtube ad
| impression to a purchase done through the app / credit
| card / other PII.
| jeltz wrote:
| So what is your experience in the business? I do not have any
| personal experience but I know plenty of people who work or
| have worked in adtech (e.g. ad words optimization
| consultants, ad agencies, affiliates who buy adwords) and
| from their stories I would say you overestimate the ad
| industry.
|
| I also know of several (3 that I can think of on top of my
| head) companies who went bankrupt from buying inefficient
| ads.
| josefresco wrote:
| "I don't think you appreciate how numerical modern marketing
| is"
|
| Maybe for the Fortune 500 / tech startup crowd, but I work
| for small / medium businesses and there is still a ton of ad
| dollars being spent with no attribution / tracking.
|
| I will routinely setup clients with tracking tools, which
| then discourages them as they finally see what their digital
| ads _actually generate_ in terms of revenue. Many stop their
| digital campaigns and increase their traditional tv
| /radio/print budgets or, fall back to running digital
| campaigns with no tracking.
|
| AKA "Brand Awareness".
| epiphanitus wrote:
| What is your perspective on the ROI of FB/google/targeted
| ads vs the traditional mediums? Is the targeting worth the
| premium?
| rock_hard wrote:
| Targeting is def worth the premium for the right
| categories
|
| Not for things like cars and toothpaste but for things
| like online services/games, fashion, homeware, etc
| eyegor wrote:
| When I last worked in a consumer tech startup, our best
| ROI by far was paying tech youtubers or doing targeted
| ads to tech categories on youtube. Being in a startup I
| was vaguely aware of marketing efforts but I was never
| involved directly, so I can't say why or how that was
| discovered. All I know is my coworkers dealing with
| marketing said the roi and conversion rates specifically
| for youtube far outstripped traditional targeted tech ads
| through google or facebook. Of course this may have been
| because we weren't great at advertising, so your mileage
| may vary.
| josefresco wrote:
| The power and effectiveness of digital targeting is often
| overblown for small businesses.
|
| Many of my small business owner clients hear anecdotes
| where a business was able to use targeting to create a
| veritable "money machine". The problem is these scnerios
| are fleetingly rare, complete bullshit or only apply to a
| specific niche.
|
| The anecdote often glazes over the thousands of wasted
| dollars spent trying to perfect the model and a hundred
| other details that factored into the success.
|
| The good thing for most is that digital advertising is no
| _less effective_ than traditional advertising. Even if
| there 's little to no targeting, or no tracking in place
| it's not any worse than tv/radio/print.
|
| I can count on one hand the number of clients in my 20
| years of web work that have created a model where they
| dump money in the top, and are able to extract more out
| the bottom. In all cases it didn't last more than a
| couple years at most.
|
| For any small business considering hiring an ad agency
| that claims to have mastered this model ask yourself
| this: Why aren't they doing it themselves?
| mywittyname wrote:
| Small companies probably see the biggest bang for the
| buck on SEO and maybe blog posts. I feel like most small
| companies have niche offerings, since most things that
| can be big, are big by now. When people/business have
| issues with their sewage system, they go searching online
| for someone to help. So the difference in ranking between
| Walters Waste Water Warriors and Steve's Sewage System
| Saviors comes down who has the nicest, most informative
| site.
| wpietri wrote:
| I'm deeply suspicious that an entire profession has changed
| the way they behave in just 5 years. Moreover, I think you're
| ignoring a few things. | One is that companies can only spend
| money on marketing they have cash to invest. In a sudden
| downturn, cash may become scarce. Another other is that in
| extreme circumstances, panic is a common reaction. Even if
| the marketing director is perfectly rational, getting an ad
| budget may not happen if the CEO and the CFO are waking up in
| the middle of the night trying hard to figure how to keep the
| company from bankruptcy.
|
| And a third, and possibly the biggest, is that it may be
| perfectly rational to pull ads now. There are whole classes
| of things that people can't really consume right now. All
| travel. All entertainment. For many, anything they have to
| leave the house to get, including big-ticket items like cars.
| And consumer psychology in a recession drives people to
| minimize discretionary purchasing, stick with familiar
| brands, and be more skeptical of anything new or unfamiliar.
|
| It's also important to realize that advertising is an arms
| race. A lot of advertising spending is only required because
| other people are also spending. E.g., everybody in the world
| already knows what Coca Cola is; they advertise not to
| inform, but to maintain dominance. So it's perfectly
| plausible that a lot of places will cut spending and see
| nothing change because their competitors cut spending too.
| pyentropy wrote:
| Marketing dollars work, and bidding for ad placement is
| competitive. The field is made of clever people that optimize
| it. However I think it's dangerous to believe that
| advertising is "numerical" or metrics can fully predict ROI
| of advertising - the same way subprime mortgages weren't
| numerical, and the same way a population mortality graph
| cannot predict coronavirus.
|
| A sudden drop in revenue may adjust the economy of bidding
| and show a potential bubble. The tiny budgets and one click
| campaigns (with platforms inventing unique metrics &
| targeting woo) in social media marketing compared to
| traditional marketing (huge barrier to entry) feel like penny
| stocks vs traditional stocks. You can easily mislead
| individuals and tiny businesses.
| mrlatinos wrote:
| Just left a data engineering job in adtech. Speaking from
| personal experience, marketers make terrible ROI analysts
| because they always want to spend the same or more. Agencies
| are especially bad.
|
| Most incremental lift studies I've seen are valid, looking at
| CTR and A/B testing as you mentioned. But as soon as you
| start looking at revenue and brand lift, all studies seem to
| come to the same conclusion - the higher the spend, the
| better.
|
| Don't get me started on multi-channel attribution... garbage.
|
| Marketing is still very much spray and pray with diminishing
| returns. And in most cases, marketers will claim otherwise.
|
| I got tired of drinking the koolaid. Modern marketing is just
| as fraudulent as ever. Agencies are just getting better at
| lying.
| lotyrin wrote:
| I've fought to bring all those things to any marketing effort
| I've been involved with and have all but literally laughed
| out of the room. From my vantage point at least, the average
| marketing effort is "We spent all our budget, good job us."
| manigandham wrote:
| You're both right. Marketing dollars work, but there's also a
| lot of wasted spend.
|
| Many big campaigns are just brand awareness, or are poorly
| implemented with lots of supply-chain and measurement
| overhead competing for the cheapest impressions. Video
| content is increasing and leading to an oversupply of
| inventory. There's competition from connected TV and
| streaming services. Privacy regulations are affecting
| targeting and measurement.
|
| A lot of budgets are also just paused in response to consumer
| demand, with uncertainty around the economy and shifting
| strategies to conserve cash and move to more efficient ads.
| tomrod wrote:
| I worked in the space, tested in the space, and can say
| returns for non-strategic models for brand aware entities is
| not meaningful.
| coldtea wrote:
| > _What you 're describing may have been the case, in a
| number of companies, five years ago, but it's just not
| meaningful now-days. Companies spend marketing dollars
| because marketing dollars work._
|
| Companies do tons of things that don't make financial sense.
| And metrics can paint 100 pictures, including the picture the
| advertiser wants to paint. Not to mention it's in the best
| interest of the marketing department of a company and the
| advertising liaison within the company to continue spending
| money in advertising whether it works or not, if they want to
| have a job...
| exolymph wrote:
| You're both right, _and_ wrong, because people, firms, and
| their respective behaviors vary a ton. Some marketing teams
| are great at measuring the effect of their ad spend. Some are
| not. It depends on the specific circumstances and the
| specific humans involved.
|
| I'd be interested in an argument over whether more marketers
| are competent versus not, but any argument that presupposes
| uniformity among marketers is just silly.
| deanmoriarty wrote:
| You might be underestimating the number of companies who
| absolutely don't know what they are doing budget-wise yet
| they manage to stay in business, and threw a lot of dollars
| in ads/marketing without deeply analyzing its effectiveness,
| just because raising money at stellar valuations was free
| until a month ago.
|
| Anecdotally, I happen to work for a 300 people saas company
| who just started drastically cutting expenses with the goal
| of reducing burn rate and delaying the need for another round
| of financing in this terrible environment: ads were one of
| the first few things to be dramatically cut (the second one
| was some super inefficient AWS spending).
|
| The ads budget shrank from 6 figures a year to near 0
| overnight, and it's unlikely to return to its former level
| any time soon. Also, half of the marketing team was laid off.
| Having 30 people in marketing for such a small company was
| definitely way too much (just like engineering, sales, ...),
| and it anecdotally proves GP's argument. All consequences of
| the fact that money was free.
| mywittyname wrote:
| A young, growing company is going to throw whatever at the
| wall and see what sticks. That's just how to learn what
| works and what doesn't.
|
| I wouldn't extrapolate that experience to large companies
| that have weathered dozens of downturns. I'm not saying
| that large companies all have a clue what they are doing
| vis-a-vis marketing, but there are a few giants who
| understand their only asset is their brand. Think companies
| like P&G or Nestle. Largely, the biggests differentiating
| factor between toothpastes or frozen pizzas is brand
| awareness and distribution deals. These are the companies
| that know exactly how much more money they will make if
| they change the color red to yellow on a box for a product
| sold in Georgia.
| joshuamorton wrote:
| No it doesn't prove the claim that the marketing tram and
| budget won't regrow after the economy improves, nor the
| claim that marketing and advertising was being done wrong
| or unnecessary.
|
| All we have to go on for that is your opinion about how the
| company was being run, which isn't backed by any sort of
| data.
| deanmoriarty wrote:
| It is my opinion, but an informed one.
|
| A couple executives just plainly admitted how crazy
| inefficient our spending was, so I just can't imagine how
| they could possibly go back to blow nearly a million a
| year in ads any time soon, or ever, when 90% of our
| revenues come from traditional enterprise deals that
| don't have anything to do with ads, for the most part.
| They are all just worried that they will have to accept a
| down round in a year, and are trying to mitigate that.
|
| By the way, this is true for engineering as well, where I
| work: now that we figured out how to remain productive
| while cutting 40% of our AWS costs (spot instances,
| killing idle instances more often, ...), will we ever go
| back to be inefficient and leaving idle AWS clusters up
| at night just because "money is not an issue"? Very
| unlikely. And the marketing department wasn't being run
| any more efficiently than engineering, budgets were just
| fat because money was free for nearly a decade.
| CPLX wrote:
| I've worked in the field and have been closely involved in
| online advertising spending and you're way overstating this.
| Confusion, misdirection, dodgy attribution, questionable ROI
| calculations and outright fraud are rampant.
|
| Furthermore I'd say most people with deep knowledge of the
| field (assuming they don't have a vested interest in arguing
| otherwise) would agree in a heartbeat.
| petercooper wrote:
| _Furthermore I 'd say most people with deep knowledge of
| the field (assuming they don't have a vested interest in
| arguing otherwise) would agree in a heartbeat._
|
| I don't know if this rhetorical device has a name, but
| basically saying "and other smart people would agree with
| me unless they had a sneaky reason not to" doesn't seem
| like supportive evidence of your point.. _(... and I
| suspect most people would agree in a heartbeat.. sorry!
| ;-))_
| ZhuanXia wrote:
| I have seen a lot of shoddy statistics used by ad people to
| justify the necessity of ad people. I would trust a random
| engineer over the ad team for this task purely as a matter of
| incentives.
| 3xblah wrote:
| There are countries, this may or may not include the USA,
| please forgive my ignorance, where only sellers of "essential"
| goods/services and their suppliers have been allowed to
| operate.
|
| During this time what is the motivation for companies to spend
| on internet advertising for "non-essential" goods/services.
|
| The longer consumers are given to _adapt_ to a lifestyle of
| purchasing only "essential" goods/services, spending more time
| with family, cooking for themselves, staying local, enjoying
| simpler, less expensive pleasures and leaving a lighter
| environmental footprint, how susceptible will they be, in the
| long-term, to internet advertising that aims to motivate them
| to purchase non-essential goods/services.
|
| Perhaps it is only temporary, but lockdowns are providing a
| paradigm shift away from internet advertising and toward
| increased non-commercial use of the internet.
|
| Those who advocate web advertising as necessary in order to
| support a functioning internet may have to change their
| arguments in the event that the internet does not become
| "useless" as advertising spend decreases.
| ping_pong wrote:
| If Google ad revenues are down 50%, how can Google be at
| $1200/share? Doesn't that make this a good short candidate?
| Nothing else Google has is profitable except for the ad business.
| The same goes for Facebook as well.
| pheug wrote:
| They already dropped by 20% from peak. Are you saying they
| should drop by all 50%? That doesn't make sense. Market is
| forward looking. Assuming a fast recovery, a couple bad
| quarters would even hardly matter in the long term. You can
| model that mathematically using tools like DCF valuation.
|
| Another thing, Google has an exceptionally strong balance sheet
| and can weather this recession for many years if need be.
| They're not going bankrupt any time soon. You don't go and just
| short such companies when there's still plenty of leveraged
| junk out there.
| crazygringo wrote:
| Because share prices are based on what people think Google will
| bring in over the next say 20 years, not the next 6 months.
|
| Everybody expects ad revenue to rebound fairly quickly once
| this is over. You don't expect COVID-19 to be cutting Google's
| revenue in half over the next 20 years, do you?
| kumarm wrote:
| As someone who runs Google Ads and also use Adsense, I am sure
| there is drop in revenue but 50% is completely off. I would
| think its probably in teens.
| CivBase wrote:
| I am baffled as to why YouTube is still primarily monetized by
| ads. Ad revenue is unreliable and inherently restricts the kind
| of content YouTube can even monetize.
|
| The model used by Twitch seems far more reliable. I thought they
| were going that way with YouTube Red, but that ended up being a
| huge disappointment. After about a year I switched to just
| donating to my subs on external platforms.
|
| Just let me make small, monthly donations to the creators I like.
| In exchange, spare me the ads. YouTube can even take 50% of the
| cut or whatever. It's more stable that way for both YouTube and
| its creators.
| zamadatix wrote:
| I'm not sure what Twitch does with live streaming works with
| static videos. Could you imagine a sub train and cheers on a
| Twitch VOD providing nearly as much income as it does live?
| YouTube seems to have monetized live streaming in a similar way
| but when it comes to normal videos they have to either compete
| with existing 3rd party services like Patreon (which is already
| down to something around 10% not 50% and covers more than just
| videos) or come up with perks for subscribing you can't get
| anywhere else (which is hard to do with recorded video with a
| bad comments section attached).
| protonfish wrote:
| This is already how it works for a lot of channels except the
| funding comes through Patreon. This is strong evidence that
| viewer sponsorship works yet YouTube is just missing out on
| their cut.
| UweSchmidt wrote:
| Note that there may be fewer ads on Twitch, but there is still
| a machinery working on you to make you select various levels of
| subscriptions or buy vanity/chat mechanics. It all hinges on
| streamers creating "1 to n" relationships, and such a dynamic
| changes the content.
|
| If only it was possible to pay for the true hosting and
| bandwidth cost, with discovery/search mechanisms either open
| source or on a separate service (decentralized and smaller in
| scope), and again a separate platform to support individual
| creators.
|
| Not disagreeing with you, just pointing out that the Twitch
| model might still suck on some level.
| Obi_Juan_Kenobi wrote:
| Unfortunately, this isn't how Twitch operates, either.
|
| Twitch is primarily an ad platform. That's where they make most
| of their money, and why they're making changes to increase ad
| impressions. Subscriptions used to give you site-wide ad-free.
| Now it's only for that channel.
|
| See Devin Nash streams for insight into the business of Twitch.
| It's not public info, so it's a lot of reading between the
| lines and anonymous first-hand accounts, but I imagine it's
| accurate.
|
| The direct-pay model is vastly preferable because it keeps
| advertisers from controlling content, and Twitch certainly has
| shown greater success here than I've seen before. But it's not
| happening on Twitch. At least not like it should.
| kawfey wrote:
| I think this is because that idea isn't sustainable for the
| majority of youtube content, which isn't produced by
| professional YouTubers. Most video is hardly even edited. In
| the current system, all video can be monetized whether or not
| it's a music video, well-produced documentary, a sponsored gear
| review, some video of someone's baby crawling around, an
| explanation of taylor series, or a 24/7 webcam livestream of
| someone's backyard.
|
| In a viewer-contributed system, only creators that have a good
| audience worth paying into would receive donations, but those
| lesser known videos would essentially have to be subsidized by
| those donations since those videos wouldn't bring donations in
| themselves. YouTube's cut, 50% as you suggest, would probably
| be better spent making the platform better for those creators
| than hosting videos that brings in no donations.
|
| Also only a very very small subset of the audience will donate.
| Platforms that have been predicated on donating or subscribing
| to receive content are struggling to lift off (besides Patreon,
| which is effectively a marketplace for content, merchandise,
| behind the scenes stuff, etc rather than just a video hosting
| platform).
| FooHentai wrote:
| That situation seems to be the case already - Professional
| YouTubers are the ones pulling in big view counts and so
| receiving the lion's share of the revenue. Yet there are
| millions of tiny contributors doing it for non-monetary
| reasons.
|
| This situation is also true on Twitch. For every big streamer
| pulling >1k viewers per stream, there's thousands of small
| streamers with <10.
|
| Youtube has already made a token effort to mimicing this with
| the 'join' button, but right now that more patron-centric
| revenue model looks to be a short- and medium-term winning
| formula. Youtube would likely benefit from pursuing it.
| henryfjordan wrote:
| Most of the views land on professional channels. You
| basically have to be at least semi-pro to reach the numbers
| you need for "monetization" by Youtube anyway.
|
| There are 2 Youtubes, one for embedded viral clips you
| discover around the web and one for professional content that
| viewers subscribe to.
|
| I think Youtube has issues shoe-horning both systems into one
| monetization scheme. I think this is mostly a problem of
| inertia but either they need to make things more stable for
| their professional creators or someone else needs to build a
| better platform for these pros.
| Jagat wrote:
| Just 'donating to creators' works in cultures where asking for
| donations and giving donations is alright. There are cultures
| (most developing nations in Asia) where openly asking for
| donations is frowned upon, and donating to non-charitable
| organizations isn't considered normal either because most
| people don't have the disposable income to just give away.
|
| Buying things for daily needs, and advertising for them is
| still normal.
|
| Unless you're willing to turn Youtube into a 'Developed western
| countries only thing'(which already exists - it's called
| Youtube premium), advertising is a better option.
| eyegor wrote:
| I think Google/YouTube made a huge strategic mistake by not
| introducing a serious competitor to patreon. Pretty much all
| youtubers these days make a significant chunk of their income
| through patreon, and its main features wouldn't have been that
| difficult to integrate into yt. They started to do a small
| rollout with yt red with "red only" and subscription options
| ("join"), but it's far from widespread and they did it after
| patreon had captured a sizeable chunk of its userbase.
| Obi_Juan_Kenobi wrote:
| Youtube has about three orders of magnitude greater revenue
| than Patreon. Do you think Patreon could grow 1000 times by
| scaling to the size of Youtube?
|
| I love the direct-support model as a consumer/viewer, but I
| have significant doubts that it competes with ad dollars
| nearly as well as people would like it to.
| paxys wrote:
| YouTube already has that as a feature. A ton of channels have
| big "Subscribe" buttons on all their videos. The number of
| people actually paying though is, I imagine, negligible.
| judge2020 wrote:
| JSYK It's a "join" button, separate from subscribing.
| jrobn wrote:
| YouTubers already don't make a lot of money off Adsense. The
| shift is already happening with companies working with individual
| youtubers. An integrated ad from someone you like/trust/have a
| relationship with is orders of magnitude more effective than a
| typical YouTube ad.
|
| Expect to YouTube to try and get a piece of this pie as well when
| there is a "integrated" ads apocalypse when YouTube changes its
| terms of service.
|
| It's expensive to store, process, and deliver all this video.
|
| YouTube has been making money off advertisement to kids for
| years. Now that is being regulated.
| adequateness wrote:
| It makes sense. I imagine a lot of companies are reducing ad
| spend right now which means the bids on ad spots will be lower.
| If there is more content being made on YouTube right now then
| that increases the supply of videos that ads can be placed on.
| joobus wrote:
| Wow, it's almost like you read the article. Almost.
| adequateness wrote:
| Almost, because the page failed to load with cookies blocked.
| If it is so obvious, why did the article need to be written
| in the first place?
| bobbean wrote:
| That's incredibly pretentious. Not everyone has the
| knowledge you do. It's almost like it's written for an
| average person.
| dang wrote:
| Whoa, please don't be a jerk in HN comments, even when
| someone might not have read an article.
|
| If you wouldn't mind reviewing
| https://news.ycombinator.com/newsguidelines.html and sticking
| to the rules when posting here, we'd be grateful.
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