[HN Gopher] What If Performance Advertising Is Just an Analytics...
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What If Performance Advertising Is Just an Analytics Scam?
Author : nsmog767
Score : 278 points
Date : 2021-10-13 16:03 UTC (6 hours ago)
(HTM) web link (sparktoro.com)
(TXT) w3m dump (sparktoro.com)
| myth2018 wrote:
| During pandemics, I got really suspicious about adwords.
|
| My ads were working reasonabilly well considering the low
| investment I was making, with a fair amount of prospects filling
| my contact form on a low but steady rate. I was satisfied with
| the return I was getting.
|
| However, the pandemic caused a significant drop on my product's
| demand. I thought I was going to get little to no contacts from
| the moment the lockdown was announced on, but:
|
| 1) I kept getting clicks at basically the same rate -- therefore
| my budget kept being depleted as it used to be;
|
| 2) Bounce rates increased A LOT;
|
| 3) The few actual people who got in touch were not actually
| looking for the product I announced, but similar ones (which I
| didn't announce nor sell);
|
| So, according to my experience, I can't say adwords totally
| doesn't work.. but I'd say their algorithms are optimized to
| spend your money regardless of the results you're going to
| obtain.
| rapht wrote:
| The article does have a point about attributed sales vs
| incremental sales - as a CFO (whether I qualify as the "hard-
| nosed" type in the article, I don't know), I'm bugged every time
| a marketing guy starts talking about how this campaign has
| been/will be "ROI-positive", and have had a few heated
| discussions on why this is mostly not demonstrable until you're
| willing to pull the plug (which you can do with more or less
| intelligence in order to minimize your risks).
|
| On the other hand, while I do indeed believe that the "ROI" from
| Performance Advertising is something between just false and
| deliberately misleading, the bigger picture that I'm interested
| in is marketshare. Because when looking at market share, it's not
| a question of incrementality anymore, but whether you're growing
| slower/faster than your competitors, and your cost of doing that,
| and at what point you're OK to 'buy' marketshare, in the sense of
| losing money in the pursuit of growth, and how much. And then,
| OK, let's talk about ROI on that basis - most of the time,
| achieving this will indeed require tools from the Performance
| Adversiting toolbox, which allow you to conveniently track the
| amount of marketshare (i.e. sales) you bought.
| simonsarris wrote:
| > Technically, when someone does a Google search for "Williams
| Sonoma Cast Iron Skillet," they probably would have clicked on
| one of the first 10 organic results, EVERY ONE OF WHICH leads to
| their website. But, y'know what ol' Billy Ma's performance
| marketers couldn't then do: prove their value to their bosses.
|
| > [picture of that search term and williams sonoma ads with
| shopping links]
|
| The main problem here is that if Williams Sonoma was _not_
| advertising on that search term, Lodge and Food52 etc etc would,
| and then those companies would be above the Williams Sonoma
| organic placements.
|
| The spend is necessary in a defensive way because Google creates
| a bidding war even for the hyper relevant.
|
| edit: I just checked and if you search "williams sonoma skillet",
| if WS was not paying for [green] then the very first "result"
| (ad) would be Food52 [red] https://imgur.com/a/9Nnxs6h
|
| I just tried "airbnb paris" and the first result is, somewhat
| predictably, an ad that is not airbnb. But the second one is also
| an ad, this time from airbnb. So they clearly didn't keep their
| spend dialed down to zero, and are aware of the need to advertise
| on their own keyword.
| coldtea wrote:
| Wouldn't that be solvable if it was forbidden to place ads
| using as search terms the tradename of another company?
| NikolaNovak wrote:
| As an end-user, the results are insane.
|
| Opening google in incognito mode:
|
| If I search for "Toyota RAV4", the first (ad) result is
| "Hyundai Tuscon". If I search for "AWS Cert", my first (ad)
| result is "Microsoft Learn". Et cetera et cetera :|
| whimsicalism wrote:
| What? That's not the case for me in incognito.
| winternett wrote:
| There is absolutely nothing independently governing and
| monitoring whether performance is correct on ads. It's all done
| in private, and you're forced to compete against SEO and many
| other things to succeed on a daily and even minute-to-minute
| basis.
|
| This is the real price of a constant threat to Net Neutrality,
| and allowing one monopolistic company to dominate mobile
| devices, web browsers, search results, and the largest video
| service on the entire Internet.
|
| Their plan to corner and manipulate what everyone's freedom of
| choice and to secure their funnel of permanent revenue is
| considered cute to investors, but no one realizes how bad this
| will get in 5 more years.
|
| Of course the numbers are fudged when you consider how they've
| turned analytics on their once very useful platform into a
| confusing mess, and when they announced that they were going to
| retire the system after it has killed off competition, because
| they can simply gather any analytical report they want
| privately from their web browser.
|
| Public front-end statics are no longer trust worthy because
| they can be manipulated to drive platform revenue and
| engagement. The best and most accurate stats are provided only
| internally, to executive leadership that owns platforms.
|
| Because we now use them for email, video views, browsing,
| phones, etc, they have key insight that can even be used for
| corporate espionage, your ideas can literally be beaten to
| market because your virtual assistant caught you mentioning
| keywords then reported you applying for your patent and
| corporate loan.
|
| Most people have no idea about how bad this all can get. We'll
| find out soon enough though.
|
| When ad revenue drops on platforms, the platforms simply reduce
| organic visibility which drives the need for regular ad
| spending for companies in order to remain visible on social
| platforms... AirBNB is riding a wave of prior popularity and
| name recognition, I guarantee they will go back to a certain
| point of obscurity at some point because they reduced their ad
| spend, and then be forced to promote heavily as they did once
| before.
|
| It's all creates a new cycle of financial deception and
| manipulation on platforms. For very profitable companies,
| advertising is usually manageable, but for startups, for small
| business, and for independent creators, this practice is
| devastating financially, and fruitless on top of the financial
| loss of paying for promotion. These platforms also made
| promises to woo users based on free organic growth, which
| somehow conveniently disappeared due to covert and convenient
| EULA updates over time.
| colinmhayes wrote:
| Freakonomics had an episode with an economist that worked with
| Ebay on ad buys. This sort of "buy ads on your own keywords"
| was shown to have zero impact on sales to the point that they
| cut completely stopped advertising when the search included
| "ebay".
| Lewton wrote:
| I just searched for "ebay" on google and the top result is an
| ad for ebay.com?
| bombcar wrote:
| This will work for someone like eBay (people searching eBay
| want eBay) but for other "brand-name" terms it may NOT work -
| people searching for Travelocity or whoever is the hotness
| there may be perfectly happy with the first "similar enough"
| link.
| colinmhayes wrote:
| There's no way to know until they do an A/B test like eBay
| did I guess. EBay was certain that they needed to do the on
| brand ads before this economist showed up too.
| bombcar wrote:
| A/B for E/Bay. Hmm.
| lazide wrote:
| Even the eBay test can be misleading - if everyone sees
| competitor B anytime they search for eBay, eventually
| they are going to give it a try.
| tomrod wrote:
| This is untrue. A small proportion, but most people
| searching for something specific what that something that
| is specific.
|
| If I search for a Dell computer, no way will I buy Apple.
|
| Likewise if I use Bing to search for Chrome, no way will
| I download edge except for user error.
| colinmhayes wrote:
| They talked about this on the 2 hour long podcast. It was
| actually pretty funny too, I'd recommend it.
| ameister14 wrote:
| Yes, when you're doing general brand terms that's true, but
| when you have a specific product in mind that's no longer the
| case.
| kposehn wrote:
| eBay is a strong brand where people searching for eBay are
| going to click on eBay, almost no matter what. For other less
| recognizable brands or crowded categories, this is often not
| the case.
|
| Branded search terms are almost always less incremental than
| non-branded (ie: "lodge logic" vs. "cast iron skillet"), but
| the actual incrementality of the terms is something every
| advertiser should be testing continuously.
| sam0x17 wrote:
| > The main problem here is that if Williams Sonoma was not
| advertising on that search term, Lodge and Food52 etc etc
| would, and then those companies would be above the Williams
| Sonoma organic placements.
|
| Except they won't click those competitor links, because they
| are already specifically looking for Williams Sonoma
| naravara wrote:
| > The main problem here is that if Williams Sonoma was not
| advertising on that search term, Lodge and Food52 etc etc
| would, and then those companies would be above the Williams
| Sonoma organic placements.
|
| When you put it that way this sounds like racketeering.
| Kalium wrote:
| If you take as a foundational assumption that the brand name
| in the search string means the traffic is in some sense owned
| by the brand, then you're absolutely right. It's essentially
| racketeering. Certainly brands often view traffic that way.
|
| Personally I resist the idea that a brand owns my attention
| because I used a keyword, but that's one of my many personal
| quirks.
| naravara wrote:
| It's a little dicer in the cases where we can pretty much
| infer that they're trying to get to a specific thing and
| would have happily used a direct URL to the page if they
| had the wherewithal to do so. In this case the ad placement
| is basically a brand trying to hijack my attention while
| I'm in the process of seeking a thing out.
|
| I struggle to think of a meat world analogy. It would be
| something like if I dialed my girlfriend up on the phone
| and, instead of routing me straight to her, I had to
| navigate through a switchboard asking me "How about talking
| to these sexy singles in your area instead?" And in order
| to prevent this, my girlfriend would then have to pay the
| company to route my call straight to her.
|
| Of course this isn't a perfect metaphor because there's a
| lot of different ways people use a search bar, especially
| now that search bars are merged into URL bars. But that
| sort of gets at what it is about this that feels sleazy.
| Kalium wrote:
| I think it's an excellent metaphor!
|
| I think it also exposes the core problem. The metaphor
| rests on knowing intent with certainty. It's perhaps
| possible that certain clarity and pretty much inferring
| might not always be the same, especially with how search
| and URL bars have merged.
|
| But I understand completely. If you genuinely feel like
| you _know_ that person 's intent with certainty, someone
| else having a crack at their attention along the way
| feels like a violation of your relationship.
| mdoms wrote:
| > if Williams Sonoma was not advertising on that search term,
| Lodge and Food52 etc etc would, and then those companies would
| be above the Williams Sonoma organic placements
|
| And if they were not above organically they would simply buy
| the advertising space that William Sonoma purchased. It's one
| of the slimiest things Google does - allows competitors to
| purchase advertising space on a query specifically crafted to
| find a particular source. It's nothing more than a shakedown.
|
| https://twitter.com/jasonfried/status/1168986962704982016
| vlovich123 wrote:
| Yeah, I think the only on-brand search ads that should be
| allowed are ones for totally unrelated products OR those ads
| are placed below what on-brand search results would provide.
| Google has no incentive to fix this though because it's an
| extra tax they charge the entire online advertising space (+
| all the other search providers do it). Carefully crafted
| legislation could put an end to this tax.
| pbhjpbhj wrote:
| Well, on a good search engine, IMO, you'd have a predicted
| store based on the manufacturer (eg their preferred seller)
| then perhaps a list of top 10 competitors and something
| like "most recorded purchases after this search are from
| seller X" with "the most popular similar store is seller
| Y".
|
| Of course Google wouldn't give that data out as then many
| companies wouldn't need to advertise at all to get top
| billing.
| vlovich123 wrote:
| That's secondary & the reason Google doesn't have this is
| likely because the sellers don't want to provide this.
| E.g. Amazon doesn't want potential customers being easily
| redirected to Walmart purchases. One of the many reasons
| Froogle died.
|
| The simple solution is that your paid advertisements are
| free if it gets clicked when you're the top result
| anyway. That way it doesn't cost the brand any money to
| bid on advertisements for their own brand.
| AlexandrB wrote:
| > Yeah, I think the only on-brand search ads that should be
| allowed are ones for totally unrelated products...
|
| The problem is that this is subjective and would need to be
| automated somehow. I think Google's original sin here is
| making the ads look so much like organic search results.
| Someone placing an ad against a competitors brand name
| would not be a huge issue if organic results were still
| front and centre like in the "good old days" of early 2000s
| Google.
| vlovich123 wrote:
| This is actually trivially automatable. First of all,
| brand keywords are something Google supports explicitly
| for this kind of targetting so they know from that
| direction.
|
| More generally though, if you paid for an advertisement
| and the natural search result has you first anyway, then
| you should not be charged for any clicks to this
| advertisement.
| mdoms wrote:
| > and would need to be automated somehow
|
| Or Google, one of the wealthiest companies on the face of
| the planet, could hire some staff to handle this.
| thegrimmest wrote:
| Why is that a shakedown? Shouldn't competitors be able to
| advertise their products? Any users who are actually looking
| for Williams Sonoma will find it. Any who are open to having
| their minds changed, or are interested in competing products,
| will be interested in competitors ads.
| bliteben wrote:
| should your competitors be able to buy 100% of the screen
| space on mobile with images where your organic result has
| none? 50% sure maybe but literally google doesn't even put
| the organic results above the fold on mobile. Often on
| google on mobile the organic results are 2 screens down.
| partiallypro wrote:
| Branded keywords are not always allowed, and restrictions
| on those ads are pretty strict.
| mbesto wrote:
| > The main problem here is that if Williams Sonoma was not
| advertising on that search term, Lodge and Food52 etc etc
| would, and then those companies would be above the Williams
| Sonoma organic placements.
|
| This is what is known as "on brand" Search ads. I like to call
| these effectively the "Google Tax" because publishers/retailers
| are forced to pay Google for the traffic they would have
| already received had the ad not been there.
|
| I've seen way too many companies look at their analytics and
| say "see we get 20x ROAS on on brand! why would we turn it
| off?!?". Because silly, people are already going to go to your
| site _without_ you paying for the traffic. I wouldn 't be
| surprised if 25% of Google's ad search revenues come from this.
| aerosmile wrote:
| I agree with the rant how Google introduced a tax that
| wouldn't have existed in a world without Google. And,
| technically speaking, it would have been possible for Google
| to not charge for that tax (but would you have done that in
| their shoes? It's not like their market share is suffering).
|
| But if you are implying that brands should not invest in on-
| brand search campaigns, then this is a really bad advice.
| It's a known fact that targeting your competitors' branded
| terms is ROI positive, which definitionally means that the
| affected brand is unable to capture all the customers who
| were initially searching for it.
| mbesto wrote:
| > But if you are implying that brands should not invest in
| on-brand search campaigns, then this is a really bad
| advice.
|
| I'll be more explicit - you should test the difference. I
| usually recommend companies do a blackout month where they
| turn off all programmatic ads and then do a like-for-like
| comparison.
|
| To further emphasis my point before, I've seen ad ops
| agencies say "hey you've got an overall 15x ROAS" and then
| find out that 80% of their ad spend is on-brand (give them
| 25x or whatever) and the off-brand (which is 20% of the
| spend) is giving them 5x. So their ROAS is inappropriately
| distributed to try to reach an overall ROAS goal.
| aerosmile wrote:
| There are bad actors in every field. I would just be
| careful in using such anecdotes to distract from the
| overall message, which as you spelled it out in detail
| seems sound (with perhaps just a note that a 5X ROAS is
| not bad for most unbranded campaigns, but I get your
| point).
| aesyondu wrote:
| I purposely click the non-ad link when searching in Google
| (because I'm too lazy to type the full url). Does that help
| at all, i.e., prevents unnecessary ad spend from bidding?
| hn_throwaway_99 wrote:
| I do the same, but 99% of people do not, so it's really a
| drop in the bucket.
|
| I do wish there were some regulation such that if a user is
| searching for a trademarked or copyrighted term, that the
| best organic search result _for that term_ should be
| required to show up first. I 'm fine with showing
| competitor ads, but I don't think they should be able to
| show up above the trademark owner's ads.
| verve_rat wrote:
| It feels like it is close (but not really) to a trademark
| violation. If I search for "A" and get a screen full of
| results for "B", if I need to scroll to even see mentions
| of "A", then that feels like it is really close to
| "passing off". I could see an argument for saying that
| this "passing off" causes customer confusion that
| requires trademark enforcement.
|
| I realise that would probably be an impossible argument
| to win under current law (IANAL), but it _feels_ so very
| close.
| figassis wrote:
| And would be trivial for google, with all their content
| id tech
| Puts wrote:
| Sometimes I click on Google ads just because I don't like a
| brand and feel a little bit of joy knowing I just cost them a
| dollar.
| titzer wrote:
| I've done that once in a blue moon, but it doesn't really
| accomplish anything except transferring that money to
| Google. Since I used to work for Google, thanks, I guess
| :-)
| drevil-v2 wrote:
| Way more than a dollar. If you really want to cost a
| company a pretty penny, click on the ad after searching for
| an "intent" to do something rather than the exact brand.
| Some of those Adwords cost many tens of dollars.
| inetknght wrote:
| > _Some of those Adwords cost many tens of dollars._
|
| Companies pay tens of dollars for a single advertisement
| placement? I don't believe you.
|
| I could believe tens of pennies, maybe as much as a whole
| dollar. But exactly what search is worth tens of dollars?
| JacobThreeThree wrote:
| I haven't seen anyone mention the fact that a big factor
| that contributes to how the Google Ads "black box"
| determines how to rank ads is via an Ad Quality
| measurement.
|
| Each ad is given a quality score, and since your own
| website will be guaranteed to be the most authoritative
| source for a keyword search with your own branded
| keyword(s) in it, by default the quality of your own ads
| will be much higher than your competition.
|
| This means in practice that the cost for a brand to be
| shown first on their own branded keywords is much lower
| than their average CPC, let alone the cost for their
| competitors to be there.
| dorgo wrote:
| >Ad Quality measurement
|
| It's called Quality score (soon to be discontinued) and
| has 3 components. Only one of which is landing page
| related. And nothing prevents competitors from building
| "more relevant" landing pages than the original brand.
| titzer wrote:
| The very fact that you have to bid on clicks for your own
| damn website by paying Google, because Google has
| prioritized ads to the point of displaying them higher
| and making them almost indistinguishable from the
| "organic" search result proves they have intentionally
| created a tax on the internet.
|
| It will get worse, to the point where to get auto-
| completed in the omnibox you'll have to pay. TBH I am not
| even sure if that isn't already the case!
| alphabetting wrote:
| I'd rather ignore some ads which are less intrusive than
| places like Amazon than pay a subscription fee to use
| search, gmail and docs which are funded by ads.
| titzer wrote:
| There are other options. For example, funding a publicly-
| owned search engine with $1 billion a year in
| infrastructure and development costs would be 50x cheaper
| than what the US spends on foodstamps. It'd be 1/10th the
| NSF's annual budget.
|
| Not that that's the best option, but we could consider
| some new ideas.
| vkou wrote:
| A publicly owned search engine, that will absolutely not
| be used for propaganda purposes by, say, the Department
| of State, or by a megalomaniac elected representative.
|
| Need to build consent for a war with <Country>? Give me
| access to the search index, and a few weeks, and it'll be
| done.
| titzer wrote:
| I didn't say it was the best option. But wow, you just
| trust a billion lines of closed source written to satisfy
| ad optimization criteria with zero transparency? I mean,
| we _can_ subject things to public oversight.
| alphabetting wrote:
| Google is pretty big with open sourcing. Open sourcing
| search would ruin it though. Spammers would game the
| system.
| peanut_worm wrote:
| You're kidding! A single click costs more than a dollar?
| gamerDude wrote:
| Sometimes. The "intent" scenarios can be pretty valuable.
|
| "I need a lawyer in ___ right now". That lead can be
| worth a lot.
|
| "Looking to buy a new car today", etc.
| dorgo wrote:
| Google keyword planner tool shows cpc (cost per click)
| for keywords. For an online gambling keyword it shows me
| 14.97EUR (for one click). There are other industries with
| cpc's of 80EUR and more.
| sam0x17 wrote:
| Back in the early 00s clicks on Mesothelioma were
| something like $24 a click because anyone who could spell
| it probably has it and is looking to sue.
| twp wrote:
| Yes. As an experiment, I tried running a Google Ads
| campaign for my https://chezmoi.io open source project
| bidding on "dotfile manager". Twenty clicks cost me $20.
| I terminated the experiment quickly.
| gumby wrote:
| Marvelous! I'll do the same. Watch out, Exxon!
|
| I mostly click on ads as chaff (mostly I block them but
| sometimes unblock them just do do some random clicking in
| the hope of confounding some profiles being compiled on me)
| btown wrote:
| It's less the Google tax than the "advertising is now
| efficient" tax.
|
| Any other medium would theoretically have the same problem:
| if Ovaltine doesn't sponsor kids' radio shows in the 1950s
| and someone thinks they can deploy capital to grow a
| competitor, that someone will buy that slot. People couldn't
| do this because there were human processes and relationships
| slowing this marketplace down. The thing that Google did was
| make it possible to test this at small scale.
| ohyeshedid wrote:
| They weren't bidding on keywords, though, just airtime.
|
| That's an entirely different advertising model and market.
| thomasahle wrote:
| > I like to call these effectively the "Google Tax" because
| publishers/retailers are forced to pay Google for the traffic
| they would have already received had the ad not been there.
|
| Isn't this just the usual problem with advertising? You have
| to do it because the other players are doing it. If nobody
| did it, it would still be the same cake to be shared.
|
| This case is more on the nose, but only because of some
| fairness assumption that "Williams Sonoma Cast Iron Skillet"
| _ought_ to be traffic for Williams Sonoma.
| mc32 wrote:
| When people search Pepsi Cola they expect to get a link to
| Pepsi or information about it. They don't expect to see
| Coca Cola or RC Cola, etc. now in this case Pepsi makes
| sure search isn't polluted by paying Google good money to
| always be the top results for that term.
|
| Now, if you searched on the generic 'cola' or 'soda pop'
| then yes you expect to see those who bid higher to be at
| the top and at the bottom those who bid nothing unless
| organically somehow they ended elsewhere.
| thomasahle wrote:
| I guess that's more a customer satisfaction problem for
| Google, than it is a problem for advertisers.
| carlhjerpe wrote:
| Advertisers are the customers, or am I missing something?
| To be fair, I don't consume any adblockable ads or TV ads
| (maybe once a quarter for TV) so I don't know if people
| click them, how much does purchasing ads affect the
| normal search score?
| thomasahle wrote:
| Sorry, I should have written "users".
| closeparen wrote:
| For staples, maybe. Advertising also gets people to buy
| things that they would not otherwise buy.
| finnh wrote:
| > Isn't this just the usual problem with advertising?
|
| Not quite: OP's point is about searches that specifically
| include your brand name. The "usual problem" with
| advertising in the zero-sum sense you propose is for
| eyeballs in general (billboards etc). The google tax here
| is more invidious, being specifically about searches that
| include your brand.
| mbesto wrote:
| Exactly. Big difference between
|
| "Williams Sonoma Cast Iron Skillet"
|
| and
|
| "Cast Iron Skillet"
| majormajor wrote:
| I think it's the same problem even if it looks more
| suspect.
|
| I think the important thing here is that companies don't
| decide to increase total advertising budget just because
| of the existence of a new channel. They have a budget of
| X. They have to decide how to break it up. Google, with
| brand targeting in search, is making a play for money
| that would've otherwise gone to Fox or ClearChannel or
| whoever. The brands redirect some budget to this new
| channel, as it shows its effectiveness.
|
| Many of them still spend some on traditional channels, to
| get that first appeal and be the "Williams Sonoma" in
| "Williams Sonoma Cast Iron Skillet." Many of those people
| aren't just going to click through to Lodge ads instead.
| But less than they did when traditional channels were the
| only game in town.
|
| Same dilemma, though:
|
| If nobody advertised in Google Search or non-Google
| channels, people would just buy whatever skillets they
| found in whatever stores they found, or what their
| friends told them about.
|
| If one brand advertised in offline media, more of those
| people would buy that brand.
|
| So all brands advertise in offline media. And then it
| comes down to effectiveness of the campaigns + the same
| criteria that it would've otherwise -
| availability/placement, word of mouth, etc.
|
| Then, if only one brand advertised in search targeting
| other brand names too, more of those people would buy
| that brand.
|
| So all brands advertise on their brand keywords in
| search.
|
| But ultimately it's the same game in both places. With
| the same net, Google just captures some spend that what
| would've gone to non-Google places previously.
| jayd16 wrote:
| >pay Google for the traffic they would have already received
| had the ad not been there.
|
| But this line of reasoning begs the question. If this system
| wasn't in place, then Google search would not exist as it
| does and the search traffic would not necessarily exist in
| the same way, no?
| tshaddox wrote:
| I don't see why the search engine would work differently or
| be any less popular if Google used its algorithms to
| determine intent (that's Google's whole thing) and then
| automatically (or via human moderation) prevent companies
| from showing ads when there is clear intent to find another
| company's brand. Google would be somewhat less profitable,
| perhaps, but the search product would still work fine
| (arguably even better) for the people searching.
| mbesto wrote:
| > Google search would not exist as it does and the search
| traffic would not necessarily exist in the same way, no
|
| yes and no. Google search didn't have as intrusive and
| competitive ads as it did before and the search function
| was effectively the same. Nowadays, if you search "Williams
| Sonoma Cast Iron Skillet" you get 5~6 ads and 2-3 scrolls
| to get to the real organic results. 6~8 years it was like 1
| ad and you could see the first result.
| bryanrasmussen wrote:
| At this point I'm actually wondering how much more
| discussion will be required about "Williams Sonoma Cast
| Iron Skillet" to get HN among the top search results.
|
| Another reason why ads for "Williams Sonoma Cast Iron
| Skillet" exist are not just to combat Williams Sonoma
| competitors but also scummy SEO search engine spam, I
| mean what if you don't pay to have your stuff in the
| first results and some hustle comes along that makes fake
| product review sites off of scraped results and engineers
| getting their stuff all among the first results, since UX
| research shows people not finding a relevant hit in the
| first few results do not go to the next page in results
| it implies that ads are required to give the correct
| research for something obvious like this because
| otherwise you have to take a chance with the present day
| subpar google results.
| z3rgl1ng wrote:
| It's pretty shocking. Had similar discussions w/ co's
| dominating organic and paying ~~fucking con artists~~
| affiliate marketers. IMO those are faaaaar worse than poorly
| allocated search spend..
| worker767424 wrote:
| It's not a tax, it's a protection racket. You wouldn't like
| it if someone looking for Williams Sonoma saw results for Sur
| La Table, would you? Pay up.
| vkou wrote:
| An ad directing shoppers to your competitors who pay them
| is not a protection racket, no more than a travel agency
| directing travelers to businesses that they have a
| relationship with.
|
| It's the entire business model of aggregators and
| intermediaries and middle men, which compose roughly half
| the world's working population.
| bambax wrote:
| So in a way, big advertisers that are leaders in their markets
| would be favorable to adblockers, because they free them of the
| need to do defensive advertising.
|
| One could argue that no advertising is hard for the
| challengers, but in today's situation they are outspent anyway,
| so what do they have to lose?
|
| The conclusion is that both incumbents and challengers would be
| better off in a world where no advertising exists.
| patmorgan23 wrote:
| I always skip the ad links and click the organic one, even if
| it's for the correct company/product. Because when I click on
| the ad link 9/10 is some weird ad funnel page radther than the
| actual product page I wanted to go to.
| dublinben wrote:
| Defensive spending to protect otherwise organic traffic could
| also be called extortion.
| pradn wrote:
| This should be allowed, because this means smaller
| competitors have a shot at the customer base of a more
| established competitor. If we ban it, it's just shoring up
| established players.
| desmosxxx wrote:
| +1 this has happened to me before and I've ended up buying
| from a competitor before. We should promote competition.
| matsemann wrote:
| Worst part is that the competitor has nothing to lose, so
| they basically will spend the whole margin of a sale on the
| ad. Which means that the original company has to do the same.
|
| Where I worked before, Google could get $4 for ever $1 we
| made. And we actually delivered the service, and people
| googled our name. Pretty crazy...
| earthboundkid wrote:
| Forget about the corporate POV for a second, as a user, if
| I'm searching for X, I probably want X in my results, no?
|
| It's the fundamental contradiction in Google's search ads
| model. If Google delivers users the thing they want, ads by
| definition have to be things users don't want.
| lifeisstillgood wrote:
| >>> If Google delivers users the thing they want, ads by
| definition have to be things users don't want.
|
| Ben Evans has a tweet something like "half of facebook devs
| are working out how to code the algorithm to serve you just
| what _you_ want to see, the other half are working out how
| to get the algorithm to serve you what _advertisers_ want
| you to see. "
|
| We are doing something wrong
| inthewoods wrote:
| Natural outcome of all internet advertising based models
| imho.
| thegrimmest wrote:
| Right, but you may also be interested in an ad from a
| competitor for a similar product, especially if they were
| differentiated by price, no?
| inthewoods wrote:
| This is the fundamental issue with all advertising-based
| models. Eventually, they all run into the problem of having
| to continue to grow. The only way to continue to grow is to
| display more ads, thus compromising the user experience,
| which starts the downfall. AOL was a great example of this.
| Google seems to be heading this way.
|
| Google's original values were the ability to provide better
| search (common answer) and be fast (less common answer) -
| both of which were a complete contrast to the Alta Vista
| and other search engines. I could easily see Google facing
| disruption from a new player - but I don't think it will be
| another search engine. Probably a paradigm/systemic shift.
| fabianhjr wrote:
| Advertisements are fundamentally not what search service
| users want regardless of searching for a specific brand or
| not. (Its what advertisers want others to want)
| sokoloff wrote:
| If I'm searching for "Williams Sonoma 12 inch skillet",
| advertisements for places selling it are a pretty large
| subset of what I want.
| wormslayer666 wrote:
| If a search engine encounters the query "Williams Sonoma
| 12 inch skillet", retail outlets selling it should
| organically appear in results without the need for ads.
| sokoloff wrote:
| If it's $39.99 on W-S.com, I _definitely want_ to see the
| place that's willing to sell the same pan for $34.99, the
| EBay listing for $32.50, and the one selling a competing
| similar one for $29.99 even if those sites don't have the
| organic search SEO juice to land in the top 10.
|
| As a Google search user, why wouldn't I value these? If
| Google doesn't serve them and another search engine does,
| I'd be inclined to switch to the other one.
| thegrimmest wrote:
| Sure, but what about an ad from a competitor for a
| similar pan at a lower cost? Isn't that what advertising
| is all about?
| pbhjpbhj wrote:
| Yes, i was thinking similarly. The GP wants links, not
| ads (specifically), but if the trustworthy domains are
| saying this particular skillet is low quality then you
| want that first, rather than an ad.
| computerphage wrote:
| My "by definition" detector has fired. It says: that's not
| true by definition. Ads could instead _also_ be things that
| users want.
|
| I do actually think you have a good point.
| jayd16 wrote:
| I guess the argument is that if google could make the
| perfect search result, ad spending would, by definition
| either be exploitative of the advertiser by providing no
| change, or providing value by changing the results from
| perfection.
|
| In reality, Google is not perfect and you can argue that
| ads do provide value by promoting relevant content, even
| if its gameable by our capitalist system.
| IggleSniggle wrote:
| I like this pedanticism, but I still think you can even
| argue the "by definition" piece of it. I suppose it ends
| up being somewhat tautological in the end.
|
| If you really like Skillet X, and I ask you which skillet
| I should buy, and you tell me, "Skillet X," then it is
| not an ad.
|
| If you really like Skillet X, then somebody gives you $5
| to recommend it if anybody asks you what skillet to buy,
| and then when I ask, you tell me, "Skillet X...I mean you
| should know that somebody gave me $5 to say that to you
| but honestly I was going to say that anyway" then _is_ it
| an ad?
|
| It kinda _intuitively feels_ to me like if it doesn 't
| alter the result, it's not an ad, it's just somebody
| taking advantage of another person's willingness to hand
| them money and doing nothing in return.
| gingerlime wrote:
| Exactly. And it's bad for customers too. My mum (70) just
| fell for it, and she's pretty clued about computers and
| technology. She searched for a flight with Ryanair, so
| entered Ryanair on Google. First result was some scummy
| reseller, which sold her the same ticket for a higher price
| with some "extras".
|
| Bidding on a competitor's brand name keyword should be
| banned. But Google can't resist double-dipping.
| thegrimmest wrote:
| I mean.. RTFM? Look at the address bar? The branding of the
| site? Pay attention and be careful? This stuff only works
| on 70 year olds. It stands to reason it won't be viable in
| a few decades.
| MrBuddyCasino wrote:
| > if Williams Sonoma was not advertising on that search term,
| Lodge and Food52 etc etc would
|
| If I as a customer am using such specific search terms, then I
| would assume that my intention is to find and possibly buy this
| specific product. The results of other brands might be
| annoying, but why should I click on them? The relevant results
| are still displayed on the first page.
| rapind wrote:
| Ultimately I think it decreases google's value as a search
| engine (to the user searching) by a very small amount, but
| nets them a high immediate return. I bet it's hard to
| quantify the net effect over time, and it would be a really
| hard sell internally to not allow it.
|
| I've noticed the quality of google search decrease
| drastically over the last 15+ years or so. I don't think
| that's directly tied to ad buys though.
| dabeeeenster wrote:
| It's not about the customer, it's about the fact that the
| merchants have to pay the Google tax in order to play.
| The-Bus wrote:
| The competing ads will often say something like "Introducing
| [Product Y] which costs 25% less and is 10% less smellier
| than [Product X you searched for]"
|
| If you've never heard of Product Y, you might be intrigued
| and click. Maybe you want something less smelly!
| jayd16 wrote:
| Depends on the brand, right? If I search for Klenex or
| Bandaid, or Advil, I might be fine with the cheaper generic.
| kposehn wrote:
| Your logic about the ads is sound, but your experience as a
| customer does not mean all customers exhibit this behavior.
| The best course of action is to test this conclusion which
| can be reliably done with a Google Ads Experiment.
| CraneWorm wrote:
| Now, that is what I call organic advertisement.
| gotmedium wrote:
| I think there is an under-appreciated average search engine
| user in the comment:
|
| People will typically write their intent on the search engine
| even when they could simply directly to the website.
|
| Case in point: The top 10 bing searches are for websites,
| including FB, Google, Youtube [1]. This traffic is highly
| competitive and should (as in all competitive markets) be bid
| among competitors.
|
| https://ahrefs.com/blog/top-bing-searches/
| lowbloodsugar wrote:
| The address bar _is_ the search bar. My wife _never_ types
| "facebook.com". She types "facebook", gets the google
| search page, and then clicks on facebook from there. It
| pisses me off that if I start typing facebook, Chrome
| doesn't autocomplete to facebook.com. In contrast, if I'm
| in Safari, and type "n" I get "news.ycombinator.com"
| autocompleted.
| pbhjpbhj wrote:
| It must be a setting?
|
| Small business people in my area of UK have always done
| this, type in the box in the middle (usually Google,
| occasionally Bing or some other service). But my pretty
| tech-literate kids do it too, even when I show them how
| they 'should' do it and that is faster, and they don't
| need the extra click to get where they're going ... mad!
|
| On Chrome on Win10 as I use at work though, typing in the
| address bar, with my settings, I get auto-fill of
| addresses (the history search is noticeably missing vs
| Firefox) including the option to use 'tab to search' on a
| domain.
| codetrotter wrote:
| For example if the customer was previously not familiar with
| Williams Sonoma but had seen an ad in the paper or on TV or
| on the subway etc, that caused them to search for Williams
| Sonoma cast iron skillet.
|
| And beside that a lot of people routinely misclick or click
| on ads not understanding that they are ads even when they are
| marked as such.
| MrBuddyCasino wrote:
| So the theory is that if I search for "Williams Sonoma cast
| iron skillet", but misclick on some competitor, I'm buying
| that instead? I don't know, I don't usually assume the rest
| of humanity to be a lot dumber than me.
| codetrotter wrote:
| People don't need to be dumb to do that. Being
| inexperienced with computers or confused about computers
| is enough to cause people to do a lot of things like
| that. There are a lot of people out there who are
| inexperienced with or confused by computers.
|
| But my main point was that the brand may not be all that
| important in the first place even though it was included
| as part of the search term. The person making the search
| could've seen an ad and been intrigued by the product,
| but upon landing on a competitor site they may choose to
| buy a similar product from them instead.
|
| If you are deeply into the kind of thing you are buying,
| you will make a lot of research to find the best one. But
| there are a lot of things we buy that we don't care as
| deeply about, and where we may choose the first one that
| fits the bill sufficiently well.
| thegrimmest wrote:
| > landing on a competitor site they may choose to buy a
| similar product from them instead.
|
| Doesn't that just make for effective advertising? I'm
| failing to see the harm here.
| thegrimmest wrote:
| > Lodge and Food52 etc etc would
|
| And wouldn't any users who end up buying a Lodge pan have been
| legitimately converted by effective lodge advertising? I don't
| think anyone who's _only_ interested in Williams Sonoma will
| just go ahead and buy a Lodge pan. Unless you 're suggesting
| that simply because the user entered "Williams Sonoma" in the
| search bar that page somehow "belongs" to them, which seems a
| bit absurd.
| xlance wrote:
| This is pure and utter bullshit.
|
| Performance marketing = Distribution. Without performance
| marketing your competitors take the sale instead.
| s17n wrote:
| The example given in the article seems very off-base: the author
| is vaguely planning to purchase some type of planner, and he gets
| an ad for a specific planner from a specific retailer. There has
| to be a pretty tiny chance that he would have ended up at that
| exact site without the ad, so if the ad does lead to a
| conversion, it's incremental revenue.
| pbhjpbhj wrote:
| It's interesting the OP appears to accept they're in the
| uncanny valley of "well FB knew somehow I was going to buy that
| one and showed me the ad".
|
| For me it just made me think, well I'm doing something right
| because Facebook mostly offers me shitty white label stuff
| that's being sold using fraud (I've made complaints to
| Advertising Standards [UK] a few times about Facebook ads) and
| that I would never buy.
| bagacrap wrote:
| Not to mention, "you've just visited some articles recommending
| fancy paper notebook products" makes it sound like he viewed
| some spammy top 10 list full of paid affiliate links, so he's
| probably succumbing to performance advertising regardless of
| Facebook's later involvement.
| timdellinger wrote:
| see also "Consumer Heterogeneity and Paid Search Effectiveness: A
| Large Scale Field Experiment" (Tom Blake, Chris Nosko & Steven
| Tadelis) in which EBay did the same experiment (they stopped
| advertising), and also "The Unfavorable Economics of Measuring
| the Returns on Advertising (Lewis and Rao) which talks about how
| hard it is to measure impact.
| steve76 wrote:
| Take one product. Make a thousand different businesses who sell
| them. In one ad, Britney Spears is holding that frying pan. In
| the other, it's the Undertaker.
|
| Instead of product and customer, think value added. You buy a
| server for $0.065 an hour. You buy traffic at $0.01 a click.
| That's your raw commodities. How do you make a profit off of
| that? Supposedly if you're good enough you can get elected
| president. I'm sure there's room in there for you to pay your
| bills.
| DevKoala wrote:
| I learned of a bro through a targeted advertisement and I am
| looking at it for my next rental. I don't believe AirBnB's
| conclusion can be interpreted as "advertisement is irrelevant."
| Ozzie_osman wrote:
| (So I do think that performance advertising is partly a racket,
| but it can work really well if you know what you're doing).
|
| One additional thing people don't call out is that a lot of the
| budgets spent on these platforms are "learning" budgets. Agencies
| play this card really well. They'll tell you, "oh, you need to
| increase your budget, and test all these different combinations
| of ads/targeting/landing pages/etc so that you can learn what
| works (or the AI behind the platform can learn what works)". And
| obviously, in "learning" mode, you're ignoring the ROI.
|
| I've seen people spend substantial amounts of money in "learning
| mode", and the platforms are kind of incentivized to make the
| learning less efficient so it takes longer and more spend for you
| to get to ROI positive (or to learn that you will never get
| there).
| aerosmile wrote:
| There are so many holes in these arguments that you could drive a
| truck through it. Which is so infuriating, because a big part of
| my professional career consisted of watching all of Rand's SEO
| videos and really appreciating them. I really thought he was a
| genius. But then over the past few years, he started sharing more
| general views on entrepreneurship, and those takeaways just
| didn't really make much sense. Basically, his own VC-funded
| company turned into a shit show and suddenly he started
| advocating against VC in general (as opposed to taking an honest
| look at the mistakes that his company made). So in the past few
| years, I tried to reconcile in my head: how can a genius make
| such imperfect conclusions? My initial takeaway was that he's
| blinded by his own mistakes and shifting the blame, which seems
| perfectly reasonable and understandable. Frankly, I would
| probably feel and act the same way.
|
| But after reading this article, it finally dawned on me. He makes
| imperfect conclusions in everything he touches, it's just that in
| some fields those conclusions can be more easily proved to be
| wrong than in others. SEO is the perfect field where a polished
| presenter can get away with imperfect conclusions for years -
| trust me, I know, I made a living for years in this field, and I
| am very familiar with the nature of this work. Most of the time,
| you have no idea what the black box really does, and instead
| you're just trying to guess what might have happened. Most
| importantly, there are many ways to skin a cat in SEO, and just
| because your approach is net positive doesn't mean that you truly
| are delivering the global maximum (or that the net positive gain
| was ROI positive). In short, it's impossible to know who's right
| and who's wrong, and Rand's videos convinced me that he's right,
| but I am no longer sure. I just rewatched one of them, and can
| easily see how his conclusions are just... opinions.
|
| While we may or may never find out if his SEO opinions were the
| global maximum, we can quantifiably demonstrate that his opinions
| on content marketing are not solid. This whole essay he wrote can
| be replaced with "hey performance marketers, don't trust the
| platform numbers and instead do your incrementality studies."
| Platforms like Facebook will give you those for free if you reach
| a certain spend level, and you can also get them from 3rd party
| providers like measured.com. In other words, if you're a
| performance marketer and you're not conducting incrementality
| studies, then you're very early in your career and are not
| following the best practices. Simple as that - no need to
| extrapolate from there and reach all sorts of additional
| conclusions (which is obviously a pattern in Rand's behavior) -
| calling into question a perfectly investable marketing channel,
| conflating the needs of a public company with everyone else's
| needs, using words like scam, etc.
|
| I am really disappointed to have to write this, but you would
| have been better off not reading this article. If Rand is really
| advocating that the majority of entrepreneurs should follow his
| advice and focus on PR instead of performance marketing, then
| perhaps an honest thing to ask would be - how is that working out
| for his own company? AFAIK, SparkToro is nowhere close to
| replicating the growth of his previous company, which is honestly
| disappointing for someone with such a huge reach and name
| recognition.
| lifeisstillgood wrote:
| Incrementality studies: https://www.adroll.com/blog/marketing-
| analytics/beginners-gu...
|
| Interesting article
|
| 1. "industry" is moving away from last touch attribution
| (pretty much what Rand complains about)
|
| 2. "Incrementality strives to identify the causal event of a
| conversion,"
|
| The way to identify the causal action seems to be :
|
| errr ... that's difficult
| aerosmile wrote:
| You linked to an article that offers no guidance on how to
| actually do it, which is more indicative of the article
| itself than of the methodology. One of the vendors in this
| space has a good amount of content on this topic, which you
| can find at the bottom of this page:
| https://www.measured.com/. Dislaimer: I have nothing to do
| with this vendor or the industry in general (apart from
| successfully spending money on performance channels).
| lifeisstillgood wrote:
| My apologies I should have prefaced it with "for others
| confused as to what incrementality is all I could find was
| ..."
|
| It's a surprise to see a vendor have a clear explanation on
| their site however - and it's worth quoting i think
|
| >>> Incrementality testing creates an experiment that
| systematically withholds media channel exposure to a
| representative subset of users (the control group) while
| maintaining normal media channel exposure to the broader
| user set (the test group). If the control group is both
| sizable enough to be statistically significant and selected
| at random such that they are broadly representative of the
| user base, then the media channel's incremental
| contribution can be determined by the difference in
| business outcome (conversion, revenue, profitability, etc.)
| between the test and control groups.
| [deleted]
| ChuckMcM wrote:
| Can I politely suggest that you share with us the holes you see
| in the arguments and how you see them? Whether or not Rand is
| any good at what he does or says will be clear by your expert
| disassembly of his arguments.
| engineeringwoke wrote:
| People on this board love the idea that anyone who isn't an
| engineer is an idiot and everything that everyone else does
| that isn't writing code is somehow worthless. In broad
| strokes, they think that all people who do people-facing work
| are charlatans that are constantly trying to hide how
| worthless they are because talking to people, etc. can't
| possibly provide value. Then, they (like so), ask you to
| break down your arguments so they can pin the tail on the
| donkey that is the logical fallacy that they will use to
| discount your (almost certainly correct and informed)
| opinion.
|
| Unsurprisingly, those people are wrong and marketing works.
| photochemsyn wrote:
| It's also fair to say that if you let the marketers drive
| business decisions it's a recipe for disaster. Pushing low-
| quality product out the door just to hit some quarterly
| sales goal, that's what marketers will push. Epic failures
| with disastrous long-term consequences are the typical
| result (Boeing MAX for example).
| bliteben wrote:
| you don't even have to be polite can't believe I read that
| whole comment
| aerosmile wrote:
| Rereading the post, I agree it came across as more personal
| than it should have been. I wish I was able to frame it
| more as a response to all the people advocating for
| alternative marketing ideas which frankly never work out.
| Instead, I brought in his own company into the narrative,
| which was below the belt. I know first hand how hard it is
| to get something to work, and how unlikely it is to happen
| time after time. I wish I could edit the comment, but HN
| won't let me at this point.
| poetaster wrote:
| Hmmm. Marketing works!? Well having been a sucessfull .com
| era ad co. founder, I suceeded in raking in the cash of the
| uniniated (automobile, etc, so no tears) only to see
| companies literally obliterated by marketing. TV was then
| still 20 times the spend. Still, marketing had 0 clue. Fun to
| drink with at the theatre, sure. I was CTO, so, shrug? No, I
| was incensed and tried to talk other managers client side out
| of giving ME money. I know some clever people in marketing,
| but when they smell budget, it's a movie shoot in the sahara
| time.
|
| I do think things are better in some sense today. But it is a
| hungry beast, marketing. Oh, and lies and statistics.
| aerosmile wrote:
| - Brian's comments about Airbnb's approach to performance
| marketing are used to imply that Airbnb's lessons apply to
| other businesses. Very few businesses - especially those that
| start from small numbers and need to grow them - have 90% of
| their traffic mix come from repeat customers. Using Brian's
| comments helps fuel the narrative that brand marketing is a
| better investment than performance marketing, which is
| correct in some cases (Nike, Airbnb), and not in others (most
| startups). Also, as another member pointed out, Airbnb's
| performance marketing budget is still well over $200M/year,
| which no responsible/public company would spend if it wasn't
| returning a great ROAS. Finally, Airbnb is known for all
| sorts of marketing shenanigans in their early days, and they
| certainly can't take the credit for a pure brand play.
|
| - Calling performance marketing platforms a scam (repeatedly,
| both in the title and in the narrative) doesn't explain how
| those same performance marketing platforms are carrying the
| majority of traffic acquisition in most of the B2C companies
| that went public this year (and practically all of the DTC
| ones). Calling into question the accuracy of measurement is
| one thing. Calling it a scam is wrong and designed to rank on
| HN rather than to be reflective of the true value of those
| platforms.
|
| - As I pointed out in my original post, all you have to do is
| use incrementality studies and 98% of the criticism instantly
| goes away. Rand implies that you have to do your own studies
| (by eg, following Avinash Kaushik's methodology) which is
| 100% wrong - Facebook will do them for you if you reach a
| certain spend limit, or 3rd parties will as well with no
| spend limits. Also, from experience, this really becomes an
| issue once you spend meaningful amounts on two platforms at
| the same time. His rant on this subject has an iota of truth
| and a whole lot of sensationalism mixed together, and overall
| leads to wrong conslusions.
|
| - He conflates "paid search" with "all performance marketing
| platforms", including "paid social." It would have been
| helpful to point out that the challenges with branded terms
| are entirely isolated to paid search and have nothing to do
| with paid social.
|
| - My favorite sensationalist tactic: frame a strong
| accusation as a question. This way you get the clicks, but
| you can still cover your ass by linking to resources that
| with enough research would allow the reader to answer the
| question with a "No." But in lieu of that research, the
| implication is that the answer is a "Yes." You'll see this
| tactic used by less reputative media sources, and I was
| disappointed to see Rand do the same.
|
| I could go on but hopefully this will suffice.
| lostinquebec wrote:
| Your first point is very hopeful, but not what I've
| experienced. The bigger the company, the more slack for bad
| decisions.
|
| Your other points I think relate to scale. No advice can be
| universal, and if you read the article as absolutist, your
| take makes sense. If you read it as "hey, your mix is
| likely wrong", a lot of the criticism fades.
|
| I think we've lost a bit of creativity in marketing. The
| Lego movie example is a really good one. I think it is
| probably good this happened, as a lot of creativity was
| performative (how do I win an ad award/impress my peers)
| and not about increasing sales, but we've perhaps shifted
| the balance too far, and there is likely some areas with
| good ROS that are now better bets.
| aerosmile wrote:
| Scale brings both, headwinds and tailwinds. The outcome
| often hinges on how the balance of those two forces plays
| out.
|
| Ecommerce example: every year the CPMs go up and your
| paid margin goes down. But every year you have a larger
| email list, so the balance of paid to unpaid shifts.
|
| General example: every year you get more of the late-
| stage employees who care less and less about your
| company. But every year you can afford to pay for more
| layers of management, which will keep an eye on the
| underperformers.
|
| This list goes on and on... The headwinds are driven by
| external forces, whereas the tailwinds end up working out
| based on your specific execution of the opportunities
| that present themselves to you. This is where an
| experienced operational team can make a huge difference.
|
| > I think we've lost a bit of creativity in marketing.
|
| You absolutely cannot rely on performance marketing
| forever. It's a shot in the arm until you have reached
| enough [fill in whatever you wnat] so that you can
| leverage that momentum to reach the escape velocity. So
| it's not good forever, but it's a great catalyst.
| dsizzle wrote:
| To your point that AirBnB's and other global brands don't
| extend to most businesses, Facebook's recent outage
| provided such an experiment and indeed a lot of small
| businesses saw massive effects
| https://mashable.com/article/facebook-outage-small-
| business-...
| aerosmile wrote:
| Thank you for sharing this. Facebook received a lot of
| criticism for how they lobbied publicly against iOS14.
| Their reputation is ruined, and anything they say will
| always be taking with a cynical afterthought. But as much
| as it pains me to say it, they are 100% right in saying
| that iOS14 is indirectly going to create a lot of damage
| for SMBs and companies trying to disrupt the status quo.
| There's more nuance to it, but think of it this way: if
| your marketing budget plans on reaching 100m Americans
| each year, then the negative impact on micro targeting is
| not quite as bad since you're going for the mainstream
| customer anyway. But if you're trying to reach only 1m
| people, then losing micro targeting is a matter of life
| or death.
| NumberCruncher wrote:
| > Rand implies that you have to do your own studies [...]
| which is 100% wrong - Facebook will do them for you
|
| So FB, who earns on my spending, offers me to measure for
| me whether my spending makes sense for me. Why would FB
| ever tell me to spend less? Don't they like money?
| stoicking wrote:
| The causal incrementality of ad spend is rarely negative.
| You expect to see decreasing returns with additional ad
| spend. For each dollar in ad spend, one advertiser might
| want to see $3 in revenue, another $5. Incrementality
| studies then allow advertisers to tune spend to their
| operating points.
|
| Facebook does like money. Do you think lying to the
| biggest advertisers in the world is the best long-term
| strategy, or do you think instead it might be better to
| report out the most accurate results possible?
| aerosmile wrote:
| It's fair to question credibility, but you have to
| realize that their results can be compared against 3rd
| parties, and it would lead to a lot of reputational
| damage (and also legal risk) to systematically defraud
| your advertisers. All it takes is one smart team to out
| the entire enterprise.
| [deleted]
| inthewoods wrote:
| "Also, as another member pointed out, Airbnb's performance
| marketing budget is still well over $200M/year, which no
| responsible/public company would spend if it wasn't
| returning a great ROAS. Finally, Airbnb is known for all
| sorts of marketing shenanigans in their early days, and
| they certainly can't take the credit for a pure brand
| play."
|
| My experience is exactly the opposite. The larger the
| budget, the less real hard analysis is done. This is
| especially true with the rise of attribution modeling which
| allows marketers to essentially motion blur the data.
| beervirus wrote:
| That was an awful lot of words. Too bad none of them had
| anything to do with what you think this article gets wrong.
| aerosmile wrote:
| It would have made the post even longer. But I corrected that
| in the child post. Hopefully that clarifies it.
| [deleted]
| citizenpaul wrote:
| I've been beating this drum for a decade.
|
| I once even had a marketing department shut down with analytical
| proof. I got tired of the marketing department with probably 50x
| the IT department budget constantly jumping down our throats
| about how "IF ONLY IT HAD DELIVERED X BY X we could have had
| 100,000,000,000x /s sales this month"
|
| I made a dynamic report dashboard in my first react project to
| analyze market spending and prove that even if you wanted to move
| around metrics to be comically generous the marketing was doing
| basically nothing to drive sales. MGMT got rid of them and
| literally nothing changed except everyone had better budgets.
| murillians wrote:
| And that React project's name? Albert Einstein.
| bogwog wrote:
| The entire management department stood up and started
| clapping.
| vasco wrote:
| More in "things that definitely happened" at 7.
| cblconfederate wrote:
| How is it a scam? They sell dashboards that s the business.
| stephc_int13 wrote:
| When advertising is a monopoly or quasi monopoly, it transforms
| basically into a tax on all transactions.
|
| I think this is overall a waste of resources and I'd like to see
| a more virtuous system, but I fail to imagine one.
| fungiblecog wrote:
| All I can say is "No shit, Sherlock".
|
| I'm constantly bombarded by ads for stuff I've already decided to
| buy (or more usually that I already bought last week). This stuff
| has zero value. The point of advertising has always (until now)
| been about taking your product to people who didn't know it was
| there. Targeted advertising would be a funny joke if so many
| people didn't take it seriously.
| chmsky00 wrote:
| Advertising as we know it emerged as a melding of government
| propaganda research and behavioral economics during world wars,
| so of course it's often scammy.
|
| It sounds "deep state" but it's actually plainly documented in
| government files and written about by reliable sources.
|
| Remember we're still emerging from an era of whispering the same
| old story of morality and obligation to each other.
|
| I am not at all interested in helping someone build a fertilizer
| empire or pillow brand. Politically my hands are tied to doing so
| if I want a life.
|
| Poor people effectively live a life of quota and state sanctioned
| limits on their access to material support by cutting social
| programs with public support.
|
| Advertising America as anything but a sanctimonious police state
| is a scam.
| cwkoss wrote:
| The "Century of the Self" documentary series about Bernays and
| the rise of propaganda/marketing is really great. Recommend it
| for anyone who hasn't seen it yet.
| kposehn wrote:
| I'm going to repost my original comment (thread here:
| https://news.ycombinator.com/item?id=21468505) about this which
| is still applicable:
|
| > Reliably someone comes along every few months to question
| [performance marketing]. I always come back to analyses of
| incrementality as the real proof.
|
| > Take an audience of X people. Divide them in two. Show ads to
| your test group, don't show to control. Watch your business grow
| and gauge the lift between the two audiences. The companies that
| know how to advertise at scale do this constantly and can gauge
| the real effect of their ad dollars. Facebook, Google and others
| make these tests possible in their platforms, while other
| software suites such as Impact Altitude and VisualIQ allow you to
| do this kind of analysis and testing as well.
|
| > In the end, most of it proves out to be incremental. There are
| notable exceptions of course, but when are there not?
| gingerlime wrote:
| > Facebook, Google and others make these tests possible in
| their platforms
|
| Any specific tips/links on how to do this with Google/Youtube
| retargeting?
| ssharp wrote:
| I was at one company several years ago and made two big changes
| to digital advertising:
|
| #1 - Eliminated all paid search other than some limited branded
| search terms and shifted all the money to affiliates who were way
| better at making profits on the keywords we were competing on
|
| #2 - Eliminated all display advertising after running numerous
| experiments showing it provided almost not incremental
| conversions, even though the platforms happily took credit for
| them.
|
| Those two things drove our blended CAC down substantially and by
| building better affiliate relationships, sales actually
| increased.
|
| The lesson here is that you need to try a lot of things out and
| you should be continuously questioning what you're doing and
| running specific experiments to gut check effectiveness of any ad
| platform that is slapping cookies on wide groups of users and
| claiming conversions.
|
| My suspicion is that this is near impossible at any large
| organization, even one as new as Airbnb. I can just imagine
| someone walking into a team of 20+ performance marketers and
| suggesting they need to experiment to determine if any of it is
| remotely effective. COVID forced them into this but it's
| something that they should have already been doing.
|
| I also suspect that the top line focus/obsession of most VC-
| backed companies make this type of exercise seem almost
| counterintuitive. Don't mess with or question the momentum.
| partiallypro wrote:
| #2 is basically an industry standard for ad firms (at least
| good ones), you'll usually only get people buying those ads to
| fill budgets or to do branded advertising that's only purpose
| is to raise brand awareness. I don't really agree with your #1
| point, but that really depends on your vertical. You couldn't
| really do that well in service industries or financial/legal
| services, etc.
| ameister14 wrote:
| Oddly enough, display ads crush it for restaurant catering
| zippergz wrote:
| Maybe your situation or industry is an exception, but my view
| is that affiliate marketing is one of the most corrosive
| influences on today's internet. It drives a truly mind boggling
| amount of spam of all types, from affiliates who add literally
| no value other than inserting their affiliate code into the
| transaction. The proportion of content on the web that provides
| no true new information, but exists solely to drive affiliate
| traffic, is surely massive.
|
| So, it's great for your business that this worked, but I
| personally don't see any strategy that leans on affiliates to
| be worth celebrating.
| ssharp wrote:
| A lot of things can fall under the "affiliate" umbrella but
| what we did was doing 1-on-1 deals with content providers who
| were acquiring a lot of relevant traffic. It was not promo
| code spamming.
| PoignardAzur wrote:
| Wait, so what was the monetization channel for the
| influencer?
| projektfu wrote:
| I forgot to do something and basically ended my Google
| Advertising spend. I haven't missed it in the least. I don't know
| if I would have done better without it, but an increasing number
| of people still find my website and phone number even though they
| are no longer clicking on the ad that Google provided when they
| searched my exact company name, costing me the majority of my ad
| spend.
| dorgo wrote:
| As I understand it ad spend is good if you want attention right
| now. In the long term organic traffic is cheaper and more
| desirable. In addition ads can be good for exploration.
|
| So it's only natural that after some time organic traffic
| exceeds paid traffic.
| toinbis wrote:
| In performance marketing(=KPIS are a)sales volume and b) Cost per
| action - CPA) it's very simple - you can't scam how much you've
| spent on ads. Also you can't scam how much you charged the
| traffic you've bought. Both figures are reported by your finance
| department with pretty much 100% precision.
|
| Yes, you do have a challanging problem of attribution. But the
| spend and revenue figures are what matters at the end of the day.
| And neither of them has any area for scamming (let's ignore edge
| cases).
|
| Disclosure: only skimmed through the article and my arguments
| above are just directed towards the headline. However credible
| and opinion leader the author - Rand Fishkin - is, the article
| itself at the first glance did not inspired me personally as a
| worthy my attentive reading time.
| jameshart wrote:
| You should read the article. You might learn something about
| the dubious value of attributed traffic.
| ulises314 wrote:
| So they compromise everyone's privacy for nothing?
| [deleted]
| CaveTech wrote:
| I take issue with the conflation of Performance Advertising with
| Awareness Advertising.
|
| The whole point of _performance_ advertising is that it's effect
| is _measurable_. If AirBnB spent $500m+ on performance
| advertising, they should be able to trace that back to an exact
| amount of revenue. If you are a brand in this scenario, you can
| conduct split tests by sampling the conversion rate of users from
| advertising vs non-advertising. Again, it should be simple to see
| if the conversion rate for users targeted via advertising has
| increased or is unchanged.
|
| In the branded search examples, again, as an advertiser, you can
| see what searches are associated with your leads. While you do
| have to compete for attention on your own branded search (to
| compete against competitors taking the slot), you should also be
| able to recognize unbranded terms which drive conversions for
| you. Again, assuming this is actually _performance_ marketing,
| you would be able to look at the cost of these placements and the
| ROI, and the impact would be measurable.
|
| The rest of the article is largely composed of straw-man
| arguments that imply the results are not measurable, when in fact
| they are (if done right).
|
| disclaimer: I'm the CTO of a performance marketing platform. The
| vast majority of conversions on our platform happen same-session.
| There's a very easy way to measure this effect -> pause your
| campaigns and immediately see conversions fall.
| judofyr wrote:
| Reminder that Uber turned off $100M of their ad spend and saw
| basically no change in conversions:
| https://twitter.com/nandoodles/status/1345774768746852353. I'm
| pretty sure they thought they were working initially (through
| conversion tracking).
|
| As you mentioned: The most important test (that you should be
| doing every now and then) is to _actually_ pause the ad and see
| if revenue falls. Anything else is just an approximation and
| should be treated as such.
| missedthecue wrote:
| I think performance advertising is a great idea if you don't rank
| very high in search results for your category.
|
| "Rental stays in XYZ city" will bring up an airbnb result all
| day, probably in the top five results. Therefore, paying $3 a
| click to be placed above your own search result is probably
| silly.
|
| I happen to have a small side project and advertise it with a
| very low budget on facebook, google, and bing. It works. I don't
| rank very high because my SEO skills are poor, but google ads
| absolutely drive real and interested people to my site.
| dhimes wrote:
| Do people coming from Google make a purchase? I've found that
| Google is for research-- people are usually looking for free
| information.
| missedthecue wrote:
| My side project isn't for sale or behind a paywall, so I'm
| not sure if they have their wallets out. But I know for
| certain that they're real and seem to be interested in my
| offering enough to click around and sometimes drop a message.
| morelandjs wrote:
| One of the strengths that Amazon has in this space, is that they
| are both advertiser and seller, so they can A/B test their ads in
| a way Google cannot, because they have perfect transaction data
| tracking.
| avalys wrote:
| AirBnB has such good brand awareness that it's not surprising
| they don't need to advertise very much anymore". On the other
| hand, advertising might be a pretty good investment for their
| competitors, like VRBO.
| netcan wrote:
| People have a tendency to view advertising as ineffective on
| them. " _I never click ads._ " Mostly this is true. Most ads
| people see don't make them do anything. People see a lot of ads
| though.
|
| Meanwhile, it's a marketing cliche that _" half the budget is
| wasted, but we don't know which."_ It's also true that google or
| FB provided analytics, using default settings often grossly
| overestimate ad effectiveness. All true. A journalist somewhere
| is writing a version of this article at any given time.
|
| But... From the merchant's perspective, the existence-proofs for
| advertising's effectiveness are undeniable. Launch a site. No
| visitors. Advertise. Now there are visitors. People subscribed to
| something or bought something. The ROI may or may not work, but
| the principle isn't in question.
|
| For a blank slate, newly launched business performance marketing
| is easy to measure precisely and you can have a reliable ROI. For
| BMW, GoPro or geico insurance... the world is more complex, ROIs
| are more theoretical and " _half the budget is wasted, give or
| take 50%_ " applies.
|
| The same was true for TV. A mattress store run ads with a crazy
| guy screaming "Sale!" and the next day a lot of mattresses get
| sold. The fact that ads made people come buy mattresses is
| trivially true, from the merchant's POV.
| mkmk wrote:
| It's weird that Rand Fishkin has been in the marketing space for
| so long, but somehow hasn't encountered a single effective
| performance marketing team that measures their spend well and
| complements the efforts of SEO and social media marketers (like
| Rand).
|
| Hard not to see this as a clumsy sales pitch for his company,
| especially when it starts with such a disingenuous example/quote
| (of _course_ AirBnb didn 't have to spend on performance
| marketing during a global pandemic where everybody was suddenly
| looking for a getaway...)
| tweetle_beetle wrote:
| > It's weird that Rand Fishkin has been in the marketing space
| for so long, but somehow hasn't encountered a single effective
| performance marketing team that measures their spend well and
| complements the efforts of SEO and social media marketers (like
| Rand).
|
| I mean I guess he would know from personal experience? He
| hadn't been the CEO for a year or two at the time, but he was
| still very much the public face of Moz when they "asked 28% of
| Mozzers to leave"[1], who worked on products complementing SEO.
| They used various euphemisms, but ultimately it's because they
| made no money[2].
|
| [1] https://moz.com/blog/moz-is-doubling-down-on-search [2]
| https://twitter.com/randfish/status/765973082611781633
| rfwhyte wrote:
| This article should be taken with a huge grain of salt, as it's
| coming from a company that sells a service that is essentially is
| a competitor to the performance media channels it lambasts.
|
| Any article that says "Don't buy X buy Y" loses a lot of
| credibility when it's written buy a guy who sells Y.
| [deleted]
| ChuckMcM wrote:
| My take on this is that its sort of like the prisoner's dilemma
| in that if everybody said "We'll not spend anything on ads[1],
| let the organic results speak for themselves" then you might get
| one result, but anyone who has been de-indexed from Google knows
| that having no results on the front page means a huge drop in
| traffic for you. And if your business depends on web conversions
| well that is a pretty measurable loss of revenue.
|
| [1] or black hat SEO for that matter.
| bob229 wrote:
| Entirely plausible but not a shred of evidence
| fourseventy wrote:
| It's well known that the self reported performance numbers from
| Google Ads and Facebook Ads are inflated, however those ad
| channels still do drive real value. I run an ecommerce marketing
| attribution company (ThoughtMetric) so I have first hand
| knowledge and data about this subject.
|
| The most common source of inflation in Google/FB self reported
| performance numbers is multiple ad channels taking credit for the
| same order. If a customer clicks a Google ad then clicks a
| Facebook Ad then makes a purchase, each ad channel will claim
| credit for that purchase. In reality each ad platform only has
| claim to ~50% of the purchase (depending on what attribution
| algorithm you want to use).
|
| In terms of knowing that real value is produced from these ad
| channels, I see it every day in many of our customers data.
| Clients will increase or decrease ad spend and there will be a
| correlated increase/decrease in sales.
|
| tldr; Google/Facebook ads over report their numbers but do
| ultimately drive sales according to the data I have first hand
| access to.
| ssharp wrote:
| I always used to just capture the old UTMZ cookie data (or
| rebuilt it when the actual UTMZ cookie went away) and stored
| that with the order data. It's not the most sophisticated
| attribution method but it at least gets around these sorts of
| double counting issues with orders.
| prox wrote:
| One of the most vexing problems for me is how to calculate how
| much to spend. We had a year of double ad budget, but we didn't
| see a corresponding rise in sells. Only 10%. We assumed we
| reached market saturation, but it still a lot of guesswork,
| even when meticulously diving into GA data.
| fourseventy wrote:
| What industry are you in?
| prox wrote:
| Medical supplies mostly (think beds, chairs etc.)
| franczesko wrote:
| As much as possible, as long you're earning money, I guess.
| andrewyates2020 wrote:
| Hi, I started a company, Promoted.ai (YC W21) that solves this.
| My background is from Facebook ads eng and Pinterest ads eng.
| Large advertisers are already aware of this, and so is Facebook
| and Google. At Facebook, I led a research team to help big
| accounts to drive more incremental conversions. At Facebook at
| least, there is a lot of energy to try and generate the most true
| performance lift and measure it as correctly as possible.
|
| However, every advertising platform will take your money if you
| give it to them, so buyer beware.
|
| True incrementally is a challenging measurement issue and
| therefore even more challenging to predict for delivery via ML.
| It's real, though, just hard.
|
| Buyer beware. When buying ads, think the stock market. If you
| hear stories about 20x ROI from random people, do what you when
| you hear 20x ROI on stock picks: nothing.
| trentonstrong wrote:
| Would like to hear more about these 20x ROI stock picks.
| redelbee wrote:
| What if this article is missing the forest for the trees a bit?
| In my experience performance advertising is almost always paired
| with awareness advertising. The latter makes you aware of the
| brand/product/whatever then the former nudges you to
| act/buy/whatever.
|
| So if you're buying or even just evaluating performance ads
| without considering the bigger picture you might come to
| erroneous conclusions.
|
| Take the Lego Movie example from the article. The $65 million
| movie is no doubt an awareness play. Could you make the case that
| you should also increase your performance budget to help capture
| more of the demand you just generated with the movie? Or should
| you just hope that people go from the movie theater to buy Lego
| unprompted? Is it worth it for Lego to advertise to people who
| walk out of the theater and search for "Lego Batman set" or
| whatever? I think so, even though evaluating such branded search
| campaigns individually might make them seem inefficient.
|
| It seems very easy to dismiss the performance advertising as a
| scam when you evaluate it in a vacuum. As noted in the article
| it's important (and very difficult) to understand the incremental
| outcome of any channel or campaign. That incrementality includes
| awareness campaigns.
|
| After more than a decade in advertising and marketing I am now
| more than ever unwilling to accept simple or definitive answers
| to highly complicated questions. At best I hope that we can
| unwind some of the overall complexity so we can have a chance to
| trust some of those definitive answers.
| Closi wrote:
| The problem is it's not what's sold on the tin - the promise of
| pay per click advertisement is often that you can track the
| results of your spend more easily, and also that it can get
| buyers at the time they are searching for a sale. The article
| seems to contradict those two points at least.
| rvnx wrote:
| No, advertising is not a scam. It's only a scam if you pay for
| the visitors that would have come anyway (buying your own
| keywords, and also retargeting/remarketing in most situation).
| s17n wrote:
| This is what the article discusses.
| franczesko wrote:
| Ok, read it. The article falsely assumes that performance
| marketing relies purely on the vendor conversion data. I
| don't know any business out there, which would do that.
| franczesko wrote:
| Exactly. It's not about the total sales digital marketing
| generates, but the incremental ones it brings. It can be quite
| efficiently evaluated, so definitely it's NOT a scam.
| rexreed wrote:
| So much of what we rely on today for Internet applications and
| infrastructure has at its core a fallacious advertising revenue
| model. As companies who spend money on advertising realize the
| low returns they are getting, they will turn off that ad spend,
| which will turn those platforms into increasingly needy and
| demanding in your face advertisers, being more intrusive with
| your data. Since the average "user" is the product and not the
| customer, users will continue to see fewer and fewer features
| that don't help with advertising revenue and the quality of the
| overall service to the user (not the customer, the advertiser)
| will decline.
|
| We're already seeing that. The quality of Google products
| continue to decay. Facebook and LinkedIn are increasingly both
| becoming shallower advertising hustles (LinkedIn just this week
| turned off post notification for events to force people to buy
| LinkedIn ads). As other apps and websites get snapped up by these
| FAANGs, we'll start to pine for the Internet that was 2008. The
| decay is already well under way.
|
| What is truly sad is that some of the smartest computing minds of
| our day are spending their efforts at these FAANGs not advancing
| society but rather helping keep people more addicted to social
| networks, optimize for clicks on video and web streams, pushing
| products in all your channels, and optimizing for the wrong
| things. How have we gone so astray?
| yupper32 wrote:
| > What is truly sad is that some of the smartest computing
| minds of our day are spending their efforts at these FAANGs not
| advancing society but rather helping keep people more addicted
| to social networks, optimize for clicks on video and web
| streams, pushing products in all your channels, and optimizing
| for the wrong things. How have we gone so astray?
|
| I think this sounds deeper than it actually is.
|
| What you're describing is just capitalism. A consequence of
| capitalism is that sometimes people figure out how to make
| addicting products and then capitalize on it (cigarettes,
| drugs, social media). Eventually we figure out the harm and
| work hard to stop the damage as much as we can. Cigarette usage
| is down to historic lows in the US, for example. Sometimes it
| takes a while and takes a lot of fighting.
|
| Another consequence is massive incentives to advance society.
| You can't deny that the vast majority of technology advances
| over the last 20 (or 40 or 60 or 80) years have been incredibly
| beneficial to society. And the advances wouldn't have happened
| if we didn't also risk the occasional bad actor coming up.
|
| We're still figuring it all out as a society. We've weathered
| worse and will come out of it stronger.
| malwarebytess wrote:
| Considering technology, capitalism, are causing a mass
| extinction on our planet and pushing us to collapse I'm not
| sure that I can't deny our technological advances have been
| beneficial.
|
| When something is killing you and all life on the planet, it
| doesn't matter if it's killing you softly.
| arbuge wrote:
| The example given in the article of the planner ads isn't a good
| one. The author is trying to make the argument that performance
| marketing mostly unfairly takes credit for sales that would have
| happened away, but this particular sale, even if it had happened,
| would have been unlikely to have gone to the specific brand that
| was advertising. If they hadn't placed that ad, they wouldn't
| have made that revenue. Some other planner company would have.
|
| (If you have a near-monopoly on planners, of course, such an ad
| would indeed have been a waste. The author would have come to you
| by default once he decided to get a planner. )
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