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Comment by coldtea | Hacker News Reader

>Yes, your intuition derived from a single anomalous data point (yourself) is definitely more accurate than the companies which have seen demonstrable success from targeted advertising.

"Single anomalous data point"? His description is exactly how targeted advertising works for pretty much everybody. He's not some weirdo outlier -- we're all show the same things we've bought and tangential things to our searches with the stupidest ad AI.

He might be wrong that "it doesn't work" (e.g. doesn't pay since it's crude), and probably he is, since so many businesses follow it, but he's totally right in that it's crude and far less effective than its potential effectiveness.

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The outlier is the kitchen faucet, not the person. It's fact that there exists multiple data-driven targeted advertising firms, and their data shows them that it works. That doesn't mean that every single impression works, it means that a high enough (likely very low) percentage of the impressions work.

Now we can debate if it ought to work, if it's ethical etc., but let's get the facts straight, it does work.

Works is a pretty low bar. Obviously it makes money for some people. Obviously it's better than no targeted advertisment.

The parent described how it's broken and works crudely and bad.

That it still works and gets some sales, he probably doesn't doubt.

What other bar were you hoping for? It's advertising. The fact that it works better than other kinds of advertising is a pretty relevant bar.

FWIW, since we're doing anecdata, I just checked my Amazon front page. Many things are irrelevant, a few comical (I recently looked at a 80-book box-set of Penguin classics[1], now it's systematically recommending each individual member of that box-set to me :-/ ) -- and a few are quite relevant and I clicked on them to check it out.

1: http://www.amazon.co.uk/Little-Black-Classics-Box-Penguin/dp...

> The fact that it works better than other kinds of advertising is a pretty relevant bar.

And that's in a nutshell both the solution and the problem because users have only so much to spend on product. So you end up with an arms race and that's exactly what we are seeing.

It's like the joke about two guys in a jungle, one with boots, the other with running shoes. The one with boots asks why are you wearing running shoes. The second one answers: In case we get chased by wild animals. "You won't be able to outrun a wild animal so don't bother, wear boots". To which the guy with the running shoes says: "I only have to outrun you".

I remember the talk the former Prime Minister of Poland gave to technology students on event I was attending; he retold this joke and wished us to be "the guy with the running shoes" in today's competitive market. I recall feeling pretty disgusted by this remark. I guess I prefer cooperation over competition.

It's not a proven thing that humanity would excel if people co-operated instead of competed. So what we have instead is this hybrid: groups of people co-operating in competing with other groups, think team sports, the various tech challenges, companies competing for market share and so on.

The only places in which people are really competing directly with each other are in the labor market (which drives the price of labor down) and in professional sports or other one-on-one contests.

Almost everywhere else we co-operate before we compete.

So far this model is a bit like democracy, it may not be optimal but it seems to be the best we have. If you can improve on that model you'll go places but you're going to be ironically in competition with everybody else!

I guess it's not proven, though it seems intuitively obvious (which, I admit, is often the sign of pitfalls) ;). I think what hit me during that talk wasn't glorification of competition per se, it was promoting ruthless competition. In the end, team sports and tech challenges are healthy as long as everyone remembers it's just a game and doesn't treat it too seriously. It works in business too, but there people often forget - sometimes because of greed, and sometimes because money is like hit points - losing them hurts; lose enough and you die.

Also interesting note: from my experience, most tech companies aren't really competitive. The market is big enough that most successful companies either compete superficially or sometimes outright cooperate, even when working in the same market.

It's called an eco-system for a reason, the parallels are many and the differences few.

>It's not a proven thing that humanity would excel if people co-operated instead of competed.

It doesn't matter if it's proven or not. We're (hopefully) not automata just doing what's proven to make us excel without consideration for the others.

> And that's in a nutshell both the solution and the problem because users have only so much to spend on product.

I don't see the problem? It's probably much more expensive per impression than traditional advertising, but probably much less expensive per sale (which is the metric that matters). This arms race means that if I'm a plumbing supply company, I can now spend my money on displaying ads for specific plumbing goods to people searching for specific plumbing goods, even when that means I'm going to hit some people no longer in the market for these goods -- but even hitting people who are no longer in the market is vastly better then hitting people who were never in the market. This lowers the barrier to entry (less cash required to advertise your products) which means more and better competition which means prices go down.

But that's not at all what happens. First, the plumbing company buys ad space from that morass of companies in the article's diagram. Then the add distribution network decides who sees the ads. And in the specific case we're talking about, users didn't see the relevant ads until after they made a plumbing purchase. So it failed at every level.

They don't appear to be targeting people who are in the market for plumbing supplies and hitting a few who already have them, from what we can tell. They appear to not be targeting people who are in the market at all until after they're out of the market.

> The fact that it works better than other kinds of advertising is a pretty relevant bar.

But a very low one. Conventional advertising is what, 0.1% effective?

I find my Amazon recommendations are often pretty good. And I'm willing to spend time curating them. If advertising on the rest of the web was as relevant as my Amazon recommendations then I'd probably stop blocking it.

> since we're doing anecdata, I just checked my Amazon front page. Many things are irrelevant, a few comical (I recently looked at a 80-book box-set of Penguin classics[1], now it's systematically recommending each individual member of that box-set to me :-/ )

I'll raise you mails that I get from Alibaba - after few months of receiving offers of aerospace-grade struts, I'm now getting mails advertising... stones.

(I do know how this happened though; the first is the result of me searching for aerospace-grade struts after CSR-7 launch failure, seeing if I can find the unnamed vendor by looking if someone is dumping cheap struts on Alibaba; the second is the result for me accidentally typing in "Pebble", meaning Pebble Watch).

I think if someone already bought a product a better ad would be of similar products other people with said product.

What I've noticed personally is that searching/researching for some very specific purchasable term (e.g. Love sac furniture) triggers the targeted advertisting. The thing is, the ad agency does not know whether I've made the purchase or not. Usually, I'll start researching something 1 day to 2-3months before purchasing depending on how large of a purchase it is, so the ads are useful up to the point I use the ad to make the purchase. Unfortunately, after the purchase is done, the ad just becomes irrelevant and annoying.

So there's probably a significant number of people where targeted advertising is able to get the click that leads to the purchase. In reality, it's probably just taking organic traffic that would have purchased anyway and counting it as a targeted advertising win versus an organic purchase.

Do you really need a lov sac? More than any other beanbag chair or alternate seating?

Or did the ad nudge you toward the conclusion that it is right for you, before you got over it and forgot?

Are you sure?

Every single impression might not work, but this happens extremely often. People joke about how they get ads for stuff they recently purchased. Lots of people.

> It's fact that there exists multiple data-driven targeted advertising firms, and their data shows them that it works.

If this is an unassailable fact because data, where can I see that data?

econsultancy.com most likely have some studies and reports on it.

> "Single anomalous data point"? His description is exactly how targeted advertising works for pretty much everybody

The anomaly is not how targeting works, the anomaly is that it "doesn't work" on him. The fact is that most people do occasionally buy things because of advertising, particularly targeted advertising.

"Doesn't work" is in quotes because I suspect that he has in fact bought something based on a targeted ad in the past.

No, his argument is that he won't buy the same kitchen sink faucet, or any other kitchen sink faucet for that matter, anytime soon yet gets them advertised for month. This should also hold true for those people that "do occasionally buy things because of advertising, particularly targeted advertising".

If you comparison shop for a faucet online, it would require collusion between all faucet vendors for them to know when you finally purchased one.

I assume he bought the faucet from Amazon so Amazon knows that. You would think Amazon would sell ads based on past purchases too. Then all the kitchen utensil/product/cleaner companies could pay for an ad that is displayed after the purchase of related items, like kitchen faucets. The weight should be lower on impressions for more faucets(unless it was returned) and higher for these kinds of ads.

> the anomaly is that it "doesn't work" on him. The fact is that most people do occasionally buy things because of advertising, particularly targeted advertising.

I'm not so sure. It's quite a big claim to say online advertising is effective on "most" people. It's also quite possible that it's not, and that online advertisers are all chasing an anomalous minority population that is not yet ad-blind.

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