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Comment by partiallypro | Hacker News Reader

It's not overblown if you're lying to advertisers about the quality of impressions their ads received, and lying to investors about it too...especially when your stock has rocketed to making Facebook easily in the top 10 largest corporations in the world.

Not only that but Facebook actively brags about video impressions in their conference calls. This is fraud. I think this is something that should be investigated by the SEC to be perfectly honest. Doesn't mean they should be charged, just investigated; because if they are misreporting this, what other metrics are they misreporting to shareholders?

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> quality of impressions their ads received

My understanding is that they only counted it as an impression if it was a view for at least 3 seconds. If anything, including non-impression views is lying about the quality of impressions their ads received, because they're not impressions.

I don't know if that's how video ad impression data is normally reported, but it sure sounds more intuitive to me.

> quality of impressions their ads received

I don't disagree, but FWIW the ads still had better ROI than Facebook's competitors, so the oversight (while embarrassing) may not have actually changed the willingness of ad buyers to pay for ads.

Better ROI than competitors. Did facebook tell you that?

Any modern advertiser knows their ROI from different channels. As a big FB spender, this doesn't effect us at all.

FB has more information about other channels than you do, I.e. for all you know they have algorithms favoring users to see FB ads that are on path that usually leads to your site based on FB pixel tracking. Then all the multi-attribution ROI of FB is nonsenses but you have no idea.

I'm not saying they are doing that, I am saying be especially careful with anyone in advertising who is misleading and who doesn't try to protect their reputation by being exact in what they say.

Regardless, dollar for dollar, if people are seeing bigger conversions or returns it doesn't matter whether they came from display advertising or 'organic content'.

If they buy something, who cares?

If someone is intentionally adding correlations using predictive information then they are stealing money you did not have to spend on traffic that was inevitable. It is like standing inside your waiting room to hand out your buisiness cards then claiming the sales commission.

If you have independent metrics of your own spend, then no, facebook didn't tell you. But you'd have had to have had similar spends in similar ways with all their competitors to know that.

Speculation on alternatives won't have a bearing on an investigation into the legitimacy of their claims.

Comments like these should have disclaimers about the author's position on the stock.

What specifically is the lie here? That they report average view time without trivial views? That seems like a more useful metric.

You also can't really directly compare these simple metrics across sites as they don't get at customer lifetime value. With these simple metrics you run into problems where the average video view may be higher on site A, but the average spend for users is higher on site B, and simply following the metric will lead you to an ineffective campaign. Whose responsibility is it to effectively manage an advertising campaign?

While I agree that more oversight and transparency is welcome here, I think jumping out and calling it fraud is exactly the kind of reaction that makes me feel this is overblown.

Brick and mortal local retailer here. I spend over $100,000 annually on advertising in my local market. That is all digital at this point. Facebook video is a significant chunk.

The lie is about the effectiveness of video on Facebook.

I directed a fair amount of additional ad spend to Facebook precisely because Facebook users on average seemed to be giving a lot of attention to videos on the platform, even if they were promoted. It actually seemed like there was finally something that could work to replace the kind of lift we would see from TV advertising 5-10 years ago.

This calls that into question (which may be putting it mildly). It also calls into question all of the other metrics Facebook provides advertisers.

Does the additional ad spend convert to an acceptable lift in sales? If yes, why do you care about video engagement? If no, why maintain such spend even if the engagement numbers are genuinely high?

How could anyone possibly know? You maintain spend because Facebook claims it's providing value. There's no way to actually know this with any certainty, and Facebook manipulating their figures doesn't add clarity in the least. That's why this whole issue is important — these people are spending millions on ads because of the numbers Facebook reports. Then people are spending millions more on stocks because of the profit generated by aforementioned hand waving.

Statistical measurement of lift in sales.

Most small advertisers wouldn't be able to do this, and attribution is hairy as hell, but the options for measuring this are there.

This is a bias of online thinking. Brick and mortar retail doesn't really know the conversion rate on ad spend. The old adage is that you are wasting half of your advertising spend, but the problem is that you never know which half.

So, we make decisions based on imperfect information. When it was TV or Radio ads, there were 3rd parties that measured the market and reach of the station. With Facebook, Youtube, etc we have to take their word for it.

You don't measure the conversion in case of a brick and mortar vendor. But you can still measure proxy values for effectiveness: an uptick in sales volume or number of clients after after starting a campaign, for example.

But we aren't just running one form of advertising at a time, so what to we attribute the uptick?

Also, our marketing doesn't exist in a vacuum. Weather, competitors, a traffic jam down the street, variations in employee performance, etc all impact the performance as well.

It's not like we can just A/B test Facebook video ads vs Pandora Ads and pick the winner.

So, we shift our budget based on the available information.

And the average video view length is part of the information that we used to make decisions.

I'm confused. you seem very confident that facebooks video marketing is a lie, even while you admit being unable to attribute sales.

I know multi-touch is hard, but doesn't that mean you should be less confident in your statements because the data is fuzzy?

He said that he used the avg view length on FB as a reason to choose that channel. If he had know that they didn't factor in <3 sec views he would perhaps not used that channel.

If the ads boosts sales, use them. The speciffic number seconds they are shown is irrelevant. You will have to do your own analytics anyway.

> Duh, just solve the fundamental problem that has plagued advertising since the birth of the industry!

That's kind of why Facebook/Google was ever supposed to be valuable: they empower the analysis. How do you do good analysis with bad inputs?

You don't really.

But assuming the FB/Google reported numbers are accurate, would you pay for them and just convince yourself they are actually increasing your sales?

You should be able to at least plot sales numbers against ad spending per week over a year.

Facebook also "should" be able to report numbers in a way that isn't misleading to their customers.

Inputs are not good or bad, they are better or worse.

In the 1300s, feedback to the advertiser took years.

In the 1900s, months.

In the 1960s, you could now measure the effect of blanketing a MMR with ads, and see how sales there compared to nationally.

This century, you have still-imperfect, yet much better than before, attribution.

Good analysis in the 1930s was different than now. Good marketing was the same, but with cruder tools.

Ah, classic courtroom fraud defense. "Feel fortunate you even caught me; that would've been impossible a century ago!"

Having wiggle room on numbers isn't a bad thing. Lying about the amount of wiggle room on said numbers is.

You can do the analysis that you want, there's no proof that advertising increase something. They are bad and should be banned from our live.

See my reply to the comment above. With local retail, you can't just measure the conversion rate.

It is not about the specific number of seconds. It is about the implied engagement and focus of the audience. It is about a reported difference in the behavior of Facebook users vs other online properties.

You never can. But are you just going to blindly spend money on ads and just believe they work?

Yeah, that is basically the entire advertising industry. Precisely what "brand exposure" is.

What did they define the metric as prior to this 3 second revelation?

The one thing that would make it misleading is if they reported the average time excluding views under 3 seconds, but reported impressions including them. From the article it is not clear that this is the case

I think your comment is the key one. I actually don't see a problem at all with what they've reported IF they also separately excluded views under 3 seconds from their total count of views (i.e. the denominator). If they included them in view count, I would think a lawsuit would be warranted.

This is the piece I've been digging for info on.

The dimensions to break out reporting columns for various view duration percentages has always existed. Any advertiser worth their salt is looking at the breakdown for stats on meaningful views because out outside of cases where your message is delivered in a couple seconds you typically only care about longer views and would just look at those numbers.

So the question is how deep this polluted other metrics.

As far as I understand it, what happens is that views under 3 seconds aren't counted towards the average. So if you have 999 999 views of <1 second each and 1 view of 3 seconds, the reported average is 3 seconds / 1 view = average view time of 3 seconds, while the true average is something like 500 000 seconds / 1 000 000 views.

So they would report that hypothetical as "999 999 views; 3s average"?

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