Facebook Says It Found More Miscalculated Metrics
wsj.com
wsj.com
The primary business objective of advertising for companies such as mine is to build brand awareness, product benefit awareness and brand identity (eg. are you partial to Coke or Pepsi? Nike or Addidas? etc). Doing this will influence your purchase when you next shop for our categories (eg. your next shopping trip to Walmart or Amazon). Note that we are looking to influence a future shopping trip, any "digital conversion" we may get (eg. click thorough to our product page or an online retailer) really is pure gravy from our point of view.
The primary metrics of interest to us therefore are how many people did our impressions reach (people - not cookies or devices), of the ones we did, how many were in our desired target audience and what was our impression frequency to them (at some point, high frequency becomes excessive). We don't even really look at clicks or conversions unless there is a specific interaction based marketing program.
Hope this helps explain how big advertisers look at media.
The larger problem here is, depending on what is being optimized for - such as CPM, a big advertiser can begin to allocate an increasing chunk of their ad spend towards the worst performing inventory. I've noticed even Google has more and more very questionable ad products being sold, complete with nearly useless "conversions" being mixed together with real on-site conversions.
For all the heat Snapchat got in their IPO story, the sponsored face/AR filters are the best thing I've seen for brand advertising online in a really long time.
While it is true that many agencies plan based off share-of-voice, this is simply done because of laziness, and more prevalent, the lack of clear data that matters (we have X dollars, we can reach X number of people, post-campaign, we reached X people, campaign was a success!). Clicks don't matter, I agree, but conversions do. Specifically sales. That is what is paying for the advertising. As ad-tech advances, planning for sales will replace planning for reach. Think of an upside down triangle where digital and audience targeting fill the smallest part. This will be the first place where ad investment will go because you are able to see the direct results on sales. After you saturate this bucket, you can start filling things like lookalikes, contextual, behavioral, to TV and OOH at the top.
Agreed on your point. The total dollars spent by brand advertisers simply dwarfs direct response ads, and the industry standards for "success" often seem useless to direct response advertisers. Remember, these are brands who had been buying magazine and TV ads prior to the internet, so any quantifiable numbers is a major step forward for the industry.
And thanks, I knew about that, but without any kind of information about the spend level required to get a Facebook rep, it's hard to justify increasing spend for the purpose of getting our view tags whitelisted.
We typically these days prefer market mix models and the like for building definite guidelines on absolute money allocation.
We do run lift studies for operational comparisons and optimizations, but find these techniques unreliable and generally overestimates for any absolute conclusions. We do technically evaluate most new techniques that come to market.
For more info, I recently did an interview on an ad-tech site about this: http://www.thalamus.co/blog/lenny-chase-interview/ Happy to talk more separately if interested.
I don't trust the black box of the ad recall stats they provide, so that's not really an option. Is Nielsen's data any less of a black box for this sort of data? And is it actually a decent sample? The older way Nielsen did things was biased because people had to sign up to be a part of it.
And yes, the challenge is that to get a statistically significant read, we need to throw a lot into a specific test, and that is hard to justify without benchmarks. Kind of a chicken and egg problem if your brand is large enough where it takes considerable display dollars to make a blip against your other traffic.
I've been curious if things like Adobe's Attribution econometric modeling tools help much here, but guessing that lack of data will be an issue there as well.
My client is in the same chicken-egg problem and the way we approached it is: Going on blind is worse than the risk of a bad study. It's completely up to us to do due diligence and ask the right questions to find holes in the vendor's methodology and minimize the risk. We felt that the data gained will be accurate directionally, albeit skewed.
I've never had first hand experience with Adobe's attribution models but from what I gather, lack of data and similar to media mix modeling.
IMO, advancements in this space will be battling privacy concerns.
Have you found any good off-the-shelf tools to help with the incremental lift analysis that might be better suited for advertisers who are not as massive? Our current plan is to get DCM in place, pipe everything we can through there, and then let our Data Science team go nuts at trying to model it. Seems like that's our best bet since tools like Adometry or other dedicated attributions platforms don't make sense for us yet.
Yes there are a bunch of regression modeling methods and some complex setup lift and attribution studies that let you do this. Some of the techniques are under experimentation. They are generally expensive.
How do you calculate ROI for the ad spend? How do you figure out if you targeted correctly? For instance, I'm highly unlikely to buy either nike or Adidas, so I'd be a poor target.
On our scale, quality of targeting is something we trade off vs reach. The relationship is often non linear - say you get 10 million reach at an expensive CPM but very high accuracy vs. a 100 million reach that is cheap CPM but has half the accuracy, we'd might be better off putting money in the second bucket.
Sorry for the trite answer, but this kind of knowledge is so new and ever changing, and there is so little incentive for it to be documented externally, that if you're really interested in it, the best way is to become one of them.
And that is the real crux of the matter. FB is a media company. They are currently denying it in the wake of the political discussion (please don't go there) but the real reason is valuation of media vs. tech companies.
Adwords used to work really well, but its effectiveness has declined in recent years.
We've tried finding a LinkedIn consultant without any luck.
The HN community may be weary of sending / receiving unsolicited email but if you provide massive value upfront and only contact prospects who would get 2x+ ROI from your product/services, you will not be seen as spam and will convert a good % of the prospects.
I've run a lot of these type of campaigns and the key is to:
A) Only target prospects who have a real need for your product/service and have the budget for it
In your case, I would go on different grant websites and add their grant recipients to your prospect list. This way, you only target organizations who actively use grants.
B) Do a bit of work for them to provide upfront value in your cold email
In your case, research a list of grants they're eligible for (you can share the same list to nonprofits in the same space) and provide unique insights about these grant givers are looking for based on your experience. Your value upfront + value ideas will open the conversation and naturally lead to prospects asking about about how you can help them.
You can get an idea of what the initial email could look like here: http://www.artofemails.com/sales-freelancer#writer
I always say the same thing when people are buying FB ads. Doesn't matter how people you reach, how people are you converting?
Reminds me of an article that came out in 2010 comparing their add platform to a Ponzi scheme:
http://www.jperla.com/blog/post/facebook-is-a-ponzi-scheme
It also references PG's rant about how Yahoo! was doing the same thing in his 2010 article:
The first two ads I'm seeing right now in my news feed are Walmart and Banana Republic. I don't think 2016 is anything like 1998.
No, not all. I'd be a billionaire by now if this was true.
I've been in the affiliate business for 11 years and so far I've yet to come across any decent program that paid out just for clicks. Everything is conversion-based. For good reason - generating clicks is trivial and dirt-cheap, if you don't have to worry about conversions.
I found a few click-based programs a few years back. Turns out they were just monitoring conversions on the backend anyway, and dropping all non-performing affiliates.
So, I see, the affiliate is responsible for driving 'quality' traffic towards a business.
It seems like industries like gambling and smoking and other vice industries would be the best place to be then?
In some contexts a click through might count as a lead, but most of the time you need something called a "partial", which some sort of customer information. Be it an email, phone number, address, etc, that the user willing submits.
Most affiliate programs are based off conversion because unqualified leads could quite literally be worth nothing to the business.
The amount the affiliate earns from each also varies greatly. Clicks would be a few cents, partials potentially a few $, conversions tens of $.
This is the point. Might not impact the billing, but might lead announcers to miscalculate which campaign to use, for how long, for which audience, in the ending resulting in bad contracts with Facebook. That will be billed correctly.
Customers will be billed the same. Ok, I agree on that; but in better metrics means more accurate ROI calculations and in the medium/long term this means more business.
Shows you where their priorities are.
Whereas with production systems usage and troubleshooting is far more unstable.
Something that one voluntarily chooses do do being hard is not an excuse to do it poorly or in a way that places inappropriate burdens on others.
Or the rampant Freebooting? https://www.youtube.com/watch?v=t7tA3NNKF0Q
It brings me back to something I complained about on these boards years ago. I was working with a fairly small social gaming company about 10 years ago, during which time Facebook was boasting about "300m, 400m, 500m users!". Meanwhile, we were learning that almost half the users in our game were "fake" accounts. It was a major issue, but wasn't in the interests of Facebook to disclose during their hyper-growth. In fact, they made a point to state that fake accounts was not an problem.
Clearly Facebook will use the metrics when they are convenient, despite their invalidity.
People remember numbers but lose the context. Especially people whose bonuses depend on misunderstanding them.
The initial value proposition of online ads was click = confirmed intent. When not enough people click, they construct increasingly convoluted notions of purchasing seconds of mindshare at a time. Of course, at a certain point these purchases become as untestable as a billboard on a highway, a big difference being that highway billboards don't prop up industries, ecosystems, and even geographical regions like online advertising does.
If someone calls shenanigans on online ads, it will be far more catastrophic than if they did the same on billboards/radio/TV ads.
Dark patterns are a growth industry.
Like cancer.
Welcome to advertising. Shady as fuck.
That Facebook talk publicly about this issue (naming it a software bug) either means some lawyer business is already happening in the background, or the difference between what they promised and delivered is so obvious that it is just a question of time. This article is bad for Facebook's image as an advertisement platform and there is no reason to publish something like this, other than liability.
That said, Facebook has good lawyers and will obviously make it exceptionally hard for customers to prove Facebook is at fault. Additionally, their terms of service for the self-serve ads[1] is filled with blurry statements such as "we are not responsible for [...] technological issues [...] that may affect the cost of running ads", which will make legal battles lengthy and boring.
98% of all statistics are made up.
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Earlier discussion: https://news.ycombinator.com/item?id=12561302
It demands a lot of introspection and you couldn't stop that if you tried. The pressure is coming from the elephant in the room.
> Facebook’s efforts to fix its reputation with Madison Avenue may fall short of the demands from some ad buyers.
> ....
> One way Facebook could calm frustrated ad buyers would be to undergo an audit via the Media Rating Council, the media industry’s independent research watchdog.
The ad buyers might have suspected something fishy and started pushing back.
If you're a small business, Facebook may screw you over big time, so it's not worth the risk. I assume big companies just don't care.
Feels oddly transparent. What is prompting this level of transparency?
I read that as "we have no idea on how to measure, so please tell us what is important for you guys".
Such a sham.
Which is a great way to improve their product.