Google derives 80% of its revenue from ads, Facebook 99%. Imagine these giants coming down if it turns out that online ads aren't effective?
EDIT: Tweaked the wording regarding the alleged "coordinated takedown" as a reaction to a comment.
I think it's more related to people trying to ride the karma wave than "A coordinated takedown of ad tech companies". And it is effective, because it happens way too often.
Nevertheless it would be interesting if the idea of digital ads being ineffective snowballed to the point where it became like a self-fulfilling prophecy, and led to the demise of large companies that we think of as "giants" or "monopolies".
I'll bet that a lot of ad spend is zero sum. They'd probably rather share profits than boost google's.
[1] https://hn.algolia.com/?query=follow-up%20by%3Adang&dateRang...
Examples would be:
1. follow-up submissions
2. an initial wave of critical comments followed by a wave of apologist comments
3. first page of comments occupied by a single top level comment with lots of descendants (you often post to draw attention to other pages of comments in these cases)
The average third-party ad networks are junk, rife with fraud (ads that are never actually seen or clicked by a human), poor targeting, poor measurement, limited brand safety, and opaque billing.
First-party ad tech provides much better control over these factors and can generally be offered cheaper because they can more effectively allocate their clients' budgets. In what other industries are the superior products cheaper than the junk? (not rhetorical - I'm curious if this exists in other industries)
G and FB are the biggest first-party ad sellers, given that their total addressable audience covers most of the free world, with Amazon rapidly gaining ground. TikTok, Pinterest, and Snapchat are building clones of G/FB's ad tech by poaching a lot of their engineers (karma for G/FB cloning their consumer products...) and are also showing strong growth as first-party sellers.
If you're a website/app that monetizes through a third-party network (including Google Adsense and Facebook Audience Network), you're going to see your revenues plummet in the coming months.
By the way how impressive is the scammer level of sophistication. App level man-in—middle-esque (probably imprecise terminology) forging of attribution based on massive monitoring and siphoning of what otherwise would have been organic conversions. Super cool. And those were the ones they caught imagine what they didn’t.
Or, you know, somebody read the first article on HN, then found the other somewhere, and thought of posting it, as it relates to the same disucssion...
Happens all the time with posting clusters (and the Baader-Mainhoff phenomenon).
It's funny how quickly the word conspiracy is used by the party that has most to lose.
It's more likely that people have spend the past 10 years buying into the online ad industry, got burned and finding out it wasn't because they weren't spending enough it was that they were defrauded.
We should see class action lawsuits over the next 10 year horizon that will put a massive hit to the shady ad tech industry.
Millions of small to big businesses were defrauded out of their ad spend and now the industry will simply make way to a whole new scam.
Oh please let it be so, even though it's just a wild ass guess. Ad "tech" has ruined the internet (only slightly hyperbolic). Oh to be able to recover the "innocence" of the late 90s internet. Maybe I should just stop browsing so I can spend more time yelling at the kids to get of my lawn
If you've been on various internet marketing forums, you will see that this is just a group of people who weren't smart enough to land a wall street jobs but morally unhinged enough to defraud businesses.
I am already hearing about law firms sending out letters and emails to people who bought Google or Facebook ads in the past 10 years.
With the new USGOV administration hawkish towards social media/tech (essentially ad revenue dependent cmopanies) and now seeing class action lawsuit against ad tech companies, my popcorn is being prepared in the microwave.
People have no idea how lucrative ad click fraud is in the botnet market. It used to be that botnet operators DDOS for hire or install Dutch spyware toolbars, now with headless browsers and fingerprinting evasion it has become impossible to distinguish real ad impressions from fake ones.
Your only tool to fight these fraudsters are statistics but over the past 10 years the "bad guys" (I don't know who is more evil, the people defrauding businesses legally or illegally) finally figured it out. They know if they are too greedy they will be caught so they now play the long milk game.
It is incredibly lucrative. A single botnet victim can yield upwards of $2~4 in ad revenues from a variety of ad networks.
It is IMPOSSIBLE to distinguish real from fraud ad clicks/impressions since the introduction of headless browsers and fingerprint evasion
Somehow web scrapers/botnet operators have found the sweet spot. This is just like how the American Cosa Nostra working with Russian criminal groups were able to siphon off crude oil from the USGOV in the 80s.
I miss the 90s when everything was more simpler and secure as a result. You can't hack an HTML document.
It is in fact much more likely that Google decreases the visibility of articles that in any way tarnish Alphabet's reputation.
The problem is that first off, people rightfully dislike advertising so it's expected for them to rant about it, second, regulation is being worked on (whether the GDPR, CCPA, or similar) that would thwart targeted advertising, so advertising is now also facing pressure from the government and not just from people ranting about it, and third, these articles talk about brands themselves having doubts about the effectiveness of their advertising efforts and the media rightfully reports on it.
Ranting about ads by itself won't change much, but in this case it seems some advertisers themselves are having doubts as to how effective it really is and both the media and HN is reacting to that.
> Google derives 80% of its revenue from ads, Facebook 99%. Imagine these giants coming down if it turns out that online ads aren't effective?
Just because Google and Facebook are able to make a profit off their ads doesn't mean that their ads are actually good value and not overpriced, nor that the people in charge of assessing the ROI of these ads are incentivized to look into it (which is the point I'm arguing in the thread you linked). You can very well agree that online ads are effective but still aren't worth what they are currently priced at.
Exceptions:
- New products deserve some advertising. I would handle that like the patent system. Demonstrate your product is sufficiently different, and get access to some attention economy time slice.
Some may say, well what about competition with existing products to bring down cost? Simple, get rid of stupid https://en.wikipedia.org/wiki/Monopolistic_competition and start selling things in unmarked tubs with a price tag. Cheapest one wins. Of course, there has to be quality control and avoiding regulatory capture with that, but stupid brands are not a good solution to that problem.
- I choose the TV channel, website, etc. to visit, but public space I might have to walk through because it's the only option - In that public space it may be impossible not to see the adds - sight lines in public spaces are public property
Now, one may ask "what about paying someone to verbally advertise in public space". I think that should remain legal, because that does seem like a slippery slope. I'm willing to risk that society won't collapse so far that that highly inefficient form of advertising became cheap enough with destitute surplus labor.
Take diamonds for example. Prior to the mid 1900s, diamonds weren't nearly as sought after as they are currently. It took the marketing and advertising efforts (among other efforts, like monopolizing the mining process) of De Beers to convince the public that diamonds should be highly coveted. It was advertising that pushed the public to think spending X months' salary on a diamond ring should be normal. De Beers is obviously highly derided, but this a pretty clear cut case that advertising is NOT zero sum. The value of diamonds went up because of advertising, and nothing else depreciated in value as a result.
I won't even touch on your other points about unbranded goods, except to say that consumers definitely show preference for branded items, and I don't really see why that is a problem.
If you take into consideration the money wasted on overpriced stones, it's zero sum. How did people ever get engaged before De Beers?
I mean zero-sum in that advertising shifts spending from one area to another. Perhaps all the diamond ring money would have gone into other things.
It's a hard point to prove or disprove, but even if advertising overall deceases the consumer saving rate, sure the vast majority of advertising cancels out. (I'm going to buy tide or downy, but not both.)
> except to say that consumers definitely show preference for branded items
Well these meaningless competing brands convey no information and waste tons of resources. And it's rather an embarrassment to Capitalism for the primary non-price information exchanged by market actors to be bullshit noise, even if it isn't a "real problem" compared to global warming or something.