Facebook knew for years ad reach estimates were based on ‘wrong data’

Same shit that caused "pivot to video" and killed so many things.

https://twitter.com/adamconover/status/1183209875859333120

Even three years ago, I have seen academic work (presentations) on Facebooks effectiveness of advertising - based on facebooks own data - and the conclusion was pretty dire.

The only reason (yes I asked) Facebook continued to allow these studies was because Google did even worse.

I wonder if all this stuff ever got published.

Never heard anything in the press, so I am guessing Facebook eventually pulled the plug. I wonder if I saved the drafts tho :>

>Facebook has come clean on a slight error in how it presented video view time on its platform. A mismatch in how average video view time is calculated and how it is defined — resulting in that number being reportedly inflated by a trivial 60 to 80 percent, for a short period of two years.

I don't understand - a "slight" error and 60-80% is "trivial" for a "short" period of two years? Is it just me or is this language excessively apologetic? Or is it meant to be ironic?

Why large companies fail - they put revenue ahead of customers.

How long a company can get away with that depends on their moats, competitive landscape, and what alternatives exist. In the case of FB, obviously there's a huge moat and a semi monopoly.

There is some competition from Twitter and Snapchat, but really FB acquiring Instagram doubled their market cap, because that is the only other social platform that has truly reached their scale, and also has an effective, if not more effective, ad platform.

This is also pretty typical even at smaller companies. Different people have different "masters". The product manager is rightfully trying to build the best product for their customers - the advertisers. But the upper management has bonuses tied to revenue usually through stock compensation, so their interest is in their own pockets. The product manager who correctly points out a real issue, is then seen as a negative, rather than someone doing a fantastic job.

We experienced these blatantly false promises from FB, so we stopped buying ads from them. Hoping to get a few tenths of a penny on the dollar back from them from this lawsuit. Hoping it hurts them a bit more than a few tenths of a penny on the dollar, though.

I have seen many people fail to realize (and sometimes to understand at all) that taking measurements of large numbers of people is always fraught with errors of all sorts. No matter how hard you try, it is like the universe always pushes back to make sure the data are imperfect. Sometimes those imperfections are acceptably small, and other times the imperfections are uncomfortably large.

In my opinion, anyone involved in such large-scale data collection and analysis should acknowledge the inevitability of error and provide disclaimers about potential sources of error.

From my own personal experience with online advertisement, it pays off in one specific case. If a user is right now comparing multiple solutions to a specific problem, showing them an ad for your solution could pay off. E.g. if someone searches for plumbers near their home, an ad of your plumbing company will have a decent CTR and may bring in business. Bombarding someone looking for random entertainment after a hard day at work with ads of luxury cars would be quite futile.

The advertisement companies know this very well, but they also know that the specific, well-aimed ads make a small fraction of their revenue. So they have a very direct interest in using the success metrics from the specific ads to sell their platform to a much wider range of customers, for whom it will never pay off.

There's also considerable FUD[0] involved in the decision process. Sure, you don't see your ads paying off directly, but there must be that legendary brand awareness building up in the background. What if you decide to pull the plug on ads, and in a year your company's sales drop by 20%? Do you want to risk your entire career over a choice of saving your employer's money that isn't your own money anyway?

Also a huge chunk of advertisers are clueless people that decided to try ads for the first time. They don't know what to expect in terms of payoff, they don't know to make specific problem-oriented ads (and whether their case is even a problem-oriented case). So they spend some ad dollars and move on. But due to the scale of the market, it still adds up to a healthy profit for the platform.

[0] https://en.wikipedia.org/wiki/Fear,_uncertainty,_and_doubt

It is difficult to get Mark Zuckerberg to understand something is wrong if it is making him the right amount of money.

I remember not too long ago Uber cancelling previous arrangements with Facebook advertising over a similar fraud.

Facebook did something shady? I know most of the stuff coming out these days is in the past, but I really hope they are turning the corner and starting to act like they poses a spine and want anything but more dollars. Otherwise I see a dark future and a lot of litigation in their future.

At this point, it's hard to make a case for why Facebook is NOT a criminal enterprise.

Facebook ads are scam. FB Ads don't reach anyone.

Class action lawsuit coming in 3,2..

I'm sure the free market will punish Facebook, so we don't need to worry about this.

Facebook is not an advertising company. They're a parasitic revenue laundering company. They feed off the cashflow of soon-to-be-bankrupt startups as part of giant global VC-fueled pyramid money laundering scheme. Founders get paid to take huge loans on their startup's books and run their startups straight into the ground while laundering all their capital to beef up Facebook's revenue for the benefit of big VCs and their crony capitalist friends who own Facebook shares. The shell company's employees and regular tax payers (who lose value via monetary inflation caused by these dubious bank loans) take the fall while all the key participants of the scheme get off scot free.

Rince and repeat; real definition of 'serial entrepreneur'.