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Comment by hermannj314 | Hacker News Reader

Do you have data to back up this claim?

The marketing side of the business is very data driven with lots of very intelligent statisticians and scientific testing for ad placement and ad content, etc. I cant accept that the same people that are manipulating my thoughts and desires with algorithmically optimized content never once thought to run hypothesis test on performance of targeted ads based on browsing history.

I feel like you are making a bold claim, am I misunderstanding?

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Here are some stories from academics that had trouble getting companies to actually run rigorous experiments about ad effectiveness:

https://freakonomics.com/podcast/does-advertising-actually-w...

I don’t think ad companies are really trying to disprove the idea that their business model works. The intelligent statisticians work for the ad companies or in the ad departments of the product-selling companies.

It's very easy to forget to challenge your assumptions, and one of those assumptions is "more data = always good"

I don't think they are necessarily saying that. The data driven aspect is to connect users actually wanting or interested in something. The measure of this is the conversion rate, which is where the user actually clicks on the ad. You can also connect these with purchases from the ad buyer. The data driven piece is all the variables involved in developing functions that maximize this. At that point it is basically data science.

The advertising industry relies on ads being ineffective. That way you have spend more on them.

There’s an argument that firms will compete to get better performance per dollar spent.

Having said that, look at all the evidence of platform fraud, auction fraud and click fraud that came out during the Google trial.

They control most of the signals that come back to the groups paying for ads, and every level of the system that generates that signal (inside and outside of Google) is designed to defraud the advertiser (and advertising firms).

Hey, which trial are you talking about? Do you have a link to it?

Can you elaborate what you mean about the "system that generates that signal (inside and outside of Google) is designed to defraud the advertiser (and advertising firms)"?

Thanks

> The marketing side of the business is very data driven with lots of very intelligent statisticians and scientific testing for ad placement and ad content, etc [...]

We'll see that and raise you: “It is difficult to get a man to understand something, when his salary depends on his not understanding it.” (Upton Sinclair)

Ok, I'll call and raise you the same quote!

If I can cut my company's ad spend by an order of magnitude and still get the same sales... you really expect me to believe I won't get a fat bonus next year? Really?

Companies and investors do no behave rationally. If they did, there would be no ai industry, no buying gsuite and ms365 at the same time, no buying teams and zoom at the same time, and no return to office, among many other things that are part and parcel with the "modern" business structure.

Really a lot of these plays are about satisfying preconceived notions of what a company ought to look like based on what other companies are doing in order to make broad comparisons for investment. It is why merely hype is such a strong signal for businesses rather than having a product that can stand on its own two feet.

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