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Comment by bee_rider | Hacker News Reader

I don’t have compelling evidence either way. But, I’d be a little skeptical of the data collected by the ad company. They are specifically and organization who’s entire skill-set includes convincing people to pay more, and that they might need some new service. I mean it isn’t some dirty secret, it is exactly what their value proposition is.

The internal data you were viewing and the metrics they track are, in part, to show people and convince them to buy the ad service. That’s like pure uncut ad-guy ad-material.

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There is no grand conspiracy, the ad industry is massive, and advertising works. Companies would find out pretty quickly that advertising is a waste of money, yet here we are decades later and they still ad spend like crazy.

It definitely works, and the more tailored the ads, the better they work.

The key is remembering we are talking about average people, not nerdy techno anarchists with router level ad blocking and a pavolonian vomit reflex to seeing the word "sponsored".

It doesn’t require a grand conspiracy, just nobody deciding to rock the boat. It seems that when academics try to measure how effective the ads are, the effect sizes are much smaller than expected or it turns out the companies haven’t run any actual experiments.

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

> The key is remembering we are talking about average people, not nerdy techno anarchists with router level ad blocking and a pavolonian vomit reflex to seeing the word "sponsored".

Sure, dump everyone who is skeptical of ads into this niche weird person case, and it makes it easier to ignore them. Have you actually talked to these “average people,” though? My experience has been that most people just find ads annoying.

I know lots of people annoyed by ads, but I also have family that buy things advertised on Instagram all the time.

Having worked for these companies some of the data is murky (e.g. did these ads they saw earlier lead to them buying the product later, perfect attribution is obviously impossible) but a lot of it is unambiguous where they tracked people straight from clicking on the ad directly to a purchase. People have their conspiracies but I've seen it in black and white, it's very very clear. The only way I could see the data not being clear is in the case of outright fraud, which I'm fairly certain wasn't happening within our own metrics (as it would not only lead to legal liability but even more importantly fuck up the machine learning models).

Edit: to be clear I would believe the effect of ads is overstated, it's just the idea they are ineffective is wrong and people claiming that you can get more effective ads without tracking people at all doesn't seem plausible based on what I know of the industry. I could see contextual ads working in niche use cases (which again we already see when searching for products. YouTubers have relevant sponsors all the time. We even have affiliate marketing, where it's not only contextual but part of the content).

Tracking somebody from clicking on the ad, through to the purchase doesn’t prove that the ad added any value, though. The ad only added value if the person wouldn’t have otherwise found the product.

Yeah I feel you on this. Anecdotal, but I’ve had plenty of Google searches that ended in what technically counts as ad conversions, but the exact same link is only three items below. The only difference for them is that I clicked on the ad version because it is near the top typically.

Keyword advertising for your company’s own name is a well known mistake: there’s no reason to serve ads to people who are already searching for you. If anything the high conversion rate on that sort of keyword is an argument against… using conversion rates as a metric, haha.

Used to be a mistake. Now it's pretty clear you have to pay-to-play to get top billing on SERPs.

But keyword advertising on your competitor's name looks very dishonest. I search for company A but get B as top result.

Look, none of these criticisms are novel or unknown in the industry and it's well known that measuring the exact impact of ads is impractical but we're not talking exact numbers here, just whether personalized ads are generally effective or not. This criticism effects how effective it is but not the fact that it's generally effective, unless you think all ads are doing is shifting sales forward in time (which doesn't really make sense to me).

I think this is more of an effect for things like search or ads on an e-commerce platform (somewhat ironically the contextual ads people here are advocating for are much more susceptible to this) but less so for a lot of the more random ads, especially for niche products.

Edit: For me they are obviously effective. I think the more interesting question is exactly what the return on ad spend generally is but that would take very specific data that I don't have access to.

That can be measured! Turn off your ad budget for a day and see what happens.

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