472 karma · joined October 31, 2011
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Marketing is finding product market fit. Product is a sub-category of marketing. Design is a function that contributes to product.
Linkedin calculates an ad impression (last I checked) as 50% of the ad is on screen for at least 300ms. I can be scrolling as fast as my thumb will flick down my LinkedIn newsfeed and it would probably count.
Then the KPI being used is clicks. I don't know of any business owner who would take that as valid. It should be some kind of conversion event (newsletter signup, contact request, or purchase, etc.)
If it were up to me, I'd want 4,400 clicks and a few dozen conversion events to do my calculations on statistically significant effectiveness. Especially since the author is paying CPC (cost-per-click)... who cares about impressions at all?
The ebay example twists the concept of user acquisition (new customers) and purchases (new or old customers). It is a common tactic to buy advertisements defensively, for example, if you're a product manager, and have determined that some of your user base are more transactional rather than frequent.
Another pet peeve I have is how they conflate direct response advertising and marketing.
a) technologists screaming "ads are literally the worst societal cost, like ever" who don't want to understand the industry
b) advertising folks taking up arms to defend their shamanistic, money-printing machines without statistics (Reason No. 7 will SHOCK you)
c) A tiny, tiny group of Mandalorian-like voices who have a necessary statistics AND industry understanding who are being drowned out
(this is in jest, but I double-dare you to say it isn't at least directionally accurate)
Other commenters have mentioned it throughout this whole comment thread as "incrementality tests". Amongst other approaches, this is the way.
Freakonomics severely lack the industry understanding. Listening to the podcast was like hearing how HTML is a programming language from the kid in week 2 at code camp. Then too the article, all the issues with Uber was just doing a bad job of managing their ad spend and they can fall into group B, noted above.
The baseline of this work is a control group who see no ads and then you build your tests from there that factor in channels, cohorting, and other components to get a statistically significant outcome. Yes, this will get more challenging with upcoming privacy changes (IDFA removal, et al). However, the last 10 years this wasn't a problem and I'm sure the corporations in the identity resolution business will hand-shake on a bunch of 2nd party data deals that just move the deals done in broad daylight around identity tracking and audience creation to the alley. Further, any advertising that is tied to an already known customer is able to be backed into at an audience level with login and cookie data. Even Pi-hole users may not be exempt here.
To finish with some constructive advice:
1) Advertising is not a synonym for marketing. We're only talking about advertising in both HN threads.
2) Every industry has high and low quality. Pareto's principle should be aggressively applied to where one spends their budget in the cesspool that is the Internet.
3) If you're ever seeking an agency to provide advertising services and they don't have a qualified data science or statistics leader (10+ years work experience, degree in Stats/Math/Econ, an MBA, or similar), run. Run from those shiny-shoes gurus. Channel your inner Usain Bolt and run.
Much of this buying and selling of data within the paid advertising industry hides in plain sight because it goes by so many names - contextual targeting, relevancy data, media enrichment, lead enhancement, blah blah blah...
He’s actually had a couple of exits which can’t be said for most authors in the space.
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I was at a startup 5 or so years ago, and now am at a very large company. The world of pain you enter as a small shop when the Large Co. takes you through their third-party compliance and enterprise IT requirements are mind boggling. WorkOS seems to be that critical and much overdue on-ramp between startups and the FT500.
1. https://www.reddit.com/r/wallstreetbets/comments/fck1tu/if_y...
Google and Facebook will turn to developing countries with over 100M pop to bolster bottom line the next decade, and for the US, per your first point, continue to acquire more consumer eyeballs and fold them into the parent company (take special note of their recent rebranding) for top line gains.
Facebook aren’t oblivious to these challenges and are investing in new-media experiments (I.e. hardware). It’s important to view these as just other viewports for the social connectivity. Think back to the explosion (and then clamp down) of social FB Canvas gaming on Facebook, they’ll launch v2 of that in an improved fashion with Oculus and pair it with Portal, then push majorly of compute to the cloud - watch out Xbox and PlayStation (probably PS6, not next-gen).
All this to say: Facebook is now a holding company looking to scale across the digital consumer landscape and encourage opt-in data sharing. I think they’ll go through a tough period but aren’t in any immediate danger.
Wow. I think when they do end up writing that HBS case, this will also serve as a wonderful example of sunk cost fallacy.