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Is Online Advertising Worthless? (zerohedge.com)
turkeydance shares a story from ZeroHedge:
Category 1 storm clouds are gathering over what has traditionally been one of the most lucrative, and perhaps only profitable, sectors to come out of Silicon Valley in decades: online advertising. Two months ago, it was P&G which fired the first shot across the "adtech" bow when not long after it announced it was slashing its digital ad spending because it thought it was not getting the kind of return on investment it desired, it made a striking discovery: "We didn't see a reduction in the growth rate." CFO Jon Moeller said "What that tells me is that that spending that we cut was largely ineffective"...
So fast forward to last week, when during Thursday's Global Retailing Conference organized by Goldman Sachs, Restoration Hardware delightfully colorful CEO, Gary Friedman, divulged the following striking anecdote about the company's online marketing strategy, and the state of online ad spending in general... What Friedman revealed - in brief - was the following: "we've found out that 98% of our business was coming from 22 words. So, wait, we're buying 3,200 words and 98% of the business is coming from 22 words. What are the 22 words? And they said, well, it's the word Restoration Hardware and the 21 ways to spell it wrong, okay?"
Stated simply, the vast, vast majority of online ad spending is wasted, chasing clicks that simply are not there....One wonders how long before all retailers - most of whom are notoriously strapped for revenues and profits courtesy of Amazon - and other "power users" of online advertising, do a similar back of the envelope analysis, and find that they, like RH, are getting a bang for only 2% of their buck?
So fast forward to last week, when during Thursday's Global Retailing Conference organized by Goldman Sachs, Restoration Hardware delightfully colorful CEO, Gary Friedman, divulged the following striking anecdote about the company's online marketing strategy, and the state of online ad spending in general... What Friedman revealed - in brief - was the following: "we've found out that 98% of our business was coming from 22 words. So, wait, we're buying 3,200 words and 98% of the business is coming from 22 words. What are the 22 words? And they said, well, it's the word Restoration Hardware and the 21 ways to spell it wrong, okay?"
Stated simply, the vast, vast majority of online ad spending is wasted, chasing clicks that simply are not there....One wonders how long before all retailers - most of whom are notoriously strapped for revenues and profits courtesy of Amazon - and other "power users" of online advertising, do a similar back of the envelope analysis, and find that they, like RH, are getting a bang for only 2% of their buck?
...or someone who said half of his advertising budget was wasted...but identifying which half was the problem?
Just in time, coin mining is coming to replace ads.
I suppose the next step will be to make all links internal to a site with ajax, so the coin mining script can run continuously as long as a user is on the site.
(T>t && O(n)--) == sqrt(666)
My observation in retail has been that appeal to brand loyalty is the most effective form of advertising. You probably aren't surprised by that, but you likely don't realize how insane it gets. It's extremely common for my customers to think an HP printer will work better with an HP computer.
As for advertising: Fake reviews. They work. You don't even have to explicitly buy them; give someone a free product and they'll give it five stars about 90% of the time. Doesn't hurt that Amazon customers reliably upvote five star reviews and reliably downvote negative reviews.
Correct, you should know to the penny, to the minute how effectice your online ads are.
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Correct, you should know to the penny, to the minute how effectice your online ads are.
You mean that you should get from Google metrics about how effective are the ads Google is selling you, or that you should get from Facebook metrics about how effective are the ads Facebook is selling you, without in either case having access to the information needed to verify the metrics they give you?
That's the world of online ads, in a nutshell.
lucm, indeed.
The difference is now that we can see which half is working, if we measure it by immediate purchases. If you pay for ad, and it does not result in a sale, then is it working? Some would say no.
In a way we are back to the mode of print advertising a hundred years ago. A store runs an ad for a sale, the store can then look to see if revenue increases for the day, and then judge if the ad works. Since that ad is likely run on many outlets, one can't say exactly which ad works. This is what is different now.
But that misses the advertising model of the past 50 years, which is branding and long term returns. You advertise beer on the Super Bowl not just to get sales today, but so the kids will hopefully buy your beer later. You give away a magnum of expensive alcohol to soccer players not to sell the alcohol right then, but to connect with the fans that when they celebrate they are going to buy it.
So maybe branding is still a thing. Maybe putting the Amazon name everywhere is valuable. The problem with advertising and the dot com crisis was that there was an incestuous relationship between advertising dollars and advertisers. it was actually the same money looping around from one had to another, with no value being created. That is no longer the problem. it is that the 'new economy' people still think they have found a new economics, and the cost of acquiring customers can be reduced to zero.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
I don't know, the Russians sure did a lot with $100,000 in Facebook buys. Maybe they just know their 'consumers' better.
-- I have a private email server in my basement.
Twitter is fucking worthless. But we all already knew this. But just for shits and giggles, lemmie tell ya some numbers.
Twitter gave me one of those ad trials for their service, a free $100 credit to try them out as an advertising system.
My company received a 0% click-through rate.
I guess I got exactly what I paid for, absolutely nothing. But one thing was for sure, Twitter made sure I absolutely NEVER gave them any actual money for advertising, since it was literally useless and worthless for my business.
...ads are either blocked by software or my mental ability to completely tune them out as visual noise. If I want something I search for it.
So, then, you can tell if I click your ad today but my wife buys your product tomorrow? Your ads somehow gain persistent access to my webcam and/or microphone in order to verify that the person who was sitting at the machine when the ad was clicked is still sitting there when the purchase is made, even if those devices do not exist or are disabled? That sure is some trick, and if you're not doing it (and you're not), you're making assumptions. In other words, as SNR said, it's a proxy measurement.
APK quotes people (including myself) without context and should not be trusted. Just thought you should know.
A lot of web sites ask this, generally with a drop-down. I frequently find that either I don't know, or I heard about them in multiple ways, mostly, neither answer is available, so I select the most irrelevant.
Seriously, guys, If you are trying to collect this information, do it properly on a small percentage of transactions. If I get asked 3 times cos I buy from you three times, then I will probably go elsewhere for the fourth. I ran a polling business 25 years ago, and we knew this then. The only two reasons for polling 100% of customers are (a) stupidity, and (b) evil intent.
Sent from my ASR33 using ASCII
Contrast all that with the non-ad link that the search string "procter and gamble" generates, which is simply "http://us.pg.com/".
True BUT! When you click on that link (in most browsers without active defenses) you'll see that the click is intercepted and it fires off a POST request to Google anyway, tracking the click, with a link that looks something like:
https://www.google.co.uk/gen_2... string]&s=2&v=2&pv=0.[random number]&me=54:[random number],V,0,0,0,0:6834,h,1,52,i:49,h,1,52,o:214,h,1,51... [many more bits of data] 1,e,C&zx=[some other number]
That will then redirect you to the destination site.
You won't notice it unless you're really tracking requests - if you mouseover the us.pg.com link it doesn't show the Google tracker. If you inspect the source it just looks like a regular HREF link.
Do you now who P&G is? Do you think that they sell direct to consumer? Their ads are far more indirect, meant to increase sales at retail.
I still have more fans than freaks. WTF is wrong with you people?
There's an onmousedown event in the page's javascript that changes the link when you click on it. I wish browsers would disallow such sneakiness.