At first internet advertising was a no-brainer. Agree to host ads, get revenue to keep your site afloat, make a profit, expand. Fine. But now we’re inundated with ads to the point people are turning off. Hell, there are ads I’d be happy to see, but I never will because I’ve blocked them with a Pihole and Ublock. The vast majority of people aren’t doing that, but are they actually buying the advertised products and services?
Guess I can’t get my head around the logistics. Seems like all the money in the world is available for advertising, but are these companies actually seeing a return on that investment? Reddit’s basically bots advertising to bots, and the stock market rewards them handsomely. Nobody involved is stupid, they know this is happening, yet companies are still throwing money around. (Someone will relate this to the AI bubble, but it’s not really the same thing.)
There was a great article posted here about how 40% (?) of ad views are bots. (If someone can find it, that would be great!) The issue came up to the author because he was tasked with finding out why the advertising spend wasn’t getting expected sales. The number of clicks didn’t jive with sales results. The advertiser was seeing some ludicrous clicks vs. sales that was 1/10th of what it should be.
And companies are paying for these dismal results?! Think of a time where you were responsible for results at a company. If your spent $X on a thing, and didn’t get at least $X dollars back, you would back off that spend or your boss would pull the plug. (Sure, marketing often takes time to get a foothold, I get that.) That’s how capitalism fucking works. And for all the bitching about capitalism, the players don’t seem to be doing that thing. I feel like I’m taking crazy pills.
Is internet advertising a sort of bubble? Doesn’t seem to be as it just keeps going.
My friend’s partner works in online advertising from matching, ugh, “influencers” to brands to more “traditional” targeted online advertising.
I asked her something along these lines and she told me about a campaign she’d just worked on which dropped my jaw and changed my perspective.
Essentially, she was working with some product being sold with or inside some luxury brand of cars. Her firm was able to target people who seemed to work in dealerships for that brand in Canada. The product being expensive as hell meant that even a handful of sales would justify the campaign.
The campaign cost her firm almost no time, the data were available fairly easily and once established could essentially be run automatically.
Hers is an extreme example but combine relatively low costs with unnervingly accurate micro targetting like that… It’s a stupidly efficient means of communicating to prospective clients compared to every other type of advertising.
Reddit is an interesting example. They’re milking the advertising for all they can but I’d be surprised if the bulk of their revenue/stock valuation was from ads versus holding all sorts of AI trainable data.