Hacker News new | ask | show | jobs
by dgmdoug 3874 days ago
I'll weigh in on morgante's side here.

What WB discusses is a common misconception. Just because it doesn't appear to work for yourself, doesn't mean that targeting is not worthwhile. It's not really designed for an improved user experience, but to provide an advantage to those running the ad campaigns.

The crucial thing that people forget, is that that targeting only has to be a little bit better than random to be worth doing (from the ad operations perspective). Given a large number of ads shown every day, with nominal cost, we've only got to push a fraction of those toward users with a slightly better propensity to interact to increase the interaction rate, and get paid more from the advertiser (presuming a model where the advertiser pays us based upon interactions that we generate).

One of the reasons that it is profitable is that the amount we might get paid for an interaction could 50p, £1 or even £10 depending upon the client and media. The cost of showing that ad is a few pence per thousand! So, we can get it wrong many many times, and still show a statistically significant improvement in interaction rates and make a huge dent in profitability for ourselves.

I discuss all of this in Chapter 5 of Algorithms of the Intelligent Web. 2nd Ed. https://www.manning.com/books/algorithms-of-the-intelligent-...

3 comments

> Given a large number of ads shown every day, with nominal cost,...

And here we descend into spammer-logic. It took a decade or more, but spam filters are good enough now that spam is almost a non-issue; the flip-side is that email, which was designed to be reliable above all else, is now flaky because some legitimate mail can't find its way through the maze of filters, many operating according to machine learning that defies introspection. Ad blockers will eventually be that good, will break web pages in equally unpredictable ways, and the "Open Web" will be a worse place for it.

But I guess you make some money from your book.

Spammer logic is basically human nature. You can't kill it with morality because a few self-interested actors are enough to spoil the soup. It's an inescapable arms race.
I would add that Spammer logic is the nature of life itself. I think it was Neal Stephenson who commented that plants "Spam nature their environment with pollen." Same goes for sea turtle eggs, tadpoles, and sperm.
The Spamming Gene, I guess.
Targeted ad talking about targeted ads, so meta.
Exactly. I almost fell out of my chair laughing when I read that last line.
To complete the circle, dgmdoug should post an analysis of the funnel from HN post to book purchase as proof that targeted ads do work.
I missed a trick it seems. Should have posted a link where I could track conversions. :-/
Yet it would still be better to show useful ads. To try and predict what you would buy next, instead of showing more of what you've just bought. Its astonishing how 'little bit better than random' they are.
There is literally billions of dollars begging someone to figure out how, and plenty of contenders trying.