[ac29]

I think you've intentionally been hyperbolic to make two nuanced positions sound like complete opposites.

Here's my take on the two sides here:

1) It makes me uncomfortable that companies can track me online and use info that to target ads (or whatever their business model thinks it needs my info for). There are things about me like my location, identity and politics that are personal and I want to be in control of, not tokens to be sold.

2) Online advertising returns much less than $1 in profit for every $1 spent, so whats the point? Only big tech companies are benefiting from it. The fact that advertisers are pulling back during this economic contraction only proves this - if $1 in ad spending bought you >$1, they'd keep up their spending.

Not everyone will agree with me, but for me, both of those are true.

[rahimnathwani]

"Online advertising returns much less than $1 in profit for every $1 spent"

Are you saying (A) no single advertiser increases their profits by more than the amount spent on advertising, (B) that, in aggregate, the amount spent on advertising is less than the additional profit earned by all advertisers, or (C) something else?

It's unlikely that (A) is true.

It's possible that (B) is true but that any individual advertiser would be net harmed if they were to stop advertising (because they can't stop their competitors from advertising).

"The fact that advertisers are pulling back during this economic contraction only proves this - if $1 in ad spending bought you >$1, they'd keep up their spending."

It doesn't prove that. Perhaps they are pulling their spending because:

- they're not selling any more due to social distancing (theatre tickets? massages? dating services?)

- they're not selling any more due to supply constraints or inability to operate their business's physical locations

- the stuff they're selling is stuff people cut in a downturn

Just because a piece of advertising isn't worthwhile when no one can go out and many people have just lost their jobs, that doesn't mean it wasn't worthwhile before.

[ac29]

C. I think its impossible to prove that any given $1 of advertising earns back $1 in profit for any sufficiently complex advertiser.

Targeted ads for largely online companies: If your customer sees an advertisement on Facebook and YouTube, and sees a few sponsored search results on Bing, then opens an ad in an Amazon mobile app six months later and converts, which ad was effective? Which was priced right? Lets assume you can 100% correlate all of this activity. Can you justify spending $X on platform Y will return >$X?

Brand awareness ads for largely offline companies: Your products are largely sold at retail, and you are a large multinational company like Coca Cola or Nestle. Which of your ad campaigns this quarter drove sales? Can you justify spending $X on platform Y will return >$X?

[rahimnathwani]

"I think its impossible to prove that any given $1 of advertising earns back $1 in profit for any sufficiently complex advertiser."

Even if that is true, that doesn't mean it's impossible to prove that your total advertising budget of $X improves your profit by more than $X.

[TeMPOraL]

It may be possible, but it's a hard problem. Are the people doing this calculation in your company competent in statistics, or are they just trusting what their ad management tools tell them?