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by legitster 2182 days ago
I don't think I understand this question. Why doesn't Facebook limit the number of impressions? I assume the premise is that fewer ads will be worth more?

Again, the ad market is insanely efficient and competitive. Restricted supply doesn't correlate with increased prices. If 1000 impressions is worth $20 to me, and it costs $30 on Facebook, I can take my money elsewhere. I don't even need to push a button, I have software that could automatically change my budget minute to minute.
2 comments
reilly3000 2182 days ago
More inventory means more chances to sell something to an advertiser. That is why they go to such great lengths to build massive data centers with gigantic digital brains to figure out how to optimize session depth, impressions/user, watch time, etc. Buyers are not able to pay beyond their profit margin, so increased rates just means they cut budget and look somewhere else.
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sfpoet 2182 days ago
Let me explain it another way.

As a user, I often see the same ad 100s of times. Yes, 100s.

On most ad software, you can set it so that the user sees it maybe 3 times.

The fact that I see an ad 100s of times means that the ad market is inefficient. Maybe the competition for that ad space is efficient, but from a user POV, advertisers are wasting time and space.

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legitster 2179 days ago
Replying a bit late:

This is the difference between "Reach" (number of people who see the ad) and "Impressions" (number of times an ad was shown). Advertisers have the ability to optimize for either (or neither if they optimize for something else).

Usually this is based on some internal metrics they have, like a report that correlates the number of impressions it takes someone to convert. Nobody will buy a product based on a single impression, so some amount of repetition is required. There are also industries with really long sales cycles where consumers may only make buying decisions once a year or less, so if you buy ads, you need to do it over a long period of time.

That's not to say every advertiser is doing things logically or efficiently. There are a lot of dumb strategies. Just like the stock market, it's full of really dumb decisions, and it only seems sensible when you stand back and look at it as a whole.

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