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by john_moscow
1949 days ago
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From my own personal experience with online advertisement, it pays off in one specific case. If a user is right now comparing multiple solutions to a specific problem, showing them an ad for your solution could pay off. E.g. if someone searches for plumbers near their home, an ad of your plumbing company will have a decent CTR and may bring in business. Bombarding someone looking for random entertainment after a hard day at work with ads of luxury cars would be quite futile. The advertisement companies know this very well, but they also know that the specific, well-aimed ads make a small fraction of their revenue. So they have a very direct interest in using the success metrics from the specific ads to sell their platform to a much wider range of customers, for whom it will never pay off. There's also considerable FUD[0] involved in the decision process. Sure, you don't see your ads paying off directly, but there must be that legendary brand awareness building up in the background. What if you decide to pull the plug on ads, and in a year your company's sales drop by 20%? Do you want to risk your entire career over a choice of saving your employer's money that isn't your own money anyway? Also a huge chunk of advertisers are clueless people that decided to try ads for the first time. They don't know what to expect in terms of payoff, they don't know to make specific problem-oriented ads (and whether their case is even a problem-oriented case). So they spend some ad dollars and move on. But due to the scale of the market, it still adds up to a healthy profit for the platform. [0] https://en.wikipedia.org/wiki/Fear,_uncertainty,_and_doubt |
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