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by netaustin
1352 days ago
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The boundary between useful advertising and word of mouth is exceedingly thin and contextual. When Uber turned off $100m of advertising and found no meaningful change to its installation growth, had it already won? Clearly not then and not now; it's barely posted an operating profit and it still a couple billion away from positive net income. Rather, it's in a duopoly in the US and an oligopoly in some other markets and facing a pretty gnarly advertise (defect) or not (cooperate) prisoner's dilemma. Word-of-mouth can be a form of promotion. Most products have obvious entry pathways which smart and experienced marketers will readily identify; few of these are display ads, fewer still are billboards. The space of advertising decisions is high-dimensional and dependent on too many factors to succumb to generalization. Many awesome businesses have thrived without it; others would've starved without it. |
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This is misleading. Ad networks were defrauding Uber by generating fake clicks so such that organic installs of Uber would be attributed to these ad networks despite the install not being from an ad.
The problem was the ad networks and not advertising itself.