What if performance advertising is just an analytics scam? (sparktoro.com)

Article summary

The article questions the effectiveness of performance advertising, suggesting that it may be an analytics scam. It cites the example of Airbnb cutting its performance advertising spend by $542 million without seeing a significant impact on sales. The article argues that ad platforms have an incentive to take credit for conversions that would have happened anyway, and that advertisers may be overpaying for ads that don't actually drive incremental sales. This can lead to a situation where advertisers are essentially paying for ads that don't provide any real value.

Main themes

• performance advertising effectiveness
• ad platform incentives
• incrementality vs attribution
• search engine priorities
• competition and market dynamics
• user experience and ad relevance

What commenters say

• Some argue that ads can provide value by promoting relevant content, even if it's gameable by the capitalist system.
• Others believe that search engines should prioritize organic results over ads to help consumers get the best deal.
• It's argued that bidding on a competitor's brand name keyword should be banned to prevent misleading consumers.
• There's a view that smaller competitors should be allowed to bid on established competitors' brand names to promote competition.
• A point is made that users who search for specific products may still click on ads from other brands, potentially leading to a sale.
• Some think that search engines should prioritize relevance over ads, and that users don't care who is getting paid by whom as long as they see relevant content.
• The opinion is expressed that the current advertising model is flawed and prioritizes growth over user experience, leading to a poor user experience and potentially driving users away.
• It's suggested that alternative models, such as demographic targeting, may be more effective and less intrusive than interest-based targeting.