Ad-tech as a bubble overdue for a bursting | Hacker News Reader

Ad-tech as a bubble overdue for a bursting

pluralistic.net

21 pointssamizdis7 comments

On the contrary, ad supported tech companies seem to be the only profitable startups over the past 10 years or so.

I'm exaggerating of course, but only a little.

As long as “free” exists, and the general population don’t understand why it’s free - then sure this will be the case.

I think the knowledge tide is turning on surveillance and there will be a time where people will gladly pay (a reasonable amount) for a service that is working for them.

Somehow I see sources claiming that ad tech is not working as we thought; increasingly often.

Honestly it makes intuitive sense.. All this predictive things and still I get pretty dumb ads based purely on my search context.

You are not the customer.

Adtech sells ads to companies that want to reach you - the highest bidders - not the companies you are interested in.

In other words, there is a profile that says "v4dok: gender, age, income, location" and even if you are highly interested in lego, lego won't pay $1 to serve you an ad, but a water filter company or a political candidate might.

isn't the point that LEGO would want to show its ads to those who have some interest in lego? Why would the water filter company show its ads to those who never searched/texted for a water filter before? or I'm just behind the times, and now the concept of targeted ads is completely different than what I'm used to learn?

This is an interesting problem. Maybe the answer is the opposite of what we are thinking.

LEGO already has a massive advertising program, and they know that everyone knows who and what they are. So they may not need to specifically target you, because they know that sooner or later, you’ll go to Target or Walmart or Amazon, and buy their products. Whether it is for your own kids, for yourself, or for your nieces and nephews.

However, Water Clarity Filter Company, just came into existence a few years ago, and they’re now making a push to sell their products.

Now, Water Clarity Filter Company knows that they can’t spend the money like LEGO can for mass advertising, and either way, it won’t be effective. They know that their best bet, are to target home owners, that may or may not have a water filter, but maybe with a little targeted advertising, they might jump on the opportunity to buy a water filter on sale.

So when you see this ad for a water filter, you may not be interested in buying it now, but maybe you will next year. And the odds go up, if you are also within the target demographic range that they are looking for.

The same can be said for a LEGO competitor, say Blocky Block Toys. If you’re in their targeted demographic, they may want to advertise to you to make you aware of their toys, as an alternative to LEGO.

Maybe a good example for you would be people interested in Tesla cars.

They won't see Tesla ads because ... tesla doesn't advertise.

But the people selling water filters -- they know they sell to people with good income and who live in a house. People who can afford a tesla also match that, so there's a higher chance of selling to them than the general population, so they may pay to advertise.

So yes it is different - advertising is based on other people's interest in you, not on your interest in them.

Reply on news.ycombinator.com