In particular, this question applies to the digital advertising industry, which was hailed as more efficient, cost-effective, and measurable than traditional print and broadcast media.
In conclusion, advertising metrics
All those vague promises were supposed to change with digital advertising. It's now possible for advertisers to track how many people clicked on their ads and purchased their products using technology.
In addition to measuring direct response ads (Buy now and get 50% off your next purchase), this technology was also useful for measuring the response rate of search ads.
In contrast, it had trouble measuring the effects of long-term branding messages. Causation is a very difficult thing to prove, and it still is today.
Doubts continue to grow
Digital ads have raised questions regarding their effectiveness. Despite the fact that 60% of internet adverts do not even get viewed owing to their placement at the bottom of screens or otherwise not visible, advertisers/pubs are still losing Ad spend and being billed regardless.
In addition, Click-through rates are well below 1% and many users are blocking ads.
There is a gross overvaluation of digital advertising. Google and Facebook, basically the only two platforms that do measure its effectiveness, keep their auction systems pretty much unavailable and not transparent in the slightest, unless you really know what you’re doing and are able to pull a few strings here and there it’s pretty tough to measure.
A proprietary algorithm runs them. Those algorithms aren't always in the best interest of advertisers.
Major brands have often been surprised to see their messages on websites with offensive or racist themes. Many people responded by imposing a boycott on Google and Facebook.
By boycotting platforms, you tell them they should improve the protection of advertisers - brand safety. Further, the analysis of digital advertising data indicates that it is most likely fraudulent, with clicks and views generated by computers, rather than humans.
The eBay experiments
eBay terminated all online keyword advertising as a way to bargain with search engine Bing-in other words, it stopped paying Bing for online searches on "eBay".
How did it happen? This experiment served as a means by which eBay could assess the effectiveness of its online marketing.
eBay saw no decrease in clicks or purchases despite not running keyword ads for its brand. As a direct result, eBay’s paid-search marketing budget was cut by $100 million a year.
In an unexpected move, eBay's experiment with no ads wasn't immediately copied by the rest of the industry.
There is no doubt that it works
These research findings are not intended to suggest that advertising isn't effective. For example, my iPhone and MacBook Pro, is all due to their advertising.
Despite their high price tag, I believe these products are of superior quality. Moreover, data are available. So I guess the answer to the question is yes, advertising does work.
Nevertheless, researchers can now focus on researching and focus on finding the right answer by using better software and hardware.
