When we think of ads, we think Google, Meta, Amazon, and TikTok. All of these platforms are blackboxes.

That essentially means when you advertise on these platforms you don't get to observe or measure what's happening in the ad serving logic.

However this wasn't the industry standard at all.

🌐 Early days

Even in the early days of Meta Ads, advertisers had the ability to participate in the ad auctions with individual bids (for a given user) and measure the outcomes of ad auctions via transparent bid stream data available to all players. (like market depth data from stock exchanges)

This was the industry standard as advertisers demanded this data, and media buying was largely oriented towards buying impressions.

📱Mobile Ads

As user attention got consolidated, traditional display ads publishers lost traffic to Facebook.

In fact, in the early 2010s when smartphone consumption skyrocketed, most display ad exchanges couldn't adopt to the changing ad inventory as their legacy adtech couldn't serve native ads on mobile

🤖 Machine Learning

On the other hand, Meta doubled down and harvested bid stream data (at user and device level) to train machine learning algorithms and predict user behaviour on ads.

These AI algorithms by design were blackbox algorithms, and provided much better ROI for advertisers than buying good'ol impressions

👑 The Reign

Over the next 6 years, Meta's audience based native ads took over display ads completely and changed media-buying from buying impressions and clicks, to purchases and conversions.

🛡️ Privacy Pushback

Fast forward to 2021 - Apple and pro-privacy advocates came out hard and killed user identifiers that are essential to share and match users to conversion data across the internet.

🧠 Data Advantage

But guess what? In the post-privacy world - the walled gardens already had trained digital clones of their signed-in users and had hordes of data on advertisers as well.

And big-budget advertisers were already addicted to direct response ads

This is when the walled gardens started pushing it's black box campaigns - PMax and Advantage+ and forever raised skyscrapers around it's "garden"

🍂🍁 Decomposing Garden

Without fresh user behavioural data scraped from the internet, Meta's algorithms aren't as effective as before and the garden is rotting.

Big budget spenders can spend their way into generating enough data and create a green patch for themselves.

If you understand how the algorithm works, Meta is still a scalable and profitable channel for many brands. It's just not for newbies anymore.

As a brand owner it's imperative for you to understand that you need to invest a minimum daily budget to assist Meta's algorithm to keep finding newer prospects for your business.

We can help you decide the budget - Book a demo call with us