Tiny persuasion effects remain profitable when scaled across millions
Evidence
You might be surprised to learn that average conversion rates are really low. It’s therefore important for political campaigns to invest tons of money into buying ads. It’s hard to get people to buy things or vote a certain way, so you have to bombard people with ads repeatedly. Micro-targeting can make this process much more efficient. For example, in Matz, Kosinski and Stillwell’s experiment, the ads that were tailored to extraverts reached 841,308 people out of whom 117 purchased an item. That’s a conversion rate of 0.014 per cent. In contrast, when the ad shown didn’t match the user’s personality the conversion rate was much lower (just 0.008 per cent). The micro-targeting strategy thus helped bring the cost down by a whopping 50 per cent to only about £8 ($11) per conversion. The ads themselves are pretty cheap to run, so the return on investment an organization is going to see goes up dramatically with proper targeting. What’s often well understood by marketers but misunderstood by scientists is that, even at low conversion rates or ‘near zero’ persuasion effects, it’s still very profitable to target people with ads. — Sander van der Linden, Foolproof, 575
Categorization
- XREF: Mirrors the reader’s interest in scale and small-effect compounding more than causal claims about vote choice, like Milgrom’s work on trade equilibria. — connects to: People change their own minds; persuasion attempts play a small role — Holm Gero Hümmler, Ulrike Schiesser, Fact and Prejudice: How to Communicate…, 215; Brands profit by monetizing user-generated word-of-mouth influence. — Alice E. Marwick, Status Update: Celebrity, Publicity,…, 253; Algorithmic ad revenue profits from outrage and affirmation equally. — Anna Kornbluh, Immediacy, or The Style of Too Late…, 101 (+2 more)
Broader Connections
- People change their own minds; persuasion attempts play a small role
#complicates(0.85) — Holm Gero Hümmler, Ulrike Schiesser, Fact and Prejudice, 215 - Brands profit by monetizing user-generated word-of-mouth influence.
#expands(0.80) — Alice E. Marwick, Status Update, 253 - Self-aware premeditation and commitment are the strongest defenses against persuasion
#contradicts(0.80) — Shoshana Zuboff, The Age of Surveillance Capitalism, 965 - Advertising industrialized attention by converting it into a resellable commodity
#expands(0.80) — Tim Wu, The Attention Merchants, 24 - Algorithmic ad revenue profits from outrage and affirmation equally.
#expands(0.75) — Anna Kornbluh, Immediacy, or The Style of Too Late…, 101