the author is suggesting that ad spending online correlates with increased sales. is that the case? seems a big part of ad spending is simply part of burning VC money regardless of outcome.
This article poses some interesting thoughts. It is quite long, but I think worth a read if you are interested in this [0].
I think a way to frame the question is: "Will the coming decline in ad-spend result in proportional decrease in sales (while factoring in crisis driven declines)"
I suspect that this forced experiment will result in identifying that 20% of ad-spenders were getting 80% of the value, while the rest were either not technically capable or just trying to keep up with trends, thus bidding up the ad prices. The result being huge profit for Google/Facebook as the market maker.
Now advertising businesses are moving to automated bidding with advertiser specified target performance, so you will likely spend less ad budgets on less sales. And I don't think so called "VC money" has ever been a big part of ad spending. Most of the online ad spending still comes from big established businesses.
It decreases the risk of failure but also corrupts the product signal. You can't get a truly clean read on the product/market fit with constant advertising since you're effectively externally subsidizing product adoption.
Or, maybe you aren't subsidizing it and just tossing money in the wind...and that's the problem, you have an x +/-/*/^ y effect and can't separate the two.
So the advertising becomes "locked in" because it was never extricated from the rest of the product and it becomes too much of a risk to pull it.
Some people try to isolate things and figure it out but it's not really possible, externalities change, contexts change, needs change, advertising happens on the sneaker net without your knowledge... It's a real bitch
