Tag Archives: politics

What’s that got to do with the price of ads in Russia?

I’ve been reading comments on articles about the Russian intelligence effort to influence the US election by social media subterfuge. I know this is a dumb idea. It directly goes against Matt Groening’s advice: “No matter how good the video on YouTube is, don’t read the comments, just don’t, because it will make you hate all humans.”

But, against my better judgment, I’ve come across an argument a few times that I want to discuss. It goes something like this:

“Clinton and Trump spent $81M dollars on Facebook ads, but we’re supposed to believe that Russia spending just $46K made an impact? Yeah right, libtards, har har
har.”

Fair enough. The candidates spent a butt-load more money than the Russians did, as they should have. The basis of the argument is real: Facebook’s lawyers came right out and testified those exact numbers to Congress. It would be naive to argue equality of effort.

But if we permit ourselves some historical context, I think it’s worthwhile to come up with an analogy for Russia’s long game.

Let’s take a brief look at the history of small change vs. big money:

In 1997, Amazon was a baby with a market capitalization of less than $1B.

The year before that, KMart and Sears were two different companies that had a combined market cap sixty times larger than Amazon’s, each around $30B.

Where are we now, 20 years down the road?

KMart went bankrupt, restructured, and ended up merging with Sears in 2004. The consolidated Sears Holding Company hasn’t done much better, now posting a market cap of about a half-billion. Yawn.

And Amazon, the little company that wasn’t even in the Fortune 500 twenty years ago, while Sears and KMart were the 800lb gorillas… what happened to that scrappy bookseller?

Amazon’s market cap in 2017 is FIVE HUNDRED AND THIRTY-FIVE BILLION DOLLARS.

That’s 535x more than what was once the ‘real thing.’

What does a story of retail market capitalization have to do with the price of Facebook ads in Russia?

Nothing, if you aren’t willing to think about it. But if you are, it’s just one example of many that prove looking at investments over the long haul is how you measure success – not analyzing them a few months later.

I’m willing to bet that Russia didn’t spend $46K with the expectation that in six months their effort would be complete. Isn’t it more likely they were spending $46K to find out what would be possible in six YEARS, or longer?

So, you can make the argument that a hostile foreign government spending a few thousand dollars on divisive Facebook ads in 2016 isn’t a big deal, because hey, the actual candidates spent way more than that.

Or you can remember those people who in 1997 said “Oh, Amazon isn’t very big, nothing to worry about. Sears and KMart are where we should invest!”

I could be stretching the comparison beyond its merit, but honestly, this story makes me nervous.

What kind of money does Russia have to spend for people to take them seriously? What if in the next election they spend $500K? $1M? $5M? At that point, could it be too late to undo the damage?

If Facebook and others don’t address this problem now, where are we going to be in 20 years?