PPC Rip-Off

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If you are a business owner who is advertising on the Internet, reading this document is likely to save you thousands of dollars – and perhaps even keep you from advertising yourself completely out of business.

No doubt, the purveyors of PPC advertising will be FURIOUS that these little-known secrets are being revealed; they will “poo-poo” this article, and perhaps even engage in a bit of defamation of character to attempt to impugn the verity of what is written here. However, show this article to any Internet-savvy 12-year-old, and he / she will tell you that what is written here is empirical fact.

In the Fall of 2009, despite the mid-October 2009 stock market rally, the U.S. economy is poised on the brink of disaster. This, despite what anyone may try to tell you, is a Sword of Damocles[1] hanging over the entire country – Thank you George Dubya. Despite the public denial and apathy, businesses are struggling to generate sales. One of the methods being used to try to drum-up business is the much-touted and highly over-rated “Pay-Per-Click”.

For the benefit of those new to Internet advertising, Pay-Per-Click (or PPC) is a link or a banner ad sold to you by a company who has a high-traffic Web site – usually listing or dealing with the industry or product you are trying to promote. The seller offers to place your ad – be it a text ad or a banner ad onto his Web site, and will charge you a certain amount of money every time someone clicks on the ad. Clicking on the ad usually brings the visitor to your web site, or to a place where your product or service is explained in detail. For example, let’s say you own a moving company. A phone company that has an Internet Business Directory may charge you $3.75 to place your banner ad on their Internet phone directory under “Moving Companies”. When someone visits the Internet Business Directory Web site and searches for “moving company”, your ad will appear (along with all the others in the same category).

When the visitor clicks on your ad, you will be charged $3.75, no matter if the visitor becomes your customer or not. Yes, you will get visitors to your Web site[2], but there is no guarantee that the visitor will become your customer. In other words, PPC advertising contracts DO NOT guarantee conversion rates – in point-of-fact, no PPC contract will even mention conversion to sales at all… and I’m telling you that if anyone even uses the word “conversion” in the same breath as “Pay-Per-Click” when trying to sell you a PPC contract, hang up the phone, don’t answer the email, or show the salesman the door.

· The “link” to your Web site is an “internal link” that does not directly link to your Web site, and will NOT improve your site rankings with the search engines (see the discussion in: “The Bad News” and“Terminator ‘Bot Tools”, below).

For this topic, I will use an actual example, taken from a real-life situation[3].

I have a good friend who owns a small moving and storage company in New Jersey. He spends horrendous amounts of money[4] every year with ½ and full page ads in the “Yellow” phone books (hardcopy). One day, the representative for the phone books company shows up for a prearranged business appointment, and I happened to be in the office. He begins a schpiel[5] about how his company is one of the top Internet phone directories with TEN TIMES the traffic of his nearest competitor with a similar-sounding name[6] (verified by me via www.Alexa.com), and the bottom line was simply this:

Four hundred (400) clicks per month from his Business Phone Directory Web site in the “Moving Companies” category for $1,500 / month on a one year contract. Do the math. That’s $18,000 / year, and $3.75 per click! The so-called “customer” could just be someone browsing for prices – in which case, even though my friend’s prices are extremely competitive, and his business is “A+” BBB rated, there is no guarantee that the “clicks” will convert to any sales.

PPC ads are also sold based on how many companies are willing to purchase PPC ads at the moment. A PPC ad for a moving company will cost more than a PPC ad for a company that sells monogrammed left-nostril inhalers that glow in the dark. This is the main reason that PPC advertising is probably the most expensive advertising you can do. Typically, if you convert 3 percent of your visitors to customers, you are “Madison Avenue material”. Realistic conversion rates (on average) are much more like 1.5 percent. Out of those 400 clicks in the example, that amounts to 6 customers and a terrible waste of money. Despite what others may tell you, FFA (Free For All) advertising will bring many more visitors to your Web site than PPC – and it costs you nothing but the time it takes to post the ad. Craigslist (www.Craigslist.org) is a bit more complex; the trick with Craigslist is to construct several dozen differently worded ads (in order to avoid the “similar ad” restriction) which sell the same product or service, and post them to the areas most likely to generate sales, or areas with the densest populations.

We will construct a scenario which presumes an identical outcome, and ‘play’ with the numbers a bit to see what it would take to achieve the identical result – 144 Paying Customers – with two totally different advertising campaigns.

Business A buys a PPC or “sponsored ad” campaign on a major search engine for $1,500 / month for 400 “clicks” / month, and is locked into a 12-month contract.

Business B buys a Targeted e-mail ad campaign that places 10,000,000 (Ten Million) e-mail ads to 100% double opt-in recipients for a one-time cost of $74.95 There is no contract, but he continues the ad campaign for 12 months, which gives him

[12 x 10,000,000)] = 144,000,000 (One hundred forty four million) ad “impressions”.

Total sales at the end of it (assuming a totally ridiculous ONE in a MILLION conversion rate (0.00001%):

Difference in cost to achieve the same result [$18,000 - $899.40] = $17,100.60

In addition, Business A is locked into a 12-month contract. If he placed an ad in a (printed) phone book, he cannot retract it because it didn’t live up to his expectations. On the other hand, if Business B’s advertisements do not bring him the expected business, he can “cut his losses” and cancel his ad campaign by simply not renewing it, and is under no further contractual obligation. If his ad does not achieve the expected result, he can take his advertising budget and go advertise elsewhere. The owner of Business A continues to pay his monthly advertising costs, and the business the ad generates does not even cover the expense of placing the ad. “Of course”, you may say, “he can always claim it as a loss on his income tax”.

The Question: “What if my competitor finds my PPC ad and clicks on it a thousand times? Do I pay for a thousand clicks?”

Their Answer: “No, you will only pay for ONE click. We record the IP address of the visitor, and repeat clicks from the same person will NOT result in additional “click” charges”.

The PPC sales pitch always includes this false reassurance – If the prospective PPC customer is Internet-savvy enough to even ask the question.

The Hidden Truth: The competitor’s “click” DOES count as ONE “click”. However, if a competitor has a dozen PCs in his office (each machine will have a different IP address), he can initiate a dozen clicks, and (at $3.75 per click) will cost you [$3.75 x 12] = $45 THAT DAY – and what business did those dozen clicks generate? None!

Depending upon the method used to record the IP address of the visitor – or whether in fact the IP address is NOT stored or recorded by the PPC vendor’s server, and instead, “cookies” are used to record the “click” on the visitor’s computer, all your competitor has to do to initiate ANOTHER dozen costly bogus “clicks” on your ad is to clear the “cookies” in his browser (On Internet Explorer select: {Tools / Delete Browsing History}), and perhaps clear the Prefetch folder (C:\Windows\Prefetch), and click on your ads again. If your competitor can costs you 12 clicks per day at $3.75 per click, it will certainly erode your ad campaign to the point where it is no longer cost-effective to place the ad.

To be fair, most companies dealing in PPC store the visitor’s IP address on their server, so that in fact, whatever the (normal, every-day) visitor does; if he clicks your ad a zillion times, the “click” from THAT particular machine (and presumably that particular user) will only be charged to you ONCE. That IP address could be stored for a period of anywhere between 30 and 120 days, in order to (they say) minimize this sort of thing by competitors.

However – and this is not to imply that it is a common occurrence – Where there is a will, there is a way, and having over 40 years of computer experience, and 15 years of Internet experience, I must say that when I learned of what I am about to reveal to you, it put me OFF even thinking about Pay-Per-Click – forever!

Many of you who go back a ways will remember the simple ‘bot’-like[7] Windows 95 / 98 application called “Recorder”. This program was able to record your mouse movements and clicks / keyboard keystrokes, and save them to a MACRO file that could be played back – optionally in an endless ‘loop’.

Well, “Recorder” sub nom[8] is back – under various forms and aliases; the free “Win Macro”, for one, and this, along with IP Address cloaking software, can be used to construct a simple “Terminator ‘bot’ that destroys PPC ad campaigns on autopilot in minutes.

Many PPC ad campaigns are ‘budgeted’ or ‘click-limited’ in some way. For example, if Business A bought 400 clicks per month at $1,500 / month, if his ad was clicked 100 times a day, then his ad campaign would terminate itself on the 4^th day of the month, leaving him with no advertising for the remainder of the month. If the ‘clicks’ were done by a ‘click-bot’, he has no business to show for those clicks, and big bills to pay with no revenue to pay them.

When I proposed this scenario to a few businessmen I know, they hesitated to believe it, because after all, the companies they were buying their PPC ads from are Fortune 100 companies – and the general consensus was “they wouldn’t lie to me”. Well, denial has many forms, and it is hard to argue with one’s own foregone conclusions, but the facts are the facts, and I had to prove it to them by a simple demonstration.

I called the friend {who shall remain anonymous for obvious reasons} – I’ll call him “Mr. M” – who mentioned this to me several years ago, and asked him to come to my office and run a demo for a skeptical business associate of mine. Third parties lend credibility to seemingly incredible facts. On my machine, I have installed an IP Cloaking program that I use to surf the Internet anonymously[9]. This software has the option of changing my IP address with a click. My PC also has installed a freeware program called “Win Macro”, which I use to automate confirmation email responses for thousands of Web page submissions I do monthly.

Mr. M began by starting the IP Cloaking software and the “Win Macro” program. He also opened a DOS window from the {Start / All Programs / Accessories} on the task bar. He continued by using Internet Explorer and doing a search for the businessman’s competitor’s PPC ad on a Business Directory Web site. After all of this was neatly arranged on the screen, he pressed “Record” on the Win Macro program, and gave the recording a name “KillPPCdemo”. He clicked the competitor’s banner ad which sent the browser (Internet Explorer) to the competitor’s Web site. He immediately closed the tab, and selected {Tools / Delete Browsing History}, made sure the checkmark next to ‘Cookies’ was selected, and clicked ‘Delete’. He then clicked on the DOS window and manually entered the command: “Del C:\Windows\Prefetch\*.*” and responded “Y” to delete all the files. Next he clicked on the “Change IP Address” option of the IP Address cloaking program, and the on-screen display informed us that the Proxy server he was now using was in Australia. He terminated the Macro recording and saved the file. He clicked the ‘Options’ tab on the Win Macro program and selected “Play back at recorded speed” and set the number of repetitions to 300.

Mr. M started the Win Macro program by clicking ‘Playback’, and sure enough, the program faithfully reproduced his mouse movements, clicks, and keyboard entries, playing them back continuously. Each time the mouse clicked “Change IP”, the program reported a different IP address in another country. With the program running on autopilot, we went to the other side of the room to get some coffee and a bit of brunch.

When we returned to the machine about 15 minutes later, it was happily chugging along clicking the ad, deleting cookies, clearing the Prefetch directory, and changing IP addresses. After watching the screen for about ten minutes or so, my skeptical friend remarked, “So? I don’t see anything happening”. Mr. M responded, “Just keep watching…” So we watched – for what seemed like a long time, but was perhaps a total of 20 to 25 minutes…. When……..

The competitor’s ad suddenly disappeared. The ‘bot managed to click the next ad in the rotation before Mr. M could halt the Win Macro playback. “What you just saw”, he remarked, “Was the AUTO-TERMINATION of a Pay-Per-Click ad campaign. We just cost your competitor hundreds of dollars, and chances are we blew his ad budget for the month.”

My skeptical businessman friend was impressed. He said, “Well, thanks for showing me that – the guy trying to sell me the clicks didn’t say anything about this.” Well, there’s a good reason he didn’t – if he DID know about it – assuming that he did – he’d blow the sale and lose his fat little commission. Now YOU know, and it is up to you whether or not you want to take the risk. Remember – NOBODY can guarantee that ‘clicks’ will convert to paying customers, no matter where they come from or who referred them to you. ‘Conversion’ for the most part, is a matter of statistical probabilities more than anything else. If you’re doing 2% conversion rate – I don’t care what it is you’re selling or giving away – you’re golden. If you somehow manage a miraculous 3%, the person doing your Web site design or writing your ad copy needs to work on Madison Avenue for an upper six-figure salary…. Unless of course you’re selling left-nostril inhalers that glow in the dark with monogrammed initials on them, and you have a monopoly on the market. If you’re the only game in town, you win by default.

My friend Mr. M also remarked before he left, that this little improvised “Terminator ‘bot trick is not the only way to terminate a competitor’s PPC campaign. “A slower, but easier way”, he said, “is to click on the PPC ad and then copy the URL – which always goes through their {the PPC ad site’s} server [For example: a Google PPC (sponsored link) ad for AlliedWidgets.com[10] might show: http://hitech.alliedwidgets.com/&kid=GOG1035224546 as the URL instead of directly linking to the Web site at: www.AlliedWidgets.com ] – and sign them up for 1,000,000 ‘hits’ on a few of the Autosurf[11] sites. This way, their site will be in a continuous rotation, but through the Autosurf sites where it is unlikely that anyone who would be interested will see it. Their Web site will get hammered with visits from PCs all over the world – which is actually goodness for the Web site – and it is actually what we just did with the ‘bot… however, now you won’t have to devote any more time or machine resources to do it.

The Autosurf rotation will be seen as a ‘click’ because thousands of different machines with different IP addresses will be using the PPC ad link… just as if they clicked on the ad. The Autosurf ad rotation using the PPC ad link is effectively a “click”, and will be recorded as such on the server, along with the IP address of the machine fetching the ad or visiting the Web site.

Mr. M said, “Unless you sign the sucker up on a dozen Autosurf sites, it is not likely that you’ll kill the ad campaign in a few minutes like we just did, but since many of these Autosurf sites give away 100,000 or more free page rotations just for joining, and most of those sites take months to display those pages, using the Autosurf sites is the best way to kill a PPC ad campaign long-term with absolute, complete impunity.”

Mr. M advised us to use a new, never before used email address for the Autosurf sign-ups, and to use an IP Cloaking program to set up and access the email verification that the Autosurf programs use to ‘validate’ the submissions. “Don’t forget to use a ‘High-Anonymous’ Proxy server when doing any of this stuff, and it would also be a good idea to defrag the hard drive after you’re done.”[12], he said, and I wholeheartedly agree.

The question that many of you reading this are naturally going to ask next is, “Is Terminating the PPC ad campaign of a competitor legal?” I’m not a lawyer, and I can’t give legal advice. I honestly couldn’t tell you. I doubt even the lawyers could answer this one. I just know that it is possible. Now, since I have proven it beyond any question, you know too.

Most probably, ‘bot-terminating a competitor’s PPC ad campaign falls under the category of “Black Hat” – “Spy vs. Spy”[13] material. Certainly it is unethical, under-handed, sneaky, and whatever other negative connotation you may give it… but is it a crime? God only knows! Is it being done as a matter of regularity on the Internet? No doubt; Absolutely no doubt. Given that the methodology of how this is done – however one chooses to do it – naturally involves cloaking the IP address of the machine assigned to do it through numerous “High-Anonymous” Proxy servers, the chances of being “caught” – at what is at best {in my opinion}, mischief, is slim to non-existent. The burden of proof – assuming a case could even be brought to bar – “beyond a reasonable doubt” and “to a moral certainty” is all but impossible.

“High Anonymous” Proxy servers do NOT record the IP address of the accessing machine. Proxy servers outside the Unites States are not subject to US Law Enforcement jurisdiction or subpoena powers in any case. In any event, any PC whose IP address is cloaked by a foreign “High Anonymous” Proxy server effectively browses with complete anonymity and acts with absolute impunity on the Internet.

An updated list of Proxy servers along with IP Address cloaking software is available from: http://digital.net4truthusa.com/proxylists.htm The “RAW” Proxy lists contain “High Anonymous”, “Anonymous”, and “Transparent” Proxy servers listed in separate text files.

Now that I’ve shown you that PPC ad campaigns can be ‘Terminated’ even by a relative novice with the right ‘tools’, let me tell you that this is no ‘Profound Revelation’ to those who have been doing Internet advertising for any length of time; in other words, I haven’t taught anyone who would do this sort of thing, something that they didn’t already know. All I did was to open the bag and allow the proverbial ‘cat’ to escape. If you are doing PPC advertising and your ad manager or consultant says that ‘bot termination of PPC ads “is impossible”, or “won’t work”, they are either ignorant of the facts, or they’re lying to you.

If your PPC ad campaign is not performing up to expectations, it is somewhat ‘natural’ because of the state the US economy is in, to say “The economy sucks”, and blame it on George Dubya. Well, the economy sucking certainly is Dubya’s fault, but the failure of your ad campaign to generate enough business to justify the expense of the ad is probably due to something else entirely. You could be the victim of a PPC Terminator campaign by your competitors and you won’t even know its happening unless you know what to look for. Your PPC ads disappearing overnight or your PPC costs going through the ceiling on an “open-ended”[14] campaign with no business to show for it is probably a red flag that something isn’t exactly Kosher.

I have now completed my schpiel on PPC advertising. Conclusion: In any of its numerous variations, Pay-Per-Click is a rip-off. You would do well to avoid it if at all possible, and statistically, you would do much better at a fraction of what PPC costs by using the much less expensive targeted ad marketing, FFA ads, or posting ads on Craigslist. We will refer you to some of these proven advertising resources at the end of this article.

In all honesty, I don’t particularly care for ‘Negative Ad Campaigns’ – whether they be for consumer products and services or in political advertisements.[15] ‘Bot-terminating a PPC campaign can probably be loosely compared to a “smear-ad” campaign; the effect is to render the opponent’s voice moot. In the case of a “smear ad”, it attacks the competitor’s credibility; in the ‘bot Terminator scenario, it attacks the competition’s means of communicating to an audience. The effect is essentially the same. Would eliminating your top competitor’s advertising bring YOU any more business? Who knows? Certainly you could easily get away with it, and I’ve shown you how little effort it takes to do it, once you have the right {software} tools and a little practice doing it.

Among other things, I am a professional IT Consultant and Webmaster and I also run several dozen Web sites, among which are an Internet Christian Ministry and bookstore for Veterans at www.Net4TruthUSA.com a Veteran’s Advocacy Web site at www.VFCLL.com and an Internet shopping mall www.TelsonUSA.com. I also run a Web site for a friend’s moving company www.BigSamMoving.com and a Web site for aspiring Internet Entrepreneurs and businessmen[16] at www.MakeALotOfDough.com .

As an ordained Christian Minister, I am often amazed at the time and effort that is expended on doing negative[17] things. In some cases the effort is totally mindless – as in a recent case reported in the NEWS, where a young man used a shotgun left to him in his Grandfather’s will to hold up a convenience store for a few measly bucks. The store employed video surveillance, and when he was finally apprehended and the shotgun recovered, the weapon was found to be a rare antique worth hundreds of thousands of dollars. Well…. Duhhh!

As a rule, stupid people with criminal mentalities expend more effort to do the wrong things that inevitably result in failure, than intelligent, moral, ethical, and law-abiding people expend doing the right things that lead to eventual success. The Biblical admonition “… your sin will find you out”[18] notwithstanding, it is an immutable law of nature that success, morality, and ethics go hand-in-hand, and vice-versa. Enjoying what you do for a living also plays a big part in the success of a business. A wise man once said “If you enjoy what you do, you’ll never work a day in your life”. I am living proof of that axiom.

Being competitive is the American Way. Gaining the upper-hand in – or at least a fair share of the market for your particular product or service doesn’t necessitate destroying someone else’s business. Contrary to what many would have you believe, there isn’t a {finite} “pie” out there to be cut up into pieces and distributed unfairly; each of us can have as much of that “pie” as we can wish for – all we have to do is create the market, or honestly pursue what is realistically available. Ingenuity is what built this country; greed and unscrupulousness is the cancer that is destroying the American Dream for all of us. Deal fairly and honestly with people, and you will be a magnet for word-of-mouth and repeat business. By all means employ every strategy and “high-tech” method to get your message ‘out there’, and the market will choose the winners and weed out those whose conduct does not merit their business.

By far, the best scenario in business is a “win-win” situation. This little article is a small example. By taking the time to write this piece, I have (hopefully) educated thousands of small, struggling businessmen and entrepreneurs about the pitfalls of Pay-Per-Click. In return, I get to pitch a few things I am personally involved with, and that I personally use in my own business advertising. As an affiliate, I make money ONLY when you do – and so my motivation is to help you make some dough, so I can make some dough as well…. That is why we named one of my Web sites: www.MakeALotOfDough.com

The Web site teaches everyone how to generate a growing, second income that could eventually become a significant part – if not the major source of a person’s income. It works if you work it, and there are hundreds of tips, suggestions, and resources for you to use as you see fit. The more you do, the better and faster it will work. The income sources promoted are varied, and so this diversifies one’s portfolio of income sources.

Feel free to visit and avail yourself of all the tools and resources to promote your Web site and generate new life for your existing business, and build an additional second income:

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FOOTNOTES

[1] In classical legend, a courtier of the elder Dionysius, ruler of Syracuse, Sicily. When Damocles made too much of his sovereign's good fortune, Dionysius invited him to a feast where he symbolically hung a sword over Damocles' head by a single horse-hair to demonstrate the precariousness of the happiness of kings.

[2] If clicking on the ad brings them to your Web site.

[3] The names have been changed – but the scenario itself actually happened.

[4] Over $100,000 annually.

[5] Schpiel – Yiddish for “sales pitch”.

[6] Nudge-nudge, Wink-wink, Say no more - say no more.

[7] ‘bot – Internet slang for ‘robot’.

[8] Sub nom – (Latin) ‘under another name’.

[9] This protects me against identity theft, IP address attacks, and other forms of ‘data mining’ by various search engines.

[10] AlliedWidgets.com is a fictitious, non-existent company used as an example for the discussion here.

[11] For a list of popular autosurf sites see: http://www.makealotofdough.com/websitetools.htm#AutoSurf

[12] Defragmenting the hard drive is a good way to overwrite browsing history and cleared Prefetch files so that they cannot possibly be recovered; not that anyone is likely to seek to recover them.

[13] Spy vs. Spy – the name of a popular newspaper comic strip also featured in Mad Magazine.

[14] An ‘open-ended’ PPC ad campaign is one that is not limited in budget or number of clicks. Open-ended PPC ad campaigns have been known to cost advertisers so much for so little return that the companies literally advertised themselves out of business.

[15] ALL political ads without exception – are lies, half-truths, libelous, slanderous, and carefully crafted propaganda and psychobabble. I don’t pay attention to ANY of it; they’re all liars, thieves, and scoundrels – that’s how they got to where they are.

[16] I use this term generically for both genders.

[17] Or sinful.

[18] Numbers 32:23b

Having exposed Pay-Per-Click for what it really is, hopefully you will consider some alternative advertising campaigns. Outside of the “bidding wars” for Search Engine keywords, and the exorbitant fees charged for PPC ‘clicks’ by Phone Company Internet Directories and so-called “Adwords”, there is an entire universe of Advertising methods and venues to choose from. Based on years of experience and recommendations from several business associates and colleagues, we searched out the very best of the best alternative advertising companies and became their affiliates. I personally believe you would do well to take a look at the following Web sites – do not let the low cost compared to PPC, keyword bidding, sponsored ads, or “Adwords” fool you. I know you will be pleasantly surprised with the results. Also take a look at our “Rank Enhancer” software on http://digital.net4truthusa.com/rankenhancer.htm