Table of Contents
1.0 Executive Summary
3.0 Online Lead Generation
- 3.1 Overview
- 3.2 Impact of Fraudulent Lead Generation Practices
- 3.3 Performance Marketing Fraud
- 3.4 Sample Legal Cases
4.0 The Maritime Executive Advertising Services
1.0 Executive Summary
This report covers a summary of findings surrounding advertising services requested by Larson Electronics (“customer”), an industrial lighting company, from The Maritime Executive (“publisher”), an online news and magazine publication that focuses on the commercial marine sector. The services, which were requested between February 2016 and August 2016, involved the promotion of various customer webpages and products via the publisher’s advertising services (email newsletter campaigns and promotional online ads). A key assertion in this summary involves the origination and quality of the email leads, as well as the generation of website traffic from the ad campaigns and results provided by the publisher. Furthermore, a press release (published on October 20, 2016) titled
The scope of this report covers the current state of digital marketing, fraudulent lead generation practices and examples of legal cases surrounding damages related to dishonest performance marketing methods. A conclusive analysis of The Maritime Executive’s advertising services that was provided to Larson Electronics can also be found in this report. Information in this report may not be utilized to support assertions and statements made by any individual, group or party, without consent and clearance from the author. Larson Electronics and the author of this report may not be held liable for assertions made in this report.
Internet marketing, a marketing practice that specializes in using digital mediums for advertising campaigns and promotions, is not as transparent as many consumers and businesses believe it to be. Deceiving digital marketing techniques have been around since the nascent proliferation of the internet era in the 90s. For example, Search Engine Optimization (SEO), the practice of meeting specific algorithmic standards set by a search engine, e.g., Google or Bing, in order to “rank” higher in the Search Engine Results Page (SERP), has, since its inception, been split into three categories: White Hat SEO (leveraging non-invasive SEO guidelines), Black Hat SEO (exploiting SEO guidelines to force one’s website ranking in SERPs) and Grey Hat SEO (a combination of White Hat SEO and Black Hat SEO methods). Moreover, the use of scripts or bots to automate and manipulate certain aspects of the digital marketing process, such as customer lead generation and website traffic, has become more prevalent, as having a digital presence has now become the norm for businesses that want to reach their online audience.
In most cases, the quality of results generated from deceitful or fraudulent digital marketing methods are very poor. Yet, many publishers, ad agencies and other websites that offer advertising services continue to utilize such methods to speed up various processes that would normally take weeks or months to complete. According to a report released by the Interactive Advertising Bureau (IAB) in December 2015, digital advertising fraud costs the industry around $8.2 billion annually. “Non-human” traffic makes up $4.2 billion of the projected figure. This is relevant, because according to a study by Incapsula, 61.5 percent of website traffic worldwide is generated by bots (search engines, scrapers, hacking tools, spammers and non-human impersonators). In lead generation, the use of scrapers to generate hundreds of email leads is becoming increasingly common. These programs scour the internet for contact information using a set of pre-determined criteria to ensure accuracy and relevancy. However, the results are rarely accurate and relevant, resulting in low sales and wasted money for the customer who purchases the leads from the publisher.
An example of such occurrences can be traced back to a high-profile legal case between NetQuote and MostChoice in 2008. Both companies relied on an online lead generation model that encouraged consumers to submit applications for insurance quotes on their respective websites. The data acquired from the companies were then sold to insurance brokers, who used the leads to contact prospective customers. NetQuote had received several complaints from insurers about fake leads, which triggered an investigation. In 2006, the company proceeded to file a suit against MostChoice after attorneys found out that MostChoice hired an individual, Brandon Byrd, to submit around 3,500 fake applications on the NetQuote site over a span of nine months.
The court rejected MostChoice’s defense, which asserted that it should not be liable for false leads since it was not aware that NetQuote would act on the leads. The company also claimed that by submitting thousands of fake leads on the NetQuote website, it contributed to the development of the company’s lead filtering system. In the end, the jury heavily favored NetQuote and awarded the company $4.8 million for falling victim to the creation of false leads. In a move by the court to use the case as a warning for other publishers attempting to leverage dishonest lead generation practices, the jury awarded double the punitive damages requested by NetQuote.
3.0 Online Lead Generation
Online lead generation refers to the generation of prospective customer contact information, which is used by businesses to increase product awareness or sales. Such internet marketing practices typically rely on digital mediums to acquire contact information, such as email newsletters, social media surveys, opt-in subscriptions and contest entries. The effectiveness of online lead generation has changed to become more effective in the past ten years. According to a Business Products Buyers Survey (March 2007), over 80 percent of consumers claim that they find the product or service they are looking for, before a company or agency reaches out to them about the product or service. Moreover, buyers are usually between 66-90 percent into the buying journey before interacting with a vendor. At this point in the buying process, the risk of “dropout” is low, compared to an individual who is stuck in the early stages of the buying journey. This suggests that with a list of leads generated online (based on the definition above), businesses should be able to close sales easily or “convert” a prospective buyer into a customer with minimal effort. Unfortunately, this is not always the case.
When it comes to the quality of online leads, a large bulk currently in circulation by companies that sell leads (sellers or publishers) are irrelevant, outdated or fake. According to Glenn D Burks, a professional internet and marketing trainer, many people are enticed by the sheer quantity of internet marketing leads, while overlooking the quality of contacts. Burks arrived at this conclusion during a lead generation campaign conducted in 2002. The campaign was able to generate roughly 600+ leads per month. However, a closer look at the information collected suggests that the list generated lacked quality with over 80 percent of the leads generated being filled with erroneous or fake information. In the digital marketing sector, it is common practice for sellers to avoid providing assurance over the quality of data. In order to safeguard themselves from scrutiny or accusations, some sellers use misleading terms like “audited” or “screened” leads, without providing transparent information on how the leads were acquired.
According to Venable LLP, there are three laws that regulate fraudulent lead generation practices:
- “General advertising and marketing law principles, enshrined in the FTC Act, the Consumer Financial Protection Act (CFPA), and state laws (known as “mini-FTC Acts”), that prohibit unfair or deceptive acts or practices, including the dissemination of false or misleading advertising. The CFPA also prohibits “abusive” practices.
- Specific statutes, both state and federal, regulate certain marketing channels. For example, the Telephone Consumer Protection Act (TCPA) and CAN-SPAM Act regulate telephone and email communications, respectively, and the Telemarketing Sales Rule applies to many forms of telemarketing.
- There are statutes that regulate specific consumer products and services, such as mortgages, credit cards, and other consumer loans (e.g., Truth in Lending Act and Regulation Z, Credit Card Act, and the Mortgage Acts and Practices Advertising Rule [“MAP Rule” or Regulation N]). These laws typically regulate how such products are advertised, in addition to how they must be structured and serviced.”
The proliferation of deceptive lead generation practices has caught the attention of several government regulators and agencies, including the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB). Specifically, the groups are cracking down on “the extent to which, publishers and lead aggregators are liable for the end users’ legal compliance” and dishonest profiting practices by sellers attempting to earn money from low quality or fraudulent leads. To help protect consumers and businesses from fraudulent sellers, the FTC launched a workshop in 2015, called “Follow the Lead: An FTC Workshop About Online Lead Generation.”
For businesses, the impact of working with fraudulent leads from sellers can be felt in both the short and long term. Soliciting or contacting individuals without their consent could hurt the reputation of businesses, leaving them open to legal risks. Furthermore, there is a lot of effort, time and money that goes into reaching out to prospective buyers. Technically, it is up to the seller or publisher to ensure the quality of leads being generated and sold to the business or buyer. But as mentioned earlier, some sellers take a shortcut to completing this meticulous task by using crafty adjectives and terms/conditions to safeguard themselves from complaints and accusations. However, this does not change the origin of the erroneous or fraudulent leads. Simply put, describing one’s leads as “audited” does not justify the true nature of the leads, nor should it be treated as a “loophole” for publishers to sell a list of “bad” or irrelevant leads to a business for profit.
According to a report from ZoomInfo, roughly 30-40 percent of business contacts change jobs every 12 months. Up to 66 percent change job titles, 43 percent get new phone numbers, 34 percent request for name changes and 37 percent change email addresses. This suggests that maintaining lead generation lists is no easy task and the chances of receiving irrelevant leads is fairly high, even from reputable lead generation sellers.
Fortunately, it is easy to detect fraudulent leads; but very difficult to report them, as publishers and sellers usually take a defensive stance in the quality of leads sold. Currently, according to Larry Kim (founder and CTO of Word Stream), average online conversion rates (sales) for all industries is 2.3 percent. By comparison, fraudulent leads typically generate zero sales, resulting in zero conversions. Bounced emails is another indicator that there is something wrong with the list of purchased leads. Additionally, irrelevant leads may also be a sign that the list was generated falsely or in a manner that is unnatural (non-human), such as the utilization of scripts or bots. For example, a business that sells bike equipment will likely not generate or attract potential buyers who are ice cream shop business owners or law firms that specialize in insurance fraud. By comparison, reputable or positive lead generation sellers, in order to provide quality leads, target industry-related contacts and avoid contact information that would not benefit the buyer.
From a B2B perspective, performance marketing is a form of online advertising that focuses on specific activities or actions. The overall goal of this practice is to facilitate a conversion funnel, wherein a potential customer executes a desired action. This action could be signing up to an email subscription service, submitting contact information for lead generation, clicking on a banner ad, purchasing a product or etc. In performance marketing, businesses only pay for performance, depending on the agreed prerequisites between the service provider and the client. The “per action basis” model is seen as very attractive for businesses, because it allows them to get their money’s worth by only paying for actions that ultimately should generate some form of profit. Groups that offer performance marketing services allow their campaigns to be measured using metrics to boost transparency. Some even go as far as submitting reports that provide summaries of the campaign, which is also used as a basis for billing, invoices and payments.
With over 36-50 percent “non-human” traffic engaging online ads in 2014, around $300 billion was lost due to marketing-related fraud (based on data from HasOffers by TUNE). This suggests that performance marketing fraud is becoming increasingly common, as more businesses promote their establishments online. The spread of such practices does not mean that businesses should tolerate dishonest performance marketing specialists. As mentioned earlier, the rise of robots and automation has helped fraudsters provide more lucrative website traffic and lead generation services. This development has impacted advertising ROI greatly, since businesses must pay for activities generated by shady publishers, which usually does not lead to sales, conversions or revenue.
There are several types of performance marketing tactics being used today. The top three that are relevant to this paper includes the following:
Data Dumping: For dishonest lead generation services, the amount of personal, unregulated data in circulation online can be advantageous. When generating contacts during lead generation campaigns, some fraudsters “cushion” the list using old or irrelevant contact information. Blocking this practice is very difficult. Most businesses find out weeks or months after the campaign has finished. Furthermore, data verification techniques often overlook very old contact information because they offer a certain level of uniqueness that gets passed off as relevant. Careless publishers may “cushion” up to 70-80 percent of leads generated during a campaign, while claiming 100 percent relevancy.
Website Traffic: Fraudulent publishers often offer website traffic services to boost awareness for a specific product or event, upon the request of a client. In most cases, the generation of page views or impressions can be exploited using bots. These non-human bots appear as successful page views or impressions, which are billable. Since such actions are not being performed by a human, or a by an individual who is genuinely interested in what the business has to offer, the chances of the generated traffic completing the next step in the conversion funnel is very low. These days, “incentivized traffic” is so common that businesses can purchase up to 6,000 website page views for $5. Yet, many publishers attempt to charge premium rates for low quality traffic that are marketed as non-incentivized.
Technical/Network Fraud: This involves the publisher “forcing” the client’s platform to count a conversion where such activity did not actually occur. Compared to the other two techniques, this requires the publisher to hack into the client’s network tracking platform. Fraudulent performance marketers may engage in this practice to say that “the traffic was indeed low quality, but not fraudulent – since there is evidence of conversions.”
As mentioned earlier, businesses should not tolerate fraudulent publishers that are exploiting dishonest performance marketing services. Many companies aren’t aware that such practices can be disputed legally in court. Due to a surge in low quality lead generation campaigns and incentivized website traffic, legal cases between publishers and unsatisfied customers have become increasingly common in the past decade.
An example of such dispute was filed in the Iowa District Court on June 2014 (LACV081096). The case involved CUES, a company providing questionable ad services, and BVS, the client. In 2011, the two parties entered into a documented Master Agreement. The contract, which contains a confidentiality provision, indicated that CUES was requested to perform “specific marketing activities” on behalf of BVS. The type of undisclosed marketing service is not relevant to businesses that are victims of performance marketing fraud. The main takeaway is that BVS went after CUES due to failure and refusal to execute the contract, or “performed them so poorly as to constitute a material breach of the contract.”
This was a salient point in the case; because at the time, businesses in personal disputes with publishers were not aware that under-performance or lack of quality advertising campaign results can be used as grounds for legal disputes.
In another example, an Estonian man pleaded guilty to fraud and computer hacking (“clickjacking”) charges on April 27, 2016. Vladimir Tsastsin was sentenced in a Manhattan federal court for participating in an elaborate malware advertising scheme that infected computers and allowed the team of criminals to push ads to compromised systems. The hackers then collected money from customers paying for online traffic. The main takeaway from this case is that individuals looking to profit from dishonest website traffic practices are being taken seriously by legal courts.
4.0 The Maritime Executive Advertising Services
Larson Electronics, a Texas-based industrial lighting company, engaged The Maritime Executive, a publisher that specializes in coverage for the industrial marine industry, for advertising services, between February 2016 and August 2016 on a monthly basis. Both parties participated in the deal, which included the promotion of Larson Electronics content in email blast campaigns and online ad placements. By offering promotional services using its platform, contacts and digital reach (based on “audited” data), The Maritime Executive provides Larson Electronics with contacts for lead generation and website traffic activities for promotion and sales generation. In The Maritime Executive’s revenue model between a customer and publisher, after the completion of the advertising campaigns, the publisher charges the customer for promotional services. Furthermore, at the end of the advertising campaigns, the publisher provides the results of the campaign, along with the list of contacts generated for lead generation, as well as the URLs promoted, total number of clicks and total number of impressions (to justify the viability/effectiveness of website traffic services).
According to The Maritime Executive’s Consolidated Media Audit Report, which covers 12 months of publications up to June 30, 2016, the publisher defines “page impressions” as the following:
“The combination of one or more files presented to a browser as a single document as a result of a single request received by the server, and that is recorded at a point as late as possible in the process of delivery of the content to the user’s browser, therefore closest to the actual opportunity to see the content by the user. In effect, one request by a browser should result in one page impression being reported. The counted page impression may not necessarily be in focus or visible in the user’s browser.”
The publisher also defines “unique browser” as the following:
“A measurement of unduplicated cookied browsers that accessed the digital content of a site during the measurement period reported. In the absence of a cookie, the combination of the IP address and user-agent string may be used to measure a unique browser. For numerous reasons, a unique browser does not represent a unique individual.”
In the report the publisher provides definitions of social media followers:
“Facebook Likes: Facebook is a social networking website. A like represents the number of times that a registered user clicks on the Like button on a Facebook page controlled by a Publisher. A Facebook Like may not equate to an individual person.
Twitter Followers: Twitter is a real-time short messaging service that works over multiple networks and devices. Followers are registered users of Twitter who “follow” the “tweets” of another registered user. A tweet consists of a text message of 140 characters or less. The number of Twitter Followers represents the total followers of the tweets and may contain followers that subscribe to multiple feeds. A Twitter Follower may not equate to an individual person.
LinkedIn Members: LinkedIn is a social networking site designed specifically for the business community. With LinkedIn publishers have the ability to have a “company page.” LinkedIn users may follow a company page, and are therefore considered “members.” A LinkedIn member may not equate to an individual person.”
In application, the terms can be found throughout the report. On the first page of the document, the publisher cited the generation of 248,346 contacts with a disclaimer in fine print: “Total Gross Contacts include Qualified Paid and Nonpaid Circulation and Unique Browsers.” The report also provides exact figures of website page impressions (504,082), website visits (336,732), unique browsers (225,823), Facebook likes (18,840), total number of Twitter followers (33,324) and LinkedIn followers (64,720).
Based on definitions of terms established by The Maritime Executive in the report, the contacts and activities generated from the company’s website, social media channels and other mediums, may not originate from an actual human. Instead, it is very likely that the origin of contacts or reported activities could be from non-human sources, such as scripts or robots programmed to load a specific web page or link. It is important to note that The Maritime Executive uses page impressions, unique browsers and social media engagements as parameters for gauging the effectiveness and viability of advertising campaigns and services offered to customers, despite suggesting there is a possibility that no actual human being sees or initiates such engagements.
“Maritime Executive promotes the concept of audited total gross contacts. We need to understand more about what ‘audited’ in that context means, but I can tell you that this list is not what we signed up for and we know for a fact already that a statistically significant amount of these folks in these lists we were given as leads are not Maritime Executive readers and never clicked on our ad in any of their campaigns,” said Rob Bresnahan with Larson Electronics LLC.
Part of The Maritime Executive’s digital marketing services included lead generation, which were provided in the form of email addresses (no names, addresses, phone numbers or respective professional roles). In the “natural” lead generation process, an individual or group would enter his or her contact, as an act of interest in establishing a communication line with the company for business. In order to come from a valid individual or human source, the contact information must be valid, relevant and provided out of willingness to participate in the ad campaign as a potential customer.
At the end of the advertising campaigns, the publisher provided a list of email leads with the overview of results. Larson Electronics believes that most of the leads provided by The Maritime Executive were fraudulently generated, possibly using a bot/scraper that scours the web for publicly listed data that is easily accessible or purchased from a third-party lead generation service provider that applies similar tactics.
To support such assertions, a Larson Electronics representative compiled a list of generated leads (213) from the advertising campaign results and contacted the leads individually. Below are some results from the compilation:
|Michael.Kushner@jacksonlewis.com||attorney – according to assistant she doesn’t believe he is interested.|
|firstname.lastname@example.org||left that institute in 2011 – have email stating this|
|email@example.com||automated email address – says member of their team will contact you soon|
|firstname.lastname@example.org||did not request information – have email|
|email@example.com||no use for our product, take off list – have email|
|firstname.lastname@example.org||sent email to colleagues to see if anyone emailed us|
|email@example.com||auto email to contact a different person|
|firstname.lastname@example.org||Says we have reached him in error – have email|
|email@example.com||no longer works here|
|firstname.lastname@example.org||resigned as of 8-11-2014, have email|
|email@example.com||out of office|
|firstname.lastname@example.org||bounced email – per CB hasn’t been with company since 2011|
|email@example.com||out of office|
|firstname.lastname@example.org||emailed that we have reached them in error|
|email@example.com||not aware of any request for explosion proof lights – request to be removed from list – have email|
|firstname.lastname@example.org||no longer works here|
|email@example.com||out of country|
The results show that a number of email leads provided were invalid (bounced). Moreover, some individuals confirmed that they were not interested in products from Larson Electronics or were wrongfully contacted and requested to be removed from the list. These findings suggest that the leads were generated using “unnatural” means, such as the utilization of a bot or scraper.
To further assert that the leads were generated fraudulently, it is important to note that several contact information from the leads provided by the publisher were on public company directories. The contact information could easily be found using a search engine, including Google. Such information was present on both the company domain and public directories – which are sources easily accessible for bots and scrapers. Examples of contact information that can easily be scrapped or acquired by non-human applications include leads provided by The Maritime Executive in August 2016. Twelve out of the first 20 from the list appeared in the SERPs, when searched for on Google.
Specifically, some leads provided such as “firstname.lastname@example.org” (an email address used for recruiting purposes – also easily searchable using a search engine) were irrelevant to the products being promoted (in August 2016, all of the products part of the campaign were related to industrial lighting systems). Larson Electronics also found several “swekis.com” email addresses, which can be traced back to a law firm. Like the first example, Larson Electronics products are not being used by law firms; they simply have no need for explosion proof or corrosion resistant lighting. Perhaps the most interesting observation is that “swekis.com” email addresses appeared numerous times in the list (i.e., email@example.com, firstname.lastname@example.org, email@example.com, firstname.lastname@example.org, email@example.com, firstname.lastname@example.org, email@example.com and etc.), suggesting that the contact information ended up on the list via non-human applications, such as a bot or scraper; as it is not common practice for multiple members from the same company to engage in a product they are not interested in, or is irrelevant to their line of work. The “swekis.com” email addresses can be found on public directories.
From the same list of leads generated by the publisher in August 2016, other contact information shared similar irrelevancies and questionable originations, e.g., several “@allenovery.com” email addresses (Allen & Overy is a law firm that specializes in business). There were several duplicate entries, in some cases triple entries, suggesting that the application used to acquire the leads either went over the same directory, or encountered several public directories with the email addresses present but failed to notice the duplication from the first source. Duplicate entries are common with numerous email addresses from the list provided by The Maritime Executive in August 2016. It is very unlikely that an individual would naturally key in his or own email address several times; and it is even more unlikely for this occurrence to happen naturally on multiple, separate occasions from different companies within the same timeframe.
Additionally, some leads generated were The Maritime Executive email addresses from other companies, as well as other advertising companies. These entries do not carry any weight or relevancy; they should not be on the list provided by the publisher. Furthermore, advertising companies do not buy industrial lighting systems and products, it would be unnatural for such groups to request to be added as a lead. A highly probable explanation is that the leads were generated by bots or scrapers; and since the company contact information used similar industry-related keywords that the non-human applications were targeting, the email addresses were picked up unintentionally by the application. Larson Electronics asserts that most (roughly 60-95 percent) of the leads provided by The Maritime Executive were scraped – either by the publisher or from a third-party service that uses similar automated tools and processes.
The Maritime Executive provided website traffic as part of their service to Larson Electronics. As mentioned earlier, the objective of website traffic generation is to boost awareness, product promotion and online sales (conversion from a visitor to a customer). Larson Electronics approached the publisher specifically for this service due to its extensive reach in the marine sector, which is directly related to the company’s line of lighting systems, such as corrosion resistant luminaries and explosion proof lights.
The results of the campaigns, as reported by The Maritime Executive, showed inconsistencies with data from Larson Electronics’ Google Analytics platform. Generally, the publisher reported activities that were non-existent, possibly erroneous or misleading.
Below highlights examples of discrepancies in website traffic generation results between The Maritime Executive and Larson Electronics:
- Between April and September 2016, the publisher claimed to have delivered 487 clicks (note: not sessions) to the following link: http://www.larsonelectronics.com/p-104691-80-watt-wireless-remote-control-led-spotlight-24-volt-dc-or-120-220v-ac-spot-to-flood.aspx. Using data from Google Analytics, there were zero clicks during the session and 21 page views for the link from all sources between January to September 2016.
- Between April and September 2016, the publisher claimed to have delivered 490 clicks to the following link: http://www.larsonelectronics.com/p-64376-corrosion-resistant-requirements-saltwater-led-light-4-foot-2-lamp-2nd-gen-class-1-div-2.aspx. Using data from Google Analytics, there were 10 user sessions for the duration of the campaign and 248 page views for the link from all sources between January to September 2016.
- Between April and September 2016, the publisher claimed to have delivered 492 clicks to the following link: http://www.larsonelectronics.com/p-73051-160-watt-high-intensity-led-light-21600-lumens-120-277v-ac-high-mast-lighting-outdoor-rated.aspx. Using data from Google Analytics, there were 10 user sessions for the duration of the campaign and 143 page views for the link from all sources between January to September 2016.
It is important to note that for the entire year, Larson Electronics did not receive a single online sale from the advertising services provided by the publisher. To measure conversion rates accurately, Larson Electronics uses Smart Goals to monitor the quality of traffic, going beyond traditional metrics, such as average time spent on the website, which can be defined as the following:
“Smart Goals uses machine learning to examine dozens of signals about your website visits to determine which of those are most likely to result in a conversion. Each visit is assigned a score, with the “best” visits being translated into Smart Goals. Some examples of the signals included in the Smart Goals model are Session duration, Pages per session, Location, Device and Browser.
To determine the best visits, Smart Goals establishes a threshold by selecting approximately the top 5% of the traffic to your site coming from AdWords. Once that threshold is set, Smart Goals applies it to all your website visits, including traffic from channels other than AdWords.”
Larson Electronics averages a conversion rate of 4.93 percent for email campaigns in 2016, as calculated using Smart Goals. Email campaigns from The Maritime Executive resulted in a conversion rate average of zero percent. As mentioned earlier in Section 3.2 and according to a Word Stream report, average conversion rates for all industries is 2.3 percent (generally lower for e-commerce, higher for relevant leads and Smart Goals). Hence, at the very least, the publisher, since it reportedly used relevant sources of traffic, based on its “audited” reach of 392,212 and total audience of 472,692+, should have been able to deliver some conversions (even one) from the advertising campaigns that took place during the entire year of 2016.
“Naturally, this leads us to the traffic statistics problem. If these people are the ones clicking on our ad in their digital campaign and coming to our site, how is that possible when these people don’t exist, don’t read Maritime Executive or stopped using that email 5 or 6 years ago? How is this traffic being generated? It would certainly explain the average page views of one, but the question remains, who or what is generating the traffic? Whatever the answer to that question is, this does explain why there are no conversions, no smart goals and no referring links for any sales, etc,” explained Bresnahan.
Based on the results of the advertising services provided by The Maritime Executive to Larson Electronics during the entire year of 2016, it would be possible to conclude that the advertising services provided were fraudulent, low quality and misleading. The publisher promised to deliver leads, which can be defined as an individual or group in the buying process who is interested in the product or service being marketed. The leads provided by the publisher from the advertising campaigns did not meet the definition of a lead – the majority of contacts provided were either acquired unnaturally or falsely generated. Therefore, The Maritime Executive did not actually provide leads. Instead, the publisher provided a set of random contact information and passed them off as genuine leads. Moreover, The Maritime Executive may have used (or engaged a third-party that offers such services) bots, scripts or scrapers to acquire low quality, fraudulent contact information. It would be possible to assert that the publisher under-performed in its advertising services to Larson Electronics, which according to Section 3.4 in the case between CUES and BVS, such actions may be used as grounds for legal disputes.
Next, the website traffic results provided by The Maritime Executive were inconsistent and falsely generated, when compared with data from Larson Electronics’ Google Analytics platform. All advertising campaigns conducted by the publisher did not generate any conversions. Furthermore, the publisher boasts an extensive “audited” reach of 365,212; “audited” unique browsers of 225,823; “audited” social media followers of 116,866; and a total audience of 472,692+. Yet, the publisher’s advertising campaigns failed to deliver a single conversion for almost an entire year’s worth of advertising services. In this case, the use of the term “audited” does not change the origination and quality of the advertising services provided. Based on The Maritime Executive’s Consolidated Media Audit Report, such “audited” sources may be non-human and “may not equate to an individual person” (directly quoted from the report); thus suggesting that some of the publisher’s audience that participates in the advertising campaigns are non-human (bots) that have no genuine interest in the products being marketed.
“There are so many issues with Maritime Executive; it is hard to wrap my head around them all,” said Bresnahan. “It is not clear yet whether all campaigns we were billed for actually ran, but we definitely have issues with the leads generated by the campaigns that did run. This year, we are pretty aggressive about following up with these leads to further the sales of our products. The goal of advertising is to garner more dollars of margin from the advertisement, than the ad itself cost.”
“In looking over the leads from Maritime Executive, we noticed that we received email only data. This is unusual. Typically, we get full contact data for leads. We also noticed several hundred leads from attorneys at large firms. We advertised explosion proof LED lights for hazardous location areas in these campaigns. These are products that make sense for tankers, refineries, chemical processing centers and docking areas where oil and other chemicals are routed on and off transport vessels. Not lawyers. For example, we had 7 partners from one firm ‘respond’ to one ad in one e-newsletter on one day. It just would not happen.”
To conclude, using fraudulently generated data, The Maritime Executive misled Larson Electronics into thinking that the advertising campaigns were successful. As a result, Larson Electronics continued to pursue the publisher for more advertising services. The publisher, being fully aware of its actions during the advertising campaigns, profited from the fraudulent services.
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