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Harold Mansfield
01-13-2009, 06:42 PM
We all know certain "niches" prey on peoples fear, desperation and insecurities:

* Gamblers in debt
* People whose home is about to be foreclosed
* People about to go out of business
* Students who need money to enroll
* People who want to get rich quick
* Parents with children needing legal help
* Insurance agents, doctors, therapists, who have failed or fear failing there exams
* Women who can not get pregnant
* Women scared of husbands having affairs
* Men who cant get women at all
* People with illnesses/aches/pains who cant find a solution
* People who have work drug tests coming up soon

Although I sell weight loss products, I can't take the easy way out and purposely prey on peoples desperation.
As an Internet Marketer, is it all about making the buck, or do any of you shy away from products or services that offer little or no help, yet convert well with high payouts?

vangogh
01-13-2009, 07:33 PM
I couldn't promote a product I didn't believe in. Now I don't have to think the product is the greatest thing every created, but I do want to believe I'm offering something useful to my visitors.

But I also think that we all have different ideas about what is useful. There are things I may personally think worthless, where someone else thinks they are useful. I won't hold it against anyone of they go into markets I wouldn't go into.

Your question actually has some wider implications.


We all know certain "niches" prey on peoples fear, desperation and insecurities

You mention the niches, but take them out of it.


prey on peoples fear, desperation and insecurities

In many respects that's normal marketing behavior. We all make buying decision based on emotion and those are three powerful emotions that do get us to buy. As I was writing this a commercial for Toyota used vehicles came on. The ad was pushing the idea that these vehicles were certified in some way so you know you're getting a good vehicle. But that's really selling by pushing fear buttons that if you don't buy certified you could end up with a lemon.

The marketing is aimed at your fear of not buying a used vehicle that's been certified by Toyota.

Is that immoral? Toyota makes good cars so you'd likely be getting a good car. They're not pushing something bad at you, but they are playing up the fear angle a little in order you to make the buying decision.

Every how to book ever written is going is selling to your fears, desperation, and insecurities. That doesn't make them bad by default.

It's an interesting question and one who's answer is mostly going to be in the eye of the beholder.

SteveC
01-13-2009, 09:28 PM
There are basically two ways to sell a product or service and these are:


To gain a benefit
To avoid a loss


Most companies sell to either one of these.... I sell based on benefits, an insurance company might sell based on fear of a loss...

Don't mix up peoples buying motives, methods to markets, etc with business ethics... some people, like most here have ethics and others don't... those that don't generally don't last long in business but they do cause a great deal of hurt.

billbenson
01-13-2009, 09:52 PM
Take your diet site for example. You may have a diet on there that works for some people but not others. They are adults (usually). Give them decent information.

There are a number of subjects on your list that I wouldn't touch. Get rich quick for example. But, there are enterprising people who do, in fact, use these programs and make money. Some are just scams.

DONT-BE-AN-IDIOT.COM is available!

I would personally draw the line if the people you are selling to will be stealing from those they sell to. You can't have complete control, but you could do things completely ethically and have the information you use completley misused.

I don't see anything on your list that could not be promoted in an ethical manner. Many are promoted in unethical manners, which gives industries a bad name.

orion_joel
01-13-2009, 11:26 PM
I think another thing that it comes down to if you are thinking of going into one of these markets but hesitate due to your perception of that market is dont be. If you don't promote, someone else will. If you dont make money from it, someone else will. Just because you dont market it does not mean that people don't want it.

So do you best to be ethical and not mislead people, and just go for it.

Steve B
01-14-2009, 08:29 AM
I've never been a big fan (or even understood) the "if you don't do it someone else will" argument. I don't see how that comes into play in a personal morality question.

ShopLady
01-14-2009, 09:17 AM
The overall approach matters when you are trying to sell; if you see a marketing method you can see right through, don't use it EVEN if it is making someone else money. Else, would you want to be known as the person or company who does this or that in a conniving way? Nope. Not at all, right?

Be straightforward, be honest, give just enough info (good and bad) to draw the interested people in so that they are intrigued to know more. Even if they don't make a purchase, they will remember you for your honest approach. It's too easy to spot a scam these days.

vangogh
01-14-2009, 10:25 AM
if you don't do it someone else will

Steve, I agree. That's always come across to me more as a justification for doing something you know is wrong than anything else.

@ShopLady - I agree with what you said, but let me toss something out for discussion. Where's the line? If you know using a certain color for a button will get more clicks on that button, everything else being the same, would you use that color? Is that manipulation?

If you know that rewriting a line of text subtly in your sales copy will increase sales would you rewrite that line of text? Assume it doesn't change the message of the copy at all. Assume it does alter the message.

Every limited time offer you see is going after your fear of missing the offer. We all buy some things on the last day of an offer that we probably would have passed on had we known the price would stay the same tomorrow. Is it spam?

I think there is a line where things cross into the spam realm, but it's a very gray and fuzzy line that changes for each of us. Some things are clearly spam, others clearly not, but many things can fall on one side of the line or the other depending on who's viewing the line.

Harold Mansfield
01-14-2009, 01:26 PM
This post brings to mind this guy specifically, Jeff Paul's Secret to Internet Millions.
This guy is clearly a scam, but he preys on naive people that think the internet is free and easy money, but, what he is selling is junk.

He uses all the right triggers, showing expensive houses, beautiful girls, and supposedly normal people who have hit the big time with little or no work.

He is really pouring on the BS and actually claiming that people who use his system make 100k a week !

He truly disgusts me, but apparently he is making some coin.
I think this particular guy is dangerously flirting with a federal indictment, but there are 1000's others.

His marketing is genius, way better than the product.

Some may say he is merely providing information that people don't know how to find on their own, but webmasters who know the business can clearly see through him.

Has he crossed the line, or is he just targeting a niche that people want and are willing to pay for ?

orion_joel
01-14-2009, 07:00 PM
Firstly i would say that this Jeff Paul has crossed the line, if he is using figures and such which are not correct. However if all the figures he uses can be backed up and proven, then no.

Also let me clarify exactly what i meant in my last post. By saying, If you dont do it someone else will, i am not meaning in anyway to be dishonest, because if you notice my last comment in the message was, "So do your best to be ethical and not mislead people, and go for it."

The first thing that comes to mind in this whole discussion is if you really do find something to be morally wrong to yourself then why would you consider doing it at all. However sometimes i think that it can come down to a belief that others may find it morally objectionable and they dont want to mess with the status quo.

For example from the original list, Gamblers in Debt, I am sure that a large portion of the community find gambling to be against their believes, probably even more so if the business idea is to prey on them to make money apparently helping them get out of debt. However if you could help them in some way, and make money at the same time while truly helping them to improve their situation rather then making it worse, why wouldn't you want to do this.

Really if there was a way to make money from truly helping people in any of these situation's, without doing anything illegal, and without taking advantage of them, then morally i would have thought that you were providing a benefit to society rather then being condemned for doing it.

vangogh
01-14-2009, 07:54 PM
However if you could help them in some way, and make money at the same time while truly helping them to improve their situation rather then making it worse, why wouldn't you want to do this.

Funny you mention this Joel. I was thinking of the very same thing this morning. All of the niches mentioned could be sold something that would truly help them in some way. At the same time you might still prey on their fears a little to make the sale. Maybe your sales pitch to the gambler is:

Your last bet put you in debt?
Fat Tony ready to break your thumbs for his cash?

Don't let your gambling ruin your life. Learn how to overcome your gambling problem with our 12 step program.

Ok, not the best copy, but hopefully it's enough to make the point. It's clearly using fear to help sell a product. Assuming the product is good (say it has a 75% success rate) is it still spam to sell to the gambler?

@Harold - I'd be more inclined to say he's crossed the line, but it's not an easy answer. If I owned a Ferrari dealership and sold you a Ferrari is it crossing the line because you really couldn't afford it. Your paperwork cleared. Your credit was fine. But you'd just lost your job. So you were sold something that you wanted, but isn't going to do you any good. I don't think any of us would find fault with the Ferrari dealer.

How different is the scenario. Jeff Paul is selling something someone wants that won't do them any good either. Again I'd lean toward him crossing the line, but doesn't the buyer need to take some of the responsibility too.

Harold Mansfield
01-15-2009, 01:59 PM
......

@Harold - I'd be more inclined to say he's crossed the line, but it's not an easy answer. If I owned a Ferrari dealership and sold you a Ferrari is it crossing the line because you really couldn't afford it. Your paperwork cleared. Your credit was fine. But you'd just lost your job. So you were sold something that you wanted, but isn't going to do you any good. I don't think any of us would find fault with the Ferrari dealer.

How different is the scenario. Jeff Paul is selling something someone wants that won't do them any good either. Again I'd lean toward him crossing the line, but doesn't the buyer need to take some of the responsibility too.

The exact same argument could be made for the mortgage industry 3 years ago. I knew many people who were in the industry at the time and they knew that they were putting people in homes that they couldn't afford, but it was legal. The only thing that they were concerned with was getting financing, and the only thing management was concerned with was finding a buyer for the paper.

Yes, the buyer should take on much of the responsibility. I think that if you really believed back then that you could afford a $400,000 house, on a 30 year adjustable, while making $50,000 a year, you were kidding yourself.

The same goes for anyone that truly thinks that sending in $39.95 is going to unlock the gates to a $10,000 a month income, with no training, and little work.

Selling people dreams is big business, and always has been, but, is it "Money at all cost, as long as it's technically legal?"

I can't do it. I have contemplated selling "How to make money online." type ebooks, and products, to make some quick cash, especially now, but I just can't put my name, or even a fake name on something I know to be generalized garbage.

As far as Jeff Paul goes...I fully expect to see him going the way of Tom Vu. Federal indictment, assets seized, and jail time. He is doing the oldest cons in the book. Bait and Switch, Junk Bonds, Snake Oil, Misrepresentation, all combined with automatic billing. Just like every other scam like it, before him.

billbenson
01-15-2009, 03:15 PM
I can tell you this. At the end of the .com bust in 1999, I was selling equipment for a startup company. The equipment was two years two late. An Israeli company already had a better working product. Our product wasn't even close to working and was a poorer technology.

A distributor in Central America wanted to quote our equipment. $1M or so. I could have done that, but we could never deliver and the customer would probably not have bought the equipment anyway. I told the distributor the truth. I effectively got fired because of that. I resigned, but that was in place of getting fired. Company failed a couple of months later anyway.

I would have been putting my distributors credibility on the line with his customer and I wasn't willing to do that. It was that distributors largest customer. They were selling millions to them yearly.

For something like get rich quick ebooks, I don't know if I would do it or not. If it has value if someone actually followed through with it, then I probably wouldn't have a problem. If it is a chain letter / pyramid sort of scheme etc.; there are plenty of other credible products out there to sell.

vangogh
01-15-2009, 05:44 PM
Good example Harold. I think we're pretty much all in agreement about Jeff Paul and I do hope it's clear I wouldn't enter these markets or look to take advantage of people. Maybe my example wasn't the best. What I see though in most every discussion of spam is people talking like it's a black and white issue when it's really shades of gray that often get very fuzzy somewhere in the middle.

Let's consider the typical ebook. I've read a few promising riches in the sales pitch that turned out to have solid advice. No one would get rich reading them, but the books were worth the few dollars they sold for. If even one or two tips were followed they would pay for the cost of the book. The sales letter still looks like complete spam and does sell on the negative emotions we've mentioned. Many times the advice inside was worth the price of the ebook, though may not much more. Is the whole thing spam? I don't know. I suspect some would say yes and others no.

seolman
01-15-2009, 11:23 PM
IMHO it really comes down to two things: the seller's conscience and the Buyer's diligence.

A young inexperienced seller may honestly believe one of these ridiculous get rich quick schemes can really help you make a ton of money and so with his rose-colored glasses he proceeds to spend his hard-earned cash promoting it hoping both to help others and make a few bucks himself.

In turn, a savvy young lady investigates the scheme and finds 4,000 complaints against it at the BBB and decides it's not the package for her deciding the kid selling it is a useless scumbag.

The kid is not in fact a scumbag, just an inexperienced bonehead who was not smart enough to do his own due diligence prior to offering the product up for sale. After selling a few "get-rich-quick" packages and having to refund a lot of money perhaps he will learn his lesson.

The bottom line is: it's not always about ethics. It can simply be a lack of experience. Just believing in a product doesn't make it ethical to sell it. It requires due diligence. It requires enough experience to know you aren't getting yourself or others into legal trouble or possibly endangering lives (as in the case of selling health products or products where a person could be put in physical danger (such as say faulty cryogenic valves).

Lots of people have died due to people selling products they truly believed in but knew nothing about.

orion_joel
01-16-2009, 02:23 AM
Seolman i think that you are very correct in what you say. I do also believe that due diligence is maybe the number one thing that is so often over looked by potential customers.

vangogh
01-16-2009, 11:07 AM
A young inexperienced seller may honestly believe one of these ridiculous get rich quick schemes can really help you make a ton of money and so with his rose-colored glasses he proceeds to spend his hard-earned cash promoting it hoping both to help others and make a few bucks himself.

That's one of the main reasons why I don't like people accusing people of spamming. I've seen quite a few naive people promoting something that leaned to the spammy side of things, but the people didn't strike me as bad people. Just misinformed. I've seen a few get shouted down as being a spammer instead of the situation being explained to them. Someone who accuses others and labels them without any real proff strikes me as a far worse crime than an email I don't want showing up in my inbox or someone dropping a link on a forum post.

KristineS
01-16-2009, 12:40 PM
I tend to go with my gut in these sorts of situations. If it seems wrong to me, than I won't do it, regardless of what others might think.

Not everyone is like me and I do think due diligence is definitely the name of the game. Caveat emptor (let the buyer beware) has survived as part of our language for a reason. In a perfect world it would be the seller's job to only sell us good products and services but we don't live in a perfect world. People need to take responsibility for themselves and their actions. Do your research before you buy.

vangogh
01-16-2009, 10:06 PM
Going with your gut can be a good spam detector. It's not perfect though. I agree with caveat emptor. I think of the Nigerian email scam. The one where a some Nigerian prince contacts you telling you he'll wire millions to your account if you first wire him some money to help clear his money through channels.

Now the people who send this out are pretty disgusting, but I don't really feel sorry for the people who fall for it. I mean how much thought does it take to realize it's a scam. Because Nigerian princes are always finding my email and wanting to give me millions.

orion_joel
01-17-2009, 12:54 AM
I agree Vangogh, additionally though, how often do you find yourself with an entry to a lottery you have never heard of, let alone remembering to enter it.

Business Attorney
01-17-2009, 01:12 AM
That's one of the main reasons why I don't like people accusing people of spamming. I've seen quite a few naive people promoting something that leaned to the spammy side of things, but the people didn't strike me as bad people. Just misinformed. I've seen a few get shouted down as being a spammer instead of the situation being explained to them. Someone who accuses others and labels them without any real proff strikes me as a far worse crime than an email I don't want showing up in my inbox or someone dropping a link on a forum post.

Vangogh, you are very kind. I am a moderator on several boards and I have gotten really tired of people coming with a clear intent only to tout their own product or service. I estimate that on one forum I delete 20 posts for every one I make myself.

I joined the forums to participate, not to moderate. I am not rude to the posters but I am quick to delete posts and somewhat slower to ban users, and my reasons given are invariably brief. If someone asks for a better explanation, I willingly give it but in most cases these are "drive-by" posters who never return again anyway. I feel no compulsion to give every violator lessons on forum etiquette in the off-chance that they are the 1 in a hundred who truly doesn't understand that what they are doing is wrong.

Steve B
01-17-2009, 01:20 AM
but I don't really feel sorry for the people who fall for it.

Just keep in mind there are plenty of people with different levels of psychological stability (and ability) out there. I would feel sorry for someone who fell for this obvious scam for two reasons - 1. that they fell for the scam and lost their money, and 2. that they were in such a state of mind that they fell for the scam.

seolman
01-17-2009, 01:40 AM
I know Steve better than that - there's a clarification coming.

I do feel sorry for the old ladies who get suckered by the smooth talking telephone salesman or the naive kid who is talked into buying the junky used car by the wiley car salesman. Not everyone had a good mentor around to teach them the ropes. The fatherless boy who never had a dad or kind uncle to teach him what to watch out for - he deserves a break and won't get one. The old woman whose husband died. He used to handle all the business matters so she gets easily suckered by some fast talking sales guy, or maybe she just can't make decisions as well as she used to and is an easy target for the ruthless.

Our natural sense of justice tells us this isn't right.

greenoak
01-17-2009, 08:27 AM
i like buyer beware, but i cant beware of some drug im prescribed , or how good my brakes are....as usual things are kind of grey and fuzzy....

having a moral angle to business would come natural to lots of folks who came of age in the 60s....when you drew a line in the sand and definitely wouldnt work for or support the bad companies...the ones who made napalm etc etc....

if you think the weight loss product would work i dont see any conflict....if you know its a fraud would be more to the point.....and what doesnt play to peoples fears? most products have some part of that...life insurance, life jackets, make up, safe toys etc etc...

i think you should at least slightly believe what you are selling isnt mostly on the bad side........ ....
ann

phanio
01-17-2009, 11:21 AM
I beleive in integrity in business. First, you treat someone well, they may tell one persons. You treat someone bad, they WILL tell 10 people.

I just want to be able to sleep at night. Choosing the color of a button or flashing arrows, ok - they still have to click. But lying or manipulating for your own gain is just wrong.

I deal with this daily in my business. I have companies seeking funding that just have no clue what they are doing (regarding the funding). I try very hard not to steer them to products or services that help me - but that will really benefit them. I guess its just what YOU can live with.

Harold Mansfield
01-17-2009, 12:47 PM
Going with your gut can be a good spam detector. It's not perfect though. I agree with caveat emptor. I think of the Nigerian email scam. The one where a some Nigerian prince contacts you telling you he'll wire millions to your account if you first wire him some money to help clear his money through channels.

Now the people who send this out are pretty disgusting, but I don't really feel sorry for the people who fall for it. I mean how much thought does it take to realize it's a scam. Because Nigerian princes are always finding my email and wanting to give me millions.

That reminds me. I have to answer a few emails. Apparently I am the sole descendant of a wealthy oil tycoon in Zaire. They have been searching for me for months, and I have inherited $70 million dollars:D

If I combine that money with the fee I am to be paid for helping the daughter of an imprisoned businessman smuggle money of their country, I should be a rich man by the end of the day.

vangogh
01-17-2009, 03:02 PM
I joined the forums to participate, not to moderate. I am not rude to the posters but I am quick to delete posts and somewhat slower to ban users, and my reasons given are invariably brief. If someone asks for a better explanation, I willingly give it but in most cases these are "drive-by" posters who never return again anyway. I feel no compulsion to give every violator lessons on forum etiquette in the off-chance that they are the 1 in a hundred who truly doesn't understand that what they are doing is wrong.

David as soon as I know someone is spamming posts are banned and members are deleted. I've been moderating long enough at this point to recognize a lot before many people will. I just like giving people the benefit of the doubt. On a webmaster forum where I admin someone joined a few years ago and his first few posts came across very spammy, but he was just a young kid and didn't realize. After treating him with some respect and helping him understand things better he became a contributing member of the community.

As far as people falling for scams I do feel sorry for people when they fall for many. I get plenty of emails that look incredibly legitimate and could easily fool people. I also realize I may be better at spotting some than others.

However the Nigerian scam is something you only fall for by being greedy. There is a point where the person being scammed needs to own up and take responsibility for getting taken. I still feel bad for the people who got taken, but I have a lot less sympathy for someone who gets scammed by something that really should be obvious and something that scams you by appealing to baser instincts like greed. And of course it depends on who the person getting scammed is. I do realize that something obvious to us may not be so obvious to a 93 year old who gets on the internet once a month. There are certainly people who for one reason or another are incapable of seeing a scam for a scam though no fault of their own.

seolman
01-17-2009, 03:34 PM
I told you there was a clarification coming :D

vangogh
01-17-2009, 03:36 PM
You are wise beyond your years.

And you've seen me talk about this before too haven't you?

seolman
01-17-2009, 03:57 PM
I'm not telling...

billbenson
01-17-2009, 04:26 PM
I feel sorry for the elderly who are frequently preyed upon and not up to date on things. Also, remember that not everybody is that up to date, particularly with computer stuff. That provides an opportunity for both the scammers and legitimate marketers.

I get Nigerian scam sort of emails all the time; mostly to buy products. My scam filter is location, real bad english, ask if you take a credit card in the first email, yahoo email address. I normally send a heavily inflated quote if I'm suspicious. I recently did a deal with Indonesia which made me nervous. Turned out to be ligit, so you can't always read a book by its cover.

But I get these emails every month. The people that get taken are the ones that are elderly and / or don't spend time on the internet.

Yes I agree, just like buying a bad stock everyone should do due diligence, but show me someone who never made a mistake and I'll show you a liar.

Greed is a big part of it though. Not just the scam artists, but the victims.

vangogh
01-17-2009, 08:11 PM
Bill I agree with you about the elderly, but the odd thing is every time I hear about someone falling for the Nigerian scam it's someone who'd between 35-50 and someone who should really know better.

billbenson
01-17-2009, 10:08 PM
I worked for a company for a short period of time that got taken for 60k to Nigeria. They did international business, the order passed through the sales guys hands, accounting, secretarial, and shipping. Every single hand that touched the paperwork knew better. They were trained to double check each other. Actually pretty surprised nobody got fired as the owner was a hot head &%%$.

Came in various mornings to find things like holes punched in doors. Owner was a cheap hothead. Well run clean operation though. 30 or so employees and they had to do $1M in sales a month. All internet BTW.

vangogh
01-18-2009, 02:15 AM
Makes you wonder how they didn't catch it. That's what I mean though. Seems like this scam doesn't catch the elderly, but people being a little greedy, wanting to believe that some prince they never heard of will really give them millions.

By the way just how large is the Nigerian royal family? At least 100 different exiled princes have contacted me in the last few years. That's a pretty big family.

orion_joel
01-18-2009, 04:42 AM
I worked for a company that got taken for over $100K in Notebook computers, about 8 years ago. The order was placed from i think Thailand i believe and paid on credit card, and the biggest issue was that one of the sales guys was actually in on the deal, and was out of their before they could fire him.

Personally i do not imagine how pulling such a scam could leave you better off then staying on doing your job. Seriously even if he got a majority, it would have still been less then he would have earned that year staying in the job.

billbenson
01-18-2009, 05:21 AM
Forgot to mention above; using multiple credit cards is a red flag. I have had Nigeria orders as well that hit every red flag. I just ship really late on those.

Corey, if you are out there, is there any way to see if a credit card is valid? There used to be a site that showed what bank a card was on so you could call them. Visa shut them down.

I just used the wait 30 days approach on suspect charges. Can't tell though, good orders can look fraudulent. Could be an employee going around purchasing, but it's a valid order??

Steve B
01-18-2009, 10:38 AM
I think it's actually easier to see how the company with so many people touching the paperwork got scammed. It's called GroupThink. Nobody took personal responsbility for their part of the transaction and/or assumed that someone before or after them would have stopped it if it wasn't legit.

I think age is only one factor. There are a lot of truly feeble minded 35 years olds out there too. I don't mean that in a deragatory way - I'm talking about people who are on the verge of needing to be institutionalized. I'm sure there are plenty of people that get scammed that should know better too, but I'd stop short of saying I don't feel sorry for them. It's not against the law to be greedy. If they participated in something that they didn't think was legal AND it ended up a scam, then I don't have any sympathy for them at all. From what I remember about those Nigerian royalty scams they are ridiculous scenarios, but if you were to believe their story (due to extreme naiveness, or mental incapacity of some sort) I don't think it sounded like you would be participating in anything illegal.

vangogh
01-18-2009, 11:57 AM
Steve, you're probably right about the group think thing. In those cases though my sympathy isn't there for the people getting scammed. Think about this particular scam. It's not someone trying to deal with a company on a business level. It comes in addressed to an individual with the usual poor English, spelling, and grammar. The email claims a Nigerian prince has escaped something and has millions in the bank, but he needs your money to clear his money in the bank. If you agree to transfer thousands of your dollars to his account, he'll be able to free up his money and share it with you.

For a business to fall for something like that is pretty shameful for the business. If you tell me some elderly man with Alzheimer's fell for this than I absolutely feel sympathy for that person and place all the blame squarely on the spammer. I'd feel the same sympathy for anyone regardless of age if the person isn't really completely in charge of their faculties. But if you tell me a business fell for this or the average person who does have their wits about them, it's harder to have sympathy for them. They most likely fell for this because of their own greed.

Harold Mansfield
01-18-2009, 12:49 PM
I worked for a guy about a year and a half ago that would do any business with anyone in Africa, period.
He had been taken a while back with a wire transfer for about $10k. It passed all of the checks, passed the banks scrutiny, cash was in the account and everything.

Weeks after the product was shipped the bank contacted him and told him the transfer was indeed from a fraudulent bank and the cash did not really exist.

He got stuck, but I always thought of how unfair it was for the bank who approved the transfer, and showed the cash, not to be held responsible for their own lack of security and checks. I mean that is what they do. The are in the money business. They are supposed to know every trick in the book to protect us...isn't that why we give them our money ?

billbenson
01-18-2009, 01:17 PM
That's weird eborg. For my indonesia deal, I set up a separate checking account and talked with the bank manager at several different branches. They all said that a wire transfer was like cash.

Steve, as for so many people touching the paperwork, that guy had a really good system. He held everyone responsible for any error, publicly berated them for errors, and fired people. He was a real a## but the system worked quite well. I think the reason nobody got fired is his pet star salesman did the order.

orion_joel
01-18-2009, 07:21 PM
Surprisingly enough fraud it seems is easy enough in real person as well, as long as the people making the sale are not to bright (or in on the deal).

When i worked in retail a customer came in and went through getting a laptop, while we were out the back getting the laptop, the cashier put through the transaction, without being provided the credit card and using a number the guy had written on a piece of paper. We could only assume she was involved, because it was constantly drilled into everyone card must be present and signature must be checked, along with drivers license on all purchases over $1,000. The guy end up getting caught, as we did get his number plate as we realized what was going on very quick, when we found the credit card slip, not signed on the counter. But store policy was do not chase.

BillR
01-27-2009, 04:32 PM
I find ethics and morality discussions quite interesting.

One of the dangers of traveling for work is you are in hotels far too often and see far too much TV. I actually bought one of Jeff Paul's books years ago for a modest price ($29 as I recall).

His stuff is not a scam in the literal sense. His basic premise is that anyone can create valuable books/guides based on of their expertise in a particular area. This probably true for some people (but not rocket scientists, surgeons, etc).

That much is true - provided a person has a desirable expertise in some area, they can document it well, and it is reasonable that anyone can acquire that expertise at home from the book. If these things are true it's not a scam (yet).

Where it becomes a scam is in his pricing. He insists that the price for these information products should be very high - his example was a book for financial advisors on how to generate leads - he was selling it for just under $1000.

This is the point it becomes a scam. I have no problem with people selling information products on the web - but pricing an item so astronomically high has the effect - as he says in his own words - of making people emotionally invested in the product and they tend to believe in it. At this point you are not selling a product based on it's value - you are selling it based on an entirely different thing. A buddy of yours will tell you if a $5 book was a bunch of crap. If he spent $1000 on a bookhe's going to tell you it was worth it (unless he returns it...) because he is emotionally vested.

Still though - I don't have too much of a problem with it if people have an iron-clad refund agreement which they live up to.

I am actually in the process of creating an information product myself. I believe this has some value - the specific reason I am creating this one is simple: I tried to go buy this book and I couldn't find it - there are very few resources of this variety out there - so I am doing it myself.

I am undecided on price but going off of the "Jeff Paul" method I should charge hundreds of dollars for this. I could never do that (never mind that my wife would kick my butt) - but I think $30 might be reasonable based on the "I would pay that much for it" principle.

vangogh
01-27-2009, 06:17 PM
That is a little shady to price the book so high just so you'll generate positive word of mouth. Then again he might sell more at a reasonable price. It doesn't matter to me what my friends say, I'm not going to pay $1000 for a book.

There is truth in what he says and I know many people wouldn't even consider it shady. Many would simply call it smart marketing.

What both interests me and frustrates me about questions of ethics is it really comes down to the individual and what they believe is right and wrong. We're all different and have different code of ethics. Sure most of us will agree that killing someone is bad, but what happens when it's in self defense? What happens when you're killing someone because you believe if you don't they'll kill you even if there's no direct threat? What about war? The ethics of something killing another human being, which we all seemingly agree on, can become murky in a hurry.

Move the conversation to politics or religion and watch how quickly people disagree on what's right and wrong.

So when it's so easy for ethics to become murky over something like killing others which at first glance we'd probably all say is wrong, how can we really apply one universal ethical standard to something like marketing?

Further complicating marketing and using the Jeff Paul pricing as an example. Suppose Jeff never mentioned how he prices things high on purpose. What if he priced the book at $1000 because he felt it was worth $1000 or because he rolled some dice to come up with the number? What if he priced it at $1000 because he didn't know any better? I don't know that anyone would be thinking scam if he honestly thought the book deserved to be priced so high, yet it would arguably have the exact same result of people not wanting to admit it wasn't a good book.

So the part we'd really complain about ethically is that he was smart enough to observe the effect of the high price. It really has nothing to do with the price itself or what happens because of the price. Had Jeff Paul remained ignorant of why certain pricing works he'd be lucky. But once he gains enough intelligence to know what's going on he becomes unethical. Kind of ironic.

Maybe ignorance really is bliss.

BillR
01-28-2009, 11:38 AM
I'm not going to pay $1000 for a book.


The counter argument (from Jeff Paul, not me) to this is simple: Financial advisors hate generating leads. It's the worst part of the job. For most of them one or two sales will cover the cost of the book; hence, it is worth it. Also, if you went to a seminar on how to do this the cost would be comparable.

I'm not buying that argument very often. There are probably cases where this is true but not for the majority of information products people can produce. If I make a "field guide to mushrooms" I could claim you will save thousands of dollars over your life time picking mushrooms instead of buying them and try to charge $1000 for it.

No one would ever go for it.

Oh, and ignorance is bliss. I miss it :)

vangogh
01-28-2009, 11:43 AM
When you think about it a lot of this comes down to the price the market will bear. You're right. It's unlikely people are going to pay $1000 for a book about mushrooms, but when you toss out the idea that a book with financial advice will save you many times that $1000 it's a much more likely sale.

KristineS
01-28-2009, 12:38 PM
There's also the question of is it bad ethics if you're charging what the market will bear? This comes up a lot with pharmacies, who charge outrageous prices for drugs people need. Insurance covers the cost for most people, and the pharmacies claim they can't make a profit unless they charge these prices, but the prices are generally quite a bit above what it costs to produce the drug.

Is this ethical? It depends, I guess. If you have good insurance and can cover any co-pays out of pocket, you probably don't think about it much. If you desperately need the drug and don't have the money to pay for it, then you probably feel like the pharmaceutical companies are price gouging monsters. It's all in the circumstances.

In the case of the $1,000 e-book, I'd say there isn't an e-book in the world I would buy for $1,000, but then I'm not in the financial world either. If I were making several hundred thousand dollars a year, and this book promised me I could increase that amount, it might be worth $1,000 to me.

I guess the real scam might be if the information in the book is stuff anyone could find out, or if it doesn't work and the author of the book knows that. Then it's a scam.

vangogh
01-28-2009, 01:19 PM
Kristine the flip side of the pharmacy question is would it be ethical to force someone to sell something at a loss because you think it's too important for the person buying it to have. I'm not suggesting pharmacists are hurting and are in danger of going out of business. I'm arguing more the general idea than this specific case. I can tell you if I was pharmacist and I was legally required to sell drugs for less than it cost me to buy, I'd quickly find another line of work. That wouldn't be good for those people needing the drugs either.

I think the real scam in the ebook thing is the friend who recommends a bad book, because they don't want to admit they got taken for so much money or want to convince themselves they really did make a good decision to buy it.

seolman
01-28-2009, 05:20 PM
This entire thread is about marketers who prey on others using the Internet. There is even legalized "preying" on markets. Consider this same subject of pharmaceutical companies.

I'm a businessman and I want to make a profit. I've worked at top management level in publicly traded companies and I understand the drive to produce value for shareholders. Consider the following issues:

a) Cost to develop drugs must be covered by profits from sales
b) Cost to develop future drugs must also be covered by profits from sales of existing drugs
c) US customers typically pay at least 2 to 4 times what many foreign buyers pay for sophisticated drugs.

So basically what drug manufacturers are saying is: we are willing to sell drugs for what the market will bear in foreign lands and as long as US buyers are will to pay more, they will bear the brunt of the drug development costs for the foreseeable future.

I have a serious medical condition that requires me to buy expensive drugs each month. In the US these would run about $1,000/month but here in Costa Rica these cost about $360/month for the exact same brand name drugs. I benefit greatly from this cost difference but I will be the first to admit it is an unfair practice. So shouldn't US consumers be able to buy these on line overseas and import them? There are plenty of people in the US making less money than some people in Costa Rica. Why should they have to pay more?

billbenson
01-28-2009, 06:36 PM
As an unrelated side note, Seolman, I had a 16 y/o dog with a heart condition in Panama. I had him on human heart medication for years. Only one pharmacy in the city had that medication. I'd buy out their stock once a month. I think it was about $100 a month for that dog. I guess it would have been a lot more here, although he was diagnosed in the US and given the medication.

OK, end of hijack.

vangogh
01-28-2009, 08:31 PM
Interesting breakdown of the pharmaceutical market Dave. I guess if the U.S. was to get cheaper drugs it would mean prices outside the U.S. would have to rise. The profit is going to be calculated based on the how much the company can make overall.

Is it right or wrong? I'm not sure there's an easy answer. As a U.S. citizen I'd prefer to pay less, but I also know per capita we're probably making more here than per capita in Costa Rica. The system will never be fair to everyone.

seolman
01-28-2009, 09:16 PM
Steve I'm not sure if price leveling will happen or not. Many of these pharma companies make enormous profits gouging US insurance companies and consumers. If they raised prices offshore, sales would plummet because quite simply the local markets would not be able to afford their product.

Most of it is overcharging in the name of "research" etc. Many of these pills cost $0.25 to make and they charge $5.00 each retail. There are so many pills now doing the same job from a clinical perspective it's almost boring. How many pills are out there to reduce pain, fever, blood pressure, muscle aches, cholesterol etc. and yet the research for similar medication goes on. It's a huge market! Get one patent on a slightly different synthetic molecule that works similarly to Ibuprofin and POW you have a percentage of a huge market. It may cost you $30 million to develop the product and get it to final FDA approval, but in 2-3 years you can easily recoup that money plus the cost of getting it to market. Your patent lasts much longer. Drug companies make Billions on a single successful product.

I'm waiting to see how many billions are spent fighting the reformation of the health care system.

vangogh
01-28-2009, 09:54 PM
I'm sure you're right about the price leveling not happening. Drug companies will look to make as much as they can and if that means charging more in one place they will. I know the price compared to the cost seems ridiculous, but I'm sure things like lawsuits are factored into things.

seolman
01-28-2009, 10:03 PM
You are right Steve. I hadn't really considered the "risk" factors that must go into the US market side of things. Lot more lawyer issues to consider on this side that would justify a higher price.

vangogh
01-28-2009, 10:37 PM
We are a sue first ask questions later society. I think the legal stuff is one of the main reasons for the high medical costs here. All it takes is one or two lawsuits going against a company.

seolman
01-28-2009, 10:52 PM
Sad but true...hopefully that will be addressed too some day.

billbenson
01-28-2009, 11:01 PM
I can't speak for Costa Rica, but in most of Central America the monthly wage is $100 to $200 and the staples such as food or gas are more expensive, frequently do to distribution problems, but also do to monopoly's. Double the price for gas and food and $200 per month. It's a disaster waiting to happen.

Dave, is Simon in Costa Rica? They have really monopolized the market en El Savador and I believe in Guatemala as well. Both banking and retail.

seolman
01-28-2009, 11:19 PM
Dave, is Simon in Costa Rica? They have really monopolized the market en El Savador and I believe in Guatemala as well. Both banking and retail.

Simon is not here. But McDonalds, Pizza Hut, WalMart, KFC, Fridays, Taco Bell and others are all doing well.

Costa Rica is the wealthiest of Central American countries with a higher literacy rate than the US. They abolished the army in 1949 and put all that money onto education and building up the health care system so they are much more advanced than most other Latin American countries. There are over 100,000 retired Canadians here and I don't know how many Americans. Tiger Woods, Barbara Streisand and Mel Gibson all have vacation homes here in the northern Pacific region. It's become the new Hawaii.