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The model is extremely effective: take a quiz and enter your phone number to find out the results. The only problem is that once you enter your phone number you’ll be charged $20 a week. The quiz is not actually hosted on Facebook though. Instead, users will view the advertisements on applications like the “How Well Do You Know Me?” application. The developers of the application (and the collaborating ad network) have cleverly embedded advertisements that fit well with the application.
There is a legitimate purpose of the “How Well Do You Know Me? ” application but the ads aren’t as legitimate. Some of the ad networks have come under fire recently for serving up the misleading advertisements. As I wrote back in March, one ad network was forced to payout $500,000 in a settlement. Essentially that settlement has simply become part of the cost of doing business though.
Typically this news wouldn’t have frustrated me because it is a widely known dirty practice among some of the top advertisers. The “How Well Do You Know Me?” application has over 24 million monthly active users though so I know that thousands of individuals have been impacted by these scams. One of those happened to be my mother who called me up the other day to tell me that she had a $25 fee on her phone that was a result on clicking on one of the application advertisements.
Initially I experienced multiple emotions including guilt (as though I had contributed to the problem) and a bit of frustration that my mother had been duped into one of the scams. At a certain point these companies need to draw a line and say that some advertisements are simply unethical. I’m reaching out to some of these ad networks directly to see if they let developers opt-out of such advertisements.
At the end of the day, who ends up being responsible for those advertisements? The developers? The ad networks? While these scam ads are paying out higher CPMs right now, is this the best way to build a sustainable business? I personally disagree with this business practice but even I have received money from some of these ad networks at one point or another which makes me feel extremely guilty. Should Facebook be responsible for more effectively monitoring these ad networks?
In the example ad that I’ve included below, users are redirected to a site that looks like Facebook but isn’t. While you can say that the users were ignorant, it’s simply human to make mistakes. If enough people click on the ad, a small percentage of people will slip up and enter their number. Should the social advertising industry develop best practices for what ads are acceptable? The IAB has published their own best practices for social advertisements but it doesn’t include what ads are displayed.
Update
Facebook sent us the following statement: “We’ve received some reports of deceptive content in ads placed within apps by developers. These ads are not from Facebook but we are concerned about any potential threat to our users’ experience. We have already had the ads removed from a number of apps. We are continuing to investigate to make sure these ads stay off Facebook and may take further action against developers who host the ads.”
This is really clever, shady as hell but really well done. Wonder how/if Facebook will crack down on this.
I’ve clicked through several of these ads to see if they are scams. I’ve entered my phone number in every time and never been billed a cent - which makes sense. What if I entered my friend’s phone number, would he be charged? No. Every time I’ve done this I’ve received a text message that says the service will cost $9.99/mo. and a pin that I have to take back to the website to enter in to confirm that I am the owner of the cell phone. On the screen where I enter the pin it clearly says (above the fold, not in small font) that I am signing up for a $9.99/mo. service which will be billed through my cell phone account. Getting the results of the quiz has never been worth it to me so I have not entered my pin. While I agree that the advertising is questionable and I can’t understand why someone would pay for “premium” text messaging and cell phone games, I don’t believe it is a scam. Go ahead and enter your cell phone number - you won’t get charged anything.
these developers and networks cause others on the platform to work even harder to earn others’ trust…ultimately, this will not produce sustainable value.
thanks for bringing to people’s attention Nick.
That IQ test ad is one of the ones I looked at today in relation to privacy issues.
You have ads on AllFacebook.com (Points to the upper right) to the same companies that are displaying the ads on Facebook you write about. So you are part of the problem you write about.. funny how that works huh?
@Hypocrite who won’t write their name … while I’m not going to call out individual sponsors, what was the last media company that you’ve seen that has draw attention to bad practices that could have originated by some of their sponsors?
I’m not going to starve myself by killing off sponsors but I’m sure as hell not going to stand for deceptive practices.
Your mom is a dumb hooker. Have her go back in the kitchen and make me some blueberry pancakes.
“I’m not going to starve myself by killing off sponsors but I’m sure as hell not going to stand for deceptive practices.”
Take a breath, and ask yourself, doesn’t this sound like the rationale of EVERY SINGLE DEVELOPER who runs these things. what an awkward call out piece.
Nice article…reading the comments though…lashing out only opens yourself up to being criticized by others…
If killing off sponsors is going to cause you to starve then you’re in serious trouble as it is. Just sayin. I doubt that’s really the case though. Also, allowing deceptive practices is the same as tolerating them.
You bunch of retards, the billing will only occur ONCE the PIN is received (on your phone) and submitted (on the website), and there are usually more pricing disclosures that come along with the PIN…but people, mostly teens, are too brain dead to read any of this… or maybe they don’t care that mamma is going to fit the bill.. truth of the matter is that mobile offers work because of the lack of physical interconnect between a service and monetary obligation….just watch a top video show on MTV or MuchMusic (Canada) and you have a bunch of numnuts texting msgs like “I love this video!” “Shout out to my love” for $0.75/txt… I applaud any company who takes advantage of the feeble minds, I will actaully employ this in one of my apps! Thanks for the idea!
I’ve done this, and cancelled the services, however there were 14 total charges on my account…I only allowed it for three..never got a text from the other 11 is was “railroaded” into. Verizon states, “you authorized thee charges, and there is nothing we will do for you.”
When I informed Verizon that I did not allow the other “tack on” texts permission, I was just given 11 “800″ numbers and told I need to take care of them. After about 8 hours on the phone, I have yet to be credited!!!
BEWARE!!!
I noticed this cheezy practice on Facebook as well which altogether confirmed my position of not taking part in any of these apps at all.
Long term this is extremely hurtful to Facebook because it makes people very reluctant to get involved in any of the advertising or applications that they might otherwise have been interested in.
I also think cell phone companies should completely do away with the practice of third party billing for things like ring tones or text message alerts. It’s just a shady shady practice that builds a lot of ill will.
Just wanted to add that there is hope for those who were scammed (and sorry, IMO this is a scam). If you stay calm and contact the Premium SMS provider’s customer service, they will arrange at least a partial refund of the charges. Refund comes in the form of a check sent by mail. Had $400 of premium sms charges refunded (don’t ask - teen/automatic top up for prepaid cell phone = mega charges)
I got almost 75 dollars bill from this sneak…premium blah blah……does anyone know what should i do?
Dowon, very important to reply STOP to the message on your cell phone!! Otherwise, they will keep coming and you will keep getting billed.
i think this is like super ultra mega bad fo sho my nizzle in the hizzle
Its scary that people sign up for these scam programs. You have to be a little dumb if you sign up for a $9.95 per month mobile billing service to get the results of your 5 question IQ test.
Unfortunately, a lot of people do it! –> http://www.facebook.com/pages/Dumb-IQ/166690143771
Unfortunately, these SCAMS prey on the less sophisticated computer users. Teens and seniors are especially vulnerable as they see the pics posted of their friends who have supposedly taken the quiz. They figure that since “Billy Jean” took it, then it must be okey to enter the number. They just want to get the answer to the IQ test!! It is a crying shame that such underhanded practices are allowed. If the company was legit, they would advertise their ring tones, wallpaper, etc and sell their product that way. It is OBVIOUS they are preditors.