Does anyone really make any money from spam anymore?

Factual Questions
21

I would define spam as unsolicited and unwanted email.

It is often sent in bulk. It is usually commercial. It is often fraudulent. It is often sexually-oriented. Full of misspellings and misleading links. But none of these define the animal, they just go along for the ride.

I send out unsolicited emails on infrequent occasions to members of my neighborhood homeowners group, none of whom ever explicitly asked me to do this. It is bulk, in that it is more than one at a time. It is not commercial, or fraudulent, or sexually-oriented. I try very hard to avoid misspellings and carefully check links, if included. I use me own email address for returns, and it is an active, valid address. Is this spam? I don’t think so, because not once has anyone ever asked me to remove them from the list, and some have gone to the trouble of thanking me for keeping them informed on topical issues.

22

As a recent upper manager in a internet marketing company I can definitely say yes. As someone said, the overhead of spamming is incredibly low. You can send out millions of emails daily and only need a return rate of 0.001 and you will make plenty of money.

You may wonder, who this 0.001? Well, I will use a similiar (and as hated) marketing technique to explain: telemarketers. Most people hate telemarketers, but they make billions a year. According to this site over 100 Billion in 2002. One of the reasons of their success is that most people in the US have an incredibly hard time saying “no”. There is small device called a zapper (and several like it) that when you get a telemarketed call, you click on the button and it basically tells the telemarketer “no” for you (or sends out a signal, etc). Sells for about $40. $40 for a machine to say no because you can’t.

Secondly, many people are always on the look out for the next great “deal”. They will watch the Home Shopping Network, peruse the classifieds and check out the garage/yard sales. Reading an email or listening to a telemarketer isn’t any more work (though it might be significantly more annoying).

Now I will give you one specific industry example: the mortgage industry. Let’s say I send out 5 million pieces of spam and get a return rate of 0.001. That makes 5000 responses. 5000 people who are interested in getting information about a mortgage, be it refinancing a current house or buying a new one. Now, this is not 5000 people who are going to get a mortgage, just interested in getting information and replied to the spam. The spammer can sell those 5000 names to mortage companies (though there is usually many layers of middlemen) for $20-100 per name. The actual selling cost varies with geography, amount of information etc. Let’s give it a figure of $30. Most spammers will mix in bogus information and most mortgage companies will accept a contact ratio of about 25% - 50% meaning that they can contact 25-50% of the names sold to them. That means the spammer can double or triple his income simply by mixing in bogus information. So now I am able to sell 10,000, or 15,000 names at $30 a pop.

But wait! There’s more! It’s acceptable in the mortgage industry to resell a name up to 4 times, so now the spammer can sell those 10,000 names 4 times at $30 a pop. So let’s do the math. 10,000 times 4 times $30 = $1.2 million. Even if my numbers are off by a factor of ten (and I guarantee it’s not) that’s still $120,000.

Now granted, the mortgage industry pays the most for this type of information, but you get the idea. And as I said I was in the internet marketing industry so I know my figures are correct. And before I start getting pitted for being a spammer or sponsor/solicitor of spamming, one of my responsiblities was to feret out spammers and make sure our company did not do business with them.

23

I would say the fact that they signed up to this mailing list means that the email is solicited and, thus, not spam.

24

BBC March 23, 2005:

25

Looks around office

By my reckoning I can see at least 5 people right now who need a good sound slapping.

26

I’m not saying I doubt your numbers, TomSlick, since you seem to know much more on the subject than do I. But I will say that they seem remarkable. What you’re essentially saying is that there’s a variety of spam which pays the spammers as much as 24 cents per message, on average. At that rate, even charging postage for e-mail would not wipe out spam.