Spam Still Generates Good Return on Investment
California Scientists Test Potential of Unsolicited Email Campaigns
Nov 14, 2008
Internet spam has earned a reputation as the cheapest form of advertising, in both class and the cost of producing it. Now we’re told that unsolicited email campaigns have very tiny response rates but still return a profit.
Computer scientists at the Berkeley and San Diego campuses of the University of California conducted their own spam experiments early in 2008 to see how effective that kind of advertising can be. They said they believe their experiment was "the first large-scale quantitative study of spam conversion."
Saying "the best way to measure spam is to be a spammer, "the researchers said they infiltrated part of a commercial spam operation for 26 days to send out nearly nearly a half billion unsolicited emails. They did this through a network of nearly 76,000 home computers that had been hijacked earlier by the commercial spammer.
Response Rate 0.00001 Percent
In their report on the experiment, the research team said they would have produced 28 sales for their fake pharmacy even though their response rate was less than 0.00001 percent. That’s one response for every 12.5 million messages sent out.
"These conversions would have resulted in revenues of $2,731.88—a bit over $100 a day," the scientists wrote.
They estimated that by using the full system at its disposal, the commercial spammer was netting about $7,000 per day, or more than $2 million per year. However, they concluded that "the profit margin for spam (at least for this one pharmacy campaign) may be meager enough that spammers must be sensitive to the details of how their campaigns are run and are economically susceptible to new defenses."
The 0.00001 percent response rate compares to an average 2.15 percent response that the Direct Mail Association says is received by "legitimate" direct mail companies.
Stafan Savage Headed Researchers
The California research team was headed by Assistant Professor Stefan Savage and included Chris Kanich, Christian Kreibich, Kirill Levchenko, Brandon Enright, Geoffrey M. Voelker and Vern Paxson. Kreibich and Paxson are associated with the International Computer Science Institute at Berkley and the others are with the Department of Computer Science and Engineering at the University of California, San Diego,
The 12-page report on their experiment is titled "Spamalytics: An Empirical Analysis of Spam Marketing Conversion."
For their spam experiments the scientists set up a fake "legitimate-looking pharmacy site" and offered "male-enhancement products" costing abut $100 each.
Used Only 1.5% of Spammer’s Network
They estimated they used only about 1.5 percent of the commercial spammer’s network potential.
The scientists warned that their results "represent a single data point and are not necessarily representative of spam as a whole. Different campaigns, using different tactics and marketing different products will undoubtedly produce different outcomes."
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