Thursday, October 4, 2012

The value of cyber sabotage

Good morning everyone. Yesterday I was discussing the idea of the ethical company and the impact that ethical practices have on profitability. Can we actually place a value on an example of unethical behavior?

A while back I was playing around with google and facebook ads as a way of promoting this website. I found out the hard way that this was not really financially smart as each ad click which was leading to my site was costing me 25 cents. Given, the cost per click may not appear to be high enough, but if you aggregate the clicks on a daily basis they were quickly adding up to a three digit amount per day. Given that the website's sole purpose is to inform readers about how economics is used on a daily basis, I quickly abandoned this strategy. My experience though gave me an idea of how a company can sabotage a rival.

If companies advertise through google or facebook, it is not unheard of paying prices that can reach up to $1 per click, sometimes even more. The reason for such high of a price is that through google ads a company can target a particular viewer  who in turn has a higher probability of purchasing the product or service. In most cases advertising companies will set a daily budget that cannot be exceeded.

A rival company can cyber sabotage by repeatedly clicking on google ads, therefore increasing the cost of advertising and also eating away the daily budget so that the campaign becomes ineffective. (And yes for the computer geeks among us the only thing we need is to hide the ip address or access the internet from multiple locations).

If cyber sabotage is a probability, why do companies advertise at all?

Have a sabotage free day!

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