Stop Clicking on Those Ads

Stop Clicking on Those Ads

The US spends more on advertising than any country in the world–to the tune of $140 billion a year. A quick search on Google returns research suggesting that each one of us receives anywhere from 300-1,000 advertising messages a day in one form or another.

Can you trust any of them to be legitimate? Probably.
Can you trust many of them? Probably not.

To me it all boils down to this:

      Question: Which companies are spending the most on advertising?
      Answer: The ones that are making the most money off of you.

Let’s look at Direct Response advertising. In the US, companies spent almost $3 billion on Direct Response advertising and it was the fastest growing sector of the top 10 categories. This sector is the whole reason I wanted to write this blog. There are some great products in direct response like Rosetta Stone, etc., but there are also quite a few nefarious characters.

The top advertisers online are pushing products like online education, payday loans, debt repair, etc. and most of these are on the FTC’s “most wanted” list. These are my top offending online scams that consumers should watch out for (you’ve all seen these ads…):

  1. Cash for gold: These guys are everywhere. One company even bought a Superbowl commercial this year featuring MC Hammer and Ed McMahon. They’re aggressively buying advertising space of TV, billboards, radio–and the web is plastered with their ads. There are hundreds of companies doing this. How can they afford all this ad spending? Because they are making a tremendous amount of money off of consumers by paying them far less money than their jewelry is worth. Check out for one testimonial. When I last looked at this website, there was a banner ad on the site for Classic! You can find countless testimonials on their bad behavior by typing in “cash for gold scam” into your search engine of choice…

  2. Online education: US Consumers are spending billions to receive an education online. But here’s the kicker–most “institutions” offering courses are not even accredited. So consumers are throwing the money away on an education that isn’t recognized by anyone. These unaccredited schools are not held up to any real standards, so consumers are spending money for a poor education with no worthwhile credentials. That’s why they advertise so much–they charge MUCH more money than the education costs or is worth. has good advice on avoiding online education scams.

  3. Payday Loans: These loans charge a huge amount in fees. They prey on people who are living paycheck to paycheck and they take in MUCH more money than they need to. There is little risk to the lender (since the loans are guaranteed by a future paycheck), yet when you include all the fees they charge effective interest rates that are comparable to loan sharks. You see these ads all over the place. Lots of ads equals lots of money to be made by the advertiser. Check the FTC for advice on avoiding Payday loans.

  4. Debt Repair & Credit Card Debt Reduction: Most of these guys charge you huge fees to do things you could do yourself. Again, they are preying on people who are desperate and uninformed. Check the FTC to find more info on real solutions and tips to avoid credit card debt and resulting debt repair scams.

  5. After Market Car Warranties: I just started seeing these ads, but now I see them all the time. I knew nothing about them but I could tell by their copycat format and their frequency that they were likely a bad deal for consumers. Remember: if they are spending a ton of money on ads, they are making a ton of money off of you. Just Google “car warranty scams” and you’ll see hundreds of articles on the topic. Or once again, the FTC has great advice to avoid car warranty scams.

These are all “smash and grab” businesses that don’t care at all about integrity or providing real value to the consumer. They have one goal and that is to make as much money off of you as they can. They will eventually get shut down by the FTC, or they will get found out by consumers and lose their victims as people get wise to their cause. But they will rebuild and sell us something else we don’t need and charge us way too much for it. Two years ago it was sub-prime remortgages and sub-prime loans, now it’s cash for gold, debt repair, payday loans, etc. The mortgage scams helped get us into the recession we’re in now and the “new” scams are preying on people who are trying hard to get out.

Why aren’t we hearing more about this? Why doesn’t everyone know this? The simple fact is the scammers make so much money that their advertising budget is much larger than the FTC’s, so we hear the scammers message and not the truth. And consumers just keep on clicking through…

The only solution is for consumers to get smart and to spread the word. We have to educate ourselves and help to educate the less-informed.

Bottom line: if you see lots of ads for new products or services and they sound too good to be true, they probably are. Do your research, Google that product/service name + “scam,” check the BBB, the FTC and get informed.

Then spread the word…

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