Thursday, March 30, 2006

Why to NEVER spam! - A Lesson From a 2001 Startup

What We Did

Near the end of the first bubble, I joined a cool idea for a startup company. We had a subscription based product to sell online and I was hired as the Director of Web Development. I was stoked; but it didn't take things long to fall apart. Even if the bubble hadn't popped, our gig was doomed to fail. I'll now share with the world one of our biggest mistakes - spamming.

We were getting exactly the subscription rates I expected; but we weren't seeing nearly the rates that marketing wanted. To solve this, marketing purchased a list with millions of e-mail addresses. This list cost us a whopping $50. Then, they put one of our programmers on the task of building some quick spamming software. Once it was ready, they fired it up and sent out an unsolicited bulk e-mail to millions of unsuspecting folks. What was the content of this e-mail? It was a promise to donate a percentage of all new subscriptions to a Sept. 11th victim fund... then it linked directly to our site. While I didn't really agree with the ethics of the message, that is an issue for another blog post entirely.

As you might have guessed - I NEVER KNEW about the spam machine. There was no doubt, I never would have agreed to it. Marketing was wise enough to do the whole thing behind my back.

Up until this point, I had been working various promotional techniques to build site traffic. I was working to gain better search engine indexing. I was finding ways to get online communities talking about us. I was doing link exchanges. All the while, I was putting in late hours trying to get the backend parts of our website coded... And for some reason, and I didn't think to ask why, our other Web programmer was busy on some secret project.

What Happened

It started off like any other day, I started by checking my e-mail. I noticed a flood of unsubscribe requests. I was a bit surprised. I started asking questions, and then found out about the spam machine, the $50 list, and what had been set in motion in meetings behind closed doors.

unsubscribe emails in my inbox

By the time I found out, it was too late - the damage was done. Still, we were just starting to know the damage. Aside from damaging our brand's image, we'd pissed off enough of the right people to put a real hurt on our business.

First, our mail server was configured to send overflow e-mail to the ISP's main mail system. Our flood of messages, and the returning flood of bounces and unsubscribe requests completely flooded our system and then the ISP's system. We took their mail server completely offline. All of their customers were without email, thanks to us. We didn't even make a scratch on our $50 list of e-mail addresses before the system collapsed. One of our guys - the one who hooked us up with the ISP to begin with - spent his next couple of days cleaning up the aftermath and getting all the servers cleaned up and online. A lot of legit e-mail belonging to innocent people got lost.

Once we got the mail server up and running, we noticed that we were still having trouble getting e-mail messages pushed through. Why? Because we were blacklisted! We'd made enough noise to pop up on black lists all around the Internet. Our important, completely legit e-mails were being sucked into tiny blackholes all around the Internet - never to be read. Heads should have rolled, seriously. Our head of IT spent weeks begging to be removed from lists. It doesn't end there, not just yet. There was a bit of a kicker.

our web traffic blocked

Because we were so blunt in our spamming techniques, it was easy to pin the source of the spam directly to our domain. So, our entire domain was blocked on routers all over the Internet. This meant that the normal traffic I'd worked so hard to build was suddenly blocked from our servers. No one could subscribe, even if they really really wanted to... because they couldn't even reach our site!

How Did It End

Some people don't learn. I did. I learned that some of the blokes I worked with didn't have the sense God gave a turd. They modified the spamming software to send e-mails in bulk bursts as to not bring down the mail server, and they turned the spamming machine back on. After all, they still had the rest of the list to spam.

I was livid, and I expressed it. We started to tank and it wasn't long before there was an initial round of layoffs. Guess who made the list? Yeah, me! When the operations fellow made the announcement to our group, he got a bit upset and stepped out of the room. Upon his exit, I actually shouted in joy and danced a little jig right there in the conference room. I got some funny looks for that one, some folks were really upset about loosing their jobs. I felt free. I felt blessed.

I've got to give them some credit, they fought to the bitter end. A few key employees setup shop in one guy's house. They kept the company running as long as the remaining investment would allow - which wasn't long. Ultimately, in just a few months, it was all just a bad memory.

The worst part is, the product itself was a great idea. It could have worked then, and it could still work today. I'm surprsied it's not being done already.


Zero said...

Thats a really interesting article, and I thank you for the insight into that. Just getting into internet advertising spamming seems lucritive, but at the same time you just ahve to figure, of the 20's & 30's of spam emails I receive a day, I read about 0.. very cool read though.

Darren said...

Not quite sure why this got voted down on Reddit - very interesting read.

It's not often we hear a spamming story 'from the trenches.'