The Economics of Cloaking


[Author’s note: This article was originally published as a blog post on fantomNews on 2008-12-09. It is rendered here mainly for historical purposes and to back up our updated piece on Some Misconceptions Regarding Black Hat SEO. ]


Ralph Tegtmeier aka fantomaster

The Economics of Cloaking

In his recent piece To Cloak or Not To Cloak [link no longer active], Jeff Bentley analyzes the economic rationale of cloaking for a profit. It’s an aspect all black hats are thoroughly familiar with though you’ll hardly find it discussed anywhere at length in public.

The maths involved is fairly straightforward: compute the costs it takes you to build, roll out and maintain a site, check it against the money it actually makes you per day, then calculate how long it will take you to a) break even, and b) turn a profit.

If it takes you only 5 months with cloaking, compared to 20 months without, as in his example, you might think it’s a blatant nobrainer.

However, all this is actually based on a number of assumptions, some fairly obvious, some possibly less so, you’d better be clear about:

  1. Monetization of individual sites or networks holds priority over corporate branding, visitor loyalty, media buzz management, etc.
  2. Corporate main sites should categorically be excluded from any cloaking activities whatsoever – if anything, adopt cloaking tech only for essentially expendable sites.
  3. Domain registration and hosting fees aside, you’ll also have to factor in the costs which tools and services specifically required to maintain a robust, sustainable cloaking setup will run up.
    Available applications vary widely in terms of functionality and price. And no matter what tools you are using (we for our part will obviously favor our own flagship product, the fantomas shadowMaker™ [now succeeded by bSeolized shadowMaker™]), if you’re going for IP delivery – and you definitely should! – you’ll need a reliable database of verified search engine spiders that’s updated regularly. (Such as, surprise, our fantomas spiderSpy™ – featuring over 25k spiders and getting updated every six hours since 1999 [now: bSeolized IPGrabber with 62+k spiders, and counting], you’ll be hard pressed to find anything more comprehensive anywhere.)
    Try and cut some corners on this score, and chances are you’ll stand to regret it very soon…
  4. A thoroughgoing and rational risk-to-gain ratio analysis is of paramount importance: What do you stand to lose in a worst case scenario, e.g. if all your cloaked sites should be trashed from one of the search engines’ indices in one fell swoop? Despite what search engine reps may want you to believe, this is a widely overrated risk if you play it right. Nevertheless, it’s still quite real, so don’t kid yourself that you can ignore it with impunity.
    Moreover, don’t be hypnotized by Google! Yes, I know they’re the #1 traffic pump these days (social networks aside…) – but do make sure to check your conversions before you knock Yahoo!, MSN/Live or even Ask. The point being that even if you do happen to lose your sites in one search engine index, chances are the others will still push traffic your way like a clockwork for months if not years to come.
    At the end of the day, this, too, should be all about ROI, nothing more, nothing less.
  5. Finally, factor in some reinvestment of your profits: If you can manage to funnel some of your proceeds into expanding your cloaking network at a consistent rate (e.g. by 20% per month), not only will you boost your ROI exponentially, it will also implement a nice fallback nest egg should your first sites actually get trashed.

In his example, Bentley reports how a site that was making a measly $30 per day from organic search shot up to several hundred bucks a day literally over night after cloaking was implemented – and yes, it did get caught out after a while, but we can fully endorse his conclusion that cloaking is, indeed, an eminently viable business model if you can manage to actually view it from a rational perspective rather than let yourself be diverted and conned by the ethics junky crowd…

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