Ragged Riches

Has anyone else seen ads on Instagram or Facebook that fit the following bill?

• An old person in the US dedicated their lives to making high-quality, handmade handbags, watches, or shoes.
• Oddly enough, the old person looks just a little different in every single video and photo they have on the site or ads.
• Lots of random people are in videos talking about how wonderful the bags are.
• Now that they’re old, they’re closing up shop and need to sell the last of their stock off.
• Won’t you please help support the old person in their retirement?

I didn’t see this until it was brought to my attention via this video below.

If you don’t want to watch the video, I’m going to explain the basic gist of it:

• There’s a growing trend of using AI illustrations and AI videos of old people to set up businesses that sell “final warehouse” stuff from “retiring” old folks. They’re said to be made with love, handcrafted in the US, by older people.
• The products are actually made in China. They’re sent out by warehouses. The YouTube creator tested this theory out and realized that the watch he ordered was the same as the one from Alibaba that he ordered after a reverse image search.
• The people advertising the stuff are using paid actors from Fiverr for their testimonials. He even shows their ads! Woops!
• The general vibe of the video is that you should beware of the AI grannies shutting down stores. After I watched that video, I got my first ad on my email list for Grace’s Bags from the video. Grace is very busy for a retiree!

The end of the video showed that a lot of people are falling for AI grannies and grampas selling stuff. And it’s becoming one of those “glurge” scams, not unlike the rose sellers who charge $10 for a rose to tourists in France.

While the general lesson is not to believe everything you see on the net, there’s a valuable lesson to be learned here.

At first, it looks like a story that is just about a scam that is currently making its rounds on the net, but it’s not. It’s also a testament to how branding and marketing can make people shell out a ton of money on something that really isn’t that good on quality or design.

The fact that this is a scam that people repeatedly fell for, to the point that there was a YouTuber doing a PSA on it says something. Or rather, there are a couple of things we can learn from the way these “granny artisans” were marketed that can work with almost any product you’re selling…

People love a good story, especially when it comes to emotionally-charged narratives.

When I worked at Vocal.media, we had a marketing expert talk to us about how to make a more powerful ad. The biggest takeaway? It was the story.

Advertisements and commercials with stories that get people emotionally invested were great for the brand, stayed longer in peoples’ minds, and lead to higher conversion rates.

The reason all the old people AI ads work so well is because the concept tugs at your heartstrings. I mean, who doesn’t want to help a nice granny retire after 50 years of hard work? That’s so nice!

Sure, the people who actually are selling this stuff probably aren’t even 30 yet, but the story makes you feel so nice and fuzzy that you can’t help but want to spend money. It’s the same reason why so many companies have commercials that mention how a portion of their proceeds go to homeless pets. It lets you get that same warm, fuzzy feeling of helping others.

We are skeptical of businesses, but not of reviewers.

One of the things that stood out to me about the ad campaigns used in the old people AI scam was how many reviews they had related to the bags. These campaigns had so many people, recording video reviews, just to talk about how great the bags are and how nice Grace/Karen/Henry/whoever was.

The truth was revealed: they were all people hired off Fiverr, paid actors who never actually gave a crap about the bags or the fact that they were peddling some scam act. And yet, it clearly works well if multiple stores popped up with the same business and advertising model, right?

I’ll be honest. This would have swayed me too, if I hadn’t noticed the obvious AI photography of the alleged old person in charge of selling the bags. I’m far from alone in that, too. A recent article in Forbes noted that 49 percent of people trust reviews just as much as they would a direct recommendation from a friend.

As a person who started their career on Fiverr, I know how many people get paid for reviews. There were ads for positive reviews everywhere. In fact, I’ve even seen ads for paid reviewers on sites like Craigslist.

If you’re reading a review, don’t always take it at face value. You might be getting fleeced by someone who’s in a bind for money.

Marketing alone can help you boost your prices over 6,000%.

As the video above showed, the watches being sold from one of these maker scams was actually priced at a dollar on Alibaba. However, that same watch was being sold for upward of $60 on one of these scam sites.

If you do the math, the person who started that handbag scam got away with a markup of over 60 times the price of the actual product. Sure, the marketing takes money to do, but clearly, it’s turning a profit and it’s getting a lot of people caught in the snare.

At the end of the day, this just goes to show you how important belief can be in business. If you believe something is valuable, it is valuable. And the more valuable you make it out to be, the more people will shell out money for it.

As for the AI handbag scam?

Let the buyer beware.

Not all that glitters is handcrafted leather.