One of the best ways to increase exposure for your own business or cause is to expand your influence on social networking sites. For businesses, social media allows you to track the types of people, or "followers," who enjoy your product or service. Social media also allows you and others to gauge the popularity of your company. Social networking sites also help us address one of the key needs of being accepted and appreciated by our peer groups. Unfortunately, this takes an unsavory twist when the number of followers or friends can actually be purchased to make a business look more popular than it actually is. There exists a very real marketplace where Twitter followers and Facebook friends can be bought.

More Followers Means More Business?
In theory, the more followers you have, the more likely people will listen to your viewpoint or consider spending money on your products or services. This has led to some people abusing the system, as "follower sellers" create numerous fake accounts and program them to like or follow a certain page for a price.

The belief is that customers are positively influenced by large numbers of followers and likes on social media sites because they see these numbers as an indication of the value of a product or service. In July 2012, a Saudi Arabian man named Abdul Rahman al-Kharashi purchased thousands of fake Twitter followers in an attempt to show the impact of having a large number of followers, even if they were fraudulent. After the purchase, his account jumped from 600 to 183,000, according to Al Arabiya News.

Internet Bots
Many of these fake accounts are created using "Internet bots." These bots are getting increasingly sophisticated and difficult to detect. The influence of these fake accounts is immense and can influence our perception of how popular a product or brand actually is.

Facebook's representatives say that 8.7% of the site's approximate 955 million accounts are either spam or pet profile pages. Of Lady Gaga's 28,445,000 Twitter followers, roughly 47% are from fake accounts. Out of Ashton Kutcher's nearly 12,000,000 followers, 36% are fake. Steve Wozniak has around 124,000 followers, a far more modest number than most celebrities, but only 12% of his followers are fake. Barack Obama has a Twitter following that stands at over 18,600,000, 41% of which are fake accounts.

Researchers with Internet security blog Barracuda Labs conducted a study about the underground market where Twitter followers are bought and sold. They bought 20,000 to 70,000 followers from eBay and other sites searched from Google.

The researchers arrived at a number of conclusions about this underground Twitter economy. Dealers charge an average of $18 for 1,000 fake twitter accounts. No authentication other than the Twitter username is required while purchasing these accounts. These dealers also sell tweets and retweets. A dealer may be managing more than 150,000 fake accounts at any given time.

Researchers used the term "abusers" in the study for people who buy fake followers, and thereby abuse the terms of service. These abusers buy fake accounts to show high personal popularity, to sell advertisement space, or to create an image for their product or service. The study found that an average of 48,885 followers follow an abuser. It was also found that 75% of the abusers inserted a URL in their profiles.

The fake accounts had certain characteristics. The study found that about 55% of these fake accounts had an average of 2,000 followers. The average life of a fake account was five months. Twitter's staff has been hunting down these fake accounts and suspending them. However, the researchers found that dealers were being careful about the flow and speed of these fake accounts in order to avoid detection and suspension by Twitter. Dealers also use multiple accounts to carry out the various services they offer.

These accounts follow a mix of celebrities and regular profiles to look authentic. The more authentic the fake account seems to be, the higher its cost. The price range of 1,000 fake followers varies from $2 to $55. This indicates that there is a large market where money is made by selling fake accounts.

Mitt Romney, the 2012 Republican presidential nominee, had an unnatural surge in the number of his Twitter followers, raising some controversy. It seems that social media numbers are now affecting politics as well.

The Bottom Line
More companies are double-checking the followers on their social media pages as the number of Internet bots rises. While the perception of popularity online may help a business or cause attract more followers in the short term, it is good content and effective user engagement that will separate the wheat from the chaff over time.

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.