Edgar Cervantes / Android Authority
TL;DR
- US Mobile has cut ties with Google Ads due to Google’s latest policy changes, which require all payments to be made using ACH.
- The carrier claims Google’s new payment policies would cost it around $300k a year in current savings through cashback rewards on credit cards and other payment methods.
- To help offset the costs of ditching Google ads, the company is upgrading its referral program in a big way. While the first two referrals only pay $25 each, future referrals climb in value to $225 each after the fourth referral with a max of 10 per year. You can earn $1,500 in total.
A new chapter in the mobile wars is unfolding as big carriers quickly start buying up every prepaid carrier that matters with major acquisitions like Verizon buying Total Wireless, T-Mobile buying Mint Mobile, and the list goes on. The new reality is that a growing number of prepaid carriers are arguably just puppets for big wireless. The good news is US Mobile remains independent and is committed to limiting its reliance on big giants for its advertising and distribution. In fact, its CEO recently took to Reddit to announce it has parted ways with Google Ads and will look into other ways to grow its customer base. That includes relying on its fans.
Rocking the Google ads boat is a risk, but thankfully the move seems to be working out just fine. Not only is the company saving millions on advertising, but it is also seeing positive growth through other avenues like customer referrals. Now it wants to kick things up a notch. US Mobile is hoping to increase this momentum further by introducing a new referral program that will let you earn up to $1,575 a year.
In order to entice customers to regularly refer friends and family the carrier will pay $25 each for the first two referrals but will significantly increase the rewards after that. The third referral is worth $75, the fourth is worth $100, and every referral after that is worth $225.
Of course, there are some limits here. First up you can only be paid for up to ten referrals a year, which is probably more than most would want to do anyhow. You will also have to also pay taxes on the earnings if you bring in more than $600, since this is a direct cash program (via prepaid MasterCards). US Mobile says it will send 1099 tax forms to any customers that hit that threshold.
Why did US Mobile cut its ties to Google ads in the first place?
Edgar Cervantes / Android Authority
US Mobile founder and CEO Ahmed Khattak explained that Google recently made a change in its advertising terms that would require the carrier to use ACH payments to cover its advertising costs. For those who don’t know, an ACH transaction takes payment directly from your bank account. Why is this a problem? Khattak previously used credit cards and other methods to receive cashback rewards it uses to offset the costs, but Google insisted this is no longer an option.
Ultimately Khattack said that this would cost the company around $300k extra each year in missed cashback incentives. Google’s solution was to spend more money on advertising to offset those costs in the long term through increased revenue. When Google refused to play ball or further negotiate, US Mobile decided the best solution was to tell Google to “take a long walk off a short bridge” — Khattack’s words, not mine.
Khattack also wants to make it clear that Google’s changes aren’t just hurting US Mobile, but it’s small businesses in general that are under attack here. As the CEO notes that while US Mobile has been lucky enough to build itself a protective wall of sorts, many small businesses often have less of a cushion to fall back on, so using methods like credit cards with cashback is an important way to save money that can be used to grow, pay employees, and so on.
He also says that Google is ultimately going to lose money because he’s not the only small business that has had problems with the change. If even a fraction of these businesses leave Google Ads behind, Google could be looking at millions of dollars in lost revenue. A quick look around the Google Leads subreddit seems to back up Khattack’s notion that the new change has really hit the little guys the hardest. It’s also something we’re seeing from many businesses right now though. It’s easier to raise prices in the short term and worry about the knock-off effect of driving away potential customers later we suppose.
Got a tip? Talk to us! Email our staff at [email protected]. You can stay anonymous or get credit for the info, it's your choice.
English (US) ·