The RSMR Weekly Broadcast - Bot extortion: what's the problem and how bad is it?

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With Black Friday and Cyber Monday, the big Christmas spend has begun, but any great deals on a new games console or hot-ticket piece of electronics will probably be snapped up by an army of bots working for those looking to make a profit before you’ve even fired up your laptop.

What is an internet bot? It’s an application that repeatedly runs a script. There are different ways in which you can programme a bot and they are often used to raise profiles on social media. Influencers get paid for the number of clicks or the number of followers they have, and bots are used to generate fake accounts on Twitter or Instagram to follow you, increasing the numbers. 

What about commercial bots? In terms of online shopping, the purpose of these bots is to find the best deal possible. You can set the bot up to search for a product and every few seconds the bot will access thousands of websites to check availability and prices. Once the desired product goes on sale or it hits a set price point, the bot will automatically start purchasing the product in programmed quantities or in bulk.

Black Friday is a big tool for retailers, particularly in the current environment. Buying products online requires a customer to log onto a website, select a product and go through the checkout process. Retail bots scan the pages of websites around the world for the exact second an item goes on sale and they alert their owners so they can beat the crowd. A human is much slower than a bot at completing the purchasing process, so even if you’re aware that a sale starts at 9am and you’re on the website ready to go, a bot can buy the full quantity of the available product in seconds, meaning that a retailer is already out of stock by the time you get to the payment section.

When the new generation of consoles came out, the Playstation 5 and the X-box series S and X, thousands of bots were programmed to buy all these products before the average consumer had chance to browse a few stores. They were then advertised and sold on ebay for up to ten times the purchase price!

This is a form of market manipulation and seems outrageous, but it’s currently a grey area and there’s no real legislation to govern the use of bots. How do retailers feel about the bots? They’re selling their products at the price they’ve set, and the lack of supply created by the bots means that their product becomes the must have item. Brand scarcity makes the product more desirable, so retailers don’t lose out in this sense, it’s the end consumer that gets taken to the cleaners. On the one hand, the retailer just wants to shift the product so who cares if it's a bot or a 'real' customer, but on the flip side, if very few of your real customers can get the product from you, they will naturally go elsewhere for future purchases.

What’s the scale of this problem? At the start of the first UK lockdown in March this year, it was practically impossible to get hold of a Nintendo Switch. Why did it fail to meet the global demand of a Covid-19-impacted world? It's all thanks to Bird Bot, an online shopping bot that guarantees instant purchases of the Nintendo Switch, created by a 16-year-old boy from Virginia.

His friends challenged him to create a bot that would help them successfully buy a Nintendo Switch as soon as it became available. He designed the bot, bought a Switch, made the bot into an app and put the script on GitHub, an opensource forum for software developers. GitHub members studied the script, were impressed by it, replicated the code and started to design bots of their own. Bots aren’t that difficult to build; all you need is a powerful processor and internet connection and some experience in software development. Not surprisingly, the creation and sale of bots is now becoming an industry in itself.

Bots aren’t just used in the world of commerce and social media. In financial markets, algorithms are used to check how much you can buy a stock for. If there’s any sign of mispricing and an opportunity to make money is identified, the bots will carry out the transaction.

Bots plug the gap between supply and demand and are stealing part of the connected world that we have access to. If there's a niche audience or a high-profile launch, those industries are targeted. The fastest bot gets the gold and consumers pay the price down the line. With bots available to buy on app stores, this issue won’t go away and creates an ethical dilemma for shops.

How can retailers fight back? To keep the bots at bay, organisations can use AI and machine learning-based mechanisms that analyse the credentials, tools and infrastructure, along with behaviour across the web. The result is the ability to see the difference between legitimate and malicious transactions and then take action. Bot defence is an ongoing, year-round challenge, but the bots need to be stopped if we’re going to reclaim the right to shop in a fair online market.

QUIZ QUESTION: How many volunteers took part in the Oxford vaccine clinical trials and from which countries?

LAST WEEK'S ANSWER: Online shopping began in 1979!