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Investigating the HypeDrop PC Tech "Scam"

2019-04-29
when something seems too good to be true it probably is pretty sure I've started another video with the exact same line I'm saying it again for emphasis some of you need this to be emphasized underlined in bold italics whatever it takes so when I scroll through my Facebook feed like so and find something like this show up as promotional content I can't help but investigate oh and a spoiler hype drop that's the name I think yeah it sucks Thermal Grizzly's carbonate pads offer peace of mind ease of installation and industry standard performance in a market crowded with mediocre thermal compounds our own testing confirms that they conduct heat appropriately and provide a safe and consistent membrane between the dire IHS and cooler best of all you can grab them in several sizes and reuse them as many times as you'd like Carbon our pads are a peace of mind in my book and they're very consistent and that's why I use them for CPU testing check them out via the link below pipe drop is well it's a loot box website if ro small chunks of cached at them in exchange for mystery tech and that's the catch you have absolutely no idea what you're getting so the sponsored spot I saw pop-up on my Facebook Timeline pertain to pcs I'm not surprised that's retargeting in a nutshell I search for PC stuff all the time but when I clicked on the ad it took me to a splash page for dozens of PC tech mystery boxes you've got everything from gaming on a budget to PC master-race and GPU upgrade most are pretty vague and that's obviously how they want to keep it that's the first red flag the second red flag has to do with the fact that some of these branded boxes are extremely cheap check out this razor budget box we just recently worked with them for a theme to build and set up and I can tell you firsthand most of their stuff isn't cheap so when you see a $4 and ninety-nine cent price tag under the box yeah second red flag the third red flag in my book has to do with the overall product showcase for each box even the gaming on a budget box for $4.99 shows a core i5 like a BenQ monitor what looks like an MSI graphics card it's all hype I said his name hype drop that's making more sense now anyone who honestly believes that these kinds of products can be frequently found in a five-dollar loot box probably deserves to be scanned by the way the age limit here is eighteen or older so I'm not wishing for kids who don't know any better to be scammed you're an adult at 18 here in the states and you're in control of your money misleading or not I mean you've got these red flags staring you in the face but perhaps the largest red flag of them all is the fact that when you buy these loop boxes you have to do it in questionable ways so let's buy one just to show you how things work if I click the button purchase box I'm prompted to a login window I can sign in via Facebook Google email Direct it's just another way for companies to gather data but it isn't an abnormal practice the Facebook Commission's weren't alarming so I chose to log in this way all right so I'm logged in now I can purchase a box click the button and you don't have wait no you don't enough balance to perform that action what ok typos aside I was kind of shocked by this I have to add balance to an account that I just created in order to spend actual money on the platform whatever let's add balance click top-up now at this point I've only got 3 ways to add money GTA gam Evo I don't even know what this one is but I'm sure it's sketchy and kinguin 3 sites I'd never recommend anyone used frequently to be completely honest these are just passed through entities acting as the intermediary between real sellers and buyers think of them like eBay because they are a lot like eBay but with less protection and less consistency if in my personal opinion anyway if a bay is like a condom than g2a is the pullout it can help if you make purchases with something like PayPal but still I choose eBay any tape over these thanks to their strong fire protection guarantee you might disagree with me there but I mean it's it's something I'm willing to distinguish in this video it's kind of weird that they would follow you through one of these three sites complaining aside though I bit the bullet and I loaded up I used a car and I created with privacy calm not a sponsor in this video they have been one in the past but it's just good practice to make temporary cards when dealing with sites like these and privacy decline the purchase because g2a is considered a quote high risk merchant yeah see what I mean this wouldn't happen on eBay I guess I'll have to use PayPal then I would prefer anonymity but PayPal is still secure all of this just kind of adds to the sketchiness factor of hype truck anyway skipping ahead the funds were finally added to the hype drop account and I could start buying loot boxes now the first box I bought was the one called build PC it was considerably more expensive than some of the other offerings but still not the post you could spend in this category and I'm sorry I'm not gonna spend a hundred bucks on this site it's just not gonna happen so $21.99 it is the transaction was processed and I could immediately open the box a sliding banner makes it seem more like roulette than anything else you feel like you actually have a chance to win some good stuff though you and I both know that isn't actually true for a second I thought I'd won an RT X 2080 that I'd be pretty ironic when seen in the context of the demeanor of this video but no instead I want a Corsair fan not sure how I'm gonna build a PC with just a single fan so I decided to sell the fan back to the website at coincidentally a cheaper price than what I paid for it and bought a box that cost considerably less this razor box 5 bucks what do we get it's it's a sticker all right now I can see why this box is so cheap but for good measure sake and consistency in just curiosity in general let's sell this back and buy another razor loot box another freaking sticker am I surprised No third time's the charm there right so yeah let's go ahead and sell this back into it again and another sticker so I'm done with this one let's try something else how about the tech on a budget box all these are just so enticing here we go and batteries okay done with that one let's try the gaming on a budget box for $4.99 GTA liberty city yeah I know again another freaking game code this time for fallout 3 which can be purchased on a Keys retailer site like SCD key for the same price so nothing special here again I don't even know what this is again same thing no idea what this is so now we're down to just three USD or so and that's because this site conveniently takes a cut off the top of every trade in or money back exchange that you make so if you get something you don't like you click the refund button and it gives you like 80 percent or so depending on the value of the item obviously of what you paid for the box and most of the time it's gonna be a crappy product right so they're going to still make money and you're going to lose money in the long run and you'll probably feel inclined to put more money in your account but don't do that so let's go for the cheapest box the budget master not that we have much of a choice at this point stereo headphones again some kind of slim wallet again another wallet and I am out of funds well that was fun felt a bit like walking into a casino with a stack of cash and leaving with just enough change for a cab look I'm not calling the site itself a scam I'm not denying that these higher priced products are in fact being given away rather what I think is truly a scam here is the representation of these loot boxes that and the fact that it seems like hype drop has been paying creators on YouTube to represent their site in a good light with good odds and outcomes when we know this is not the case and to understand why I'm actually going to break down their business model for you so a company like hype drop has quotas let's say they sell only one kind of loot box at an even ten dollars let's say their desired margins are 50% and let's say their volume is a hundred units a week with these metrics and a few elementary calculations we can determine the ratio of products one that exceeds the $10.00 buy-in that is the number of times hype drop actually loses money there's no risk here at all by the way for the company it's just the optics that make it seem as such so 100 units per week ten dollars each comes out to $1,000 in sales per week four thousand per month 48k per year if desired margins on that thousand dollars are 50% then the company should expect to net 500 dollars per week after inventory expenses all of those stickers I won for instance in the razor box were literally worth pennies so let's say that each cost since the company could sell 95 stickers at this price in each loop box per week costing them only $9.50 in total and would still be able to spend an additional four hundred and ninety dollars and fifty cents on the remaining five items to sell that week you can buy a nice CPU cooler with that money in decent graphics card a motherboard a CPU and a kit of RAM all in that budget and still net $500 at the end of the week thanks to the offset of sticker sold during the same period at insane margins so hype drop can and probably is awarding a few buyers here and there with awesome hardware I'm not saying that they're scamming you in that sense it it all fits right into the scheme we just laid out and it always ends with them making a hefty profit it's a business it's how they designed it but by misrepresenting a loot box by showcasing the four or five priciest things on the cover that's where things get a little scammy for me it's intentional deceit in my opinion but probably totally legal and I mean look it's not like hype drop is hiding this you can see what was recently won in each box of course the most expensive items linger a bit longer so it seems like the odds are more in your favor but at least you can see to some extent the transfer of goods all by design and according to their plan if it seems too good to be true again it probably is emphasis stay away from hype drop folks that's my professional opinion thanks for watching if you enjoyed this one click that thumbs up button it does help out quite a bit click that red subscribe button if you haven't already that helps up even more arguably consider becoming a channel member for special perks and stay tuned for the next one this is science studio thanks for watching and thanks for us
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