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what does this have to do with SEO?
are you referring to the sponsor ads on Google or Yahoo or banners on sites? I know for a fact that what your friend says is 100% not true. ive ran campaigns for large ticket items and services that an "uneducated person under $40k" would not be able to afford.
i hear this debate almost every day, and its mostly a large number of SEO and offline ad companies that create a lot of lies to customers. cant really blame them because search campaigns are (imo) more effective in most cases than tv, radio and paper.
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