Secret Tips on Clickbank Refund Rate Calculation & Profitable Products

If you are new to Internet Marketing, I strongly recommend you to sign up for Clickbank as it's the World's Largest Digital Merchant where they only sell digital products. Once you have signed up for Clickbank, you can select from a various number of products in Clickbank marketplace and become an affiliate. They will send you cheques commission by mail if you have make sales from affiliates products!

I was going through a home study course and learn something new today so I thought to share it with you guys. What I am about to share is going to open up your eyes so do take some notes before you proceed.

There are many products in Clickbank but what really determines the product that can sell? Well many people are not aware that actually Clickbank does provide the information below on their marketplace.

Here's an explanation what the above numbers are taken from Clickbank

1. $Earned/Sale: Average net amount earned per affiliate per referred sale. Note that this is the net earned per actual sale, and so it is impacted by refunds, chargebacks, and sales taxes. Unfunded sales, such as returned checks, do not impact this number.

2. Future $: Average total rebill revenue earned by the affiliate due to sales from a site. Generally this equates to the average sum of all rebills.

3. Total $: The sum of all initial sales and rebills divided by the number of initial sales. It is the average total $ per sale, including all rebills that may come from that sale.

4. Earned/Sale: Average percentage commission earned per affiliate per referred sale. This number should only vary if the publisher has changed their payout percentage over time.

5. %Referred: Fraction of publisher's total sales that are referred by affiliates.

6. Gravity: Number of distinct affiliates who earned a commission by referring a paying customer to the publisher's products. This is a weighted sum and not an actual total. For each affiliate paid in the last 8 weeks we add an amount between 0.1 and 1.0 to the total. The more recent the last referral, the higher the value added.

To determine if a product on Clickbank is profitable you can actually determine by two important numbers and they are the Gravity and the $Earned/sale. Gravity tells you the growth of the product in the past 8 weeks, the higher the number means the more popular and is getting more sales on the marketplace.

The $Earned/sale will help you determine the account of refund the product has. Before I get into the refund formula you first need to find out how much the product sells online currently.

Firstly you have to visit the product page, for this a product sells at retails for US$77 which is called the Retail Price.

If you actually calculate your commission which is 61%, your calculator should show you 46.97, instead it says affiliates earn $36.04 only? Well that's because Clickbank commission, which is 7.5% + $1. Calculate it with the product price: it take you to approximately $6.77.

Now the actual total profit for affiliates and the merchant is $70.23. Affiliates earn : 61% from $70.23, which results approximately $42.84

Earned per sale is only 36.04, which affiliates will earn for each sale, where was the rest $6.80 gone? it goes to the refund!

Here's how you calculate the refund rate: ($6.80 / $42.84) x 100% = 15.87% refund rate. It means that this product is not too bad in quality. Guideline is to find product with refund rates below 25% should be quite alright.

Want A Shortcut To Track Profitable Clickbank Products?

When I found out about this I decided to go around Google to search if there were tools to help me monitor profitable Clickbank and this is what I found.

It's call CBEngine which I think the FREE version tells you enough information to find basic information without showing you the important momentum numbers you see above. What you seen above is only available in the paid version you can actually track and monitor which products in which niches you are doing that is highly profitable and I think this tools will be pretty useful for those who are doing Internet Marketing full time .

Cool stuff huh, feel free to drop your comments on my blog.