When you are determining whether the product you see in clickbank is good in quality, you should try to calculate the refund rate. Following is Clickbank Refund Rate Calculation.
Take one example: Product X price: $49.95 Affiliates earn $33.96 Earned per Sale : $23.73
When you calculate your commission,which is 75%, your calculator should show you 37.46, instead it says affiliates earn $33,96 only, why? You have to pay attention to is the clickbank commission, which is 7,5% + $1. calculate it with the product price: it takes you to approximately $4.75.
Now the actually accumulative profit for affiliates and the merchant is $45.2. Affiliates earn : 75% from $45.2, which results approximately $33.96
Earned per sale is only $23.73, which affiliates will earn for each sale, where has the rest $10.23 gone? it goes to the refund.
Calculate the refund rate: $10.23/ $33.96 X 100% = 30.1% refund rate. It means that this product is not very good in quality.
Let's take a look at a product named Beating Adwords, which created by Kyle & Carson about secret Adwords formula that will allow you to promote any product you want, under any keywords, for lower than any other advertiser.
Beating Adwords sold for $97, which has an earned per sale of $44.42. When you do the math it means virtually no one refunds the product.
Conclusion Refund rate formula :
full commission = product price - $1 - (7.5%*product price)
affiliate earning = full commission x commission percentage
refund rate = (affiliate earning - earned per sale) / affiliate
Clickbank Refund Rate Calculation is merely an easy math, so make sure you are doing it before deciding which product to promote for the sake of your customers.
Refer Refund Rate Calculator for more information.
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