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Clickbank Refund Rate Calculation
When determining if the product you see in clickbank is of good quality, you should try to calculate the refund rate.
Here is Clickbank’s refund rate calculation.
Let’s take an example :
Price of Product X: $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 only earn $33.96, why?
You have to pay attention to the clickbank commission, which is 7.5% + $1.
calculate it with the price of the product: that brings you to about $4.75.
Now the actual cumulative profit for affiliates and merchant is $45.2.
Affiliates earn: 75% from $45.2, or approximately $33.96
Earned per sale is only $23.73, which affiliates will earn for each sale, where did the remaining $10.23 go?
it goes to reimbursement.
Calculate the reimbursement rate:
$10.23/$33.96 X 100% = 30.1% reimbursement rate.
This means that this product is not of very good quality.
Let’s take a look at a product named Beating Adwords, created by Kyle & Carson about AdWords secret formula that will allow you to promote any product you want, under any keyword, for a lower price than any other advertiser.
Flying AdWords sold for $97, which has a revenue per sale of $44.42. When you do the math, that means hardly anyone pays for the product.
Reimbursement rate formula:
full commission = product price – $1 – (7.5% * product price)
affiliate revenue = full commission x commission percentage
refund rate = (affiliate income – earned per sale) / affiliate
Calculating the Clickbank Refund Rate is just a simple calculation, so be sure to do this before deciding which product to promote for the benefit of your customers.
Consult the reimbursement rate calculator [http://www.squidoo.com/clickbank-info/] for more information.
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