Expensive Affiliate,

I’ve got bad news for you: You’re most likely losing cash and you did not pay attention to it! Let me explain…

Once you joined affiliate programs you most likely considered the following factors:

- The commission
- The conversion rate

The profit formula appearance sort of a child play: Commission x Conversion Rate = Your Profit

Of course there are 3 big pitfalls here and if you do not manage them properly, your profit is at risk. Let think about them:

- Value: A high worth means a higher affiliate commission for each sale however it might result conjointly in a lower conversion rate… If the merchandise is too expensive, nobody can buy. You mustn’t be blinded by the promise of a terribly high commission. You must bear in mind that the simplest worth isn’t the one that gives you the best commission but the one that makes the highest profit. An optimized pricing that makes happy customers and satisfied affiliates is what you must look for.

- Refund Rate: Refunds can kill your selling efforts! What are price the sales you see in your account if customers request their cash back? A ton of sales mean nothing unless you keep the money!
This can be the full responsibility of the merchant to keep refunds as low as possible. A site that sells well is good. A site that conjointly keeps refunds terribly low is a lot of better! There’s solely one method to keep refunds terribly low: To deliver very prime quality services meeting customers’ expectations or going beyond what they could expect!

- Product Quality: Quality is king! Quality makes superior conversion rates! Quality permits higher costs and better commissions! Quality keeps refunds as low as doable! In a very word: Quality ought to be your compass. Don’t associate your business with low quality merchandise or services. On the high of your list, promote only the terribly best. It will additionally keep your profit on top.

How a lot of cash are you losing today?

The cash you earn and lose is considerably determined by the standard of the affiliate program you have selected as your high pick.

The question is: How does one live what’s a lot of qualitative and what’s less?

There is an objective criterion to use for answering this question and for optimizing your profit: The refund rate of your high affiliate program!

A high refund rate specific clearly that heaps of shoppers don’t seem to be glad with what they get which affiliates lose cash on their sales. On the contrary, an occasional refund rates indicates a high level of satisfaction among customers and safe earning for affiliates.

If you get many refunds with your prime affiliate program, you ought to perceive that the quality of this program is not sufficient for keeping these customers satisfied and it doesn’t do the required job for securing your profit… You’re losing money!

What are sensible, medium and poor refund rates?

Refunds cannot be totally avoided. There will always be customers that are not glad even for the foremost qualitative product or service. Thus, expecting a zero refund rate on the long run is not realistic. You should wish a refund rate as low as potential in your industry. It is vital to contemplate that there will be vital variations from one industry to another however as a rule of thumb you can use the subsequent scale:

two% or less: Wonderful
3% – 5%: Sensible
vi% – 10%: Medium
eleven% – fifteen%: Poor
16% – 20%: Terribly Poor
twenty one% or higher: Run away!

With a 5% or less refund rate you’ll be happy. Your affiliate program is reliable and your profit is secured. With a half dozen%-10% refund rate, you should monitor closely your merchant performance to confirm it doesn’t get worst. It’d be advised to scan the market for a higher different if you’ll be able to realize one. With an 11%-twenty% (or higher) refund rate you ought to be very involved together with your profit. Whatever your industry is, you are bleeding and there’s most likely a better affiliate program to promote.

What is the refund rate of your prime affiliate program?

There are 2 ways to seek out the refund rate of an affiliate program:

1) Examine the stats supplied by your affiliate program

Do your math as following: Refunds / Sales = Refund Rate

Let say you create one thousand sales per month, you get a $23.50 commission per sale and concerning 160 customers request their cash back every month. Your refund rate is one hundred sixty / a thousand = 16%. In that case it means that you should have earned $twenty three,five hundred for your sales but you’ll get solely $19,740 because of the refunds. You lost here 16% of your profit or $three,760!

You’ll be able to ask yourself: Is it only I or all affiliates for this program get similar numbers? If you employ Clickbank to push affiliate programs, you’ll get the large picture regarding the full community of affiliates that promote an affiliate program.

two) Using Clickbank payout stats to calculate the average refund rate of an affiliate program

In its marketplace, Clickbank publishes payout stats for affiliate programs. The $Earned/Sale issue gives us exactly what we have a tendency to need to calculate the common refund rate of a program.

The $Earned/Sale is the average net quantity earned per affiliate per referred sale. This variety is mainly impacted by refunds and it reveals the real commission earned by affiliates. With this range, you’ll have an inner observe the $64000 performance of affiliates programs.

The average refund rate of an affiliate program is:
(Commission – $Earned)/Commission = Average Refund Rate

What is the refund rate of fashionable affiliate programs at Clickbank?

As an example, we have checked out three affiliate programs selling paid surveys databases. We have a tendency to have found their refund rates terribly high! You may be shocked at discovering how abundant cash affiliates will lose when promoting these programs:

- SurveyScout: 16.2% refund rate!
- Survey Platinum: 20.nine% refund rate!
- My Shopper Survey: 35.a pair of% refund rate!

To urge into the main points, on November twenty ninth 2005 figures were as following:

SurveyScout
Affiliate Commission: $23.fifty
Average $Earned/Sale: $19.sixty nine
Refund Rate: (23.fifty – 19.sixty nine) / 23.fifty = 16.a pair of%
Example: For one hundred referred sales you must earn $2,350. In fact you may get only $1,969 as a result of 16 customers out of a hundred have requested their money back!

Survey Platinum
Affiliate Commission: $23.fifty
Average $Earned/Sale: $18.fifty eight
Refund Rate: (23.50 – 18.58) / 23.50 = 20.9%
Example: For 100 referred sales you should earn $two,350. In fact you will get only $1,858 as a result of twenty one customers out of one hundred have requested their money back!

My Client Survey
Affiliate Commission: $40.84
Average $Earned/Sale: $26.forty three
Refund Rate: (40.84 – 26.43) / 40.eighty four = 35.two%
Example: For one hundred referred sales you ought to earn $4,084. After all you will get solely $a pair of,643 because thirty five customers out of a hundred have requested their money back!
Remark: My Shopper Survey contains a poorly designed web site and a high value for buyers. We have a tendency to estimate its conversion rate to be significantly under different paid surveys programs. Despite its high commission, affiliates will lose the foremost money with this program.

We learn 3 lessons concerning these paid surveys affiliate programs:
- A lot of shoppers are dissatisfied.
- Affiliates lose huge money.
- The quality of those programs is terribly questionable.

What should you are doing to prevent the bleeding?

You have got no influence on the standard of the affiliate programs you promote. Your solely real influence is on the standard of your recommendation!

Giving your prime recommendation to a very professional affiliate program that delivers the utmost quality services to customers will keep your profit as high and as safe as possible.

In the field of paid surveys and mystery shopping jobs, the foremost skilled program obtainable nowadays is MaximumPaidSurveys.com.

Most Paid Surveys could be a premium database of paid surveys and mystery searching jobs. It delivers a superior price to both registered users and affiliate partners because of its very high quality.

How to spot quality in affiliate programs?

Defining quality is a troublesome job. In general, folks cannot define clearly what quality is however they acknowledge it after they see it. Thus what should you observe in affiliate programs?

The foremost qualitative affiliate programs find the proper balance between the worth they provide to customers and the price they generate to affiliates:

1. Value to customers – It includes:

- Rich content
- Good wanting web site
- State-of-the-art organization
- Friendly functionality
- Reasonable Price for many visitors
- Detailed documentation
- Bonuses strengthening the main provide
- Timely Customer Support

2. Worth to affiliates – It includes:

- High conversion rate
- High commission
- Low refund rate
- Commission paid on time
- Good affiliate support

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  • services sprite Affiliate Profit: Are You Losing Cash?
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