How ClickBank’s New Risk Management Tiers Will Affect Marketers

For many years, ClickBank has been the leading affiliate network and payment processor for sellers of digital products.

As a result, ClickBank has attracted tens of thousands of online marketers. Many are ethical. But many are not.

There are plenty of ClickBank sellers who hype their products and sell crappy low-value ebooks and videos for high prices.

The internet is awash with lying bastards telling you [you] can get rich easily,” says Drayton Bird. And a great number of those lying bastards sell through ClickBank.

Until now, all CB sellers were basically treated the same. It didn’t matter how many refunds or chargebacks you caused. Your rates were the same as the conservative seller who’s had no problems with refunds or chargebacks.

That’s all changing right now. Here’s the notice straight from ClickBank:

As part of our ongoing commitment to offer quality products and enhance customer satisfaction, ClickBank is implementing the color-coded risk management tiers displayed below. To aid affiliates in the selection of products to promote, the star ratings based on product quality will be made visible in the ClickBank Marketplace on January 2, 2013. Please note that fees, penalties, and account termination rules may be assessed beginning as early as March, 2013.

ClickBank has developed sophisticated algorithms to accurately predict expected refund and chargeback rates for individual accounts and measure forward-looking account risk. This allows ClickBank to take proactive steps to protect our customers and alert vendors and affiliates to the health of their accounts so they can take steps to lower their risk.

So what does all this mean?

1. You need to check your ClickBank accounts to see how they’re currently being scored. I have one account that’s got the best rating (violet). I have another that has a “below average” rating (yellow).

2. There is a new star rating system that is already visible to potential affiliates within the ClickBank Marketplace. A low account rating will naturally discourage affiliates from promoting your products.

3. If you have an account that is below average, or worse, you will face additional fees and penalties starting in March. The lowest scored accounts could face termination.

4. I expect that you’ll see dozens (hundreds?) of ClickBank accounts terminated in March. The accounts that are terminated will be predominately in markets that sell products about how to make money. I expect the “work from home” and weight loss markets to be hit hard, too.

5. Unfortunately, ClickBank’s refund policy invites abuse. I’ve had plenty of buyers submit refund requests mere minutes after purchasing. It’s obvious these people are just gaming the system. These serial refunders seem to be most prevalent in B2B markets. So for some sellers, it may be time to abandon ClickBank and switch to a different shopping cart altogether.

6. If you want to stick with ClickBank, but need to raise your account rating, you can try three things: a) improve your product, b) lower your price, or c) tone down your sales copy. I recommend you start by improving your product and toning down your sales copy. Only lower your price if necessary.

The sooner you can adapt to ClickBank’s new risk management system, the better off you’ll be.

-Ryan M. Healy

Ryan M. Healy

Ryan Healy is a financial copywriter and the author of Speed Writing for Nonfiction Writers. Since 2002, he has worked with scores of clients, including Agora Financial, Lombardi Publishing, and Contrarian Profits. He writes a popular blog about copywriting, advertising, and business growth, has been featured in publications like Feed Front magazine, and has been published on sites like WordStream.com, SmallBizClub.com, and MarketingForSuccess.com.

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