Dead Horse Alert: Is Clickbank Shaving Commissions?

Posted on 09. May, 2009 by joefission in Affiliate Marketing, PPC

Yes, this subject has been beaten to death. Not a week goes by that you don’t read a forum where someone is discussing how Clickbank stole their commissions. And I don’t want to add to the drone, but . . . let me share some screenshots with you.

I’ll preface this by saying that these screenshots indicate a problem only, and the cause of the problem is undetermined. But one possible explanation leads us back to the topic announced every week: “It looks like Clickbank is cheating me!”

A Quick Intro to PPC and Conversion Tracking

If you’re unfamiliar with PPC marketing, here’s a quick rundown on the process so that these screenshots make more sense.

It usually starts with compiling a good keyword list. I usually end up with 200 or more keywords. From there, you create your ads and measure results. The goal at this point is to separate the dead keywords from the ones that convert. I usually keep the most profitable keywords only, and will even cut off the marginally profitable ones just to keep my overhead as low as possible. This keyword paring process usually takes about 45 days, during which time I also split test ad copy.

After this process, I ramp up spending so that I triple my spend on the top keywords. Usually this results in anywhere from a 500 to 1000 percent increase in profits, because the overall campaign spend has been increased, and because I’m only focusing on 10 keywords or less, instead of over 200. The point is, what you see in these screenshots is the campaign during optimization.

To determine profitability, you can use conversion tracking. In this case, the Clickbank product I selected enables me to add my Google tracking ID to their thank you page. So on the front side, Google can tell me what was clicked, and on the back side, any of those clicks that reach the thank you page (a sale) will read as a conversion.

The Case of the Disappearing Conversions

Okay, so the bottom line is that the sales Clickbank says I make should equal the conversions Google says I make. If those numbers don’t match, there’s a problem. I should also point out that most Clickbank publishers do not offer conversion tracking, so what you see in these screenshots you won’t be able to find in most campaigns. That is, the problem might still be there, but it would be hidden from you.

Screenshot 1: Adwords

This cropped shot shows my Adwords campaign for this Clickbank product. The conversions reported here come directly from the publisher. That is, I pass them my Google conversion ID, and whenever any of clicks makes a purchase and reaches their thank you page, the number of conversions is incremented.

Adwords Screen Capture

So according to this, I have 21 conversions, with an average conversion cost of $35.50. This is the startup / optimization portion of the campaign. Running this campaign for only those keywords that convert brings the conversion cost down to about $24.

Screenshot 2: Clickbank

This cropped shot shows how many conversions Clickbank has credited me with.

Clickbank Screen Capture

According to Clickbank, I made 13 sales, and they’re going to pay me commissions on this number. As you can see, for every three conversions Google shows (i.e. the number of people who reach the thank you page after a complete purchase), Clickbank actually credits me with two.

So where does the other 1 out of every 3 conversions go? That’s the question. Clickbank can’t or won’t answer that question. Any ideas?

Short-sighted Shaving

If Clickbank is shaving, it’s short-sighted. At a conversion cost of $24 and a commission of $32.50 (what this program pays), this is a profitable campaign. It’s not a home run, but I would still run with it and optimize it. This is only about 30 days of effort. If I tripled spending on only the top 5 keywords, I’d be looking at between 150 and 200 sales per month, and Clickbank would receive their 7.5% commission on each sale.

But as it stands, this campaign is losing me a couple dollars per conversion, so it will be dropped. For 8 large commissions (under $260), Clickbank bypasses 150 to 200 smaller commissions per month ($500/month).

That actually leads me to believe that Clickbank is not shaving. After all, how stupid would they have to be to make it this easy to find discrepancies? And how stupid would they have to be to cheat themselves out of ongoing commissions?

I don’t know the answers to any of these questions, so my action plan moving forward is to simply avoid promoting Clickbank products via PPC. It is just not worth the hassle any longer.

I’d like to hear your thoughts. Anyone experience anything similar to this? What else could explain these numbers?

Tags: Affiliate Marketing, clickbank, commissions, PPC, shaving

34 Responses to “Dead Horse Alert: Is Clickbank Shaving Commissions?”

Jeet

10. Jun, 2009

Have you thought if product thank you pages can be ‘refreshed’ by buyers? I had made that mistake once and kept a static thank you page. I was again foolish enough to put the thank you page in my robots.txt. Anyone could go to the site and both google and yahoo would show a conversion.

Jeet’s latest blog post..Manual Directory Submission
Karen

16. Jun, 2009

Interesting article… thanks for the info, as I am trying to research Clickbank!
Shaun Taylor

18. Jun, 2009

@Jeet - Yes, it’s not a refresh problem. With Analytics, the count that I displayed is based on unique visits. And because the publisher includes my Analytics ID, I can safely assume that it’s not a static page.

@Karen - Clickbank is still the largest digital marketplace, and they handle all affiliate payments, so they attract a lot of affiliates — good for you as a publisher. I just wish they had better competition or we could hold them more accountable for stats and things like the above.

Shaun Taylor’s latest blog post..Dead Horse Alert: Is Clickbank Shaving Commissions?
Comment Policy

21. Jun, 2009

Hmm normally it’s the other way around for me. Google will less and clickbank with more. Have your tried other third party tracking services?
Steve

01. Jul, 2009

I’ve recently just started using Clickbank, this doesn’t seem like much of a morale boost for me lol…I need to research on this more. Thanks for the heads up tho.
Wyjazdy studenckie

08. Jul, 2009

Wow, thank you for the warning! A friend of mine recommended Clickbank to me, but since he’s rather, how to put this,, computer illiterate, I figured he only heard the name and some bs ad.
Still, I figured I have nothing to lose so I started researching them and what do you know, most of the comments and opinions about their service I find, are very similar to what you wrote here.
Again, thanks for the warning.
Odzysk Danych

16. Jul, 2009

They might not see it that way but couple dollars per every conversion is a huge deal. Personly I would find it a dealbreaker - those little pennies really add up over the time.

Odzysk Danych’s latest blog post..Odzyskiwanie danych - program czy firma?
Joe H

06. Nov, 2009

This is a bit frightening I’ve always took clickbank on trust. Surely this can’t be right, Clickbank have nothing to gain by doing it only the merchant would benefit
Sharon

26. Nov, 2009

I have been wondering about Clickbank for a while now. Whilst I don’t have stats on conversion tracking I have noticed trends in my Clickbank account that don’t make sense.

I go through stages where I will make no sales, and then for a brief period make 2 or 3 sales a day for a few days and then make nothing for a week. Sometimes my google adwords goes up to 60 clicks a day and I won’t make a sale for a week, but when I’m doing half the clicks I could be making sales.

Something smells FISHY to me. I was surprised at how few topics there were on this.

I am considering contacting the merchant.
oes tsetnoc

06. Dec, 2009

Clickbank is still the largest digital marketplace, and they handle all affiliate payments, so they attract a lot of affiliates

Thanks for good article
Private

08. Dec, 2009

Sharon…FUNNY you should say that. You and I seem to have the same “trends”. Now I only do this on the side..Im what is called a “BUM” marketer, but Ive been doing this for almost 2 years now…My OTHER job is law enforcement, Ive been doing that for almost a decade…Ive been doing some research on this and find it funny that alot of people have similar complaints. I even read a story where this marketer had even hired an investigator and is supposedly in touch with the FBI..Well…if this keeps up…I might be doing an investigation of clickbank myself.
411 WebConnect Canada USA

18. Dec, 2009

Interesting article about clickbank, I had heard stories but with your screenshots it’s quite impressive. Nice post
Energieberater

27. Dec, 2009

Thanks for this very interesting post. Pity that the last article is already long time ago.
Local Services Expert - Ana

10. Jan, 2010

I am very much interested in using clickbank. I am new with this and I am still searching for ways on how to earn money at home, using only my computer and my internet. I heard about PPC and clickbank but I am happy to see this article about clickbank. I think they shouldn’t have done that, if ever they really did something because you know there are lots of people using their service and I think its not fair for us who are working hard to earn money. I really hope clickbank will see this issue and address this issue as soon as possible.
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12. Jan, 2010

Everything happened so fast! Thank you so much for your help. I don’t know how I ever worked without it.
Matt

15. Jan, 2010

I was going to promote CB products but now I think CPA is good!
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21. Jan, 2010

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Morris County Movers

09. Feb, 2010

I have used Clickbank too and have noticed similarly strange statistics/trends. I haven’t had the option to use conversion tracking so I can’t confirm anything, but it looks like a lot of people are seeing these strange things happen. I agree with you that it probably wouldn’t make sense for them to shave commissions, but in the end I guess we don’t know what they’re doing over there behind closed doors. -Josh
Michael Appleton

21. Feb, 2010

Great post, I promote through ClickBank and think this is something I should be looking into abit more.

Michael Appleton
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Friend Indeed

28. Feb, 2010

here’s a theory. Is it possible that clickbank, is filling up their own personal accounts under the table. Meaning they can somehow re-route so many conversion a day to their own personal affiliate accounts, ran of course through a 3rd party front man etc. It is their biz, I’m sure it is possible. Maybe I’m just paranoid, but I have noticed the same thing, and wish I could hire my own private eye, my stats don’t make sense of late as well.
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06. Mar, 2010

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John Philip

06. Mar, 2010

Interesting article… thanks for the info, I just started with clickbank so I’ll keep an eye on them
Green Profits

06. Mar, 2010

I try to promote other sites that track my affiliate sales differently
Jay H

06. Mar, 2010

Crazy stuff, I’ve never noticed, I’m scared to check now tho…
John H

06. Mar, 2010

I don’t see why they would do this and jeopordise their business, if people can prove this then they’re done!
Kim T

06. Mar, 2010

they’re such a big part of affiliate marketing it would really suck if they were caught ripping people off!
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09. Mar, 2010

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