Archive for the 'Marketing' Category

Understanding The ClickBank Pyramid

Friday, January 26th, 2007

Before explaining the pyramid structure of Clickbank’s most popular products, I’d like to mention to the readers that I have personally promoted and profited very well from this Clickbank’s affiliate programs, which I frankly consider the easiest way in the world to make a steady 300$ a day . It’s just a very bad idea for someone with not enough money to spare to try and play that game .

A brief description of Clickbank’s business model

Clickbank allows creators of digital content to advertise and and promote their digital products via the Clickbank Marketplace to potential clients and affiliates . Most of the times , the product itself is a document of around 100 pages , dedicated to a very specific subject , sold via a very well written sales letter .

Document Product Examples:

  • How to get Rich
  • How to work from Home
  • How to eliminate Debt
  • Marketing Techniques
  • Game and Cheats manuals
  • Diet , Exercise and physical improvement

Other products consist mainly of very purpose-specific programs , that are dedicated to accomplishing an easily-marketable job .

Program Product examples:

  • Anti-Spyware/Adware/Antivirus
  • Video/Audio Format Converters
  • Simplfied graphic and document manipulation

Now, honestly speaking , nobody in their right mind would pay 49$ (or more) for a copy of digital document (not even a real book) to find out how to earn 1500$ a day by filling surveys and typing ads . A logical and patient person would more likely to search , read and test similar information by joining the appropriate communities and seeking guidance from experienced people . The same applies for Games/Cheats , Exercise/Diet guide or any other manual , and surely applies to software that can be easily acquired for online free .
Q) So how exactly do these low-quality digital products still manage to sell in large quantities for great profit ?
A) The same way many low-quality products sell - aggressive Marketing and MLM-like affiliate system .

Clickbank’s uniqueness lies in the fact that most products are not part of the marketing effort , but rely completely on the fact that some products are . Here is how it works :
Most of the top-promoted and most sold clickbank products are Get-rich-work-from-home types of products . These products , more often than not, simply sell a product about how to sell products just like the one the buyer recently purchased . These guides make a very valid point - Hey , you paid 50$ for an E-book , I got paid , and the affiliate that referred you got paid .

This creates a food chain unique to the clickbank marketplace :

  • Top Level : The digital product creators, usually the owners of the site that actually sells the product and often provides tools for it’s affiliates, but don’t directly pay for the product’s promotion .
  • Affiliates : promoters of the product , which often receive more than 50% of the revenue, but often have to pay for the product’s promotion and marketing , driving potential clients to buy the product via their unique affiliate ID.
  • A Client - A client pays and receives the products , generating profit for the content owner , and if the conversion percentages are good , for the affiliate .

The Client , in turn , will often become an affiliate of other Clickbank products , generating more profit to the owner of the content, and might also promote other products, which are not even promoting Clickbank’s business model .
This is essential to the survival of the Clickbank Marketplace for several reasons , the most important of such reasons is the fact that all affiliates are in direct competition to one another, and unlike many other entrepreneurs online (and offline) , would not invite or incourage another person to profit off Clickbank’s products .
The greatest resemblance to Pyramid schemes is actually what happens next - most Clients will actually lose money by promoting products , and after promoting products at their expense and generating sales for the Top Level , most will quit.
But not before making just a few sales of the same product they bought, to keep the ball rolling .

So who should “play” Clickbank as an Affiliate ?
My advice is - if you have a spare 1000$ for initial marketing/promotion miscalculations , enough patience to see whether you promotional methods are working in the long run even with initial losses , and most importantly , smart enough to not actually buy and apply the knowledge that is sold via ClickBank’s Marketplace, you should definitely give it a try . You just might be surprised by the amount of money you can make through nothing but calculation of conversion rates and minimal initial investment.