What is an "acceptable" CB refund rate?

Banned 16 years ago

As is true for any Clickbank product, it will doubtless vary hugely between different affiliates, according to how it's presold. I wouldn't want more than a 3% refund-rate with it, myself, in principle (says she, knowing virtually nothing about it!). But I'd expect that there'll be a few affiliates with lower refund-rates than me, and many with higher.

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RussRuffino

16 years ago

Cool thanks guys. That's about what I figured, but I wanted to run it by the tribe anyway. :-)

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Sour

16 years ago

I've always heard you shouldn't be venturing past 10%.

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WillR

16 years ago

Originally Posted by RussRuffino

can you tell me what an acceptable refund/return rate is on a CB product?

Yes, the ONLY acceptable refund rate is 0% - nil - nada - nothing. I don't understand all these people who say you should expect anywhere from 3% to 10% and so on. That is the wrong mindset to have.

You shouldn't accept anything above 0%! Is it realistic with a clickbank product? Well maybe not but it doesn't mean you should just accept it as the law.

There are always things you can do to try and lower your refund rates further - just accepting them as standard practice is NOT one of them.

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Justin Goff

16 years ago

Originally Posted by WillR

Yes, the ONLY acceptable refund rate is 0% - nil - nada - nothing. I don't understand all these people who say you should expect anywhere from 3% to 10% and so on. That is the wrong mindset to have.

You shouldn't accept anything above 0%! Is it realistic with a clickbank product? Well maybe not but it doesn't mean you should just accept it as the law.

There are always things you can do to try and lower your refund rates further - just accepting them as standard practice is NOT one of them.

If you're not getting at least 5% you're not selling hard enough.

A small percentage should be so blown away by your sales message that you push them over the fence to buy even though they don't want to.

I'd much rather have a 10% refund rate and earn $30 per sale than a 0% refund rate and earn $29 per sale (in net terms).

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WillR 16 years ago

Originally Posted by Justin Goff

If you're not getting at least 5% you're not selling hard enough.

Actually, it means you are not selling to the right people.

Originally Posted by Justin Goff

A small percentage should be so blown away by your sales message that you push them over the fence to buy even though they don't want to.

I beg to differ? Why would I want to waste my time selling my product to people who never wanted it in the first place? Why do I want all that extra hassle and support to deal with? That's not the kind of business I want to be running.
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powerspike

16 years ago

Originally Posted by WillR

Yes, the ONLY acceptable refund rate is 0% - nil - nada - nothing. I don't understand all these people who say you should expect anywhere from 3% to 10% and so on. That is the wrong mindset to have.

You shouldn't accept anything above 0%! Is it realistic with a clickbank product? Well maybe not but it doesn't mean you should just accept it as the law.

There are always things you can do to try and lower your refund rates further - just accepting them as standard practice is NOT one of them.

There is a type of person, who want a project for free, and will buy it, and refund it. Some affiliates will lie about your product, so when somebody buys it, it's different to what they expected.

for a 0% refund rate you'd have to assume everyone in this world is honest and good hearted.

If your selling a product of someone elses, and you don't hype it up, and don't add "extra" features that don't exsist, your refund rate should be low, almost none exsistant.

Just making sure people know what they are getting goes along way to lowering the refund rate.

I was an affiliate for a world of warcraft leveling guide, the vendor contacted me one day asking if there was anything he could do with helping me getting more sales. After a few emails back and fort, i found it it was because as a affiliate i had a lower refund rate then other's (buy several %). In the end most of the people that were buying the guides where teenagers, who figured once they got the guide, they'll just hit up for a refund and get it for free. How do you stop people like that?

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Michael Lee

16 years ago

Originally Posted by WillR

Yes, the ONLY acceptable refund rate is 0% - nil - nada - nothing. I don't understand all these people who say you should expect anywhere from 3% to 10% and so on. That is the wrong mindset to have.

You shouldn't accept anything above 0%! Is it realistic with a clickbank product? Well maybe not but it doesn't mean you should just accept it as the law.

There are always things you can do to try and lower your refund rates further - just accepting them as standard practice is NOT one of them.

0% is fine if you only consider the factors related to product satisfaction. I have some customers who made a double order. I even have one customer who ordered three times, so I have to refund two of them.

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celente

16 years ago

I would say 3-5% that is healthy and normal in any niche I guess.

Any more than that, and you need to sit down with yourself and work out why?

It will normally be because of a bad product, yes even bad products can sell if you have amazing copy.

There is nothing wrong with fixing your product to make it better too. Even offer your previous clients updated versions for free.

what I do is when they download their stuff, give em a suprise straight away. That has decreased my refunds by 50%.

So once they download, tell them on the download page to get a suprise bonus, that you did not advertise. they think you are semi cool then.... it works, so try it out.

Celente.

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DPM70

16 years ago

"acceptable" clickbank refund rate = zero.
"realistic" clickbank refund rate = Well that depends on many variables. I sell a product that touts and gets less than 1% refund rate (for me). Personally I think it should be higher. It's not that the product doesn't work but it doesn't do what it says on the tin for all clients.
Hence, I'm working on my own product. A 1% clickbank refund rate is good for an affiliate, but I see 1% of that market that isn't happy - and it's a big market.

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Paul Barrs

16 years ago

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sal64

16 years ago

Correctamundo...

Only 3 reasons for refunds:

sh1t product
sh1t client
sh1t price point.

Funny with my membership site packages, I've only had 3 refunds in over 500 sales. And these were for people who had different expectations, Paul.

All power to you Bro!

Originally Posted by Paul Barrs

Wow - looks like "acceptable refund rates" have gone up since I last considered the topic.

5% - 10% ??? OMG.

"Push them over the fence" - WTF?

How about QUALITY PRODUCT SOLD TO THE RIGHT PEOPLE!

Then if you're really unlucky, you might get 1 - 2% refund.

Successful selling is all about putting your message in front of the right people, not the wrong ones.

My average is 1.7% irrespective of the merchant. The merchant has nothing to do with it! It's the crap that people sell and the drop kicks that they try and sell it too that determine the numbers.

I guess it comes down to philosophy... do want customers for life, or just 'customers'?

Paul Barrs

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oneplusone

16 years ago

Originally Posted by Paul Barrs

Wow - looks like "acceptable refund rates" have gone up since I last considered the topic.

5% - 10% ??? OMG.

"Push them over the fence" - WTF?

How about QUALITY PRODUCT SOLD TO THE RIGHT PEOPLE!

Then if you're really unlucky, you might get 1 - 2% refund.

Successful selling is all about putting your message in front of the right people, not the wrong ones.

My average is 1.7% irrespective of the merchant. The merchant has nothing to do with it! It's the crap that people sell and the drop kicks that they try and sell it too that determine the numbers.

I guess it comes down to philosophy... do want customers for life, or just 'customers'?

Paul Barrs

I usually agree with your posts Paul, but I don't think you have thought this through.

See my first reply to this thread.

If you're using a money back guarantee (refund policy) as a USP for example, a high refund rate is actually perfectly acceptable.

It is more about lowering resistance and getting large numbers of people to try the product/service, and letting the ones who don't find it suitable, refund.

Of course one has to be careful with high refund rates, as it can be problematic in some cases on the payment processing side, that is another topic altogether.

But the logic that high refund rate equals bad quality product, is flawed.

There are many other reasons why there may be a high refund rate on a quality product/service, this is just one of them.

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paulie888

16 years ago

I'd say up to 5% would be be acceptable. Typically, refund rates are much lower in non-IM niches, so in your instance I'd consider not continuing with the promotion of this product if refunds exceed 5%. At the $197 price point, each and every single refund is going to hurt (seeing $100 or so subtracted each time it happens is definitely going to grab your attention!), so especially if you're using paid advertising I'd stop promoting this if and when the refund rates start drifting up too much.

Paul

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pappyy3 16 years ago

IMO there is no such thing as an acceptable refund rate.

Any sort of refund rate would trigger some alarms bells. 3 to 5 % and the bells would be ringing very loudly ...

3 - 5 % refund rates as acceptable are only touted by those who promote clickbank products.

Try telling anyone in the physical products buisiness to expect a 3 to 5 % refund rate any they will scramble to take it off the shelves and return to to the manufacturer

Right Audience, Quality product. = What your targeted approach should be.

Unfortunately fraud or deceptive purchasing practices is something we are all impacted by and may happen from time to time
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Rsberg

16 years ago

I think Paul is dead on here....

Right product to the right people is what you should focus on.

I think CB has such a high refund percentage across the IM niche because a LOT of the IM products promoted through them are CRAP!

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deertrail 16 years ago

I agree that all things being equal, you want a low refund rate, obviously, but shooting for a 0% refund rate isn't realistic.

Deliver the best product you can, use customer feedback via surveys to improve it, then start creating your next product.

Obsession with "0% refund rates" will only waste your emotional energy that could be better spent creating MORE value for customers in the form of new products.

-Bryan
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Paul Barrs

16 years ago

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KenJ 16 years ago

With online purchases you must factor in the "Idiot Factor" customer.
This type of customer thinks that you will immediately provide them with a physical product.

All my refunds this year were from 1 (count them on one finger) ONE customer who kept on ordering my product over and over again, without realising that My Download email was providing the product.

They said they were wondering how I would get it to them in "The next 5 minutes" When it didn't arrive they thought there was a problem so re-ordered.
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Alexa Smith

Banned 16 years ago

Originally Posted by Paul Barrs

I recorded a video last night of a CB merchant with 7 (!!), yes, 7 exit pop up windows... the last of which went directly to the order form 1/3 the price of the original sales page - OMG.

"OMG" is putting it mildly.

And people (well, a few people - perhaps in this case a very few people!) imagine that vendors "must have tested that and must be doing 'what works' "! Far be it from me to sound moralistic about anything, you understand, but these vendors get the affiliates they deserve, I think ...

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Paul Barrs 16 years ago

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- oneplusone 16 years ago
  
  An acceptable refund rate is subjective, and a lot of it depends on the emphasis placed on the refund policy in the marketing itself.
  
  If the angle of your marketing is encouraging everyone to "give your product a go risk free", and you keep reminding them that they can get a full refund if it isn't for them (so why not "give it a try") - your refund rate WILL be high.
  
  But so will your conversion rate.
  
  Some sellers even make their refund policy their USP, and have built their businesses using this tactic.
  
  Their refund rates may be high, but everyone is happy including customers who refund, because they got to give the products/services a try for no risk and most of them appreciate it.
  
  Everyone's a winner
  
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Dwight Anthony

16 years ago

Clickbank has serial refunders, it's just so easy to get a refund from them. They should consider dropping the guarantee down to 30 days. Bet the refund rates would drop over night.

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WillR

16 years ago

Originally Posted by danthony

Clickbank has serial refunders, it's just so easy to get a refund from them. They should consider dropping the guarantee down to 30 days. Bet the refund rates would drop over night.

Changing the guarantee won't do anything. I would bet that the majority of refunds happen within days of the purchase. Seriously, can you remember what you bought 60 days ago? Serial refunders usually buy the product, download it, and then ask for the refund. It all happens within a day or two of the purchase.

I would imagine these serial refunders would be much less of a problem in other markets who are not so familiar with Clickbank.

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pappyy3

16 years ago

Originally Posted by danthony

Clickbank has serial refunders, it's just so easy to get a refund from them. They should consider dropping the guarantee down to 30 days. Bet the refund rates would drop over night.

Wrong again

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Alexa Smith Banned 16 years ago

Originally Posted by danthony

Clickbank has serial refunders, it's just so easy to get a refund from them.

Clickbank does "ban" serial refunders (though it seems some can get round it, to some extent, with a different credit-card).

Originally Posted by danthony

They should consider dropping the guarantee down to 30 days. Bet the refund rates would drop over night.

I'll take your bet with pleasure, and give you odds. They'd actually rise.

In general, the number of "guarantee claims" is actually in inverse proportion to the length of the guarantee. Think about it.
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paulie888

16 years ago

I couldn't agree more, typically the majority of refund requests occur within the first 1-2 weeks, so shortening the guarantee to 30 days is really not going to make any material difference.

Paul

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What is an "acceptable" CB refund rate?

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