Clickbank Allows You to Sell Physical Products
The other day I was on Clickbank requesting a price increase for my account. (So I can charge more for products.) Guess what? I discovered how you can sell physical products with Clickbank!
As you might know, Clickbank is a payment processor that you can use to handle payments. As far as I am concerned, PayPal is #1 and Clickbank #2. With PayPal you get paid instantly, but with Clickbank, you have access to 100,000+ affiliates to promote your stuff.
Clickbank handles all the affiliate payments and everything, and heck -- they even added support for recurring billing this year (membership sites) and an IPN so you can integrate it with a script.
The only problem? Clickbank only wants you to sell digital products. This is because they have a pretty buyer-centric refund policy and don't want to be like PayPal where it is a big issue to get the physical product back.
So with Clickbank you can have a membership site with affiliates, but no physical product delivery -- like Jim Edwards did with The Net Reporter. ($77 per month and in addition to access to the membership site, he mailed you a physical DVD video every month.)
Here's the loophole for selling physical products with Clickbank... I noticed the following in Clickbank's terms of service:
You may also offer shipped delivery of printed media (books, CD's, and DVD's) as a courtesy to qualified customers (e.g., US and Canada only), provided the shipped media is clearly complementary and not essential to the operation of the originally downloaded digital product.
After having a Clickbank account for 6 years, I never noticed that. What you have to do is provide your members with a hybrid delivery. (Coined by John Reese.) When someone buys this physical product from you, provide 100% of the content in downloadable form -- for instant gratification -- then ship the physical materials as bonuses, for added value.
That's what you should be doing with physical products in the first place and that's what I recommended to Steven Schwartzman when he was disappointed about the Five Minute Articles WSO. Sales picked up after he added the hybrid product delivery.
I am really resisting the push into physical products. I am looking at a gigantic map of how my upsells connect to one another (drawn in Visio). There are about 60 products in that map... not all of them are connected.
I showed that map to Steven Schwartzman and this is what he had to say:
In regards to the image...WOW!!!!!!!!!!!!
I have nothing else to say about that except wow. It's amazing to see how many products you have when it's displayed like that. You can create a course on making those maps.
I recently recorded 4.5 hours of Camtasia PowerPoints for Software Secrets Exposed. This means now, not only do I offer the book, I also offer six 45 minute videos and six audio CDs.
The audio CDs are just the audio from the videos but it means you can burn them and listen to them in your car or whatever.
Should I have released this as a physical product?
- Maybe set the price low at $17 just for the PDF.
- They click to order, and have the chance to get just the audios at $37.
- They click to order, and have the chance to get the audios plus the videos for $47.
- They click to order, and have the chance to get the package for $97 as a set of 3 DVDs plus 6 audio CDs mailed to them.
There are some really good fulfillment services like SwiftCD where all the shipping info is grabbed from PayPal, but yet another drawback is getting my customers on my follow-up list as well for updates.
Could you please comment below and let me know if I should have released this update as a physical product? Have you yourself released a physical product?
Is it even worth the hassle dealing with the shipping problems and refunds... especially since with Clickbank, you can't get those physical items back?
Filed in: Clickbank • Product Creation
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Sites That Link to this Post
- Why doesn't Eben Pagan sell the DYD ebook on Clickbank? | November 12, 2008
- Physical Product on ClickBank | May 13, 2009
I was thinking the other day about using the physical package as justification for charging a higher price on the digital product. How about charging $77 for the digital product, but offering the phsical product for only $20 more? Would potential buyers see a greater value in the digital because of the narrow price difference, and would your conversions increase as a result? How many would then not think twice about paying $97?
How about offering them the $97 option first (offer higher first)… to receive the “in the mail” version… but they can receive the downloadable version for whatever price you decide, that is obviously lower.
This way you are starting high — then offering a lower cost option.
Andrew
As always Robert you have uncovered something of value. This has me thinking of how I can use the hybrid delivery to increase my sales.
Thanks
J.R.
I noticed that in their TOS when i went through and set up my first membership site with Clickbank.
I never did anything with it…it’s cool that your sharing that info.
Late!
–corey lewis
http://easytechvideos.com
Hi Robert,
Before I saw your blog I thought you were a much older bloke – some people just seem to have old names y’know? You still look slightly dodgy but that’s no bad thing in a marketer 🙂
Anyway I just bought your exit pop up generator for a new project I’m working on and of course got shoved into your mailing list.
99% of the time this happens I just unsubscribe with a slightly sour taste in my mouth.
I have to say however that I’m thoroughly enjoying your blogs and emails, and I’ll add sneakily, watching some of your marketing methods. Really interesting stuff.
Cheers
Tony Shepherd
PS About time with Clickbank eh? Must say that since they went over to direct payment they’ve shot to the top of my list of payment processors but this is really good news.
PPS Your software wasn’t bad either!
Actually, no company can keep you from shipping a physical product when a digital product is requested and delivered.
Although on my website I say absolutely nothing about physical delivery, its part of the “Over Deliver” philosophy That I use to get more that happy customers.
If I were to tell people that they were also going to get CD’s to their US / Canada address, and the CD’s were “late” or Weren’t packaged “Pretty”, Not only would they not get the surprise of the Cd’s to their address but it would create a customer service head ache of having to deliver on a schedule.
If I don’t make it to the post office for a couple of weeks, they are still pleasantly surprised when the CD’s arrive.
My Purpose of physical delivery isn’t about fulfilling the promise, its about creating a feeling that lasts long after the sale.
(I also include some additional goodies that may or not be related to the product)
Mark Riddle
PS How many of your customers would be telling their friend about your product if they only got what was promised VS giving them more than they imagined?
I think the option for selling physical goods was more open before and it is until recently that they kind of hid it in the TOS.
Kunaki and others are great for this type of products, and as long as they have an API (kunaki does) it should be pretty simple to send them the CD or DVD.
I also think it IS worth the trouble because the fact that the person has a physical product in his hands will make him less prone to ask for a refund without feeling guilty.
my 2 cents.
Richard
Robert, as usual some great info. I had thought about delivering a cd/dvd to my clients for some time, but was worried about ClickBank’s response. This makes it easy. I don’t see any reason to charge more for the hard copy as it will guarantee that I get the real name and address of my buyers.
Keep up the great work.
Mr Idea
Mark… I hadn’t even thought about that. That’s why I was so impressed with Jim Edward’s membership site — I hadn’t even seen where he advertised the free DVDs in the mail every month and I was already happy with paying $77 for all the content he delivered online.
You just found the solution to membership attrition.
Since I don’t have a website, and am not involved in clickbank, I don’t have a lot of insight on how it works. So, the only comments I can offer would deal with your own products, Robert. I bought into your Software Secrets Exposed, and am really enjoying the video series you have ongoing. Only problem is in that I can’t download them and store them for my own use privately. As long as you leave the links live, I can watch them, but I can’t own them! All the other products I got from you have the videos included. These, although given freely, are not something that I can be sure of having tomorrow, because if something happens to you or your site, they are gone. That would be a real pity, IMHO.
Gene
Hi Robert. Thanks for the info. on Clickbank. I liked your old photo better. You look wary/unfriendly (eyebrows furrowed and you’re not truly smiling) in the latest header graphic. I say bring back the old photo!
Hey Robert,
This is really a high quality article.
I also intend to offer to my future worldwide customers
a secondary option on my website if they want to gain a
content of my product in the form of the delivery on CD
or DVD.
I don’t announce though anything about the physical
delivery on my site. However, as soon as they see
inside the download section that there’s a way how to
get the product items even to their door without any
next costs, then it just vitally betters your customer
support and build a huge trust in your products.
Your customer begins to feel being safe with you. Then
he can decide to order from you even other products if
you did provide him such a brilliant service.
So this has a BIG impact on my online business as I
almost have zero refund rate! AND this is something
when my customers feel to be overdelivered if I don’t
charge anything to them.
This is a very good way how to drastically reduce
refunds and increase the customer’s satisfaction.
A physical delivery is really something like an extra
bonus when customer feels having problems with his
downloading or extracting the purchased items.
Remember, a 100% quality customer support should be
an essential part of your internet marketing business.
Anyway, thanks so much for the great sharing Robert!
Best Wishes,
Marek Brezina, CEO
http://www.AmazingHeadersBox.com
A Successful Interet Marketer from Czech Republic 🙂
I agree with Andrew I would offer download as a cheaper alternative to CDs. Personally with current average broadband speeds I do not want to wait for physical media (if it is the only option I do not buy). However with us small product producers, you do have to build creditability and offering something real and physical rather then just a few bits through the ether helps this. It is also an opportunity to give a mailing address and phone number (again I use Skype in). It all adds to your credibility. However I would price the physical media such that few people would force me to bother with it.
The attached site is for a holiday apartment. That contains a full brochure as people want something physical they can show others in the party. It builds credibility, you don’t want risk to driving 800 miles to the South of France to find it does not exist or is a hovel.
Bern
Robert,
I’d definitely try to sell the physical product — if only to know whether you’re leaving money on the table or not.
You’d hate to try this in a year or two, see a big jump in profits, and then think about all the sales you didn’t make by waiting so long to try it.
Depending on the level of marketing you’re doing, you may be able to do a short-term test using a production-on-demand company… and if it works, sign up with disk.com or a large fulfillment house.
-William Clements
Clickbank has had this “loophole” for a couple of years now, but I’ve seen hardly anyone take advantage of it.
Robert,
Firstly, how do you get your customers physical address if you are selling through Clickbank. Clickbank doesn’t give you all those details do they?
I think there are only two ways to do this effectively and the only way to find out which works best would be to test each one for a few weeks and see which comes out on top.
1. Start with the physical version and downsell to the downloadable version
OR
2. Offer only the downloadable version but then send them the physical product to cut your refund rate and increase customer satisfaction. Using this method though with Clickbank would be impossible because you need to get the customers shipping address somehow without them knowing.
Any ideas?
Here’s an idea I reckon would work GANGBUSTERS!
1. Sell customers JUST your digital product.
2. Let your customer download the digital version as per normal.
3. Without your customer knowing, send them a physical version of your product, as well as some relevant and unannounced bonuses of high value.
4. On the insert of the CD/DVD, instead of just having all the same old boring ‘this is what’s on the cd’ waste of space crap, advertise your affiliate program and tell your customer they can earn X amount of dollars just by telling their friends about this great product.
5. Customer is so happy and grateful for receiving this unannounced CD/DVD, they think you are god and want to tell everyone they know about it. The fact that they now know they can earn money doing so will really get things going. You are sticking your affiliate program right infront of them at the peak of their satisfaction.
Viral marketing at it’s best.
So with this in mind, how can we get their mailing address?
I know this is a late question and I appreciate anyone’s imput. My question is … what happens if the customer ask for the refund and get it after you’ve mailed the physical product?
@ Jeffrey,
There isn’t too much you can do about refunds if you are going to offer them. Obviously you could ask them to send the physical product back in order to get the refund – this would deter most people from taking the refund option because they then have to re-package it up and pay the postage back to you.
However if done properly, your physical products should have a much lower refund rate than that of your digital products, just because it takes more effort on their part to send the physical product back.
My advice to you is to just accept that refunds are a part of any business, however good or bad your products may be. There will always be someone who wants to get something for nothing and will ask for a refund.
As long as you provide a good product then the amount of refunds you get will be minimal and the profit made will far exceed any costs lost with refunds.
Just my thoughts.
All the best,
Will
Hello everyone,
I am in the process of setting up my first info product in clickbank.
I have come across this article because it is exactly the issue I am having with setting up my information product to be sold along with a physical product.
To me it comes down to a numbers game.
The information product is made to be sold with a physical instrument. I cannot pay out the affiliates a percentage of the selling price for the physical instrument, as I would lose money on the deal. Here is an example of what I mean:
Costs for physical products:
Physical Instrument Cost:$21.00
Cost to print CDs, DVDs, and manuals: ~$15
Total costs are about $36. Before shipping.
I sell this package for $138.00 (including the info product)
Okay, now for the issue.
Clickbank makes you keep a constant sales percentage for all of your products. I would like to maximize this percentage in order to attract the most affiliates.
The max percentage is 75%.
Now, lets do the math.
Final selling price of $138.00 sent by an affiliate making 75% commission give the affiliate a take of $103.50.
Wow… That leaves me with $34.50.
The cost to produce those items before shipping is about $36. I lose out completely.
Great for the affiliate!
Any ideas?!?
Here is a solution that I have come up with in order to make it more fair for everyone.
Sell only the info product through clickbank, and then on the thank you page offer them the instrument and any other associated physical products.
This is not the optimal set-up, I would rather sell the entire package with all the options and assign various commission percentages to each package.
Long-story, but I am hoping that this will help me to find a new result. Thanks,
-presto
Good news for everybody. Clickbank are going to be accepting physical goods for sale. Here is the email I received from Clickbank:
Hello,
Thank you for contacting ClickBank.
Currently, ClickBank does not handle the sale of physical items; we handle transactions for digitally deliverable (downloadable) products only. However, ClickBank is planning on being able to sell physical products in the Fall of this year.
There are a few ClickBank clients participating in a beta test for physical products. However, we are no longer accepting participants.
Please let me know if I can assist you further.
Shelly
Senior Account Representative
srs@clickbank.com
Presto,
FYI – Yes, you can only set one affiliate percentage per Clickbank account. So if you wanted to offer a different product with a different percentage then all you need to do is get another Clickbank account.
Also, I’m not sure why in your example above, you are saying you would pay your affiliates 75% of the sale? If it’s a small ticket item ($17-$67) then you would want to offer something high like that so affiliates have some money to advertise with, etc, however if you are selling a higher ticket item like yours, something like 40-50% would be fine.
From all the information you have given above, here is how I would set it up for maximum profit. Sell a digital version of your product for around $27-$37. Offer affiliates around 75% of each sale.
Once a person has purchased and you send them to the members area to download, present them with a one time offer of the physical version of the course including the instrument. If they say no thanks then offer them the physical version without the instrument for a little cheaper. If they say no thanks again then take them straight to their download and maybe follow up with them with the physical version again in a week or 2 – after they have had a time to read the digital version.
Your main objective should be to get people through the door and into your sales funnel. People are a lot more likely to take a chance when it is only $27 compared to $138. Anyone who is going to pay $138 for your physical course is definitely going to pay $27-$37 for your digital version. So let them do this first, they can see your whole payment process is secure and that they got exactly what you told them they would. Now that you have gained a bit if trust you can stick your more expensive item infront of their face.
Obviously you won’t be able to use Clickbank just yet to sell the physical version. I would just set that up with someone like Paypal or 2checkout.com.
Thanks Will,
That is excellent advise! I believe I will give that set-up a shot and see how it works out.
-Presto
Presto,
I think it is one of the better ways to do it. I have a similar type of launch coming up and that is the way I am setting it up using Clickbank. You definitely want to use Clickbank for your front end if you can because of the affiliate opportunities it opens up for you.
This similar type of model is the one I have also noticed Ryan Deiss using for a few of his products. If you’re not familiar with Ryan Deiss he is a fanatical split tester, so if he using one type of model then you can be sure he has tested other setups and that this one has resulted in the most overall profit for him.
I am actually a member of Ryans ‘Total Access Club’ and inside they did a video series on this exact thing. They walked through and showed us all the results from the split testing of their order processes. They tested different price points for the front end offer, $27, $47 and $97. After some decent traffic they found out that having the front end offer priced at just $27 actually resulted in the biggest overall profit – front end and back end sales included.
My theory is that when someone comes in your door at such a low price point as $27, not only are they more likely to join your sales funnel because its priced so low, but when they are then presented with the one time offers, they are more likely to buy because they have only spent $27 on the initial product – so they feel like they have more money to burn.
If you wanted to, you could signup for one of his products over at:
http://www.getmoneyfromgoogle.com. The front end product only costs $27 I think so you could buy it just to see how his whole upsell process works – it’s also not a bad course as well.
They don’t use Clickbank for their front end product but for guys like us just starting out, it is a much simpler process if we use Clickbank. People like Ryan have an advantage in that they already have big name people ready to promote their products so they don’t need to rely on places like Clickbank to find new affiliates.
Hope it all goes well.
Will
Hi
What would happen if I wanted to use both clickbank and paypal on the same page.
I would order the down loadable version through clickbank and then as they scroll down a bit they are offered the physical product and when they download that the buttons are paypal.
I can then give affiliates their cut on my own.
I actually have priced my product $97 plus and extra $60 PLUS shipping so I dont expect hardly any physical product orders.
Also would there be a way to tell affiliates that they only get a % of the profit as I myself would have to pay about $35 for the product
Thanks
Faige
Thanks for letting me know this… I will contact clickbank to see if what I have in mind can be done with physical products.
Just to update you all on this, Clickbank are currently planning on opening up the sale of physical goods later this year. They have been testing and refining the process of selling physical goods through Clickbank with some companies such as jamorama.com for some time now and expect to roll it out late this year or early next year.
While it will mean we will be able to now sell physical products through Clickbank, I have a sneaky suspicion that only select vendors will be able to use this feature (probably those that have made over a certain dollar value of sales through Clickbank already).
What a brilliant idea. I wasn’t aware that CB was supporting physical products.
Thanks for the post mate!