ClickBank is now living the last moments of glory. I have been keeping a very close eye on this market in the last year and it is now definitelly going trough its final stage.

But , let’s start this a little back :

What is the ClickBank Business?

ClickBank was founded in 1998 by US company Keynetics Inc, a Delaware corporation with headquarters in Boise, Idaho.During the years it became the world’s largest marketplace for digital products mainly ebooks and software often categorized as “rogue”. With promissing comissions and simplicity it has drawn large amounts of affiliates who promote all these.

ClickBank Startup

ClickBank started by promoting ebooks freely available online sold by fake publishers thought to be members of ClickBank staff. Those products have evolved in time and the so called “publishers” have developed full-featured backends called “members area”s inteded to serve the common buyer an overpriced product or service in a visual-appealing and less intuitive way. By exploiting a concept of simplicity , the buyer actually gets confused and eventually gives up . A clever move I could say. The average buyer will not notice the thinness of the product he has purchased , but willingly will cease to use the service as he will see it too hard to use. In my opinion this has helped ClickBank ( who has eventually turned into a payment processor for Visa and Mastercard credit and debit cards) to dramatically reduce refund requests.

The hiden ClickBank

As I mentioned , ClickBank staff have been busy developing “professional” products . Unlike the common publisher with little or no web experience , ClickBank staff have been hiring freelancers to develop profesional looking “pitch” pages which can easily convince the average web surfer to purchase the product. Eventually , they have gathered those products and started promoting them among affiliates as products with extremely high conversion rates and high commissions : up to 75%.

An example of such a publisher is PlatinumPartner who has been often rumored about to be owned by ClickBank itself.

ClickBank unethical practices

ClickBank has proven during his existence that some practices (even the ones who are at the edge of legal concepts) tend to maximize profit. They are often thought to steal and improve pitch pages of high converting products then kick out the publisher who had the rights over the product . The next logical step is to get their hands on the affiliates which is not very hard considering they are the owners of the network.

See some examples of such behavior here or here .

As a payment processor ClickBank staff have been ignoring any refund requests and fulfilling only the ones who ended up as bank chargebacks or court issues.

Practices intended to increase revenue

Over the years , all publishers have tried their best to increase the conversion rate. Among those would count the Virtual Sales Person , the Virtual Actor , the use of the Dutch price model ( x.99 like prices ) , value added options to the basic subscription model , or the “PayBox” systems - .NET frameworks intended to ease cashflow and user data collection for easier lead management.

Development and hosting of such schemes have turned out to be profitable business such as the Virtual Sales Person owned by Intellichat or the Virtual Actor (spokesperson) owned by ISpeakVideo

ClickBank Anonimity

ClickBank staff have always responded in a very evasive manner , never disclosing any personal identity. Some of the most common names used are Melissa ( mam@ClickBank.com ) , Sheri ( std@ClickBank.com ) , Shannon ( cs3@ClickBank.com )

ClickBank Successful Products

In the past months , two of the most successful products sold were the “Sattelite Television on PC” and the “High Quality Movie Downloads” Users craving for multimedia entertainment have always been the best purchasers , so what better niche to target then the typical “free movies” websites

ClickBank Failure reasons

ClickBank will fail. Major decrease in sales during the past months , dramatical falls from Alexa top 100 of “high converting” websites , the desperate try of some publishers of selling something new ( i remember receiving a spam from an affiliate who as trying to sell me Google Earth for ~$30) proves it.

Now the main question is why.

First , I think is the world economy. US people , tend to be more careful about what they spend their money on these days.

Another good reason would be the userbase. Any niche has a limited amount of people targeted . After a time , this userbase wears out , leaving few or no potential customers as the penetration rate of new broadband connections among financially potent customers is far lower then the rate the userbase wears out.

Well , and last , but not least : they have all learned the trick . The virtual sales person ? Virtual Actor? these are clear signs of something “rogue” . Members Area is another typical sign of something wrong.

Think of anything else? I can’t at the moment , but I am waiting for some shared opinion regarding this!