The Growth Booth

Affiliate Insights From A Company That’s Paid $5.5 BILLION In Commissions | The Growth Booth #49

December 13, 2022 Season 1 Episode 49
The Growth Booth
Affiliate Insights From A Company That’s Paid $5.5 BILLION In Commissions | The Growth Booth #49
Show Notes Transcript

Is Affiliate Marketing dying or growing? Find out about the state of the industry, and whether it’s a contender to be a top business model in 2023…   

Welcome to the 49th episode of The Growth Booth Podcast, a show focused on supporting budding entrepreneurs and established business owners alike, towards achieving lifestyle freedom through building successful online businesses.

In this episode, Aidan talks about one of the biggest affiliate marketing companies, ClickBank, with someone who knows the company inside and out – Dominic Keenan. Learn more about how Aidan’s own business has earned hundreds of thousands from ClickBank, how it works, and how it has paid $5.5 BILLION in commissions over the years.

Whether you're looking for step-by-step strategies to start building an online business, simple game plans to grow your business, or proven lifestyle freedom frameworks, you’re in the right place.

Stay tuned and be sure to join the thousands of listeners already in growth mode!


Timestamps:

00:00 Intro

02:29 Affiliate Marketing in 2023

04:24 What Is Sold On ClickBank?

07:20 How Can You Earn on ClickBank?

09:03 What To Look For On Offers

12:16 Episode Sponsor

12:48 Gravity Score

14:26 How Does ClickBank Pay People?

20:33 Is Affiliate Marketing Saturated?

27:54 Outro


Links and Resources Mentioned:


About Our Host:

Aidan Booth is passionate about lifestyle freedom and has focused on building online businesses to achieve this since 2005. From affiliate marketing to eCommerce, small business marketing to SAAS (software as a service), online education to speaking at seminars, the journey has been a rollercoaster ride with plenty of thrills along the way. Aidan is proud to have helped thousands of entrepreneurs earn their first dollar online, and coached many people to build million-dollar businesses. Aidan and his business partner (Steven Clayton) are the #1 ranked vendors on Clickbank.com, and sell their products in over 100 countries globally, as well as in 20,000+ stores across the USA, to generate 8-figures annually.

Away from the online world, Aidan is a proud Dad of two young kids, an avid investor, a swimming enthusiast, and a nomadic traveler.

 

Let's Connect!

●  Visit the website: https://thegrowthbooth.com/ 

●  Follow us on Facebook: https://www.facebook.com/aidanboothonline 

●  Let's connect on Instagram: https://www.instagram.com/aidanboothonline/ 

●  Subscribe to our YouTube Channel: https://www.youtube.com/c/TheGrowthBooth 


Thanks for tuning in! Please don’t forget to like, share, and subscribe!

Welcome to The Growth Booth, episode number 49, where today we're getting affiliate marketing insights from a company that has paid out over $5 billion in commissions, and this company has been a pretty special part of my journey. It was one of the first places I started making money online, and they've since gone on to pay out different companies that I own over $100 million, so we know them pretty well. And that company is, of course, ClickBank.

 

My friend who is on the call with us today is Dom Keenan, and he is the VP of Sales and Account Management at ClickBank and has been an absolute linchpin. He knows ClickBank inside and out. Undoubtedly my favorite person at ClickBank.

 

Aidan

Dom, suddenly, is an account rep for us seven or eight years ago, and has been an absolute linchpin, as I say, ever since, and quite possibly the longest-serving employee over at ClickBank, although I can't guarantee that. So, Dom, welcome to the call.

 

Dominic Keenan

Thanks for having me, Aidan. I appreciate it. And no, I've been here eight years, but we have one employee who's been here for 22, so I'm not even close.

 

Aidan

Okay. You got a bit of catching up to do there.

 

Dominic Keenan

Yeah, for sure.

 

Aidan

Over the last eight years, we've seen the affiliate marketing landscape change quite a bit. One of the things that I wanted to dive into with you here today is just thinking about the future. 2023 is just around the corner. 2022 is basically in the books at this point. So, what's the state of the industry from your perspective? For someone who gets a pretty unique insight into the sales volume that's happening or the affiliate offers that are out there, what's the state of the industry? I mean, is ClickBank as a marketplace growing?

 

Dominic Keenan

Yeah. ClickBank has been consistently growing for the past five or six years. Growing - nearly doubled the business over that period of time. So the state of the industry, at least from ClickBank's perspective, is very strong. It was interesting during the COVID pandemic, you had a lot of people who were both interested in making money online and found success with it, but you also had people that were at home clicking on ads, reading their emails, all of that. That was a big launchpad for ClickBank in 2020. That growth has continued to stick. We continue to grow beyond that. We see significant uptake in affiliates, both in paid media and email are primarily the traffic channels for ClickBank affiliates. But the interest in getting and building a business online has never been stronger, at least since I've been here.

 

 

 

Aidan

Asking me the question of what happened to my businesses during the pandemic, and overall, they really took off. I mean, there were a couple of instances of e-commerce brands where we were selling some products related to travel, and those ones sort of suffered, but anything related to information online absolutely skyrocketed. So, I can definitely relate to what you're saying there.

 

When I got started with ClickBank, I want to say it was about 2006 when I opened my account, and I opened it back then as a way to sell other people's information products. If I was in the dog training niche, I could sell info products about dog training. But it's so much more than that nowadays. Obviously, people can sell their own products, but physical products are also in their different types of affiliate marketing. Could you talk just a little bit and inform us a little bit about the different ways or the different types of products that are sold on ClickBank nowadays?

 

Dominic Keenan

Yeah, certainly. So ClickBank has really built out a robust presence in the health and fitness space over the past six, or seven years, but that's not exclusively what ClickBank sells. ClickBank was founded in 1998, which is ancient in the internet age, but it started out as a digital product-only platform. It sold digital products exclusively, then later some flat media in the mid-2000s and only in 2015 did I believe ClickBank started selling physical products. So we still have a wide array of both physical and digital products. And like you mentioned, on the digital side, it's a lot of info stuff. So it may be a Keto diet guide, right? One of my favorite products on ClickBank is a product called Ted's Plans. It's been around since 2011, I believe, and it is a guide on, if I remember correctly, about 2000 woodworking projects that you can do at home.

 

And it's unbelievable, the longevity of an offer like that, where really somebody's just uploading what they're already passionate about and what they already know about and selling it to people who don't have his level of skill or knowledge. Really phenomenal business. And so there's a wide array of products that are sold on ClickBank. I think people look at ClickBank’s marketplace and see a lot of health and fitness products at the top, but there is so much more beyond that. There's a broad market appeal for supplements, particularly coming out of the pandemic. People are very health-conscious, but I wouldn't let that deter anybody or think that it's health and fitness only. Like we were just talking about, who would have thought that a woodworking product would do really well for over a decade? I mean, that's a very serious business.

 

Aidan 

What about the commissions? What are the types of commission structures that people can use? I see people offering 50% commission, and some people 30%. Is it always a fixed commission? Is it sometimes a cost-per-action type thing? Can you explain that a little bit?

 

Dominic Keenan

Yeah, good question. So ClickBank was founded as a rep share platform, so basically a percentage of the transaction, and recently introduced CPA about two years ago, so a flat fee per sale or cost per action. And I think that occasionally people tend to focus a little too intently on what the commission percentage is. “That one only pays $50 and this one pays $75, so I'm going to take the 75%,” or likewise with the CPA. One pays $50, one pays $30, but really that's only half of the picture. The other thing to keep in mind is what's the conversion rate. So if that offer that pays a $50 commission converts at half the rate of the one that pays the $30 commission, then you're going to lose money. Even though the committed rate is higher, you're not going to make as much.

 

And I started out here at ClickBank as an affiliate manager, and the frequent question was, “Well, why doesn't it pay $75?” That was pretty common in the info product space back then. And it doesn't pay that much because it doesn't have to. It out-converts. And so that's what I always tell people to pay attention to. Do the pages look like they'll convert to your audience? Does it have a custom order form and run a test on it? Test multiple offers, you're not stuck with one or the other.

 

Aidan

What kind of metrics does ClickBank serve up? Obviously, there's a marketplace, and if you're listening to this, I'm sure I would encourage you to go over to ClickBank, clickbank.com, and you can create an account for yourself within 60 seconds. But once you get inside the ClickBank marketplace and you're trying to choose between one offer and another, obviously we're shown the commission that you stand to make the number of dollars that you're going to make. Are there any other metrics that ClickBank shares with the affiliate who's thinking about or sort of weighing out offer A versus offer B?

 

Dominic Keenan

Yeah. Keep in mind when we talk about the marketplace at ClickBank, it's not where a customer would go, but where the affiliates would go to research the offers that are available. And the two primary metrics that most people use are what ClickBank calls popularity. Popularity is a measurement of sales compared to other offers. So the most popular is going to be the highest performing, and that's on a rolling twelve-week basis. So it may not have been the highest selling yesterday or last week, but we also want to provide a broad set of data so people don't think just because something was a flash in the pan that it was the offer to promote, right? What stability is there?

 

Then the other metric that we also provide, and a lot of people rely on, is a ClickBank metric that's called Gravity Score. ClickBank doesn't publish exactly how it calculates it, but I can give you kind of the 10,000-foot view of what it's looking for. So again, it's calculated over twelve weeks, and it takes into account how many affiliates promoted it and made a sale and how much did they earn from that sale. So it's really hyper-focused on what an affiliate expects to perform from it. So what it's trying to filter out for you is, let's say, something really niche product that converts really well on a hyper-targeted audience. And I'll give you an example. Somebody asked me if they could sell a welder on ClickBank. This is like this really high-end six or $7,000 welder that only professionals would use. I was like, well, sure, I don't know that we have a lot of welding affiliates for you, but let's say we did, and that's in the marketplace, right?

 

And one affiliate who has a phenomenal welding audience is making a bunch of sales with it. The marketplace is still going to rank that low on gravity because it's only one affiliate. So the expectation wouldn't be that any affiliate could come in and pick that up and run with it. But the products with high gravity scores have hundreds, if not thousands, of affiliates. The top ones typically have thousands of affiliates that are promoting them. And we're only taking into account the affiliate traffic that's converting. So if you have a lot of affiliates that are sending traffic and it's not making sales, that doesn't count towards the score, only if it's making sales and paying affiliates commission.

 

Aidan

So gravity is a good way of assessing two offers, one versus the other, and looking at them in a global context if you like. Being able to know without knowing specifics, able to know, “Well, this one is seeming to make a lot of money, or there are a lot of people making a lot of money with this one.” So ultimately, the higher the gravity, the better when you're looking for a hot-selling product. Now, you made a point about welders. This is not specific to affiliate marketing, but when I was getting started with e-commerce, around about 2009, I had niche-specific stores, and one of my stores was a store that sold welders. Now, we didn't sell the $6000, $7,000 type of welder, we sold $1000 welders. And it was pretty interesting. We were working with local suppliers. People would come to the store, they'd search for a welder, and they'd find it. I would then have to contact the manufacturer and get it shipped out. It wasn't as streamlined as it was today. And I'll tell you what, that kind of e-commerce is nowhere near as streamlined as affiliate marketing.

 

So I think affiliate marketing for me has always sort of been like the holy grail of online business because it really does allow you to sell without needing to do any of the fulfillment. And by fulfillment, I don't mean actually shipping a product. I mean actually looking after the customer, which is where a lot more of the heavy workers are. So it really does, you know, tick all the boxes in terms of sort of sitting on the beach and watching your money roll in.

 

Speaking of money rolling, how does ClickBank pay people? So obviously a lot of people are in the United States, but a good portion of our listeners are not in the United States. So how does that work if someone's not in the United States? Is there any sort of differentiation there with regard to getting paid?

 

Dominic Keenan

Yeah, that's a great question. So ClickBank pays people, there are three different options, either every other week, weekly, or twice a week, and ClickBank sends thousands of payments a week, both domestically and outside of the United States. There are still a handful of people that receive physical checks. All payments 20 years ago went out in checks, but nobody really wants a check in the mail because you got to wait for it and go to the bank. So ClickBank usually either provides ACH or direct deposit or wire transfers. And particularly for people that are outside of the US, if they're paying for media or have fixed costs that they're paying in USD, they tend to prefer a wire transfer because that will come through in USD instead of local currency. Obviously, it depends on the exchange rate, but then you're not paying exchange fees.

 

While ClickBank's customer base is for the most part in the big five English-speaking countries, US, Canada, the UK, Australia, and New Zealand, we do have customers all over the world. So there are, I think, about 30 supported currencies. But the user base, the vendors, and affiliates that use ClickBank, are all over the place. I've got a couple of people visiting clients right now in Thailand. We just got back from Tel Aviv. We spent a lot of time in Europe and headed to New Zealand and Singapore the next year.

 

Aidan

What do you have to do to get a visit from ClickBank? Because I'm still waiting for you guys to come down to Argentina or New Zealand. Are we, like, missing something here?

 

Dominic Keenan

You're on the books for New Zealand next year, Aidan.

 

Aidan

Okay, I'll remember that. I'm going to check up on that. This is why you're saying that. I had a look at the app here and on the website. In 190 countries, I guess you've got affiliates in over 190 countries over 20 years, $5.5 billion paid. I've got a funny story about this whole payment thing. So when I got started with ClickBank in 2006, and 2007, I was in New Zealand at the time, and I was getting checks in the mail. I guess I'm not sure if I could get automatic wire transfers into my bank, or maybe the amounts weren't big enough or something back then, but I'll get these checks coming in every single week. And I grew up in and lived in a small town in New Zealand, around about 20,000 people, so everyone knows everyone. And it didn't take long for every single bank employee to know that I was this guy that was coming in with a big stack of checks in the US dollars, which is also strange given that I was in New Zealand.

 

And I never really told them exactly what I did, but I would go in there with literally a stack of checks, and it might be $70, $150 the other, but there'd be, like, ten of them. And I'd have to fill out this form like it was one big long line for each check, putting in dozens of numbers in this. And it would take me, like, half an hour each time I went into the bank to deposit these checks. But it was always funny because as soon as they saw me walk in, they would start murmuring to each other, “Oh, here comes Aidan. He's got a dozen checks. What does that guy actually do?” And eventually, they figured out that I was doing some kind of affiliate marketing, but it was always quite funny.

 

And then it got to the point where one day they said, “The bank policy has changed. You're not going to be able to deposit your checks anymore in a foreign currency.” But by that stage, luckily, I was able to get the direct bank payment straight in from ClickBank. So I always think back to that as one of the fun sorts of unusual things of getting started as an affiliate in a small town in a completely different country to the United States. So I could definitely vouch for the non-US folk. It was always pretty simple for me.

 

Dominic Keenan

I'm sure they were worried about what type of criminal enterprise you might be involved in.

 

Aidan

I have no idea, it’s a small town, it's an innocent folk, and I think they thought I was like willing or dealing drugs or weapons or anything like that. But definitely, by the way, the average bank teller in this particular place, I'm not sure why it's the case, but people who've been working in the bank for 30 or 40 years, so they're sort of remember this is going back maybe like 15 years. So it wasn't as commonplace as all these internet businesses back then. So I think that made it even more sort of unusual. And to this day, they still recognize me when I go into the bank, even though I haven't deposited a check in there for about a decade. Anytime I go in, they're like, “Oh, we haven't seen you for a while.” “Yeah, because I live in Argentina now.” So anyway. I thought that was interesting.

 

Dominic Keenan

You know I have heard numerous stories like this where the banks start getting concerned. And in fact, I've had to write a letter a couple of times to a bank on our letterhead for a client that was very successful, I figured out something on the affiliate side and had to write a letter because the bank ended up freezing the funds and not understanding where it came from and say, “Oh, no, it's legit. You can call me if you want to know more.” And it's always good to help somebody with that. But I always tell them, “Hey, this is the best example of being a victim of your own success.”

 

 

Aidan

Yeah, it's one of those good problems to have, as we like to say. So, as we roll into 2023, how do you see affiliate marketing? Again, you've got a very unique insight into this because you see thousands of transactions, you see hundreds or thousands of affiliates. How do you see the space as a place for a newbie to get started? People are often concerned about saturation, just products becoming tired. How do you see that from your vantage point?

 

 

 

Dominic Keenan

Well, to some extent a valid concern, right? For nothing else, because consumer tastes are always changing. But I would say that the broader affiliate market does a good job of adapting and is very creative. You know that wouldn't concern me, especially for somebody starting out. It's interesting that the cost of media has gone up so much. That is similar to what you did in building niche sites. We use that example of Ted's plans earlier. Right? So I actually ran across Ted's Plans as a customer. I was building a Murphy bed for our house, a fold-up bed. And so I was on YouTube looking for examples of how to build it and all of that. And sure enough, the guy who created a video, I'm pretty sure he created it with his GoPro. It didn't cost him anything. And he edited it down, posted it, had 10,000 or 20,000 views on it, and had his links in the description to both Ted's Plans, which I believe is in Ted's Plans, but also had links to the tools that he used. Right. Because there are affiliate platforms that will “Hey, if you want to use this particular soft, it's available at Home Depot, here's a link. Or it's available on Amazon, here's a link.” So that is a way to be able to bypass the high cost of media. Is that niche quality content that people are looking for?

 

Now, that guy, like I said, 10,000 views in the grand scheme of YouTube isn't a massive video, but the people that stayed and watched that, think of how niche of an audience that is, people, how many people built a Murphy bed? I can tell you it's a real pain in the ass. But the people that are coming to your video on how to build a Murphy bed are pretty interested in what they're doing and going to listen to those recommendations that earned media rather than paid media. I think it's kind of a sexy idea to be a big Facebook media buyer, big native ad media buyer, which a lot of those guys see a lot of success in, but it comes with high cost and risk. The way to mitigate that is to create niche sites or niche content as you mentioned.

 

And then the last thing I would mention is capturing the customer if you can. So on that particular video that I was talking about, “Hey, if you want more, enter your email address here and I'll send you my weekly newsletter.” I've actually been reading his weekly newsletter for two years and I would imagine, I've done a lot of woodwork. It's not super complicated. I would imagine he spends about ten minutes a week drafting it up at this point. But he has an email list, so he owns that customer as well, which is very helpful in being able to monetize that person.

 

Aidan

Right. I think a lot of people that dive into affiliate marketing really miss out on that whole email component. And when I'm asked about mistakes I've made, I could tell you that probably the biggest mistake I made was in the first two years of starting my online business: I wasn't capturing emails. And I think back to the hundreds of thousands of visitors that I had, what that would have sort of snowballed into or compounded into 15, 20 years later. So I think that's absolutely vital.

 

And there really are ways where you can have your cake and eat it too. So you can get a commission straight out of the bat, but you can also get to capture the leads and build a value-adding affiliate side to the business. And that's exactly what we do. In fact, one of the ways that we are doing really well with affiliate marketing right now is actually getting commissions without needing to sell anything at all. So being paid cost per action when someone puts their email in a form or puts their zip code in a form, and oh, by the way, whenever they put that information, we're able to capture it, reuse it, and make huge amounts of profits as a result of that. And I've still got email lists where I was capturing leads from around about 2007, still sending out emails, and still able to make commissions and all kinds of bizarre niches.

 

So I can tell you that when you get into a niche, when you talk their language, when you nurture them, and when you provide good value content that people are interested in, it's like having your own ATM machine almost, where you can send out an email and you're never going to run out of affiliate opportunities. I mean, thinking about the woodworking example, there would be hundreds and hundreds of tools you could sell as an affiliate, like hundreds of books, courses, and so much more.

 

So yeah, I think the opportunity is huge. And I feel like every online business should have an affiliate component. It's just too attractive not to have it. So we've spoken a lot about eCommerce over the past few years. I love e-commerce. It's a big part of our business. But affiliate marketing was there for me even before e-commerce, and it really has sort of stood the test of time. So I think that if you're getting started in 2023 or you're building out your plans for something new in 2023, I would really encourage you to get on the bandwagon. It's fascinating. You've got marketplaces like ClickBank that make it just so simple. And it's something that has proven itself to affiliate marketing to the standard test of time. So for me, it's as exciting, I think, as it's ever been.

 

Dominic Keenan

Yeah, I agree. And going back to something you mentioned there, understanding or talking the language of your niche audience. There's so much out there that's easily accessible. Just to give another really quick example, I know we're short on time, but there's a whole subreddit dedicated to critiquing people's golf swings. And so people post, “I'm a terrible golfer, but I try.” So anyway, I follow the subreddit. People post videos of their golf swings, and then they have like 30 or 40 people in the comments that say, “Oh, you're doing this wrong, you're doing that wrong.”

 

What's interesting is somebody will recommend, “Oh, you should switch to this type of golf club or use a golf club. I recommend this one or this golf ball.” People are so passionate about golf, and there are so many other niches out there that people are super passionate about. We talked about woodworking as well, and it became really apparent what people are interested in. And then you can talk very easily to that hyper-niche audience.

 

Aidan

Yeah. I think also if someone here is thinking about what is a good offer to sell, you can think about your own passions. Passions definitely sell. Dominic was just there talking about golf as one passion, woodworking as another one, but also solving problems. There are a lot of products on the ClickBank marketplace and other affiliate marketplaces as well that solve problems. And I've always had my biggest ones when I focused on either the problems or the passions and provided a solution to either one.

 

So we're going to talk more about affiliate marketing over the weeks ahead. We're pretty excited about how it's heading in 2023 and the opportunities that are there for the taking right now. And as always, you can find out show notes. You can watch the video of this episode at TheGrowthBooth.com. Head over there and navigate to episode number 49.

 

So Dom, thank you so much for taking some time out of your day there today. And I'm going to be expecting a visit from you guys in New Zealand or maybe even Argentina. Now that I know that you do go out and visit some of your clients in Thailand, I'm definitely going to be expecting a visit there. But honestly, thank you for all you've done for our business. As I said, I feel like you really are a linchpin in the ClickBank, at least for us in the ClickBank business there. And great to be able to have you on and pick your brain a little bit about the insights of affiliate marketing.

 

Dominic Keenan

Of course. Thank you for having me. Always good chatting with you.

 

Aidan

All right, guys, that's a wrap for this episode. Head over to TheGrowthBooth.com episode number 49, and you can get show notes, the links, and all the other good stuff that we've mentioned. And I'll see you back here in another week for another episode of The Growth Booth.