What Reporting Do You Need for Your Program?
(Right click and choose ‘save as’ or ‘save link as’ to download the audio file: Know Your Numbers: What Reporting Do You Need?)
Cody Bramlett used to own a Kettlebell gym in San Diego, where he helped train people like you who want to get in shape, build strength, increase their self-confidence, and simply feel better. Today he tries to help a lot more people all over the world. That is why he created Science Natural Supplements to help people become pain-free, lose weight and feel great about themselves. He is here to help you. Here to help you make money with Huge and High converting offers, but on a more personal note, he wants to help you succeed. He is all about helping affiliates and business owners just like you make more money, have more success, and help more people.
This is an edited version of the audio interview linked above.
Dee Braun: All right. Hi Cody.
Cody Bramlett: Hey Dee. How are you today?
Dee Braun: Hi, I’m good, thanks. So we’re going to talk today about knowing your numbers, why it’s important, how you do it, what numbers you need to know. Um, you really, it, it can kind of be a rabbit hole really. I mean seriously, um, that you can fall down. But I don’t see any downsides to knowing your numbers.
Cody Bramlett: Yes, definitely. This is a huge topic and especially for my business, I’ve been spending months with accountants. I happen to use Fully Accountable. I liked that from anybody who wants to check them out, trying to really understand my numbers. So, so Dee and I are going to kind of share what each of our businesses had to do so that way we can really help people understand how to know what’s happening in your business day in, day out and also long-term so you can make your affiliates happier and so you can make more money and that she understand what’s happening, not overspend because I know all of us get excited when you get a big deposit from the credit card processor and we should actually know where that money belongs before we get happy and start buying stuff.
Dee Braun: Right? So let’s, let’s start at the beginning. What do we mean by knowing your numbers?
Cody Bramlett: Definitely for me knowing your numbers, meaning it’s basically finding out how much money you make on every sale. And you can break that out into affiliates, break it out into a funnels you can break out to affiliates and funnels. You can break it out based on the front end, the front and the back of the front end with the upsells and downsells. You can even add in like the seven-day AR sequence to that. And then also some people, I know warrior media does this, I know that Dee, your company does this. Everyone starts to know their metrics out for long periods of time, you know, five, 10, 15, 30, 90 days, even six months. And if you’re able to know your numbers as far as possible, you can pay more now to get the customer because you’ll know you’ll make it back later.
Dee Braun: So I typically tell newer people that they need to at least know their numbers well enough at the beginning to cover their asses, right? Don’t do worse than break even on your payouts. And then as you gather more data and you’re able to take that out longer periods of time and, and figure out what you’re making where and all of that, then you can actually front load and lose money on the front end and be perfectly fine. And I’m talking front end initial payout, initial sale and you could actually make all of that back up on your upsells, downsells, and AR series. But don’t start off losing money. Definitely.
Cody Bramlett: And I can kind of speak to that based on my experience because with science natural supplements, we’ve had three main funnels that have kind of been the backbone for our business over the four years we’ve been operating. And so the first one was just my regular turmeric. I sold one, three and six bottles. And then there I had upsells and downsells. And just to kind of give someone an idea, at least in the physical product side, how the best way to calculate it, if there’s a lot more components involved. So you have your initial sales dollars, you have your commission you’re paying out to the (affiliates), which is a cost. If you have any bonuses and prizes and stuff, you have to include that as well. Then you’re also going to have inside your costs, say the cost of goods with the product, the cost of shipping, um, the cost of any returns that come back, and the cost of chargebacks.
Cody Bramlett: It’s the goal, at least for us, when we first started doing this – when we started really digging into the spreadsheets, was to make sure that we didn’t lose money on day one. So if Sherpa or Truegenics or anybody sent an email at the end of the day, I was at breakeven. And so you first need a lot of numbers to know that. So the goal is of course to find someone who’s going to help you test and be able to send good amount of traffic and do a couple hundred sales. And with that, the law of large numbers starts to kind of take effect and you start to see everything just coagulate into a similar number. So it’s really important that you know the profit center and you know all of your individual costs and you’re broken out in a spreadsheet.
Cody Bramlett: My accountants originally just had like, you know, profit and loss and I’m like, no, no, break it out every single column. So that way I can see everything independently because you have to build a note. Every piece of that’s happening because things start to change over time and we can start looking at trends of why things are happening and like why is shipping getting more expensive? Why is cost of goods going up or down? Sales taxes – making sure you have that money kept in your account before you actually pay out to the individual States. And just a side note with sales taxes, if you are selling more than 200 physical products to a state about 27 or 30 of the States, that’s considered nexus. Meaning that you have to pay taxes in that state and report in that state whether you sell anything or not. So anytime in a year you break that 200, that’s the technical rule that’s been kind of in place since last September. So be aware of that.
Dee Braun: Knowing your numbers does, I mean obviously partners want the best payouts that they can get, right? I mean that’s kind of a duh But a good partner understands it’s a partnership, and they want longevity. Like when we make a deal with you, Cody, we don’t want you losing money, because if you lose money and get in trouble, we’re not going to have the opportunity to continue making money, sending your offers, you know? I mean it has to work for both sides.
Cody Bramlett: Exactly. We want to keep, we want to keep it going forever because we all can make money, more money over a longer period of time than just trying to take it all now.
Dee Braun: So don’t get excited because you get a bigger whale on the line or give in to pressure. Cause I’m always going to ask, and Cody can tell you this, can we get a higher payout? Can we get a higher payout? Can we get, you know, that’s my job. But it’s never the intent to back a partner in a corner because we want a higher pay out because that loses us money. And you have to understand that when you’re getting pressure from a partner.
Cody Bramlett: Definitely. And it’s also smart too to really, when you’re working with new offers, to work slowly with partners who are good and they’re good people. You don’t want to be in a place where you’re with someone who is a hard, he’s a hard ass and wants it the way they want it and that’s what it is and they don’t care and they’re going to just go, go, go a hundred miles an hour. Cause there’s plenty of companies out there that do that. And when you have your offer working and converting correctly and it’s doing it like clockwork, great person to work with.
But at the beginning, especially when you’re testing, you really have to work slow and you have to be communicative like Dee is talking. And so many of us on here and on this Facebook group, um, everyone’s that’s been connected here, are willing to do that. You just have to be clear and open and in your 100% right, Dee, I agree with that too. It’s better to say, Hey, please stop than it is to let it catch fire. And then be like, Hey, I know you’ve sent 35 emails to my offer and I can’t pay you. That’s way more damaging to the relationship than it is to say, pause that offer. It’s not working. I’ll get back to you two weeks.
Dee Braun: Definitely. And the big guys do that too. I can’t tell you how many times I’ve had one of the bigger players go, this isn’t backing out. You know, you’ve got to pause it. You know, it could have been kicking ass for us, but it wasn’t backing out for them. And it’s a partnership, right? It’s a partnership. And the other thing is, is if you have a, let’s say that you’ve tested your offer internally and you’ve gotten some decent external partners to test and it’s kicking butt and say, you talk to me or Joel or Tyler or Geary. Okay. And they, one of us agrees to mail for you.
Ask for a limit, an opt in, sale, send, something limit Put a ceiling in place. Cover your ass. For us, we test into everything, so we kind of already have a ceiling in place for our partners, right? We’re never going to get an offer and just blast it to a list of a million people. But most of us in our space don’t do what we do. And there is nothing wrong with going, you know what? I want to make sure this works. So could you please limit this to 10,000 clicks, 5,000 opt ins, 500 sales, or don’t send to a segment bigger than 75,000 or whatever. So don’t be afraid to ask for that stuff. We would rather be asked that up front than have to try to track you down when you get in trouble and you can’t pay us.
Cody Bramlett: Exactly. I know many companies that have failed and gone under because they owed so much money that they had to basically disappear and go bankrupt. So don’t, don’t be that company.
Dee Braun: So knowing your numbers, there’s tons of ’em, right? What are some of the most important metrics?
Cody Bramlett: Well the two, the two big ones are going to be knowing what your average order value is, which means if you get a thousand orders, how much did on average each customer buy? And then also the knowing your average cost of goods and your average profit per order. So if you have (those) basic three sets, you know how much money you’re bringing in, how much money you owe people. And when I say profit, I usually don’t account commissions in there. So then the commissions for me become the CPA for the affiliate. So let’s say I sell $100 of a turmeric. I have $25 in shipping and cost of goods. I have 3% credit card fees. I have, you know, a return rate of 5% and whatever else. Little things might happen there.
So let’s say I’m left with $50, I will tell the affiliate, Hey, I have a $50 profit, how about we do a $45 CPA and test it there. If works great, cool. If your traffic’s awesome and slammin’, I’ll start giving you more. And then it’s always been very important, especially for us when you have physical products and high overhead is to really know those numbers on each individual affiliate who is mailing for you. So I know some CRMs are easy to grab the information from. Some require a little bit of work and spreadsheeting. Some are an absolute pain the butt to get that data from, but you got to find it. You got to go through hours of staring at a spreadsheet until you can get it down because without knowing those numbers, you are just crossing your fingers. And unless you have a unicorn offer that’s just killing it and making tons of money, you’re going to drown.
Dee Braun: Cost of goods. Let’s list off some things that could be considered. Cost of goods.
Cody Bramlett: Definitely. So cost of goods. You’re going to have your product cost and if it’s physical, of course it’s there. If it’s digital, you don’t have one, and that’s the individual units being shipped out. Let’s say there’s a production cost of $400 to make an ebook. I wouldn’t incorporate that in it. That’s just not operational costs. That’s a one-time kind of fee. Then you’re going to have your shipping costs for physical products. You’re going to have your credit card fees and mind you if you are using buy goods, ClickBank, you know, you know your fee is, and taking that, for example it’s a dollar, whatever it is, 5% plus a dollar or whatever the structure is.
Cody Bramlett: If you have your own credit card processing, you have to look at what they charge you after the fact. Because they always say you’re 2.5% plus these little like, you know, interchange fee and they kind of cover their mouth and don’t really tell you what those things are. And every single credit card is different. So a visa is not a visa. There’s a visa from Southwest and a visa from Delta and a visa from Costco and they all have different fee charges. And it’s all based on how you get points when you have your credit cards, so you really have to look at your sales and then do the calculation of what you actually got charged versus what they actually deposited. And that is your actual fee.
Cody Bramlett: So they’ll tell you 2.5%. Oh, I’m getting 2.5%. No you’re not. Most people are paying over 3.5%, especially if you have a physical product, could be more. So just make sure you know that for sure and just also know that it will fluctuate. It’s never consistent. I’ll have months where it’s half percent higher and a half percent lower. So make sure that you are pushing to the higher side. And even if you’re aiming a little high, at least you won’t get bit in the ass. So product, shipping costs, credit card fees, then you have refunds. So if you’re on a network where it’s not your credit card processor, you can automatically assume a 10% refund rate starting. Just boom.
Cody Bramlett: That’s what’s going to be if you’re on ClickBank or buy goods or those things because consumers don’t, they for some reason, they just think a little differently. If you have your own credit card processor and it has your company name on it and your own company’s customer service number, you’re going to have less refund rates significantly. I’ve seen about a 60, 70% reduction in refunds.
Then you’re going to have chargebacks. So chargebacks are a pain too, if you’re with clickbank, buy goods or one of the networks that takes care of you, they’ll manage it all and it should remain lower than 1% because they’re being good and they’re trying to blacklist people who are bad. If you’re using your own CRM and winging it, you know, you’ve gotta make sure to keep it under that percentage rate. Um, under the 1% rate – I don’t want you to get in trouble, but it still is going to be a cost. So I calculate the product, the shipping, the credit card fees, returns and chargebacks all in, and that is your major costs. Then what’s left over is what you can pay your affiliate and the more you pay them, the more traffic you potentially get.
Dee Braun: Okay. So let’s go over the types of payouts real quick. Rev share is where basically they get paid a commission. That is the safest for the partner, for the offer owner, and it puts basically all of the risk on the promoting partner. They get charged for refunds – the whole nine yards. CPA is they get paid a flat fee every time they make a sale. The risk is more on the offer owner because you’re saying, I can afford to pay you $60 on this because I know I’m going to make at least that much, preferably more. CPL is high risk because you’re paying on an opt in or lead. So all of the risk pretty much is on the offer owner and they usually take a little bit longer – it’s more of a gamble. You have to really, really know your numbers to go to a CPL.
Cody Bramlett: Oh yeah. And also with the CPL, sorry to jump in, you really also need to have funding to cover it because, as Dee knows, as I know from conversations with warrior media and a few other affiliates, you have to have money to cover 30, 60, 90 (days), 6 months of loss before you make your profit back.
Dee Braun: Yeah. I mean if your ROAS, if you don’t hit break even until day 45, you’ve got a lot of affiliate payouts to pay out in that 45 days.
Cody Bramlett: Exactly. So really got to know that and, trust me, I’ve tried CPL pages and none of them backed out so far because it is a challenge. So I’ll always take that one very slowly. And um, I, I like to recommend I like the CPA the best, personally. Because for me the rev share and a CPA is the same exact thing when you know your numbers. Because if you calculate your numbers on the large scale, say you have a thousand orders and you know that 60% of it or say $1,000 and you know the $600 of profit, then you have a 60% rev share you can give. Or If it’s $100 per order, a $60, CPA, you can hand out. So technically it’s the same thing.\
I came originally from buygoods giving out, you know, the CPA and then I switched to ClickBank for a little while and I had to do math. But guess what? At the end of the day when I looked at all the affiliates and the average commission they got per customer, it was within like a buck fifty so it was almost identical,. Being able to really know your numbers will allow you to know both of that because otherwise if you have a funnel of five different products, you have a different COG for each product because you might have three bottles in one, three bottles of supplements in the first one, you might have a stretching strap in a separate separate offer. So you’re going to have to make these rev share things different for every single product or you know your numbers largely – on a large scale – and you can just do a uniform rev share across the board. And the more simple you make it for the affiliate, the happier and the more likely they are (to promote).
Dee Braun: There you go. I can tell you why it is so attractive to affiliates – for you program owners or you offer owners. For us Sherpa, we test into everything. We have a testing process that lasts four to six weeks, and we test everything you can imagine. And if we have to wait 30 to 45 days to see what our refunds are going to be, to see what the final sales numbers are going to be, we’d never get anything fully tested.
Because, the results of test one determines what we do in test two and on down the daisy chain. CPA is clean. We know almost immediately what our PPM is (our profit per thousand). And we know if it is a winner or if it has potential, or if we need to just walk away from it and go, man, that’s a flop. It is so much cleaner. Refunds are built into your CPA rate. So what we make is what we make. The only direction it goes after day one is up. And we usually track CPA for five days and that’s what we calculate our PPM on. And there may be stragglers sales after that, but the bulk of them will come in in the first five days.
Cody Bramlett: Yeah, you’ll get the 80-90% for sure in that time period.
Dee Braun: So that tells us our PPM. You know, so Cody Skypes me and says, Hey, what was your PPM on the thyroid send? I could go and look. And he knows, I mean he knows it’s going to change a little bit, but it’s pretty spot on. We have a good idea. Did that work?
Cody Bramlett: Definitely. Law of large numbers. I love that concept. The more information you put in, the more accurate it is and the more consistent it is over time. It’s quite fun. My team, we’re doing a lot of database stuff right now, trying to put everything in from all our different sources so we can have even more data and crunch it so we can see things even clearer. It’s quite, it’s quite fun I think.
Dee Braun: So how do continuity programs, auto ships fit into this?
Cody Bramlett: So you know, the industry, at least from what I’ve seen, it’s, there’s two ways of doing it. One you can say, Hey, I’m going to give you 50% every time it ships forever. And with that, it starts to play this dicey game of cookies and things lasting and the affiliate id not sticking forever. I like the idea of really trying to be able to know your numbers a little better so you could have more plugged into your CPA. So let’s say on day one, you know, you made 20 bucks, and then in month two, you made 60 bucks, in month three you made 60 bucks, and in month four they tend to drop off. You can now look at that. You make $140 across 90 days. With that, you can pay that higher CPA, which is what I prefer to do for affiliates. And I know a lot of affiliates prefer to see. But that’s just the method I like. You could definitely just try and just, you know, know your ROI for as long as possible, But making sure you know what it is is the key.
Dee Braun: So how far out do you think you should track ROI or we say return on ad spend, ROAS, for a CPA. What’s the minimum that you think you should track that? And we include upsells, downsells in that, right? The initial sale, and upsells and downsells. I don’t think in what I look at we include AR sales because that kind of is just our money.
Cody Bramlett: Exactly. And personally when you start, I think you should just look at that whole funnel, front end, upsells, downsells. So they get to the thank you page and that should be your snapshot. And if you want to break even there and money on the AR and those seven, 10 days, whatever your AR sequence is, that can be your profit center for collecting that customer at the first time they buy your product. I like to think of it more that way personally. But like you said earlier, you know, if you have a CPL or if you have a continuity product, you can start stretching out as far as possible. But you just got to know your data ahead of time. So I like the idea of kind of breaking even on the same day cause I want to know that if the internet crashed tomorrow, that when I got my deposit the next day I could pay everybody that I need to and not have to stress about owing people money.
Dee Braun: Right. That’s a good point. We track ROAS out 180 days. We have immediate, five day, 10 day, 20 day, 30, 60, 90, 180 is what we track. And this is huge. So tracking it over everybody may give you a bird’s eye view, but it will not cover your ass. You have to know per partner.
Cody Bramlett: Definitely. And, you’re putting fire under my ass now, Dee because I’m definitely not per partner that far out. So that’s my new metric to add to our thing we’re going to be working on with our new database.
Dee Braun: I mean, I’m sitting here looking at it and there’s people that you would expect would have really solid traffic and it’s abysmal. But they’re just so far apart on the ends of the spectrum that you can be making all this money on one end and losing your ass on the other. So the way we do it is we track per partner but we also track total at the same time.
Cody Bramlett: Exactly. And especially also knowing per funnel as well, because certain funnels will work better with certain people. Like our thyroid offer does really great with about four or five partners. Our turmeric offer does really great with about 20, 30 different partners and then everyone else lives in between. It’s kind of getting mixed results from both of them – good enough to keep sending, but you know, knowing that information from each of the particular partners, each funnel you have, is key as well. It’s not just all cramming in there. Now, could you be technically leverage it on large scale and know that funnel B is paying for funnel A just so you can collect more customers? You could. Probably not the wisest thing to do, but you definitely could do that if your whole goal is just to collect more quality and qualified emails.
Cody Bramlett: Collect money from every piece you can and add it back in from the beginning so you can know how much your traffic’s worth, how much you can pay out, so you can keep getting more customers. Because everything doesn’t last. My turmeric offer. I’ve had to modify it three times and we’re going through another modification right now to keep it alive so we can continue to pay out the same if not more for every affiliate, because customers get bored. Things change, markets change, likes and interests chang, competition changes. Like right now for example, the supplement industry is getting overwhelmed with people. I’ve had meetings with my manufacturers this last weekend because they’ve all been in town at a conference, and they’re being inundated by people trying to start supplement lines. So it’s all over the place because it’s, it seems like easy money, which is going to affect the market and make it harder for everyone to compete. So if you know your numbers better, you’re going to be one of the stronger ones who’ll be able to compete longer and pay out more and continue to continue to grow.
Dee Braun: Definitely. Definitely. What else? What are we forgetting? Oh, if anybody wants a sheet, I have, I took our reports are all we use power BI. I mean there’s all different platforms, but I had our analyst who’s just like a fricking Whizkid genius. Make me an Excel sheet with all the formulas for all the ROAS and everything so it can be modified for CPL versus CPA, whatever. So if anybody wants it, just ask.
Cody Bramlett: Yes please guys take it. Don’t, don’t say no, I’m making Dee send it to me right now cause I wanna see what she does too. Yeah, so really just know your numbers. It’s probably what my competence is in my business and my ability to scale over the years and stay alive has been knowing my numbers, and obsessing over them and then hiring people who can understand them better and break them down more. A fun thing we just did recently was to find out by email domain the lifetime value and how much they reorder so that we actually know now that Gmail is absolutely the best, you could have guessed that in the first place, but there were a few surprise there too. So we can actually tailor specific types of offers to customers because you know your data, more. For example, for some reason for us, Comcast customers like to buy more expensive packs, that’s what we were able to (find out from) this. So yeah, so you change your strategies in what you promote, what you share, and what you make. So the more data you can collect, the more you can know about where your money comes from, where your costs are going and which cut type of customers are paying you, from which affiliate too, the longer you can last. And everyone I know that’s killing it right now is people that know their numbers. So find out how to know your numbers, talk to accountants, bookkeepers ask me, ask Dee.
Dee Braun: We’re hopefully going to do another article on this. I’m not sure who, but I think that two of your first hires, and it can be contractors, so I’m not talking even about employees. Okay. But you can’t truly get your offer off the ground, much less scale it. If you don’t know your numbers, invest in an analytics Whizkid. Tell him what you need, give them the access to the data and cut him loose (to do his/her thing) because that will propel damn near every decision you make from that point forward. And that person is more important than hiring a frickin’ JV manager.
Cody Bramlett: Yeah, I would agree a hundred times over because you as the owner at the beginning you can be your JV Manager, you should be repping your product, you should be doing that – 100 percent.
Dee Braun: And the other one I think that is just as important is a list manager. And a list manager that knows IP and domain reputation, canned spam rules, deliverability. I mean those two people should become, should come before any of your front-facing marketing people in my opinion.
Cody Bramlett: 100%. We got caught not watching our open rate recently and now we’re up to like almost 40% open rate. So we made the mistake of not expanding out our reach on the sends to, you know, people haven’t opened or clicked in 30, 60, 90 days reaching out. So we’ve left a lot of people off of emails who should’ve been receiving most recently because we weren’t paying attention to that. So you’ve got to make sure that there’s systems in place to look for those things. And you have someone – one person who is responsible, right?
Dee Braun: That is their job. Your healthy email list is their only concern. You know, your numbers and whether you’re losing your butt or making money is your analyst’s only concern. And those, I tell you, those two people come before all of the other bells and whistles, in my opinion.
Cody Bramlett: I would agree. Love it. And for those, I like Fully Accountable. I’m not getting paid by them. I just am happy with their service so far. They tend to know internet marketing a lot. Really be leery about the people you work with because internet marketing is a different beast. So if someone does bookkeeping and numbers for a restaurant, they’re not gonna, unless they’re really good, they’re not going to be able to relate and likely change their brain.
Dee Braun: So ask somebody you trust in the space for what you need in the space.
Dee Braun: So what did we miss, Cody?
Cody Bramlett: I think that’s it. I mean to really recap, it’s starting out knowing your sales dollars, knowing your costs and how much profit out of that you can pay to the affiliates. That’s step one. Step two I think is learning, breaking it out per funnel and affiliate. And then starting to know your ROAS longer and longer and longer out so you can potentially pay out more and more and more, or know who to befriend more and more and more because they’re your main breadwinner in terms of giving you a solid traffic.
Dee Braun: Awesome. And do you want me to send you the sheet?
Cody Bramlett: Oh, please.
Dee Braun: Okay.
Cody Bramlett: Very cool. And everyone who is listening. I’m always available. You can email me at firstname.lastname@example.org.
Dee Braun: Yeah, don’t be scared. He’s really awesome. And he’s got really cute dogs and loves to talk about the dogs. That’s for sure. All right. Cody, well,. awesome. Thank you so much.
Cody Bramlett: Thank you, Dee. It’s always fun.
Dee Braun: All right. Talk soon.
(right click and choose ‘save as’)
Includes the following files:
- Knowing Your Numbers (read this first)
- Affiliate KPI Dashboard Template
- CPL-CPA Report Formulas
- Email Reporting Template
- External Offer Order Import Instruction Email to Affiliates
- External Offer Order Import Template
- Master Partner Contact Sheet