While most consumers tightened their real-world purse strings in 2009, but that did not seem to hurt sales of virtual goods. Users of virtual world Second Life spent $567 million buying virtual goods in 2009. 65% year-over-year increase in spending on user-generated virtual items for avatars. It’s marketplace saw virtual goods sales of $6.1 million. The economy is based on the Linden™ dollar (L$), Second Life’s virtual currency. You can buy and sell L$ on the LindeX™ the official virtual currency exchange of Second Life. In 2008 more than USD $100 million worth of L$ were bought and sold on the LindeX. While Facebook gets the media hype, Second Life generates real money – even though it starts as virtual money. Let’s look at the figures.

Second Life: Virtual Economies Continue To Rise

Second Life’s worldwide user base increased by 15% to 769 million, while the amount of time spent in the virtual world climbed even faster, by more than 21%, indicating increased engagement.

In 2009, Piper Jaffray predicted more than $2.2 billion in virtual goods revenues worldwide, including $621 million in the US. By 2013, more than $6 billion will be spent worldwide on virtual items.

It predicted that virtual worlds such as Second Life would fall behind in the virtual-goods economy while social network players like Facebook become more involved in the space.

Second Life Highlights of Q4 2009

• US$153 million in User-to-User Transactions, 53% growth over the same quarter last year
• All-time high and continuing rapid growth for the Xstreet SL online marketplace
• All-time high in Monthly Repeat Logins, at 769,000 in December 2009
• 3.1 billion Voice minutes, up 15% from the same quarter last year

Total user hours continued to trend downward in Q4 while peak concurrency remained flat. This decline stems from a decrease in user hours contributed by heavy usage accounts (300+ hours per months).

Second Life Economy – Financial Highlights

• User-to-User transactions in 2009 totaled US$567 million in 2009, growth of 65% over 2008.
• Virtual currency in circulation reached L$6.95 billion, growth of 23% over December 2008
• US Dollar value of L$ in circulation totaled US$26.5 million in December 2009
• Sales of User Generated virtual items on Xstreet SL, reached L$1.6 billion or US$6.1 million, growth of 74% over 2008
• Total US dollar value of all Linden dollars traded on the LindeX™ currency exchange in 2009 reached US$115 million in value,  7% growth over 2008
• Total US dollar value of all Linden dollars traded on the Xstreet SL™ currency exchange in 2009 reached US$1.5 million in value, 169% growth over 2008

Cary Rosenzweig, CEO of IMVU, another virtual world with extensive user-to-user virtual item offerings, described that service as “more like an e-commerce company … in the sense that we get our money from the purchase of these virtual credits that people use to buy virtual items.

“Virtual goods have value to people,” Mr. Rosenzweig told eMarketer. “People buy virtual goods usually for one of three reasons: to express themselves—so they’re buying virtual goods to make their avatar look terrific—or to build relationships with other people in the form of gifts. And [the] third reason, especially in gaming environments, is that virtual goods enhance your power to effect change, to win, to do what you would like to do in that area.”

Do you buy Virtual Goods?

Have you ever bought any Virtual Goods for your avatar? How much would you pay to bling your avatar or online user experience? What do you think are the main barriers for Second Life? Do people think it’s too weird? Do you use it?

Clickbank’s analytic data is refreshed multiple times per day. You can view the last time your analytics data was updated by checking the Data Last Updated box. This contains the date and time your data was last refreshed.
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1. Daily information for your account is available for 120 days.

2. Hourly data is available for 40 days.

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The ClickBank Analytics tool helps affiliates and customers track the success of their sales and the performance of their digital products. In this article, I’ll show you how to compare specified dates hour by hour.
You can setup marketing campaigns for specific times in a day.

All of the charts we discussed in the previous articles provide information for a whole day.

However, ClickBank can also let you view your information hour by hour.

The hourly charting control is located above the trend chart, as a button; toggle the trend chart between daily and hourly to update it.

The hourly trend chart lets you compare any selected day to another selected day hour by hour.

For example, you can configure it to see your sales for today versus yesterday, or compare different days of the week.

You can use this to determine how your web business is performing during a time period and examine which marketing or business tactics are performing the best.

The ClickBank Analytics tool helps affiliates and customers track the success of their sales and the performance of their digital products. In this article, I’ll show you how to compare stages of the sale.
Clickbank offers a further degree of sophistication in its comparison charting. Comparison charting lets you chart two metrics over the same time period.

For example, say you were viewing Gross Sales by customers in India.

You can gain more insight into customer tends by overlaying the Hops received in that same time period and gain insight into the effectiveness of marketing campaigns targeted at customers in a different country.

To do this:

1. Select a different country.

2. You can have the same insight into any other campaign you are performing at the country level.

3. All of the metrics available in the data table are available in comparison charting. The control for comparison charting is located above the trend chart in a dropdown menu.

Anyone familiar with Google Analytics will understand the user interface very quickly.

In the next article, I’ll show you how to compare the different stages of a sale.

The ClickBank Analytics tool helps affiliates and customers track the success of their sales and the performance of their digital products. In this article, I’ll show you how to explore by attributes of a sale.
When checking the performance of your Clickbank sales, there are many attributes for each sale or prospective sale.

To manage your business with ClickBank, you need to examine the performance (i.e. in terms of sales and click-thrus) of your products or marketing campaigns by many or all of these sale attributes.

The ClickBank analytics tool let’s you explore and view sales trend for these attributes.

These attributes are as follows:

Vendor: The nickname of the vendor whose product has been promoted (available for affiliates only)

Affiliate: The nickname of the affiliate who promoted the product (available for vendors only)

Product: The vendor nickname and product item number promoted

Billing Type: The type of product promoted – Single Sale or Recurring

Customer Country: The customer’s country based on IP Address or the country the customer selected on the Order Form

Customer Province: The name of the province the customer selected on the ClickBank Order Form

Currency: The currency the customer chose to pay in for their purchase

Language: The language assigned to the product sold

Tracking ID:  The tracking code used by affiliates to classify campaigns for HopLinks (affiliates only)

Category: The ClickBank category and sub-category assigned to the promoted vendor (affiliates only)

You can report on these attributes by selecting them from the left-hand navigation menu once you login to your Clickbank account.

You can drill-down into the trends of each item by clicking on the item in the data table.

For example, when viewing Gross Sales By Customer Country, click on the America item in the data table and the trend chart will show Gross Sales by customers located in America.

In the next article, I’ll show you how to compare the different stages of a sale.

The ClickBank Analytics tool helps affiliates and customers track the success of their sales and the performance of their digital products. In this article, I’ll show you how to analyze sales by stages of a sale.
As an affiliate in the ClickBank Marketplace, you probably know that prospects work their way through several stages in the sales process.

For example: a prospect (potential customer) might start by clicking on a Hoplink from an affiliate.

This may result in the customer visiting the vendor’s web page, placing an order, and then moving on to the ClickBank Order Form.

Note: Clickbank refer to this first visit to the order form as an ‘Order Form Impression’.

Once on the Order Form, the customer fills in the required fields and clicks the Pay Now button.

This is the Order Form Submit.

If the submitted order form has no errors, passes fraud detection, and is accepted by the payment processor, it becomes a Sale. Technically, this is a Gross Sales as the customer can refund the product in which case you lose the sale.

After a Sale, the customer can return the product for various reasons. Depending on the action the customer takes, these returns can be processed as a Refund or Chargeback.

Refunds and chargebacks are removed from Gross Sales.

The new ClickBank Analytics tool lets report on and measure success through these stages of the order process.

The stages are as follows:

• Hop: prospective customer clicking on a HopLink
• Order Form Impression: prospective customer visiting the ClickBank Order Form
• Order Form Submit: prospective customer clicking the Pay Now button on the ClickBank Order Form (reporting counts up to one order form submit per customer visit to the order form)
• Gross Sale: A successful customer purchase of a ClickBank product
• Refund: A return of a customer purchase
• Chargeback: return of a customer purchase initiated by the customer contacting their payment processor or their bank
• Net Sale: A customer purchase (Gross Sale) that has not been returned

Additional metrics measure the success of converting a customer from one stage of the process to the next.

These are:

1. Earnings per Hop: Dollars earned for each Hop that a customer clicks. Calculated by dividing Gross Sales Amount by the Hop Count for a specified time period.

2. Hops per Order: The number of Hops it takes to generate a sale. Calculated by dividing the Hop Count by the Gross Sale Count.

3. Hops per Order Form Impression: The number of Hops it takes to get through the vendor pitch page and generate a visit to the ClickBank Order Form.

Calculated by dividing the Hop Count by the Order Form Impression Count for a specified time period.

4. Order Form Sale Conversion: The rate at which a visit to the ClickBank Order Form generates a sale.

Calculated by dividing Gross Sale Count by Order Form Impression Count for a specified time period.

5. Refund Rate: The rate by which customer sales are returned in the form of a refund. The metric is calculated by dividing Refund Count by Gross Sale Count for a specified time period.

Note: Each refund is assigned to the date of the original sale, so the refund rate is an accurate indicator of performance of sales on a given day.

6. Chargeback Rate: The rate by which customer sales are returned in the form of a chargeback.

Calculated by dividing Chargeback Count by Gross Sale Count for a specified time period.

In the next article, I’ll show you how to analyse by attributes of a sale, for example, emerging trends.

The ClickBank Analytics tool helps affiliates and customers track the success of their sales and the performance of their digital products. In this article, I’ll look at FAQs regarding this tool.
Q:  Why does the number of Order Form Submits not match my Gross Sale Count?

A: There are several reasons: (1) the customer didn’t enter all fields correctly (2) the customer’s method of payment was declined.
Q:  Where is the Trend Chart? Has it been hidden?

A: If it disappears, you can always find the trend chart on the Hide Chart link in the upper-right of the page.

Q:  Why is the Gross Sale Count higher than the Order Form Submit Count?

A: Subscription sales have a recurring billing element that initiates a sale without the customer visiting the ClickBank order form at each recurring time-period.
Q:  Why are improper Customer Countries in my reports?

A: In certain instances, a Customer Country is determined by the IP address the customer is using. Each IP address belongs to a country, Satellite Provider, or generic region like Europe or Anonymous. However, most IP addresses are assigned to a country.

Q:  Why does the automated Internet robot impact Hop and Order Form Impression data?

A: ClickBank filters automated visits from its reporting so you get a better picture of real human traffic.

Q:  Why are sales not showing in the Analytics tool?

A: Check the Last Updated Data box on the left-hand side of the reporting page. This shows when information was last loaded into the Analytics tool. The sale may be too recent to be available at this time.

Q:  Why will the trend chart not display the selected time period?

A: Select a time period and then click the Go button in order to change the time period.

Q:  Why do the Original Analytics metrics not match the new Analytics tool?

A: Original Analytics and New Analytics do not collect data on the same schedule and will likely not be in sync with each other as they calculate Hop traffic differently.

Q: Why did Net Sales data change since the last time I ran the report?

A: Net Sales may change because of refunds or chargebacks that were not included in the first report.

Q: Why are sales totals by Category greater than by Product?

A: A site listed in two Marketplace categories will include sales totals for each category, which causes your sales metrics to double.

ClickBank has just released a new tool (ClickBank Analytics) that helps affiliates and customers track the success of their sales and the performance of their digital products. This series of articles explains how ClickBank’s new and improved analytics reporting works, how it differs from its original reporting system, and answers questions related to this reporting. Also includes FAQs on analytics, metrics, reporting, trends, digital goods, affiliates, online payments, and credit cards.

ClickBank Analytics:

1. Lets you produce trend charts by different topics over custom time ranges.

2. It gives you charts and data tables so you can see sales trends.

3. You can manipulate the charts in different ways, so you can see emerging trends.

In the next article, I’ll show you how to explore sales by stages of a sale.

ClickBank has just released a new tool (ClickBank Analytics) that helps affiliates and customers track the success of their sales and the performance of their digital products. This series of articles explains how ClickBank’s new and improved analytics reporting works, how it differs from its original reporting system, and answers questions related to this reporting. Also includes FAQs on analytics, metrics, reporting, trends, digital goods, affiliates, online payments, and credit cards.

ClickBank Analytics:

1. Lets you produce trend charts by different topics over custom time ranges.

2. It gives you charts and data tables so you can see sales trends.

3. You can manipulate the charts in different ways, so you can see emerging trends.

In the next article, I’ll show you how to explore sales by stages of a sale.

Ukash, the online payment specialist, closed a deal with epay, a division of Euronet, to make its online cash vouchers available in Italy. The expansion of Ukash into Italy will see Ukash vouchers available at 1,250 epay locations across the country. The deal lets internet users in Italy pay, play and shop online using cash for free without having to pay for a prepaid card.

Internet shopping in Italy turned over 4,868 billion euros in 2007 and continues to grow.

This deal allows Italian online merchants to tap into the growing customer base of consumers who prefer to use cash as a safer way to complete transactions online.

How it works

1. Ukash vouchers do not attract a service or convenience fee.

2. Customers exchange their cash for a unique 19-digit code to use online.

3. This provides them with a secure payment system where they don’t need to reveal any financial information, enabling those without access to credit or debit cards – or those with fears of online fraud – to shop online.

Mark Chirnside, chief executive officer of Ukash, adds, “Italy is a key growth market for Ukash, where ecommerce is on the up and consumers are becoming savvy about the safer ways to pay online. By partnering with epay we are able to reach a broader scope of potential new customers and expand our global footprint.”

“This deal also opens the virtual door for many online retailers as they can now offer alternative payment methods and attract the cash consumer, as well as eliminate any risk of online fraud.”

Ukash vouchers are now available at 1,250 physical point of sale terminals operated by epay at independent supermarkets, petrol stations, call shops, drug stores and convenience stores in Italy.

The vouchers will be available in €10, €20, €50 and €100 and can be combined, split and/or converted.

Ukash is undergoing a period of rapid global growth and this year has expanded into Germany, Poland, Australia and Spain with epay.

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Matt Peckham reports in PCWorld that GameStop is playing with numbers as it tries to play down the relevance of downloadable games.

It cites the IndustryGamers reports which says that ‘GameStop doesn’t expect digital distribution to be a threat to stucco-and-rebar-retail until 2014.’

GameStop “has been monitoring and studying the capabilities of digital downloading and its potential adoption over the last several years” and that the company recently “conducted the most thorough study to-date on its capability.”

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Developers of epayment systems and virtual currencies should take a look at this CNN report in the transition of virtual currencies into the retail banking sector.

CNN report that in March, MindArk, creator of the massively multiplayer online role-playing game, Entropia, saw its wholly owned subsidiary Mind Bank granted a banking license from the Swedish Financial Supervisory Authority.

This license allows Mind Bank to be the first bank to directly incorporate real-money transactions with virtual-world activities.

Selling virtual assets directly between players for real-world cash has been strictly prohibited by most game publishers, which find themselves looped out of the profits.

This takes the exchange of virtual currencies into real monies to a new level.

While World of Warcraft and EverQuest users have engaged in “gold farming”, i.e. gathering weapons and other status symbols, and then auctioning these off, usually on EBay.

Games publishers have started to monitor with mixed results. In response, PlayerAuctions have adopted a PayPal-like approach where it brokers the deals, acting as an open marketplace for player-to-player exchange of digital assets.

CNN interviewed Simon Newstead who explained: “The idea with dual currencies is that there is a paid currency [Gold Coins], which is paid for using real money and exchanged between sellers and buyers. In addition, there is a second currency — a free or so-called ‘earned’ currency [Silver Coins] — which is gained through activity and progression in the world or game.”

“In this way,” he continues, “the economy can recognize different forms of contribution, and in newer economies these can also be traded between each other. For example, people earning currency and selling it to people who have less time but have real money.”

Virtual currencies in Second Life

Second Life’s marketplace includes objects and services for sale, including real estate.

In 2008, over $100 million worth of Linden dollars (Second Life’s currency) were bought and sold on its LindeX exchange.

“In Linden Exchange, the U.S. dollar part of the transaction is via PayPal, a well-known entity, so there’s a certain amount of trust that comes with it,” says Darrly Chang, co-founder of D&D Dogs, who sells virtual dog pets and avatars to Second Life residents.

CNN’s reports also discusses, GoldMoney, who launched a dedicated iPhone application allowing account holders to exchange gold and silver units within minutes.

This iPhone application let you manage your own digital gold like on other banking applications.

GoldMoney is firmly anchored to real-world assets, forbidding anonymous accounts.

This contrasts with E-Gold, whose founder pleading guilty to money laundering-related crimes..

How realistic is the prospect of a digital currency?

“It all comes down to trust,” says senior economist Frederic Neumann. “We trust the government to guarantee our ‘virtual’ money for real currency. [With digital gold] the gold standard is guaranteed by a private company. Governments already have several hundred years of sovereignty engrained in people’s minds, so that trust is very difficult to establish.”

Learn more at http://goldmoney.com/ and http://secondlife.com/whatis/currency.php

What’s been your experience buying and selling digital goods, especially if it involved virtual currencies?

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