Marketing Fee for marketing my store?!

[Amanda23]

Hello, all. 
I’m attempting to understand  the logic: if the idea is to reward creators for advertising their creations, why am I being charged a marketing fee? I do the work, but I’m charged a fee? But if no one does the work (“none”), there is no fee?

I will submit a question via the form as well.

I do not understand why there’s a marketing fee when I market my own products. I already pay for quite a few tools for this purpose, and I know some people pay for ads.

[JerryLambert]

From what I have read, the Marketing Royalty Fee doesn't apply when you drive the traffic.

From the FAQ:

"When Zazzle's marketing efforts generate a sale, the Marketing Royalty Fee is deducted from your Gross Royalty."

"the Marketing Royalty Fee is deducted from your Gross Royalty whenever a sale results from Zazzle’s own marketing efforts or a fellow Ambassador’s Referral"

[ColsCreations]

Trying to find the link for where I downloaded it from, but the newly issued .PDF for "Ambassador Program FAQs" includes some example calculations on self-promotion links and it clearly says that, same as before, the carve-out (now known as Marketing Royalty Fee) will be applied to ALL referred sales, even self-promotion links.

[Sara_H]

@JerryLambert  @ColsCreations 

[Amanda23]

Has it ever been explained WHY there is a fee in this situation? 

[Sara_H]

@Amanda23  It's the new T&Cs. And Zazzle can create whatever T&C's they like without having to explain why

[Westerngirl2]

Kinda lends new definition to the term "smoke & mirrors", doesn't it?  😞

[tiffjamaica]

and do you see where the excessive royalty fee is taken out twice.... am i reading that wrong?

[Sara_H]

@tiffjamaica  Yes 😂 it's taken out twice (hopefully a mistake else that's a joke)

[Fiorenzo]

This is a big hit for self-promoters. Before the change, you got the 35% promoter share on the sales price PLUS your royalty earnings minus the 20% caveat. Now you only get the so-called "Self-Promotion Earnings Goal" of 35 to 50%, depending on the department.

For this Zazzle example you showed, before the changes you got:
35% of the sales price of $100: $35
+ your Gross 12% Royalty Fee: + $12
- the 20% referral caveat on your royalty: - $2.40
-------------------
TOTAL SELF-PROMOTER EARNINGS BEFORE: $44.60 (35+12-2.40)
TOTAL SELF-PROMOTER EARNINGS NOW: $35 (35% flat of the $100 sales price)
-------------------
NET LOSS SELF-PROMOTER SALE NOW-THEN: $44.60 Then - $35 Now = $9.60 LOSS

Edit: In Departments with 40% flat rate (home decor etc), the loss is $4.60, in departments with 50% rate (invitations), you have a net gain of $5.40 instead.

@ColsCreations @JerryLambert Your input is appreciated on this special matter.

P.S. I'm working on a spread sheet and things look not that great for self-promoters with this new all-included 35-50%. The losses are consistent, especially at higher royalty rates. Will post my conclusions separately when I've checked all out.

Edit: Didn't include the extra-fee for simplicity purposes.

[Amanda23]

Agreed. I have been in the Promoter 2.0 program basically since joining, and the LARGE majority of my earnings have been from my referrals. 

Combined with showing so many other products both above and below my own when I link people to Zazzle, it is quite the punch in the gut. 

[Fiorenzo]

Same here. When my self-promos stick, the 35% referral earnings are way higher than the royalties. Most of my sales are third-party referrals, though, but that's because I didn't really promote myself. Need to change my strategy and annoy my followers more with ads rather than hoping for marketplace sales. Nonetheless, these changes are a loss also for self-promoters, unless you have low royalty % and promote basically solely cards and invitations that give you 50%.

[mylittleeden]

If that is case what happened then, how can the promoters be worse off too? Did they not not gain  the missing amount? This is what happened on a digital sale this morning where I was getting 90% around $7 it is now less than half not even close to 90%? Has to have gone somewhere? Said it was a third party sale... I would prefer to set my price and then the customer price is adjusted to what the rest get. As now this is completely unknown... how are we to work out a fair price for ourselves when we have no idea what is going to be taken from the customer price? I feel like I must be missing something surely?

[ColsCreations]

Your gross royalty on a straight (non-referred) sale hasn't changed, its still $7.65.
The transaction fee ($0.38) has not changed.
Your net royalty on a straight (non-referred) sale hasn't changed, it's still $7.27.
The 15% you or anyone else would earn as Referrer ($1.28) hasn't changed.

What has changed is the amount of the "carve out" being applied to all sales logged as referred; instead of 20% it's now 35, 40, 45, or 50% depending on the product category. In your case here it was 50%. So because of the change in that deduction amount, you earned $2.30 less on that sale then you would have before April 1st (3.44 vs 5.74) because it was referred. And you earned $3.83 less (3.44 vs 7.27) then had it not been referred at all. 

[tiffjamaica]

I agree. And in the Creator FAQ they say, "For Self-Promotion Links, this fee is effectively offset by the higher Referral Commission calculation..."   That's only true if you're reducing your earnings to 5%.   They're spinning it like you'll make so much more money because your self-referrals will be larger, but we all know most sales are 3rd party, which will now be hit by lowered royalties and the marketing fee. 
PS - also working on a spread sheet and you are correct that it's bad for self promoters and very bad for third party sales. Seems like we should be hoping for NONE referrals from here on out... 

[Fiorenzo]

I edited my original post, forgot a few things. As self-promoter you get a net gain compared to earlier if you have a royalty rate lower than 19% AND only in departments with 50% marketing share, basically invitations solely. In the largest tier of 40% you make always a loss on all royalty rates higher than the standard 5%. If you have higher royalties and have mixed/crossover sales, even as a self promoter it may be wise to stick with the 15% affiliate referral now since you have less reserve on your 35% promo sales to cover the third-party 0% sales. It's a mess.

[Connie]

Yes, that is totally a misrepresentation! Sure, we'll make more money on self-referrals compared to a third party sale, but we are losing A LOT from our self-referrals compared to what we were making before!

[jophb]

Great.... really motivating on Zazzle's part.  Let's just hit you from every possible angle.

[Amanda23]

You would think that… this is why I’m confused!

please see Sara H’s screenshot below.

[Fiorenzo]

The Ambassador program text states otherwise. Which doesn't matter anyway, since the royalties are included in your 35-50% self-promoter share and not paid separately (see my other post).

[tiffjamaica]

The language they are using in the FAQ's is so misleading. If you read on, in the Ambassador FAQ there's this saying the MF is "applied in the background":
"For example, if your department rate is 40% and Your Royalty Rate is 10%, your total Earnings would be 40% of Net Referral Sales. While the Marketing Royalty Fee is technically applied in the background, the Referral Commission is calculated so that your total Earnings equal the full department percentage."

[InkgoeswildAK]

How does Zazzle determine that their advertisement led to a sale?  I always tell people to go to my Zazzle shop via my associate link (which I have on the navigation bar of my artist website and as a QR code on my business cards) but they don’t always do that.  What’s to stop Zazzle from taking credit for those sales?

[Amanda23]

@James 
Hello! 
I was hoping we could get some clarification. There seem to be some discrepancies in various places regarding the MRF when you self refer. I am going to try to synthesize these in the screenshots here: 

From the calculator where we set our royalty percentage:
This note says an MRF will be deducted if someone *other* than me referred the sale.

From the FAQ, @JerryLambert included the quoted text here: This also seems to say that a fee ISN'T assessed when we self refer.

However, as @Sara_H shows below in her screenshot with the sample math, the MRF IS deducted if we self refer. 

This is pretty confusing. I was hoping you could clarify if this is deducted or not, and maybe pass along to the team that the language in some spots might be old/inaccurate? 


Thank you so much, 

Amanda

[Fiorenzo]

The Ambassador Program explanation also states that these 35-50% self-promoter numbers INCLUDE your royalty:

[Connie]

Definitely it's a contradiction!

[LMGildersleeve]

I'm glad you'all are bringing this up. I can't make their math work. I feel very mislead.

[Marcia]

So trying to figure out these new math calculations make my head want to implode, but I did check out some of my 3rd party sales from today and yesterday. Doing my quick math, at a 14.9% royalty, yesterday I netted around 11.9%. Today, at my 14.9% royalty, I'm netting around 7.9% – 8% tops. Most of my sales are 3rd party. I've put so much time and effort into my store. I love what I do but perhaps it's time to reassess this source of income? So over being thought of as disposable.

[Amanda23]

Sending a hug. It's a stressful and sad time. 
With @ColsCreations calculator Excel sheet resource the other day, I revamped some of my royalty rates. I need to do a lot more.  

I decided to work backward, and I only worried about royalty because referrals are hit or miss. For each product type, I decided what I thought I would be comfortable making for a royalty (eg. at least a dollar for one, two dollars for another, etc). I did this while also remembering that one sale will not come anywhere NEAR the amount of time I invested in creating that design. While doing this, I also took a look at how much a customer would pay for the item ( I presumed 15% even though the new low Zazzle seems to be offering is 10. So sometimes I will make more, but sometimes I'll make less.) 

Keep in mind, I'm not a huge seller and we don't rely on this as our survival, so I can "play" perhaps a bit more freely than others. I'm not sure this will help you, but I thought I'd share. 

We no longer need to be tied to the 14.9%, and the "penalty" fee is the same no matter if we make it 10.1%, 14.9%, or 39%. You can go up to 50% max. I definitely raised some of mine much higher than I would have thought to before...

Amanda

[Marcia]

Thank you, @Amanda23! Yeah, I've always been at 14.9%, except for the big ticket items which I've have at 10%. I looked at the suggested 10% for everything & no way, it's too little for me. I read somewhere that to break even with the new third party carveouts one would have to raise their royalties to something like 27%, which scares me. I still feel like I need to be somewhat competitive with the 10%ers, that I won't be priced out of the sale. But a few dollars more, I don't think customers would mind paying if they really liked the design. So I am raising royalties to 17%. It's probably not anywhere near enough to deal with the new, deep third party carveouts, but it would be more than I make now on a straight "none" sale. I wonder if our marketplace exposure, though, will suffer if we don't do the suggested 10%...Ugh. I hate this! 

[Fiorenzo]

Just sold a gift box for 31.05 at 17.8% royalties and got 3.04. Third-party sale, a 40%-tier product. Conclusion is, if you want to earn a fair 10% on third-party sales, you have to set your royalty rate around 20%. I have had diversified rates from 10 (pricey products) to around 27% (rare cases) with a lot around 14 - 14.9. I will keep this up and raise slightly to around 20-25 where it stays fair to the customer while giving me a fair ~10%, too. 25-30+% are only viable for truly unique designs. It's not a happy situation but things change over time, and they could change way worse. As someone whose business got victim of the "all-is-free" web and globalization in the late 90s/early 00s, and later by all these CMS and "free" web services, I'm used to reinvent myself. Not fun but it's life. As long as Zazzle still offers the most bang in the POD industry and does treat us designers more or less fairly, I don't see any urge or sense to leave. As a side note, you don't wanna know how big book, board game, video game, and music publishers treat (and always treated) their authors/artists.

[Marcia]

@Fiorenzo Thanks so much for sharing. Maybe I'll go a tad higher to 18.5%. Shouldn't really price me out of the marketplace, I guess. And I'll feel better about what I get on my third party sales.

[Fiorenzo]

I don't think royalties around 20% will be a no-go for customers to buy, if they find THEIR design for THEIR gift. I had customers paying the full price for products and designs I never thought would sell, and I myself never minded the price tag (as long as it was sustainable) when looking for "special" gifts for myself or friends/loved ones. The question I put myself when choosing royalty rates, is, would I buy this product (and design) at that price and is it a fair one. There are lovely products at more than affordable prices you can easily add 20+% on them, and there are products that are already pricey compared to the competition, where you may want to go with 10% or even less if you provide only basic interchangeable designs such as a simple monogram.

[mylittleeden]

Agree seem worse on digital products I create all my own artwork and was concerned about selling digitally just had a sale and got less then half what the buyer paid! how is that 90+% to the artist! Vey misleading to the consumer too as they aren't helping support the artist now. I hope they look at the digital side because I have no way of getting the money I did for my art there is no point in selling it.

[Barbara]

When I was in high school and taking algebra, I was extremely good at figuring out those horrid little problems with trains racing toward each other. What I'm seeing here is a mathematical train wreck. I'll be standing at a distance until the debris gets cleared because I understand little to nothing of the math, something it appears is happening to others.

A basic issue is the verbiage used in the explanations, terms being used that must mean something to in-house Zazzle employees but virtually nothing to me. The bigger issue is the underlying if's, and's, and but's. By the time I get through half of a description of calculations, I'm lost. (I'm better with trains speeding toward each other.)

I do believe I've figured out one thing: The Promoter program is defunct and the Ambassador program now pretty much covers everything depending on whether or not we add an ID to the link. Or maybe I don't understand this either.

Indeed, I'm standing still, creating nothing further and doing no promoting until I know for sure what I'm doing and why I'm doing it.

Colorwash's Home

[InkgoeswildAK]

I'm glad someone who is better at mathematical problems, than I am, said this is confusing.  I couldn't make heads or tails out of what I read about the Ambassador program and how the earnings are now supposed to work.  All I know is that a couple of days ago I placed an order for some of my postcards, using my associate link, and didn't get any referral fees.  I canceled that order and tried two more times the next day, with the same results.  I canceled both of those other orders as well.

I've promoted my Zazzle shop a lot in the 11 years I've had it but I am my own best "customer".  One thing that made buying so much of my stuff worthwhile was the extra income/savings I earned from my referral fees.  Money I turned around and spent on other items in my Zazzle shop. 

This program feels like a slap in the face.

[Heather]

UPDATE - 4/2/25 (added to the Zazzle thread on this topic as well)

Questions were added to our FAQ and we will be addressing more questions soon. 

Hi Creators,

We’ve heard some common questions that we’d like to address and clarify. We will be adding these questions to our next round of FAQ’s for clarity of all Creators, but in the meantime, we wanted to respond on the forum:

1. Why does it seem like the Excess Royalty is taken out twice for the Self-Promotion?
2. Why am I being charged a Marketing Royalty Fee for Self-Promotion Sales?
3. Why in some cases did I make more money in the Promoter 2.0 Program? 

Q: Why does it seem like the Excess Royalty is taken out twice for the Self-Promotion example below? 

Example 1: Self-Promotion Link (own Product) in Clothing & Shoes with Your Royalty Rate set at 12% 

• Product Price (= Net Referral Sales for this example): $100
• Your Royalty Rate: 12% → $12 Gross Royalty
• Excess Royalty Fee: → 5% of $12 = $0.60
  (applies because Your Royalty Rate is above 10%. The fee is 5% of your Gross Royalty) 
• Marketing Royalty Fee: → 35% of $12 = $4.20
  (applies to all Referred Sales. For Clothing & Shoes, it's 35% of your Gross Royalty) 
• Royalty: → $7.20
  (after deduction of Royalty Fees)
• Referral Commission for a Referred Sale via a Self-Promotion Link
• Department Rate: → 35% of Net Referral Sales
  (Clothing & Shoes)
• Self-Promotion Earnings Goal: → 35% of $100 is a $35 Goal.
  (from this $35 goal, you’ve already earned $7.20 in Net Royalties and the $0.60 Excess Royalty Fee applies)
• Referral Commission from Self-Promotion Link: → $35 - $7.20 - $0.60 = $27.20
• Your Earnings = $34.40
  ($7.20 paid via Royalty, $27.20 paid via Referral Commission).
• Note: Because Your Royalty Rate was above 10%, the Excess Royalty Fee slightly reduced the total Earnings you could have received from the Referred Sale via a Self-Promotion Link.

A: If you look at Example 1, the Self-Promotion Earnings Goal is $35, and the Excess Royalty Fee is $0.60. Your Earnings are $34.40 ($35 - $0.60). So while we need to deduct the Excess Royalty Fee from the Gross Royalties to help calculate the Royalty - which we then use to calculate the Referral Commission by deducting it from the Self-Promotion Earnings Goal - it is more to do the math to figure out the amounts you’ve earned rather than actually being taken out twice.

Q: Why am I being charged a Marketing Royalty Fee for Self-Promotion Sales?

A: The Marketing Royalty Fee applies whenever a sale is referred, whether by you, another Ambassador, or Zazzle. This structure helps our systems run smoothly across all types of Referrals.  So in order to make sure your Earnings hit the Self-Promotion Earnings Goal (which is based on the Department Rate), we calculate your Referral Commission to make up the difference between the Self-Promotion Earnings Goal and your Royalty.  The math can be a little bit complicated, but the end result is the same - your Earnings for that sale do not change.

Q: Why in some cases did I make more money in the Promoter 2.0 Program? 

A: Promoter 2.0 was originally a "beta" program, and we're now expanding it to all Creators. The Ambassador Program is designed to serve a wider population of Creators, while reflecting current marketing costs, so while there were situations where former Promoters benefitted more, this new program is designed to benefit the whole Ambassador community more overall.

[jophb]

You still wrote that in fairly unclear terms.  So if I get a 35% self referral on a sale.  Will I still make what used to equate to my full royalty % AND the 35% referral combined as it did in the Promoter 2.0?  Because according to your math examples, that certainly does not seem to be the case. Now it appears we essentially only get the 35% referral portion.

[Amanda23]

To my understanding, no. You will not. 
Now called the “goal,” your new maximum earnings (when you add your royalty and referral together) is 35% of the sale amount. 

The max goal varies by department, but the highest potential for earnings  is now 50% of the sales total.

[jophb]

Yeah it definitely doesn't seem to the the case.  So once again we are still back to less royalty AND less referrals and getting hit from every possible angle.

[tiffjamaica]

In most cases, no.  Unless you're royalty low and you're keeping it low (5-10%) and even then it's not guaranteed across all products. 

Here's an example for a business card sale: 
OLD CALCULATIONS for a business card set at 14.9% results in royalty of $3.08 and PPreferral of $9.05.  Total earnings = $12.13

The NEW CALCULATIONS, if you don't change your royalty, results in royalty of $1.93
Business cards are in the Office category so they have a 45% rate.
45% of $25.85 (what the customer spent) = $11.63. So that is the max you can make off this sale.
$11.63 - $1.93 (royalty you already made) - .19 (excessive royalty fee  = 9.51 Referral
total earnings = 11.44

So it's slightly less.  However, without complicating this with calculations, here's how non referred and third party sales of the same business card would look: 

NON Referred
Old: 3.85  vs. New: 3.66

Third Party Referred
Old: 3.08 vs. New: 1.93

None of these numbers seem drastically lower on their own, however when you multiply this across all of your sales, it adds up.  Or if you are a seller of things bought in bulk, like invitations.  You can see that 3rd party sales are hit hardest.  But self referred sales will be reduced as well if your royalty isn't set super low (5-10%). Unless you are confident in your ability to bring in self referrals, going that low with your royalty doesn't make sense.