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.

[jophb]

Oh totally agree. For some creators (not me... hopefully 'yet' haha) we are talking tens of thousands of dollars a year with all these new changes. 

[Fiorenzo]

Don't wanna sound like a Kevin, but the accountant in me whispers that the Marketing Fee, done correctly, has to be based on the Net Royalty (Gross Royalty minus the 5% Excess Royalty Fee, which is a payment processing fee covering the third-party payment fees e.g. from PayPal, which is fair, btw). Applying the Marketing Fee on the Gross Royalty pre-Excess Fee results in us designers having to pay processing fees for amounts of money we don't earn.

Based on your example, the correct [Marketing Fee] calculation would be:

$12.00 Gross Royalty
- $0.60 Excess Royalty Fee (5% of $12)
-----------
= $11.40 Net Royalty I
- $3.99 Marketing Fee: 35% of Net Royalty I ($11.40)
-----------
= $7.41 Net Royalty II after Processing and Marketing Fee
=======

[jophb]

I just got a self-referral on badges. Why are most 39% and only one is 40%?

[Heather]

Please see comment below or our recent update on the dedicated Zazzle thread. Thank you! 

[tiffjamaica]

Ok, I figured it out.... see my comments here https://community.zazzle.com/t5/ambassador-program/opportunities-ahead-new-ambassador-program-amp-im...

Basically, the marketing fee on self referrals doesn't matter because of the way they now calculate referrals.  Your earnings total will be the same with or without the marketing fee applied. WHY they didn't just explain that in the first place in language we could all understand, and with math examples, I do not know.  It's good news that the marketing fee does not affect your self referrals though.   Bad news is - your earnings total could still result in less money than you were making before if you were in the Promoter Program (and depending on how your royalties were set, etc). 

[jophb]

Ahhh lovely.  One of these I spent the time to promote and brought Zazzle a customer... and was rewarded with half the pay.  (for anyone who doesn't know yet, the 'self referral' you get on these is only $.45)

[Fiorenzo]

The classic slap in the face.

[jophb]

Right? 🙈

[JerryLambert]

So, you're better off not promoting your own products? I'm confused by this. 

[jophb]

It seems to specifically be a problem on digital sales I believe.

[Fiorenzo]

Yes, it is a digital sales problem, which basically were exempted from self-promoter rates before the changes. This made perfectly sense under the promoter 2 program, since your royalty rates are that high and you got both the 35% self-promotion rate on the whole price PLUS your whole royalty minus the 20% carve out. A simple calculation on your example proves it:

$11.95 Sales price
$10.55 Your Royalty
Your self-promotion income:
35% from $11.95 Sales price = $4.18
+ Your paid royalty = $10.55
- 20% carve-out from your royalty = - $2.11
------
Your theoretical total earnings = $12.62 -> more than the sales price

Now things are different, because your max earnings on cards are 50% of the sales price in total, so 50% from $11.95 = $5.975. In theory, you should have an additional $0.97 earning in the referral list. Assuming that you get your self-promotion share on downloads. If not, something is truly wrong here now. Note that this is a simple calculation.

[jophb]

yeah I don't know. But I now have two of those self-referrals for digital at the $.42 (I correct my earlier one, I gave them too much credit apparently).  Ugh. I'd like to give up my self-referral option on digital and give 'none' all the credit!!! So not cool. They should be exempt from this whole debacle.  

[Fiorenzo]

I agree, digital downloads should be handled differently. You have to add your 0.42 referral to the 5 royalty for now until they change their earnings listing to their new method, so in total 5.42 from the 11.95 end price, which is 45.35% net, lower than the advertised 50% max for invitations. I'm asking myself anyway why they calculate a 35-50% marketing fee for third-party affiliates who gain 15% and self promoters. Such a marketing fee would only make sense if it's Zazzle marketing it, otherwise, the marketing costs are paid by the affiliates in their 15% and the self promoters. For referral sales from affiliates, the old carve out of 20% made more sense, and for self-promoters you could calculate the 35%, or 30, whatever, only from the sales price without the royalty surcharge and add the full royalty. For sales resulting from Z marketing, you could then deduct the 35-50% marketing fee. This would be correct. And is technically feasible. But it is how it is. And we've not even counted in the most recent tariff comedy show yet. Wondering how the extra costs will be handled after this idiocy starts giving results, I guess, we'll have to bleed our part, too.

[OakAndPine]

Basically we are being ripped off royally by Zazzle. Zazzle is making more royalty than me on my own products.....

[OakAndPine]

Today had a referral sale after almost 15 days of no sale. Was supposed to get $15. Got $7. The heartaches to see this. All my hardwork, sitting for hours designing uploading and then being ripped off almost 50 to 60% of my royalty. Surely there must be some other way for Zazzle to make money rather than taking it out of your designers hard earned money. I have zero motivation to design here anymore. Zazzle please rethink your new changes. A lot of talented designers will leave your platform if you take away almost 50 % of their royalties.

[InkgoeswildAK]

I feel exactly the same way, OakAndPine.  I have purchased thousands of my postcards (as well as thousands of dollars of other merchandise that features my artwork) over the years.  I use my postcards for Postcrossing; both to send to Postcrossers whose names I draw, as well as to give away in Postcrossing lotteries.  My Zazzle shop info is on the backside of my postcards (in small print) so it was also a way of promoting my online shop.  No more. 

The only way I could afford to purchase so much stuff, especially my postcards the last few years, was by "earning" my referral fees on my orders.  I rolled my earnings over into more of my postcards and other merchandise.  By no longer being able to earn the same amount of profit I can no longer afford to purchase things from my store.  I've put a ton of time and hard work into building my shop over the last decade so I'm not going to close it, but I'm going to look into other forms of income. 

In the last couple of weeks I've learned how to print my own postcards, granted they're not as nice as my Zazzle postcards, but beggars can't be choosers.  I'm also printing my own stationery sets, and have sold some through my small art business.  I am also going to be printing my own greeting cards from now on.

I may wind up investing in a much more expensive, high end printer, but I've crunched the numbers and the money I'll save by not purchasing my expensive Zazzle postcards will make the printer pay for itself in a year or less.  The old saying "Necessity is the mother of invention" really is true.

[Mariholly]

I feel exactly the same. Since the announcement of the new conditions, I’ve barely created anything. I try to stay positive, but I just don’t see that positivity anywhere. So far this month, I’ve made 44 sales — okay, that might sound like a lot, but some of them only bring in 30 or 40 cents, and that’s after raising my royalty.

Sometimes I honestly think that’s the whole idea — for many designers to jump ship, conveniently causing a so-called “natural” reduction in the massive number of designs, which, most of the time, aren’t even being shown.

Just a thought.

[Fantabuloustef]

I had exactly the same thought. Pushing designers to leave, so that the marketplace would become less saturated… I also asked myself if their idea was not only to just become a place to let customers customize their own products from scratch without proposing already designed articles… The future will tell…