Why am I getting less than 10% royalty? Please let me know what is 5.0% below 10.0% on second sale?

Zainab_Baloch
New Contributor III

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1 ACCEPTED SOLUTION

Referral Carveout: If the sale of a Product is to a User referred from graphical or text links displayed on products, promotions, emails and/or web properties other than the Site, Zazzle will retain a referral carveout fee of twenty percent (20%) of your Gross Royalty* for the Product.

In other words, for anything that shows up in your Royalty Report as a 3rd Party or Self referral, 20% of your gross royalty (NOT the gross sale amount) is deducted as the "carve-out".

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11 REPLIES 11

MOM
Valued Contributor

That’s a good question. I would not know unfortunately. 🤔

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A_New_View
Valued Contributor

Not sure, but that 5% on the second scale may be in reference to an envelope or other extra item, depending on what the product was. For example, I know that there is an option on some items for the customer to check (or not) 

 

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Not sure if this is the answer or not. I had been wondering the same thing when I figured this was probably it.

 

Cat
Honored Contributor III

You're correct. It's for envelopes or other add-on stuff selected by the customer. I stumbled upon the explanation in the help files the other day, but of course I forgot to bookmark the page and now I can't find it! But basically, you get the percentage you set for the product itself, but for any add-on stuff you get the standard royalty rate which is 5%.

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Cat @ ZB Designs

Zainab_Baloch
New Contributor III

You’re right! 5% could be the envelopes and other items added however on the 1st and 3rd sale why is my royalty lower than 10% when I myself set it on 10%?? 

Because the customer used a coupon code or you are sharing your earnings with a 3rd party or both.

Can you please elaborate how am I sharing my earnings with 3rd party? 

Cat
Honored Contributor III

If someone promotes your product (posts a link to it online etc.) or if Zazzle features it in an ad, the person or entity doing the promoting (i.e., the 3rd party) earns a 15% commission on the sale. The percentage you earn is calculated on the sale price less that 15% commission.

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Cat @ ZB Designs

Referral Carveout: If the sale of a Product is to a User referred from graphical or text links displayed on products, promotions, emails and/or web properties other than the Site, Zazzle will retain a referral carveout fee of twenty percent (20%) of your Gross Royalty* for the Product.

In other words, for anything that shows up in your Royalty Report as a 3rd Party or Self referral, 20% of your gross royalty (NOT the gross sale amount) is deducted as the "carve-out".

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Cat
Honored Contributor III

@ColsCreations Thank you! I'm assuming you found that in one of the help files? I looked EVERYWHERE and couldn't find it! 

So, assuming a $10 sale price and a 10% royalty I thought it worked this way:
$10 sale price - $1.50 to referrer = $8.50 * 0.10 = $0.85 royalty to the designer

But it actually works this way:
$10 sale price * 0.10 = $1.00 royalty * 0.20 carveout = $0.20 carveout fee. $1.00-$0.20 = $0.80 to the designer 

It seems to imply that it's the same fee whether it's a self referral or a 3rd party one. So I guess in the case of 3rd party referrals we get less than we would if they calculated it the way I thought, but in the case of self-referrals (if you're in the promoter 2.0 program) we get more. Hmmm... 

 

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Cat @ ZB Designs

ColsCreations
Honored Contributor II

It's stated here in the Royalty section.

It seems to imply that it's the same fee whether it's a self referral or a 3rd party one.

Yes. Doesn't matter, either way it's 20% of the gross royalty.
So in your example above, if it's a self-referral, $0.20 (20% of $1)  is deducted for the carveout, but you earn the $1.50  (15% of $10) as the referrer so still come out $1.30 ahead.
If you're in the promoter program, the royalty stays the same. 10% of $10 = $1 and the carveout is still $0.20 (20% of $1)  but you'd earn $3.00 (30% x $10) as the referral instead, coming out $2.80 ahead.

So I guess in the case of 3rd party referrals we get less than we would if they calculated it the way I thought

I guess that depends on the actual numbers. I tried your way on two real-life items, address labels at $20.25/20% and a lighted wall sign at $225/17.2%. If you deduct 15% of the sale price before calculating the royalty, you def earn less than taking 20% of the gross royalty.

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Cat
Honored Contributor III

Oy! All of those numbers make my head spin, but I'm glad it actually works out better for us in real-life situations. I guess it's sort of a moot point since it's not like we get to vote on this stuff anyhow!

And of course it never occurred to me to look in the user agreement - I kept searching through the help files... doh! 😝

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Cat @ ZB Designs