The True Cost of Selling on Zazzle: Marketing Royalty Fees and Excess Royalties Explained

jhowcome
New Contributor II

For many creators, Zazzle has long been a go-to platform to showcase and sell custom products with minimal upfront costs. However, recent changes in their fee structure are making it harder than ever for sellers to maintain healthy earnings. Two key charges significantly impact creators' take-home pay: Marketing Royalty Fees and Excess Royalty Fees on products priced above a 10% royalty threshold.

What Are Marketing Royalty Fees?

Zazzle applies a Marketing Royalty Fee of 35% to 50% on gross royalties, depending on the product category. The company’s justification is that this fee helps cover rising advertising costs and rewards those who actively drive traffic to the site.

But here’s the catch: Zazzle treats all internal clicks on its site—for example, a shopper browsing through categories like Crafts & Party Supplies > Wrapping Paper before clicking on your product—as a “referral.” This means your sale is subjected to a referral cut, regardless of whether the customer was actually sent from an external source or found the product through organic browsing within Zazzle itself.

Simply put, whether the shopper comes from outside Zazzle or is navigating through the platform’s own departments, creators are paying a hefty cut—up to half of their royalties—for the privilege of being found.

The New Excess Royalty Fee: When Selling More Costs You More

Adding insult to injury, Zazzle now charges an additional fee if your product royalty exceeds 10% of the sale price. This means if you price your product to earn more than a 10% royalty (which many creators do to cover costs, time, and talent), you will be penalized with a further reduction.

This “excess royalty fee” effectively discourages creators from setting fair profit margins. The more you try to earn for your design, the less you actually receive after fees. It’s a double hit on creators’ earnings that threatens the viability of selling on the platform long term.

Why Does This Matter?

  • Reduced Earnings: The combination of marketing royalty fees and excess royalties can slice royalties nearly in half or more, meaning creators get significantly less for their hard work.

  • Unfair Penalties for Pricing: Creators are disincentivized from pricing their work fairly, which can force them to undercharge or lose money.

  • Opaque Fee Structure: The system makes it difficult for sellers to predict exactly how much they will earn per sale.

  • Rewards Traffic Drivers Over Creators: Affiliates and ambassadors receive substantial portions of sales revenue, sometimes more than the creators themselves, despite the creators being responsible for the product and customer experience.

What Can Creators Do?

  • Monitor Your Pricing: Be aware of the 10% royalty threshold and calculate how excess fees impact your earnings.

  • Use Self-Referral Links: To minimize the impact of the marketing royalty fee, some sellers use self-referral links to maintain higher royalties, though this requires extra effort.

  • Advocate for Change: Share feedback with Zazzle and join seller communities to push for a fairer, more transparent fee system.

Bottom line: While Zazzle’s platform offers incredible reach and convenience, the current royalty fee system imposes significant financial burdens on creators. It’s crucial to understand these fees to make informed decisions about your business and pricing strategies.

6 REPLIES 6

ColsCreations
Honored Contributor III
But here’s the catch: Zazzle treats all internal clicks on its site—for example, a shopper browsing through categories like Crafts & Party Supplies > Wrapping Paper before clicking on your product—as a “referral.” This means your sale is subjected to a referral cut, regardless of whether the customer was actually sent from an external source or found the product through organic browsing within Zazzle itself.

Can you provide proof of this? Because this is not how it's known to work. Referral "cookies" are set when one enters Zazzle through an external link. Browsing/navigating the site through internal links does not over-ride that. 

Re the Excess Royalty Fee. We've always had one, it just used to kick in at 15% instead of 10.01%. It is my opinion that this fee is insignificant in the long run; keeping one's royalty low just to avoid it is only costing you money, not saving you money. You might find this post on the subject somewhat helpful. 

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CrazyMermaid
Valued Contributor III

In all fairness, you should fully describe the etsy fees. The last time I checked etsy charges 20 cents per listing to create a product listing. You pay that whether or not you sell anything. At my current rate of production, I would owe about $50/week just to list products with no guarantee of sales. I also just found this on the Etsy site. 
"Etsy.com listings expire after four months. Pattern-only listings do not expire. If you list multiple quantities of the same item, the initial listing fee will be $0.20, and the listing will be automatically renewed at $0.20 after each of the items sells." I would pay a small fortune in renewal fees.

ColsCreations
Honored Contributor III

👍

Despite everything, Zazzle is still a completely free site to use. There is no out-of-pocket expense. No subscription fee, no listing fees ... You can create as many stores as you want - each with their own storefront and set-up and theme and custom URL - and have up to 100,000 products total per account. For free. (100,000 products x 0.20 listing fee = $20,000!!! Think about that.) And if something sells, you make real money. 

With Referrers making 15% of the total sale, they've always had the potential to be earning more than Creators, especially those Creators sitting at 14.9% just to avoid the transaction fee or doing only 5-10% to "stay competitive". This was not a secret. Anyone who read the terms knew that. I started writing more here but then remembered I made a blog post on this subject two months ago.  

Adding to this, what is significant to me is that while the carve-out fees on the Creator end increased greatly April 1, the flat 15% paid to Affiliates remained unchanged. They could have reduced the Affiliate earning to say 10% or halved it to 7.5%. But they didn't. Their saving money comes at the expense of Creators not Affiliates. What does that say? To me it's a very clear indicator that they need people driving traffic to the site more than they need new designs. Hence the big push towards the  "opportunity" we as Creators have to self-promote ourselves and earn a higher return. 

This may be a gut-punch to Creators who have made their incomes based on being an artist/graphic designer, but the hard reality is the landscape out there has changed significantly the last few years, so putting aside emotions and what's "fair", practically speaking, being able to drive traffic and thus sales to Z is probably more valuable to Z then designing. 

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Cat
Esteemed Contributor

@ColsCreations wrote:

They could have reduced the Affiliate earning to say 10% or halved it to 7.5%. But they didn't. Their saving money comes at the expense of Creators not Affiliates. What does that say? To me it's a very clear indicator that they need people driving traffic to the site more than they need new designs....

... being able to drive traffic and thus sales to Z is probably more valuable to Z then designing. 


I think it's hard to interpret it any other way. And if you spend any time at all browsing the marketplace it's pretty easy to see why they would feel that way. I mean there are millions if not billions of designs out there, and if the posts on the forum are any indication, there are still plenty of new designers signing up every day.

The part that does puzzle me, however, is why they've made it so much more difficult to secure self-referrals - especially in cases where a designer is sending a specific customer to purchase a specific product. Since sending someone a self-referral link only gives you a chance of getting the referral, and the discrepancy between getting the referral + full royalty vs. getting a 3rd party sale (and thus only a portion of your royalty) is HUGE (like the difference between getting paid $10 vs. $100) it leaves very little incentive to use the Zazzle platform for fulfilment if you have a customer ready to make a big purchase. 

Not sure if they just figured that these sorts of direct sales comprised such a small portion of their business that they were fine with losing it, or if it's just an unintended consequence of the way the system is designed. I guess time will tell.

____________________
Cat @ ZB Designs

Windy
Honored Contributor II

Thanks for the tip. You suggest the following: 

  • Monitor Your Pricing: Be aware of the 10% royalty threshold and calculate how excess fees impact your earnings.

    Here is what I find. At ten percent the greeting card I just sold would have netted me $.71, according to the earnings calculator. But I sold it at 25 percent, and had to pay at 10 cent excess royalty fee. Meanwhile, the estimated earnings royalty  was $1.96. So putting aside Marketing Fees, etc, the excess royalty is not a problem for the way I price my products. I do think it's a silly charge, and I would love to have it go away. But the math does not make me want to stay at the ten percent figure, because I make considerably  more money at my 25 percent figure. 

Come on over to the dark side.

Connie
Honored Contributor II

You're right, the excess royalty fee doesn't nearly equal what we would be losing by only having a 10% royalty!