I should probably say that Cafepress gets greedier because they already make a ton of money per item they sell. Cafepress is a POD service that allow users to create and upload designs and sell them online as t-shirts, caps, mugs etc. The designers then fix the commission they wish to receive from the sale of each item and Cafepress deals with the rest. It is a great opportunity for people to make money sitting on their asses in the comfort of their own home. As a reward for selling large quantities of items Cafepress pay a volume bonus. It is a great incentive for the shopkeepers to actually make more sales.
There are three main avenues to get sales. One is through the Cafepress marketplace which seems to account for about 80-90% of sales if you believe what you hear. Another is from your own marketing efforts either to your own off Cafepress domain or to your Cafepress hosted store. The third is the elusive and much maligned affiliate sale.
Currently any sales made through affiliates were not included in the volume bonus which is calculated using the base sales. In the new system the marketplace sales will also no longer be included. If you are one of those shopkeepers who make a big volume bonus and most of your sales come through the marketplace you have a lot to lose. It’s not quite as bad as it seems though as now there are lower thresholds for getting the bonus as can be seen in the chart below.
It should be noted too that affiliate sales which are directed at the shops rather than the marketplace will now be included in our volume bonus calculations as well as framed prints which were until now also excluded from our volume bonus. So no, the sky isn’t falling but it is raining pretty hard on some people with scattered showers here and there.
What’s really happening here? This is only conjecture but I have experienced a similar situation before. I worked for one company where almost everybody was a contract worker. When the contract was coming to an end for some of us one of my co-workers, who was a total apple-polisher btw, asked how much of a raise she could expect if she renewed her contract. She was told that she would get paid the same but would have to work longer hours. Funny? Kind of. They continually stripped away things that made the company an attractive place to work at and cut costs in as many ways as they could think of, mostly related to the employees unfortunately, while at the same time increasing charges to people using their services. The worst came when, like at Cafepress, they told us that the bonus they had been paying all along (this time for working on public holidays) was a mistake. Of course, like at Cafepress, it’s total and utter BS. This company actually took it one step further though and subtracted the bonus that we had already received from our next paycheck. It was amazing really. We couldn’t understand how they thought it could continue until they sold the company, lock, stock and barrel and then we realized they had no intention of continuing. They were just trying to increase profits in the short term to make it look more attractive to potential buyers which maybe is what Cafepress is doing. Or perhaps they are preparing to be listed.
I think that the POD market is pretty saturated at the moment and the only way to increase revenue is to eat into the competitors market and this is difficult when you are already the top dog with the other PODs already tearing chunks out of you. And it is not just the PODs either, everybody and their dog is selling t-shirts online now. So Cafepress is taking money back from the shopkeepers who made them money in the first place. It’s pretty mean but I don’t think it will hurt CP at all. I know lots of shopkeepers will head over to Zazzle and I believe Zazzle is taking some of CPs customers but Cafepress will continue to have new designers and designs at a rate that is more than enough to sustain itself. I’m not saying that Cafepress is going to do well because of this strategy, I just don’t think it will have much of an impact. I don’t think how Cafepress deals with the designers matters that much unfortunately as there is an almost unlimited supply. What will affect Cafepress though is the action of the competitors. Maybe CP understands this and are just desperately trying to grab cash while they can.
Who knows? Comments welcome.
More info: Cafepress