Land of the Free Studios, Inc., my company, relies heavily on online t-shirt and gift sales to keep going strong. But we do not use just Cafepress. We have products at other sites too such as Printfection and Zazzle. While Printfection has the versatility of CP when it comes to ease of designing a store and Zazzle does not, Zazzle outperforms Printfection for the products we have available on those site. Those revenues have also been growing while receipts from CP have shrank in large part to new pricing and bonus structures. Sure, the economy has something to do with that too but with growth at other sites it is hard to see that CP could not be doing things better on their end.

Another tool we use to generate revenues if Google Adsense. Many of the sites we operate are monetarized to generate revenue from ads that Google serves. This revenue stream has also been grown in the last year to help take some of the sting away from changes at Cafepress and further illustrates how being diverse in your revenue streams can keep you afloat when changes that are not of your own doing come a calling.

As each egg you hatch grows and matures it will slowly replace revenue lost to another source.

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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

His reference is of course to the fact that no matter how big you think you are, someone else is always able to take you down a peg. Or in this case, have you over dinner as the main course.

Cafepress has been doing a lot of things to shopkeepers that have done nothing to help us make money using their system. We are like our heroes in Star Wars and they are like the Huge Gooberfish that has latched on, making us squirm. Well, not much has changed on that front except that a bigger fish has risen up and taken a bite out of them it seems.

That bigger fish? None other than Google.

Here is the email I received today from the Death Star that is Google Headquarters:

Hello,

We’re happy to let you know that as of September 3rd, individual sellers on marketplaces no longer need to submit feeds to Google Product Search. Going forward, marketplaces will be responsible for submitting a feed of all their sellers’ items, so we will be retiring your account to avoid duplicate entries on Product Search. Cafepress will also be responsible for ensuring that your feeds are up-to-date and compliant with our policies.

In most cases, marketplaces already submit feeds of their sellers’ items. If you have any further questions about your items or Google Product Search, please contact Cafepress. We look forward to continuing to display your products, and hope you enjoy the new streamlined submission process.

Sincerely,

The Google Team

Email preferences: You have received this mandatory email service announcement to update you about important changes to your Google Base product or account.

Google Inc.
1600 Amphitheatre Parkway
Mountain View, CA 94043

With one swipe of their hand, and with no notice (ala Cafepress) Google has removed my products from their database leaving only the few that Cafepress has chosen to include in their own product feeds. My understanding is that Cafepress is not allowed to submit their entire product database to Google so the number of those products are limited. In the past before I started submitting my own product feeds I never had all of my products showing up in Google’s shopping database so I must still work under the assumption that this is true.

And while this sucks for me, do not think for a moment that it does not suck for Cafepress too! Because one of the ways they were able to get more products in the database was for individual shopkeepers to submit their own feeds which in the past Google has explicitly told me they had no problem with. Now things have changed and it looks like thousands, perhaps tens of thousands and maybe even hundreds of thousands of CP based products are gone. If my assumptions are right, while I might loose some sales multiply those losses by thousands of shopkeepers and think about how much money Cafepress stands to loose.

Now the rumor is that Cafepress worked with Google to accomplish this feat because shopkeepers were pulling their products from the Marketplace and then submitting their own feeds. My understanding is that Cafepress was caught off guard by this sudden move and caught unawares. While I find it hard to believe that Google would make such a change while not consulting and contacting one of the largest retailers using its services, I sort of can believe it based on the general arrogance that oozes from Google at times. The fact that the email came from a do not reply address and specifically tells us to direct our questions to Cafepress without notifying Cafepress is just typical Google. Couple that with the arrogance of dropping this major change right before a holiday weekend as Google employees are heading out of the office only further shows how arrogant Google is.

Also it should be noted that this applies to other PoDs too! That includes Zazzle. So it does not appear to be a CP spearheaded effort.

But what is done is done. Looks like Cafepress will have to have a chat with Google to find a solution. But in the meantime let me run down my thoughts directed at Cafepress.

First, how does it feel to have a bite taken out of you by a bigger fish? Hurts doesn’t it?

Second, now that you have have this bite taken out of you will you think though your actions that take bites out of smaller fish (like shopkeepers) before biting them?

Third, if you go whining to Google what are the odds that they will care? And if they don’t care and make you feel like you have made shopkeepers feel will this affect how you treat us in the future?

See, right now you have a bunch of us talking to Google trying to get them to understand our predicament and how some of the prices are different between our shops and the marketplace and how by doing this Google is not letting people find the best price! But we are not on your side Cafepress. We are not on your side because you’ve kicked us in the babymaker too many times for us to be. We are on our own side.

So all you are getting is even more negative press. Whereas if you hadn’t grabbed our nuts and twisted so many times over the past year we would be signing your praises and on your side in this fight.

But like I said, we are not doing that.

Would you like some ice for your own babymaker Cafepress? We’ve got a lot to spare because ours are very sore. No thanks to you.

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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

Well, interestingly, it looks like Cafepress has not grown in terms of the numbers of checks they have been sending out over the past several years. This tends to mean that they were not helping to create more and more successful shopkeepers as time went on. Here is the chart:

What I did was basically plot each point which is a difference between the current month’s check number and the previous month’s check number to show that over the past two to three years Cafepress has not been sending out more checks month to month. My interpretation of this, again, is that they were not helping to create more and more successful shopkeepers which would in turn means more and more success for them.

Note the large spike four years back. This is an anomaly I think as mysteriously the check numbers bounced from the 50,000’s to over 100,000. It looks like CP simply changed their numbering system. Either that or they had a really good Christmas with a lot of really small checks.

I think it is clear from these numbers that CP hit critical mass sometime ago. More people were signing up for their service but they were not making significantly more sales off those people that did sign up. If they were you would expect to see the chart going up and more checks being written month to month.

This could also help to explain some of the recent changes that have gone on and for the worse if you ask me. Sure many of us prior to the changes were slowly increasing our monthly sales but it looks like CP was not patient enough to let its revenues grow organically with their top shopkeepers leading the way. Instead they instituted drastic changes that added lots of new cash to their pockets by first removing MP commissions then by setting prices in the marketplace and cutting commissions to 10%.

Looks like they needed money and they found their way of making that goal a reality. These are actually typical tactics of a company that fears there is no more room to grow and they see the revenue curve starting to level off.

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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

Just how much is Cafepress costing me per sale while not increasing sales? With my old price structure I was averaging just under $3.00 per marketplace sale ($2.985). Right now I am nearly half that at $1.637 per sale mostly because I am getting a paultry $0.50 per bumper sticker. I told Cafepress when they called me to discuss this change and told me how it would drive more traffic and increase marketplace sales that I would believe it when I see it and that they would have to double my MP sales to make their service worth my while in terms of vast future updates and new products. Well, I am still waiting…

Oh, and they still would then need to double my sales on top of that too to make up for marketplace commission losses as well.

So far I am right (in that they would not do what they said they could) and CP is wrong.

Personally I think these things all point to one plan. Each of these moves are designed with one thing in mind – the bottom line of Cafepress. Since we are told that Cafepress is not in any sort of financial trouble, and if they were they wouldn’t tell us anyway, everything mirrors what I have seen many times over.

I personally believe that the owners are trying to position themselves for a sale of the company. Yes, this has been denied, but if the company is not in financial difficulty then why make such drastic changes which will certainly help CP in the short term. But once all the shopkeepers get their Zazzle, etc. stores fully running it will certainly only hurt CP in the long run?

Quick changes to increase cash flow are only done for a couple reasons. The big one is to make the books look so awesome that they can command top dollar at sale. The second one is to try to stave off financial failure.
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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

Well, I have been looking at the numbers from last month, before these marketplace algorithm changes and this month after they started to make said changes. This month is not quite over yet, but we can project where it will end up in terms of marketplace sales.

We have two numbers to look at really. First is marketplace sales and second it total items ordered from the marketplace. If we say that last month (April) is a decent base (January, February and March are my lowest grossing months of the year but April and May are pretty similar heading into summer) and if we normalize both marketplace sales and total items sold through the marketplace, from an April standard 1.00 here is how it shakes out so far.

Marketplace sales Total Market Place Items
April 1.00 1.00
May 1.01 0.93

So sales are up 1% but total items are down 7% for this month AFTER these “great” changes have been made. So, the question to Cafepress is how are these changes helping me make more money through Cafepress exactly when soon my average commission on items sold through the marketplace looks to fall by about 50%? I mean, sure Cafepress spent a lot of time trying to convince me that these changes would benefit myself and other shopkeepers but I ever bought that canned line mind you and I have been busy shoring up my revenues at other PoDs.

Numbers don’t lie. And so far the changes at Cafepress do not bode well for shopkeepers like me who have already seen revenues drop by about 40% following the removal of sales bonuses from the marketplace. Now I am looking at another halving of revenues on top of that.

So does someone from Cafepress want to tell me (again) how great these changes are going to be?

Until I see marked improvement my recommendation to avoid Cafepress as your primary (and even secondary) outlet for PoD products remains solid considering that you can still set your commissions at nearly every other service and make just as much, if not more money there.
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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

This would be like an art gallery setting all the prices of its artwork at the same price per square inch and making a Salvador Dali and a piece by some unknown artist the same price because the two works are the same size. Trust me, any gallery doing this would not stay in business very long at all.

It is my opinion that Cafepress made up their mind to change things and then decided what that change would be because all evidence points in that direction. They then went back and tried to justify the already decided upon change. However this process only leads to bad decisions time and again.

The only place where my revenues are falling for same month sales are at Cafepress. All other sites are growing. There is obviously a problem at CP. But see, like I have said before, they do not care whose designs they sell or really what quality the designs are. What they care about, and should care about, is simply moving more product and making more money. They don’t care if it is your fancy design that took 40 hours to create or someone else’s design that took five minutes.

Remember though, it is nothing personal. It is just business. So you should take the same approach and work hard to maximize your profits too. Even if that means moving to another PoD. Hey, it is just business after all …

The outcry was so huge that it forced Cafepress to push back the full implementation of the new structure until after the Christmas shopping season and, despite their claims to the contrary, push back their plans to reap bigger rewards from holiday shoppers by not paying out the same bonuses as in previous years while keeping the money for themselves.

Since that announcement, the furor has subsided and shopkeepers, myself included, have redoubled our efforts at other PoD sites to make up for lost revenue and teach CP a lesson that competition brought on by their own actions can hurt. But now as December comes to a close and top shopkeepers notice paychecks $500, $1,000, $2,000 or more less because of the the new bonus program, it will be a bitter reminder that Cafepress really did take those that have helped them grow over the years and bend us over a table and forcibly have their way with us.

I fully expect to see another redoubling of the prior efforts by shopkeepers to once again prepare to make up for lost revenue and give Cafepress much more unwanted competition that could have been avoided by a little common business sense.

Hey, it’s nothing personal. It’s just business.

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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

1) Don’t Lay Off Employees Just Because

It is tempting when business starts to slow up to start cutting employees to save money.  Here is the downside to that approach however.  If you start trimming employees now, ask yourself what you are going to do when things start to come out of the current downturn?  When requests and orders start to come back in how will you scale back up to handle the demand?  Odds are that those people you laid off are not just going to sit around and wait for you to call.  If you spent time and energy training people letting them go can mean them slipping to you competition who will benefit from your hard work.

A good business plan should include having the cash reserves to weather a dip in the market and keep your company in tact.  I know that is not a flashy suggestion and it means squirreling away some cash that you would probably really love to spend but if you downsize and get consumed by a tidal wave when the economy recovers and don’t have the personnel to handle the load then what?

2) Failure To Conduct Business As Usual

I should note that these suggestions are for when what is happening in the economy is not some catastrophic realignment but merely where the normal ebbs and flows of market forces are in effect.   So when you see me say, “conduct business as usual,” that of course has a caveat.  For example if you are company like the Big Three automakers in Detroit who are being buried because of untenable expenses brought on by idiotic, there I said it, promises to labor and giving huge bonuses to management for operating a company in the red then you certainly should NOT continue doing what you have been doing.

But for most companies that are fiscally responsible, conducting business as usual is a good idea.  If you call your customers regularly continue to do so.  If you have meetings on Monday in the office continue to do so.  If you reward success with bonuses continue to do so.  Failure to conduct business as usual is a sign to those in your company and that your company deals with that something is wrong and people do not like to work for or with companies that they perceive as having problems.

Believe me, your customers will notice if you stop calling and your employees will start acting funny as they look over their shoulder if they anticipate more changes based on deviations from the norm.

3) Remember That 10% Is Better Than 0%

One exception to my previous tip is that when times get rough, often margins must suffer.  It is important to remember that 10% of $55,000 is a lot better than 0% of $60,000.  The later number is what your product would have sold for at 20% markup. Lots of companies stubbornly refuse to realize that competition exists and that the competition is ruthless.  Sometimes survival of the fittest means the fittest have to get a little leaner too.

You may have been fat, dumb and happy making 20% on your products but when the base of customers begins to dry up, it means more competition for those customers.  Supply and demand dictates that prices drop if the number of companies providing a service stays the same but the demand for that service drops.  It is often unwise to ignore this reality.

4) Don’t Get To Nebby

When the economy sags business owners have a natural tendency to start roaming the halls more frequently and getting more interested in what people that work for them are doing.  The problem with this is that it tends to show two things.  First that you don’t trust your employees anymore and second that you, yourself, don’t have enough to do.

You either have faith in your employees or you don’t.  If you left people to their own devices when times were good and are now looking over their shoulders when times are bad you will make them uneasy because this is a change (see point number 2 about conducting business as usual above) that will be seen as a lack of trust.  And the worst part about seeing a boss more often when things are in the toilet economically is that the employees start to wonder why you are not out looking for ways to help turn the company around.

5) Don’t Send Mixed Signals

The email reads something like,

“Dear employees,

Due to the current and ongoing economic crisis the offices will be closed every Friday in December to help curb costs.  As a result, employees will not be paid for the full work week.”

Then a day latter another email is sent out reading,

“Dear employees,

Please do not forget that the company Christmas Party will be held on December 22nd!  Hope to see you all there!”

Well, which is it?  Is there an “economic crisis” or isn’t there?  Are we cutting costs or not?  Christmas Parties are not cheap ya know!  Don’t, what ever you do, send mixed signals like this.  Believe me, your employees will really start to wonder what is going on if you tell them you are cutting costs but continuing to spend money on extravagant events.

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J.J. Jackson is President of Land of the Free Studios, Inc. and Cafepress “Top Shopkeeper”. He has been selling t-shirts on-line since 2004 and is the owner of the T-Shirt Entrepreneur, a site dedicated to helping people get involved in the T-shirt Economy. He is also the owner of Funny When Wet T-shirts, American Infidel Tshirts, Uber Gamer T-shirts as well as many other online t-shirt and gift stores.

Cafepress:

You have begun doing some things that are upsetting a lot of people that helped make you what you are today and getting in the way of them continuing to help you grow. Previously you limited premium shop sizes to 500 sections, increased base prices on some items and now are rearranging the way commissions are being pay with one obvious goal – to increase revenues on the backs of those that are your lifeblood.

As an entrepreneur, I understand the need for Cafepress to make money and turn a profit. Businesses do not survive without doing so. But this series of major changes has me worried about your future especially when you seem so cavalier about making changes that greatly effect your shopkeeper base.

This most recent change, more than any of the previous, has a serious chance to cost shopkeepers money and people who use you, at least those that are entrepreneurially inclined, to sell product will adapt and fight against loosing money in a variety of ways.

Perhaps you may not beware of the way entrepreneurs think, but one of those ways many of us will pursue to recover lost profits from our own pocket is to continue to increase our presence on other one-off t-shirt sites like Printfection, E-Shirt, Spreadshirt and Zazzle. This will enable us to make up the money we are loosing from this change by making more money with them.

However, this will come at a cost to Cafepress. As we increase our presence on these other sites, they will grow. As they grow, your competition will get more fierce. As your competition gets more fierce, your advertising costs to maintain your current position will increase even more and accelerate an already upward spiral which you are helping to feed by forcing those of us who support your service to spread out to other services and grow our market share to bolster our own bottom line.

I bring this up because one of the reasons for the recent change of not providing commissions on sales from the marketplace is due to advertising costs making it cost prohibitive.

What you have basically done is pointed a gun at your own head. If you think that advertising costs are high now, just wait until your competitors double, triple and quadruple the size of their own marketplaces as Cafepress shopkeepers work hard to supplement their income by expanding and adding new revenue streams through your competitors.

The only thing saving you right now is that that gun you have pointed at your own head isn’t loaded. At least not yet.

In my opinion your ownership needs to be looking long and hard at the people you have making decisions like those as of late and questioning their sanity and business skills. Short term gains are often a goal of those at the top of any company hoping that they will be on their way out the door before the long term consequences of those gains come home to roost. Your marketplace wouldn’t be making you a dime if it were not for your shopkeepers who work hard and this is how you repay them? By cutting their profits to increase you own?

You are welcome to do that. Private enterprise does certainly require companies to make decisions and chose which path to take. But it is my opinion that is path is a path to sure suicide. No company can expect their employees to remain loyal when they announce salary cuts while other companies are paying higher and higher rates. By this same token Cafepress cannot expect the shopkeepers, who have made your site a cornerstone of their business, to remain loyal when you cut their profits.

Plus, dropping bombs like this in the manner in which you have done, barely a week before they are to go into effect, is not a very good way to gain trust with those who are essentially your business partners. You might have avoided criticism and backlash by keeping it secret until it was announced, but now you will have a tidal wave ten times worse coming down upon you by taking this approach.

I would seriously suggest those in charge at Cafepress do some self examination as to whether or not this is the path they want to keep following. Because it is clear to where it leads. Biting the hand that feeds you, brings in your revenue and that is the continuing source of your greatness has ruined companies much larger and more prosperous than you.

Now, if you will excuse me, I have some expansion plans to make and some other revenue streams to begin to grow to compensate for this change.

Sincerely,
J.J. Jackson, shopkeeper