Merch by Amazon: Does It Live up to the Hype?
By Greg Holden
Graphic design: it seems like one of those things you can't sell like a commodity on Amazon.com. Not true! A relatively new service called Merch By Amazon enables everyday non-designers to sell designs printed on T-shirts.
Merch is quickly becoming a big deal: search YouTube and you'll find lots of videos proclaiming "$50,000 Per Month or More in "Merch By Amazon,"" "Merch by Amazon: How I sold $3660 Worth of T-shirts," and the like.
But wait a minute. Isn't that what sites like CafePress and Zazzle have been doing since 1999?
Yes. But it turns out that while it does make selling T-shirts easy, there's more than meets the eye when you start using Merch By Amazon. Looking at the reality behind the initial perceptions and getting beyond the hype is essential so you know what you're getting into. But first, the basics:
What Is It?
Merch By Amazon is an online service that lets anyone apply designs to items like T-shirts (at present only T-shirts) and advertise them for sale in its marketplace. If you make a sale, Amazon charges its fees, and you're left with a royalty. Amazon does the printing, shipping, and fulfillment. For Prime members, shipping is free. So this is an easy way to sell merchandise you've at least played a part in creating.
How Does It Work?
You need to be invited to join Merch By Amazon, but you can request an invitation. After your application is approved, you come up with a design and save it as a PNG image. If you're an artist or graphic designer, you have an obvious advantage. If not, you can hire a designer to create something to your specifications on a site like Fiverr.
There is a potential problem here: it's easy to copy and re-use other designs posted online without the copyright owner's permission. Such Intellectual Property (IP) issues do come up with Merch By Amazon and are explored below.
Once you have a design you think people will want to display to the world on their clothing, follow these general steps:
1) Choose a template. Amazon provides you with several templates for sizing and positioning your design onto the T-shirt or other item of choice.
2) Upload your PNG file. You want your file to have a transparent background, which means a little image editing is needed. Initially, you are limited to 25 designs. This limit is relaxed as you sell more.
3) Position your design. You choose whether to apply it to the front only or the front and back of the shirt. You are charged more for a front/back choice, which cuts into your profits.
4) Price your item. A $9.99 price is tempting but no longer practical. At this writing, Amazon charges $9.31, recently raised from $8.10 (see current prices) plus 15 percent per item so your profit (or royalty, as Amazon calls it) would be only 39 cents.
5) Choose colors. Amazon suggests only three options to avoid customer indecision, but it's up to you.
6) Fill in details. These include your brand name, the item name, and product details.
After that, you review your product to make sure it looks the way you want, and start selling.
You can find a useful video on YouTube explaining the Merch sales process.
As indicated earlier, there are some challenges for sellers based on potential misperceptions:
Amazon Is Helping You Sell
Yes, but they're also competing with sellers, just as they do in other parts of the marketplace, where individuals are allowed to sell books and other stuff. Amazon's marketplace is already loaded with T-shirts and other clothing, much of it not created by "amateurs."
You're Generating Passive Income
Once you get your designs online, you technically don't have to do anything. But as every online seller knows, you need to market your products to get results. Those who already have a following of some sort or who have a way to advertise their products through other online stores, Facebook pages, or other outlets do have an advantage.
It Has a Dual Effect on the Shopping Experience
Merch By Amazon does provide more options for someone looking for a T-shirt with a special slogan or image...a lot more options. The question is, does it help a shopper when a search for a T-shirt with a "sunshine" or "bee" connection turns up more than 43,000 results, as it did for me just now?
Zu Adams, who sells T-shirts and other custom designs through her Kansas City-based Riverstone Goods, said "You're diluting the customer experience, which is bad for our customers. Merch sellers are flooding the marketplace with hundreds of identical, or nearly identical, designs. Customers are presented with search results that contain very little variety and I would argue that many of them become frustrated and just abandon their purchase at that point."
It should be mentioned at this point that repeated requests to Amazon.com for comments on objections to Merch were not successful. Neither were two requests for comment to CafePress, which is likely to see Merch as a big threat to its longtime business. As stated before, Amazon uses an invitation-only system to add Merch sellers, which does allow them to limit competition.
It's Easy to Find a Design and Just Use It
Repeat after me: Yes, but...do you have the right to use that design? Adams says some of her designs have been ripped off by Merch sellers. A visit to the Merch By Amazon Facebook group reveals sellers who report that they have had designs taken off the site for intellectual property violations. So Amazon does police Merch. But can it keep up with the flood of designs coming from sellers from all over the world, many of whom have different notions of what copyright and trademark mean than those in this country?
"A lot of Chinese sellers are on Merch and on the regular Amazon, and they view intellectual property much different than we do. They view it as something to take," Adams says. "All these Chinese sellers who have gotten Merch accounts are doing it, too. You can't defend yourself. Amazon refuses to take action. I've repeatedly complained over and over and they're doing nothing about it."
On the other hand, it's easy for non-designers to create simple, type-only designs and apply them to T-shirts in a matter of minutes. And lots of sellers who play the game legally are making money on the site, to judge by their own proclamations on Facebook and YouTube.
Despite her objections, Adams sees Merch as good for sellers. "I actually think it's a great concept gives people an opportunity to start a business who don't have the capital to get it going."
However, she continued, "Without any controls in place it's just like a wrecking ball. For sellers like us who have paid Amazon millions of dollars in fees, you would think they would have involved us or protected us in some way from these people who have no idea who it works. I don't fault Amazon. They are innovative and they come up with great stuff. But to just open the floodgates like that - there are people on the other end of that when they are testing a computer program and it doesn't seem to be relevant to them. That is my biggest disagreement with this: They are running an experiment...and there are people it affects."
Since talking to Adams, she launched a blog where she discusses her experience with Merch By Amazon, which you can find at ZuAdams.com.
About the author:
Greg Holden is EcommerceBytes Contributing Editor. He is a journalist and the author of many books, including "Starting an Online Business For Dummies," "Go Google: 20 Ways to Reach More Customers and Build Revenue with Google Business Tools," and several books about eBay, including "How to Do Everything with Your eBay Business," second edition, and "Secrets of the eBay Millionaires," both published by Osborne-McGraw Hill. Find out more on Greg's website, which includes his blog, a list of his books, and his fiction and biographical writing.
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