Sorry for not posting these days and for not releasing anything. I'm still here and hard at work but the two projects I'm working on are big and are not finished yet, so I have nothing to show yet. But be patient :)
This post is about Linden Lab's latest changes to the pricing of the Marketplace, which you can read here
. What I am interested about in particular is the fact that they cranked up the merchant fee from 5% to 10%. In plain English, this means that when you buy a product, the merchant used to get 95% of the price (the rest going to LL) and now they receive only 90% of it, for no return at all or any improvement in the service.
If you remember, 6 months ago
LL had jacked up the fee of the process credit from 2.5% to 5%, which represents a significant loss per year. I decided back then not to increase the price of any of my products and kept my word.
But now this is beginning to accumulate. First the process credit fee and now this. And I suspect the fee will increase in the future since LL seems to think they have a margin, with Apple's and Google's fees being 30%. It's comparing apples to oranges, if you ask me, no pun intended.
Anyway, all this to say is that this time I don't know what to do. The calculation is simple : before Dec 2nd I received X*0.95 of any sale and now I receive X*0.90, so in order to receive the same amount of money as before, I would have to change the price of every product to X*0.95/0.90 = X*1.0555... Which means an increase of 5.555%. But that would put the cost entirely on the consumer, I would hate it if a merchant did that to me.
So a more just solution would be to divide the increase by two, so the consumer takes half of the cost and I take the other half. In other words, the increase would be about 2.777% only. In practice, that would mean the When You're Hot appliers would go from L$700 to L$720, for example. Not a big increase, but a noticeable one anyway.
I don't know yet what I'll do. I could also completely close my Marketplace store and sell only in-world but let's be honest, the Marketplace is where it's at. For most people, if a product is not on the Marketplace, it does not exist.
I've known about this change the day LL posted it to the blog but I stayed quiet, not really seeing a solution, and I still don't see one. I'm giving it a week to see how much this change impacts my income, probably not much but it won't go unnoticed either, I guess.
In other words, the prices of my Marketplace products won't change before next Monday (Dec 9th). After that... I don't know yet.