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Author Topic: The Latest from Chad regarding Purchase incentives and commission structure  (Read 17912 times)

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« on: February 19, 2010, 14:25 »
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The following is the latest from Chad regarding Purchase incentives and commission structure:

Hi everyone,

We have been carefully monitoring sales since the new bundle pricing was implemented earlier this month. We're very pleased with the results and would like to provide you with the following update.

As a backgrounder, all of you know that Fotolia's previous credit pricing ranged from $0.75 to $1, depending on the amount of credits purchased. On average, customers purchased credits at a rate of $0.94 each. Fotolia paid contributors as if those credits were purchased at $1, regardless.

In February, the new credit bundles were created to incentivize customers towards buying larger bundles. If we succeeded, that would mean a larger number of credits in the system, benefiting contributors by way of increased downloads.

Even though we're only several weeks into the change, we're proud to report some initial success. On average, we're awarding 20% in bonus credits. Thus, we will continue to pay contributors commissions based on $1 credits.

We also saw a dramatic increase in the number of credits awarded. In fact, it jumped from 6% in January to 20% in February to date. Without calculating the effects of Fotolia's natural growth rate, that means we introduced an additional 14% in credits into Fotolia's ecosystem.

This additional growth in the system, along with our natural viral growth and our aggressive sales and marketing program will translate into continued success for all contributors in Fotolia's family.

We thank you for your continued support. We will continue to monitor the situation closely and report back to you with any changes.

Fotolia management

http://www.fotolia.com/forum/viewtopic.php?id=25258&p=5

Denis
« Last Edit: February 19, 2010, 14:38 by cybernesco »


sc

« Reply #1 on: February 19, 2010, 14:32 »
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WHAT???

« Reply #2 on: February 19, 2010, 14:54 »
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Thanks for starting a new thread on this, since the old one kind of got cluttered up.

I wonder what the new average credit price is? It looks like the credit prices vary from $.75 to $1.14. I think these posts create more questions than they answer.

LSD72

  • My Bologna has a first name...
« Reply #3 on: February 19, 2010, 14:56 »
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It sounds more like circle talk with the underlying being they get more success while contributors get continued success. I dunno.  ???

« Reply #4 on: February 19, 2010, 14:59 »
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I responded the following on their forum


Quote


Hi everyone,


As a backgrounder, all of you know that Fotolia's previous credit pricing ranged from $0.75 to $1, depending on the amount of credits purchased. On average, customers purchased credits at a rate of $0.94 each. Fotolia paid contributors as if those credits were purchased at $1, regardless.


Fotolia management


With all due respect, thank you for responding.

However most buyer buys from Europe in euro or in pound sterling.  I don't know why you say credit pricing are between  $0.75 and $1 when in fact it is more like between $0.75 and $1.57. As an example from a France site a package of 20 credits will average 1.14 euro which is equal to about $1.57 US at today's rate. And if a buyer buy an image of mine from this package then I get 31/157 and not 31/100.  But I am sure that you can explain this.

Thank you for your support   

Denis

RacePhoto

« Reply #5 on: February 19, 2010, 15:01 »
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WHAT???

incentivize customers
natural growth rate
ecosystem
natural viral growth

Sounds Green?  :)

What it really says? "Wha wha wa wa wahh wa waa......" (Teacher from Peanuts) and, blah blah blah until you stop listening and forget what the question was all about.

I cut and pasted it into babelfish and got this:

We'll get back to you.

« Reply #6 on: February 19, 2010, 15:17 »
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As an example from a France site a package of 20 credits will average 1.14 euro which is equal to about $1.57 US at today's rate. And if a buyer buy an image of mine from this package then I get 31/157 and not 31/100.  But I am sure that you can explain this.
Out of curiosity, what do the credit packages cost on the non US sites? I can only see the credit prices when I log in and when I log in, it gives me the prices in dollars.

« Reply #7 on: February 19, 2010, 15:20 »
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As an example from a France site a package of 20 credits will average 1.14 euro which is equal to about $1.57 US at today's rate. And if a buyer buy an image of mine from this package then I get 31/157 and not 31/100.  But I am sure that you can explain this.

Out of curiosity, what do the credit packages cost on the non US sites? I can only see the credit prices when I log in and when I log in, it gives me the prices in dollars.


Look at the bottom right,


http://fr.fotolia.com/Member/BuyCreditsChooseAmount 


Denis

sc

« Reply #8 on: February 19, 2010, 15:31 »
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What I posted on the FT Forum:

All I know is my downloads are down and the average amount I make per download is decreasing.
In 2008 my average DL netted me .96
In 2009 it dropped to .90
in 2010 so far it's .83
So for me this new pricing isn't working.
The commission cut last year was supposed to even out with the higher payout to us on the larger sizes - that isn't happening for me.
I get fewer DL's with more smaller size sales and more Sub Sales.
This is the only site where I see my numbers going backwards.
So how is this working for anyone else other than Fotolia??

« Reply #9 on: February 19, 2010, 16:17 »
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Do you understand this part?

Quote
We also saw a dramatic increase in the number of credits awarded. In fact, it jumped from 6% in January to 20% in February to date. Without calculating the effects of Fotolia's natural growth rate, that means we introduced an additional 14% in credits into Fotolia's ecosystem.

What are "credits awarded"?

« Reply #10 on: February 19, 2010, 16:35 »
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What are "credits awarded"?
Sounds like they are giving it away as a promo tool. Something like printing money.

« Reply #11 on: February 19, 2010, 17:01 »
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What are "credits awarded"?
Sounds like they are giving it away as a promo tool. Something like printing money.

I think what he means by " awarding 20% in bonus credits"  is that at the moment the average size of credit bundles being bought by buyers has given them an average of 20% discount or therefore 20% more credits then if it was bought in smaller bundles. However, in his calculation, he conveniently omitted all credits bough at over $1.00 as well, most importantly, all credits bought in other currencies which goes as high as $1.55-$1.60 per credit.

Denis

« Reply #12 on: February 19, 2010, 17:24 »
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Wow. 100% pure marketing and accounting fog-speak.  Fotolia has become the Enron of microstock.  (I hope you've all seen "The Smartest Guys In The Room".)

The people running these agencies now live in their own world of marketing and accounting schemes.  Trying to explain this system to that mob of shabbily dressed weirdos at the back door (us) is no longer necessary.    





« Last Edit: February 19, 2010, 17:34 by stockastic »

OM

« Reply #13 on: February 19, 2010, 17:42 »
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What are "credits awarded"?
Sounds like they are giving it away as a promo tool. Something like printing money.

Similar but subtly different. "We have been able to 'award'  extra credits because our contributors are generously paying for them. It's like the UK team once stated, We are the deciders and we decided that they would."

« Reply #14 on: February 19, 2010, 17:50 »
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Crikey, George Orwell was right. But  I hear this sort of claptrap every day from the founder/owner of the number two computer company... or is it number three, so I'm a little jaded. Anyway, I'm none the bloody wiser, but to you use an expression from my US colleagues "don't piss down my neck and tell me it's raining".

« Reply #15 on: February 19, 2010, 17:59 »
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Anyway, I'm none the bloody wiser, but to you use an expression from my US colleagues "don't piss down my neck and tell me it's raining".
I'm learning a lot of great English expressions here all the time.  :P In Dutch we say to grease somebody up with his own fat.

OM

« Reply #16 on: February 19, 2010, 17:59 »
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As Gostwyck suggested a couple of weeks ago, they could be preparing to get 'absorbed' by aliens. Boosting the bottom line and (maybe it's just me) acceptance rate has been remarkably high since Oct/Nov 2009. "All the better to be eaten with, grandmama." ;)

Beam me up, Scotty.

« Reply #17 on: February 19, 2010, 18:04 »
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As Gostwyck suggested a couple of weeks ago, they could be preparing to get 'absorbed' by aliens.
This would be the second law of thermodynamics applied to stock. Ultimately, we will all end up as subs on thinkstock.

OM

« Reply #18 on: February 19, 2010, 18:08 »
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Anyway, I'm none the bloody wiser, but to you use an expression from my US colleagues "don't piss down my neck and tell me it's raining".
I'm learning a lot of great English expressions here all the time.  :P In Dutch we say to grease somebody up with his own fat.

Sometimes Dutch is far more expressive though. Take for example, "Teflon Don". "Zo glad als een aal in een emmer snot." ;D

OM

« Reply #19 on: February 19, 2010, 18:12 »
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As Gostwyck suggested a couple of weeks ago, they could be preparing to get 'absorbed' by aliens.
This would be the second law of thermodynamics applied to stock. Ultimately, we will all end up as subs on thinkstock.

Excellent!  :D

It would be funny if it weren't true.

« Reply #20 on: February 19, 2010, 20:09 »
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I think its totaly sad that people think they can blind other people with pure spin and think us plebs will take it as if we have no brains at all.

What kind of people do they think we are ? Kids going out spending our pocket money on disposable cameras then submiting our "snaps" to stock sites hoping they will sell "our" images for 1 giving us coppers ?

They value our contribution ....... yeah bet they do !!

« Reply #21 on: February 19, 2010, 21:43 »
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I had a bunch of nasty image refunds lately. Despite a very good day in sales, I ended up in the minus one day.

I'd love to see FT pumping some $$$ into preventing fraud!!!

No other agency is making their contributors eat the fraud like FT does...

sc

« Reply #22 on: February 19, 2010, 23:25 »
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I had a bunch of nasty image refunds lately. Despite a very good day in sales, I ended up in the minus one day.

I'd love to see FT pumping some $$$ into preventing fraud!!!

No other agency is making their contributors eat the fraud like FT does...

I've had a few of these not a lot but it really ticks me off that they can do this and get away with it. There is no other seller of goods that does this. Every business knows there will be a percentage of credit card fraud, theft, bad checks ... and whatever else. These costs are figured into the selling price and passed to the customers, not the suppliers. By this point they should have some handle on these costs and should be able to come up with a formula to recoup these losses in their selling price, not in charge backs to the supplier. If this isn't illegal it should be, after all they have given our image to the fraudulent purchaser with no way of getting it back. It is wrong and all the agencies that charge back need to stop this now.

« Reply #23 on: February 20, 2010, 10:49 »
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I'd love to see FT pumping some $$$ into preventing fraud!!!

I said this on a recent email to them, when I informed about a refund that was actually added, not deducted, from my account.

Quote
(...) Also, I really wished FT would be more carfeul with these transactions. Over and over we've been seeing these returns, so people with frauded cards are downloading our images and we lose the images and the money. Given the frequency it happens here and seldom elsewhere, it seems FT has some weakness in the transactions verification. We would appreaciate if FT would do something about it.

« Reply #24 on: February 20, 2010, 10:54 »
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I've had a few of these not a lot but it really ticks me off that they can do this and get away with it. There is no other seller of goods that does this.
Given the frequency we see this in FT - more than in any other site, as far as I know - I suppose they have something weak in their verification procedures. 

I have purchased a lot of things online, including software, which we download almost immeadiately after a purchase.  Don't they check with the credit card company before letting us download it?  Do they also suffer from this intensive frauds? 

« Reply #25 on: February 20, 2010, 12:48 »
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I'm a software developer responsible for web site that activates software online.

 A customer enters a product serial number and a credit number, and in return gets an activation key by email Of course we verify every credit card before emailing the activation key. It's a standard procedure and there are a number of online verification services that do this, in real time.

Fotolia is apparently not doing this, probably to save money.  They're not at risk of losing any money because it doesn't cost them anything to 'produce' a copy of an image, except for a bit of CPU time and bandwidth.  A copy of a full size image might end up in the hands of a crook, who could resell it, but that risk exists with any image sale.



« Reply #26 on: February 20, 2010, 12:56 »
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... It's a standard procedure and there are a number of online verification services that do this, in real time.

Fotolia is apparently not doing this, probably to save money...

Yep, my thoughts.

Of course this is not going to chance since it's not us actively putting money into their pockets - it's the image buyers doing that. As long as the buyers don't complain, FT won't change their system, as losing customers is worse than losing contributors. FT has way too many contributors that it can afford to lose rather than taking the risk of losing one single paying customer.

Obviously they rather take any opportunity to accept whatever payment from the funniest countries and weirdest forms of payment instead of preventing fraud which would only lead to higher overhead costs, that we and the buyers have to compensate.


donding

  • Think before you speak
« Reply #27 on: February 20, 2010, 13:05 »
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How are they gonna lose buyers that don't pay any way?? All they do is gotta check. Why do we have to pay for their ignorance?? Wonder how they would feel if we charged them for liable if that free image they sent before payment cleared was used in a way that it profited the so called buyer?? BigStock puts their payments on hold until they clear...how hard is that??

« Reply #28 on: February 20, 2010, 13:35 »
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...BigStock puts their payments on hold until they clear...how hard is that??

I'm not sure of Bigstockphoto buyers actually have to wait until payment is cleared. We, the contributors only get our credits if they clear within 7 days but I assume the buyers get their images instantly when they "pay".

I don't believe that any customer is going to stay with a company that makes them wait for 7 days until they can download the images when their payment info is verified...

Credit card payments are quite easy to verify but I had $15 refund for a failed wire transfer. That's a bit tough.

Wire transfers are not really fast and allow a lot of room for scams in my opinion.

Maybe someone can shed a bit of light on these kinds of transfers.

« Reply #29 on: February 20, 2010, 14:00 »
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The question is how many images are scammed? Is it 1%, 5%, 25%? If it is only a small percentage, then putting payments on hold is a waste of time. If a download is deemed to be a scam then a deduction can easily be made off a future sale.

donding

  • Think before you speak
« Reply #30 on: February 20, 2010, 14:08 »
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...BigStock puts their payments on hold until they clear...how hard is that??

I'm not sure of Bigstockphoto buyers actually have to wait until payment is cleared. We, the contributors only get our credits if they clear within 7 days but I assume the buyers get their images instantly when they "pay".

Yeah your right on that..I don't know what I was thinking, the buyer more than likely does get it instantly. At least at BigStock you can't draw those earnings until they have cleared. That way they can't start deducting it from your account because of the bad sales and end up in a negative balance.

« Reply #31 on: February 20, 2010, 14:15 »
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Wire transfers are not really fast and allow a lot of room for scams in my opinion.
One of my refunds were a faile dwire transfer.  Since this must be a minority of sales (or not?), this could be indeed delayed until cleared.

Verifications should be more strict when coming from a new buyer.  If you have a cliente who has purchased images before, it's not that likely he will comit a fraud.

lisafx

« Reply #32 on: February 20, 2010, 14:15 »
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Personally I would rather have it the way they are doing it at Fotolia - request my money right away - than having to wait 7 days to request it like at BigStock.  

I don't like getting the deductions either, but frankly I get more at IS than FT.

« Reply #33 on: February 20, 2010, 14:27 »
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I don't like getting the deductions either, but frankly I get more at IS than FT.

Is this really about which agency creates more income for you?

Sure, we don't see how many sales get refunded at BigStock due to the 7 day waiting period but other agencies that play in the big field like IS, SS and DT do not show such regular fraudulent actions.

Especially IS must be doing a lot more to prevent that as I had barely any refunds (and I understand that it does happen...) but not like FT.


« Reply #34 on: February 20, 2010, 14:36 »
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Sure, we don't see how many sales get refunded at BigStock due to the 7 day waiting period...

That doesn't make sense.  The waiting period only applies to how much of our balance we can request, not to when it's reported to us.  We see sales as soon as they happen, and would see refunds if they were deducted from our sales.  If it didn't work that way, if our reported balance doesn't include sales within the last 7 days, we'd be able to request the entire balance they did report.

Keep in mind that a big part of the problem with the way Fotolia handles bad transactions is that there's no statute of limitations.  I've had deductions from transactions that were more than a year old.  Did it really take them that long to notice?

« Reply #35 on: February 20, 2010, 14:41 »
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I don't like getting the deductions either, but frankly I get more at IS than FT.

Is this really about which agency creates more income for you?

I think she meant having more refund at IS than at FT.

« Reply #36 on: February 20, 2010, 15:00 »
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...I don't like getting the deductions either, but frankly I get more at IS than FT.

I'm sorry.

I didn't read that far...

I think individual results may vary but I've had sooo many refunds at FT that all other agencies combined couldn't account for half of what FT does to me.

« Reply #37 on: February 20, 2010, 15:25 »
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Yes, the individual results do seem to vary quite a bit - out of 3000 sales only a single one of mine has ever been refunded, and that was an XS. Other people seem to have lost much much more.

« Reply #38 on: February 20, 2010, 15:57 »
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Yes, the individual results do seem to vary quite a bit - out of 3000 sales only a single one of mine has ever been refunded, and that was an XS. Other people seem to have lost much much more.

Wow you got lucky.

Last week alone I lost over $20 and this is happening several times a month for me.

« Reply #39 on: February 20, 2010, 16:33 »
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I don't like getting the deductions either, but frankly I get more at IS than FT.
Very strange.
There is NO refund for credit card's fraud at IS. They pay us even if they are not payed.

« Reply #40 on: February 20, 2010, 17:11 »
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Very strange.
There is NO refund for credit card's fraud at IS. They pay us even if they are not payed.

Well I did get credits deducted due to a customer refund. I don't know how the customer paid but refunds happen even at IS

lisafx

« Reply #41 on: February 20, 2010, 17:36 »
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.

I think she meant having more refund at IS than at FT.

Thanks Maria, that's exactly what I meant. 

I usually get one or two refunds every week at IS and I have had maybe 2 or 3 EVER at FT.

It is strange there would be such variation from person to person.
« Last Edit: February 20, 2010, 17:41 by lisafx »

« Reply #42 on: February 20, 2010, 17:54 »
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Wow you got lucky.

Last week alone I lost over $20 and this is happening several times a month for me.

I find this extraordinary. I don't think I've had much more than $30 clawed back in total from all agencies over 5 years and 200k sales. It's such a microscopic amount in relation to overall earnings that I'm quite surprised that any agency actually bothers to do so. Especially as all the the Top 5 are eye-wateringly profitable anyway.

In comparison to the differential in FT's strange floating 'credit value' in the various currencies and the numerous reductions in commissions, either directly or by stealth, it absolutely pales into insignificance.

« Reply #43 on: February 20, 2010, 18:22 »
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...it absolutely pales into insignificance.

This is true for (almost) any given contributor but a saying goes "Many a little makes a mickle."

For FT or any other agency this is a nice way of having cash flowing back into their pockets again.Why take a hit if you can strip it from the contributors (since they didn't get the commission yet anyway).

Friend of mine got two footage sales reversed after he received the royalties from those. Well he started the next month with a big balance in the minus.

Handing down costs of fraudulent actions to the contributors is the simplest way of not addressing the issue of verifying validity of payment information.

For the agencies it's like not being affected by fraudulent activities after all... Quite sick.

« Reply #44 on: February 20, 2010, 18:25 »
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In comparison to the differential in FT's strange floating 'credit value' in the various currencies and the numerous reductions in commissions, either directly or by stealth, it absolutely pales into insignificance.


I totally agree. Denis

« Reply #45 on: February 20, 2010, 18:30 »
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For the agencies it's like not being affected by fraudulent activities after all... Quite sick.


I find the statement opening this thread worst then that. The statement conveniently fail to acknowledge buyer's credits above $1.00 and all other currencies which make credit more then a $1.50.  The statement try to make us believe that the whole FT buyer's world revolve between $0.75 and a $1.00 per credit. This is so untrue. Like I said before as an example if you buy a package of 20 credits in Europe, it will cost you 1.14 euro per credit which is equal to anywhere between $1.50 and $1.60 depending on the rate. And most of the sales are from Europe not North America. Therefore, FT buyer's world definitely does not conveniently revolve around the US dollar.   This totally not true. Denis
« Last Edit: February 21, 2010, 23:30 by cybernesco »

« Reply #46 on: February 20, 2010, 18:46 »
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I find the statement opening this thread sicker then that. The statement conveniently fail to acknowledge buyer's credits above $1.00 and all other currencies which make credit more then a $1.50. Denis

I do agree.

« Reply #47 on: February 20, 2010, 22:00 »
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Quick show of hands, who has NOT had refunds at FT this year?  Gosh, Lisa are you the only one?  ;)

You would think the credit card companies themselves would discipline FT or yank their merchant status or deny them the ability to transact in the countries that are doing all the fraud.

RacePhoto

« Reply #48 on: February 20, 2010, 23:24 »
0
.

I think she meant having more refund at IS than at FT.

Thanks Maria, that's exactly what I meant. 

I usually get one or two refunds every week at IS and I have had maybe 2 or 3 EVER at FT.

It is strange there would be such variation from person to person.

Are refunds at IS different from fraud deductions at the other sites?

Here's the problem behind all of this. These people who steal images with fake CCs aren't doing it to use them for their website or some rag that they print. They are stealing them for the free sites and the pirate sites and sometimes for the CDs with thousands of photos. That's how they can compile them for no cost in some cases.

It's not like someone just got a free photo, it's evident that the number of reversed transactions on many sites is a major problem with image theft.

« Reply #49 on: February 21, 2010, 05:05 »
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I regards to refusnds due to CC fraud etc.  The way I see it that should be included in the 70% or whatever fotolia take for being the agent.

I have no control over their security measures but it is my content that gets stolen not fotolia's. They should absorb the theft themselves as it is 100% in their control and 0% in mine.

« Reply #50 on: February 21, 2010, 06:20 »
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Never had a fraud refund at IS, after tens of thousands downloads. Yes, there ar,  some customer refunds; almost always due to the customer downloading wrong size. Customer returns the wrong size and downloads the right one, technically is a refund, but actually it is a change.

« Reply #51 on: February 21, 2010, 06:45 »
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Never had a fraud refund at IS, after tens of thousands downloads. Yes, there ar,  some customer refunds; almost always due to the customer downloading wrong size. Customer returns the wrong size and downloads the right one, technically is a refund, but actually it is a change.

How can you return a download... ?... ::)

Patrick.

« Reply #52 on: February 21, 2010, 15:37 »
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I remember something about a refund in IS, and it was an EL if I remember it right.  It was the client that had given up, or didn't like the image, something like that.  It happened very quickly, one or two days after the sale.  I think it should not be of our business if the buyer had some problem with his client.  But if this was an isolated event with a buyer, that woud be ok.  A buyer should not be able to do it often, though.  I think he must declare somewhere that he will delete the image (that would "return" a download).

By Christmas, I went to PopCap website to buy a game for my nephew.  He has asked me to pick one for him.  After purchasing it, I noticed I had already purchased this same game two years before.  I emailed Popcap and they cancelled the transaction, what was very kind of them.  I wonder if they would have done the same if I had not purchased it before?  Or if I had not purchased it before, but had downloaded it after purchasing, then said "It was a mistake" and asked a refund?

« Reply #53 on: February 21, 2010, 16:01 »
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If a buyer at IS is returning an image they have to provide a written waiver stating they destroyed the image. Obviously the buyer is not allowed to use the image for any projects either.

How is this verified? I don't know. I only assume that IF IS would find out about usage of a returned image they would sue . out of the buyer.

@ madelaide:

Popcap probably had records of your previous purchase. That is the best case scenario to receive a refund.

If you would have purchased your first game there using an email address from hongkong and a Paypal email address from France it starts looking fishy when requesting a refund... I doubt that it would be that easy then.

« Reply #54 on: February 21, 2010, 16:36 »
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click_click,

Yes, Popcap has a record, in fact I could see the record and that's how I found out that I had purchased the game before.  They allow you to reinstall the game a few times, and everytime you have to register the game by accessing their site.  We can see how many installations left we have, and they surely do too.  Had my nephew used all installations, I'm sure they would not refund me.

lisafx

« Reply #55 on: February 21, 2010, 16:46 »
0
Never had a fraud refund at IS, after tens of thousands downloads. Yes, there ar,  some customer refunds; almost always due to the customer downloading wrong size. Customer returns the wrong size and downloads the right one, technically is a refund, but actually it is a change.

AFAIK these are the type of refunds I am getting at IS - wrong size and/or changed mind  rather than fraud.

« Reply #56 on: February 25, 2010, 14:01 »
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I guess the credit card agencies won't stop this because they are the ones we are paying back. Why should they give a sh*t? Their customer is happy, they aren't having to refund him because we are doing it, and the micros aren't paying anything either. What it really means is that everyone considers that the thing we sold didn't have any value anyway so we can pay the refund.

If you think losing a couple of dollars on a micro hurts, wait until you lose more than $1,000 on Alamy, as I did.

This is just a diversion from the main issue, which is THE CHAD's statement. But what does anybody expect? Pseudo-green mumbo-jumbo is better than being told flat-out what he means. Does it really need spelling out? "You guys just got your commission cut to make us richer. Tough. Suck it up or sod off." 


 

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