An inside look at Zazzle, which expects $250M+ revenue and a gross margin of 45% this year, larger than Amazon's recent 35% gross margin
The anti-Amazon that's making money: Zazzle — Amazon.com became the world's most valuable retailer by selling everything imaginable at virtually no profit. Tweets: @cnbc Tweets: @cnbc : This anti-Amazon site is making a lot of money: http://www.cnbc.com/... http://twitter.com/...
Context & Ripple Effects
In early 2015, Zulily was approaching $1B in annual revenue as the poster child of vertical e-commerce; months later, CNBC profiles Zazzle making the opposite pitch from Amazon: over $250M in expected revenue at a 45% gross margin, versus Amazon's recent 35%. The framing is deliberate — profit-per-dollar instead of growth-at-any-cost.
What makes the contrast durable is what came after: [[a:847792|Zulily ultimately wound down in 2023, accusing Amazon in a lawsuit of stifling its business]], while Amazon's average cut of each marketplace sale climbed from 35.2% in 2016 to 51.8% in 2022. The anti-Amazon positioning turned out to be the survival question for every independent retailer of that era.
First-order effects
- Zazzle's 45% gross margin on $250M+ revenue lets it fund operations from its own sales rather than external capital — the direct counterpoint to the flash-sale cohort, including Zulily, that scaled on venture money.
Second-order effects
- Amazon's response to thin retail margins has been monetizing its marketplace instead: its take rate rose past half of each third-party sale by 2022, supplemented by a newly broken-out $31.2B advertising business in FY 2021 — raising costs for any seller who competes with or relies on it.
Third-order effects
- The structural lesson from the corpus is that independent e-commerce brands either hold pricing power like Zazzle or become tenants paying an escalating platform cut like Zulily did — with Amazon's take-rate trajectory acting as the tax that decides which.
The trend: Retail e-commerce bifurcated into zero-margin platforms that monetize sellers through rising take rates and fees, and profitable niche marketplaces whose independence depends on never needing the platform.