In response to criticism of the new e-commerce area on its website, CrossGen has made changes to its site and created a new program for brick and mortar retailers that stock its books.  The controversy broke on the Comic Book Industry Alliance discussion board about two weeks ago, and was prompted by an October 23rd press release in which CrossGen announced the opening of the CrossGen Online Mall on its site.  The mall includes five 'stores' devoted to apparel, licensed products, original art, custom prints, and comics.  Two of the stores -- apparel and original art -- appear to be operated by CrossGen itself, or at least don't lead to obvious partner sites.  The other three online stores are operated by 'tenants'--Midtown Comics of New York City for comics, Dynamic Forces for licensed products, and BPF for custom prints -- each with its own shopping cart.  Before the change that CrossGen made in response to retailer concerns, when one clicked on the link to a store, the initial web pages appeared to be CrossGen pages; it's only when a user clicked on a product for additional info or to order that a page from the tenant site loaded.  And the crux of the matter is that Midtown Comics sells all comics at a 15% discount off cover price on its own site and on the pages that are linked through CrossGen. 

Retailers on the discussion board were upset about the discounts offered by Midtown on the CrossGen site for a variety of reasons, most centering around the perception that consumers would get from seeing discounted products on the CrossGen site and not noting that the sale was actually being done by a retailer partner.  Most of the comments came back to the problem that this can create a lower perceived value for products that retailers are trying to sell in their stores for full price.  As Robert Scott of Comickaze put it in one of his posts (reprinted here with permission), 'I don't care if Midtown discounts, that is their business.  My problem ...is that CrossGen promotes discounting of its comics on its own website.... While I doubt it will have much if any impact on my own sales, I am still disappointed that you have potentially placed me in an adversarial position of having to explain to any customer why they should pay me cover price for CrossGen books, when they can go to the website I included in my newsletter...and get a discount.' 

It's worth noting that one reason that retailers may have responded so negatively to this situation is that CrossGen has been perceived as retailer-friendly toward pop culture stores; retailers felt that the discounts on the site did not show CrossGen's usual concern for the well-being of comic retailers selling its products. 

CrossGen's Tony Panaccio (VP Product Development) spoke up on behalf of the publisher, starting off his comments (reprinted by permission) by noting, 'It's no secret that retailers in this business are abused constantly and unapologetically.  You are strong-armed into buying product, your ability to reorder strong-selling books is cut off arbitrarily, you are shorted on orders of popular comics, and you are generally put-upon by both customers and suppliers.'  He then turned to the situation at hand, noting that CrossGen was equally abused by a system in which '...we are having a frustrating time getting...product to the people who are demanding it with any level of regularity or reliability.' 

Panaccio raised a number of points in rebuttal to the retailer concerns.  First and foremost he made the point that Midtown is an independent retailer, not an arm of CrossGen, and that CrossGen can't tell Midtown how to sell its products.  He told the retailers that Midtown had made a large purchase of CrossGen back issues to stock its store and made a commitment in other ways as well in exchange for its position on the CrossGen site.  CrossGen also placed a 'jump' or transition page between the link to the CrossGen comic store and the first page listing prices, designed to address the concern that consumers would associate discounting with CrossGen the publisher.  Second, Panaccio contended that it was '...an extremely remote possibility...that current or potential retail comics customers would choose our online mall to buy CrossGen Comics instead of buying them at your stores.'  The primary reason for that opinion was the $5.95 shipping cost associated with ordering from MidTown.  He also noted that consumers buying online would get new issues later than they were available through brick and mortar stores. 

Panaccio also offered comic retailers a way to be listed as a Premier CrossGen retailer in all CrossGen comics -- simply agree to stock at least five copies of everything CrossGen has published to date.  In addition to listings in upcoming comic issues, Premier retailers will be listed on the CrossGen website. 

Comickaze's Scott was not satisfied with CrossGen's responses.  He argued that his calculations showed that a relatively small purchase could end up being sold at less than retail price, even after taking shipping charges into account.  Scott was also not satisfied with the jump page.  He argued that the pages after the jump page looked like CrossGen pages and offered discounts on comics -- allowing the perception problems to persist. 

We note that Dark Horse products are sold at a discount through a linked Things from another World online store (which has common ownership with Dark Horse) and there's been little controversy around it.  There are two main differences between the way the Dark Horse and CrossGen sites are set up.  First, when you hit 'store' on the Dark Horse site, you're taken to a page that offers brick and mortar alternatives more directly than the CrossGen jump page does.  And second, each of the TFAW pages is clearly labeled as such; it looks very different from the Dark Horse site.