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NEW - Earnings Modifications Effective 7/01/13 (Read 40068 times)
Mindy
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NEW - Earnings Modifications Effective 7/01/13
Jul 1st, 2013, 11:07am
 
Together we have done great things! Overall GCU has grown each and every year and hand in hand, more artists are getting paid each quarter and are growing their earnings more than ever before. GCU is proud of and grateful for the best artist community in the industry!
 
To keep focus on growth, GCU continues to invest heavily in many areas of our business that hold great promise for us all like: paid search engine ads (Google, Bing, and Yahoo), paid product feeds (Google Shopping and Amazon Product Ads), SEO optimization, promotions ("always available" free shipping), and forging & supporting key partnerships to better serve and expand into new markets (the UK printing partner and Kodak/Target partnership).  
 
Starting out with one of the highest commissions in the POD industry, GCU has been conscious to not impact artists' earnings until completely necessary. However, as we continue build our brand through advertising, SEO and strategic partnerships we need to ensure that the company maintains a level of financial integrity that will allow for continued growth.
 
Effective 7/01/13, we are announcing the following modification to artists' earnings that will address some necessities:
1. Rebalance GCU's earnings and investments
2. Incent artists to take an active role in self-promotion driving traffic and sales
3. Reward those artists that engage in self-promotion to drive traffic and sales with continued premium earnings
4. Allow us to keep GCU storefronts 100% free
 
Here are the details. In a nutshell, a two-tiered quarterly earnings structure:
1. Earnings per card will be reduced by 50%. EX: 20% commission on a $3.00 card will now be 10% (30 cents vs 60 cents), and so on
2. Artist's earnings ($) will be measured against quarterly earnings thresholds
3. Artists that meet or exceed the threshold, each quarter, will double their earnings - earning the full premium earnings (100%)
4. This measurement is done at the end of each quarter as part of payment preparation
5. The thresholds are the same for all artists
6. The quarterly earnings thresholds are based on historical data and are realistically achievable, even for part-time, hobby artists
7. Single Card Price Increase - the majority of GCU's sales transactions is comprised of single card sales (1 card). We will be increasing the single card price from $3.00 to $3.50. This means that artists will earn more on these transactions - 10 cents more for premium earning artists (70 cents vs 60 cents), 5 cents more for standard earning artists (35 cents vs 30 cents) - helping artists reach the thresholds faster.
8. Total Quarterly Earnings Thresholds are: 1Q = $150     2Q = $150     3Q = $150     4Q = $300  
 
Examples to help you guess-timate (forecast) your future earnings.  Imagine your 3Q earnings are the same as your 2Q earnings ...
Meeting Threshold:  
- If you earned $355 in 2Q2013 these earnings would be 50% less, $177.50 standard earnings
- The $177.50 meets the 3Q earnings threshold of $150 so you'd earn your double, premium earnings of $355 in the 3Q
 
Not Meeting Threshold:  
- If you earned $75 in 2Q2013 these earnings would be 50% less, $37.50 standard earnings
- The $37.50 does NOT meet the 3Q earnings threshold of $150 so earnings remain standard of $37.50 with no additional premium earnings for 3Q
 
The key takeaway is that for many GCU artists it will be business as usual with the added benefit of earning even more on single card transactions. Additionally we have plans to make it easier and more effective for artists to self promote. Lastly, do not despair, meeting the quarterly thresholds is realistically within reach for artists who are willing to put in the extra effort.  
 
Please know we realize that no matter how we present this change for many it will not be favorably received. Some artists will be upset and leave. That is not our intent. We have explored many alternatives and in order to continue investing in our growth and GCU's future this is a necessary change.
 
Thank you for your continued contributions, commitment and understanding through all of our growing pains as we continue to adjust in order to move forward and thrive.  
 
===========================================================================
CLARIFICATIONS (as of 7/1/2013):
1. These changes are effective with earnings beginning 7/1/13 and moving forward - future earnings
2. Artists with multiple storefronts will be measured against the thresholds based on their combined storefront earnings.    
3. Using your available earnings to pay for cards will not reduce your quarterly earnings amount used to measure against the threshold.  
4. Quarterly payments will be made as usual, within 30 days of the end of each quarter
5. The new artist discount will set the card price to $1.70 (lower than the prior $1.89).  For artist not meeting the quarterly threshold these cards will effectively cost artists $1.60.  For artists meeting the quarterly threshold these cards will effectively cost $1.50, ... compared to the prior effective cost of $1.61
 
MODIFICATIONS (as of 7/9/2013):
1. As a courtesy for the short notice of this announcement and to allow for transition we are reducing the 3Q2013 quarterly threshold by 50%, from $150 to $75
 
PAYOUT CLARIFICATIONS (as of 10/01/2013):
http://www.greetingcarduniverse.com/forum/yabb2/YaBB.pl?num=1380672644/0
 
IMPORTANT UPDATE (11/17/13):
Important Correction - Rollover Earnings & Threshold Measurement
ONLY earnings earned within the current quarter will be used to meet the current quarterly threshold.   Rollover earnings from prior quarter(s) will still get rolled over, as they are earnings due to you, however they will NOT be used to meet that current quarter’s earnings threshold to achieve premium earnings.
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« Last Edit: Nov 27th, 2013, 3:52pm by Mindy »  
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Terry_151326
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #1 - Jul 1st, 2013, 11:16am
 
Mindy, you have been a big help in the time I have been in GCU but I wonder how you would feel if you were just an artist getting you pay cut like we are. I enjoyed trying to come up with ideas for cards using my photography but the next pay day will be my last.
 
Are you employees getting a big pay cut??
 
Bye, Terry
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Mindy
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #2 - Jul 1st, 2013, 11:25am
 
Quote from Terry_151326 on Jul 1st, 2013, 11:16am:
Mindy, you have been a big help in the time I have been in GCU but I wonder how you would feel if you were just an artist getting you pay cut like we are. I enjoyed trying to come up with ideas for cards using my photography but the next pay day will be my last.

Are you employees getting a big pay cut??

Bye, Terry

 
I'm sorry to hear that Terry.
 
To be quite transparent to your direct question, yes GCU has made some significant reductions in staff (= lost jobs) and other cost cutting measures.  No one is lining their pockets over here.
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Penny_134243
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #3 - Jul 1st, 2013, 11:28am
 
Hi, Mindy,
 
Thank you for posting this.  I have a question concerning the artist discount promo code, please:
 
When we use the promo code to buy our own cards, we currently receive a commission of 15%.  In the light of this new commission structure (reduced by 50%) does this mean that we will now only receive 7.5% -- which would increase the cost of buying our own cards -- or could there be an adjustment made in the pricing of our own cards and/or the commission to keep the price for artists at the same rate?
 
I realize that I'm talking about a few cents per card.
 
(As a note for artists who are not familiar with the promo code, please look at your "manage store" page and you'll see the info on the right-hand side.  We should not post the dollar amounts or actual code here in the forum.)
 
Thanks!
 
And for anyone thinking about closing your store, why not keep it open and see what happens?  You have nothing to lose by staying, and possibly a lot to gain.
 
Penny Smiley
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Lois_138267
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #4 - Jul 1st, 2013, 11:32am
 
I'm sorry to have to say this, but this action of GCU's is harsh.  Very harsh.
 
Looking at it from a purely business point of view, it appears GCU is deliberately culling the herd.  The top producers will stay and all the little guys will leave.  That lessons the burden on the reviewers, which has, as we all know, become a giant problem over the years.  GCU obviously doesn't want to hire or can't afford to spend any more money on more reviewers.  Now, the top producers will get their cards through sooner, GCU won't have to be bothered with sub-par artwork flying into their offices, and the artists who are left and the reviewers and the owners will be happy.
 
It's survival of the fittest.  
 
It's a jungle out there!!!
 
And oh by the way, I'm NOT one of the top producers.
 
 Huh
 
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Paul_133086
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #5 - Jul 1st, 2013, 12:06pm
 
Translation of original message:  
 
"Thanks for helping to make GCU the outstanding success it has become. To reward you, we're gonna cut your earnings in half. Some of your earnings may have already been reduced when we started arbitrarily mass-eliminating cards about a year ago, including some of those that were selling well. Why? Because we can.
 
For those with just the occasional seasonal sales, don't quit your day job. I know we sure aren't.
 
Your good friends at GCU."  
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Mindy
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #6 - Jul 1st, 2013, 12:36pm
 
Quote from Penny_134243 on Jul 1st, 2013, 11:28am:
Hi, Mindy,

Thank you for posting this.  I have a question concerning the artist discount promo code, please:

When we use the promo code to buy our own cards, we currently receive a commission of 15%.  In the light of this new commission structure (reduced by 50%) does this mean that we will now only receive 7.5% -- which would increase the cost of buying our own cards -- or could there be an adjustment made in the pricing of our own cards and/or the commission to keep the price for artists at the same rate?

I realize that I'm talking about a few cents per card.

(As a note for artists who are not familiar with the promo code, please look at your "manage store" page and you'll see the info on the right-hand side.  We should not post the dollar amounts or actual code here in the forum.)

Thanks!

And for anyone thinking about closing your store, why not keep it open and see what happens?  You have nothing to lose by staying, and possibly a lot to gain.

Penny Smiley

 
Hi Penny,
Good question.  We are working on the details of this but yes, we will be making an adjustment to the artist discount so artists not meeting the threshold will still be able to buy their cards for a similar price as before ie: $1.60.  Stay tuned for an update on this thread for details.  Thank you for bringing it up.
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Penny_134243
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #7 - Jul 1st, 2013, 12:44pm
 
Quote from Mindy on Jul 1st, 2013, 12:36pm:
Quote from Penny_134243 on Jul 1st, 2013, 11:28am:
Hi, Mindy,

Thank you for posting this.  I have a question concerning the artist discount promo code, please:

When we use the promo code to buy our own cards, we currently receive a commission of 15%.  In the light of this new commission structure (reduced by 50%) does this mean that we will now only receive 7.5% -- which would increase the cost of buying our own cards -- or could there be an adjustment made in the pricing of our own cards and/or the commission to keep the price for artists at the same rate?

I realize that I'm talking about a few cents per card.

(As a note for artists who are not familiar with the promo code, please look at your "manage store" page and you'll see the info on the right-hand side.  We should not post the dollar amounts or actual code here in the forum.)

Thanks!

And for anyone thinking about closing your store, why not keep it open and see what happens?  You have nothing to lose by staying, and possibly a lot to gain.

Penny Smiley


Hi Penny,
Good question.  We are working on the details of this but yes, we will be making an adjustment to the artist discount so artists not meeting the threshold will still be able to buy their cards for a similar price as before ie: $1.60.  Stay tuned for an update on this thread for details.  Thank you for bringing it up.

 
Thanks, Mindy!
 
Penny Smiley
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Donna_137698
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #8 - Jul 1st, 2013, 12:57pm
 
to aid in sifting through the heated discussion I started on another thread, here are my questions regarding this new obstacle GCU has set before us.  And just for the record, Mindy, I am sorry GCU has cut staff.  I don't get how in one breath GCU can say its a huge success and then get rid of a portion of the staff either by direct lay off or making life harder that artists who fuel this business leave:
 
Am I now going to be penalized for not making a certain amount of money for GCU on a quarterly basis?
 
What is the exact set threshold for quarterly earnings that GCU has set?  Is it based on the historic data of the company or the individual artist?  And it was unclear to me if the $150 per quarter/$300 Q4 is set in stone for every artist.  I'd like to know what goal I am shooting for.  
 
Why can't artists who are making this threshold already be "promoted" and leave the rest of us at status quo - let this new thing be phased in???
 
What if my big selling quarters are the third and fourth with next to nothing in the first two quarters each month?  For example, I only sell maybe a dozen cards in quarter one and two dozen in quarter two but over a thousand cards between quarter three and quarter four.  I'm sorry if this is all clear to you - I need to have it spelled out more precisely - my apologies for my being unclear on this.
 
Why is each artist now responsible for all traffic to GCU if we are not paid employees?  Doesn't GCU have a marketing staff?  Yes, I know I need to help but I've done all I can at the moment.  Yes I know I can do more but again - looking for goals to set if I can.
 
Will purchasing our own cards be part of our sales or the quota must be made by purchases by strangers?
 
Will we still get a quarterly earnings check or will this all be paid up at the end of the year when assessments of our quarterly "reports" are done?
 
Frustrated, anxious to hear, and trying to decide what is best for me.  I do get that business needs to deal with the obstacles but this is a rather big hurdle dumped on us with only 24 hours to digest it.  I am sorry for my tantrums but really, this was not nice to do to people who ARE working hard to try to do what GCU wants.
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Betty_136243
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #9 - Jul 1st, 2013, 1:18pm
 
I am not a top producer but hope to be one in the future even with these changes in the earnings scale. As I see it, GCU provides a FABULOUS outlet for ANY budding or professional artist whereby they can create greeting card designs for the worlds enjoyment. This industry can be fickle, subjective and very competitive as is with anything remotely considered creative. GCU is a business and needs to be profitable in order for EVERYONE TO WIN, and I view these changes as a business decision that they most likely pondered for quit some time. The fact that I, as an artist, can create greeting cards which then can ultimately be purchased and enjoyed all over the world never ceases to amaze me. Also being able to participate in this kind of card creating service at no monetary cost to me is indeed a rare luxury as well.
These changes only remind me how fortunate I am to have found such a terrific outlet for my creative endeavours. That being said it also reminds me that being creative and or clever is only half the battle. Self promotion and working the available social/PR media souces for visibility and viability are all essential to a sucessful card line.
THANK YOU GCU for your transparency. I think I'll stick around!  Smiley
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Sandra_133229
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #10 - Jul 1st, 2013, 1:25pm
 
I agree Betty! Well said!  
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DENISE_132110
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #11 - Jul 1st, 2013, 2:20pm
 
speaking for myself, maybe it would have been an easier thing to deal with if one, it had not been as big a cut and two, if many of us were not already dealing with our cuts at Z starting today.  
 
i am also amazed when someone finds my cards amongst the many tens of thousands etc. and i know if i were to step down, there are many more who could take my place. I am not a huge seller, i do not have a big following and none of my family purchases my work. i think it is just a very discouraging time for us as online artists, sales are already low and then to be cut by this margin, its a hit we were not prepared for.  
 
i, for one, stink at self promotion/referrals and now both of my main venues are going to rely heavily on it for sales. so its just a little scary and frustrating after just starting to feel i have my feet under me.
 
please don't tell me to stop whining and create.  i am trying to formulate a strategy for myself and it will take time and attention.  meanwhile, i will hush and go try to wrap my head around these changes.
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Mindy
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #12 - Jul 1st, 2013, 4:00pm
 
Answering your specific questions below in caps for clarity (not shouting):  
 
Quote from Donna_137698 on Jul 1st, 2013, 12:57pm:
to aid in sifting through the heated discussion I started on another thread, here are my questions regarding this new obstacle GCU has set before us.  And just for the record, Mindy, I am sorry GCU has cut staff.  I don't get how in one breath GCU can say its a huge success and then get rid of a portion of the staff either by direct lay off or making life harder that artists who fuel this business leave:

SUCCESS AND TRIBULATIONS ARE NOT MUTUALLY EXCLUSIVE.  WE ARE GROWING AND REINVESTING.

Am I now going to be penalized for not making a certain amount of money for GCU on a quarterly basis?

What is the exact set threshold for quarterly earnings that GCU has set?  Is it based on the historic data of the company or the individual artist?  And it was unclear to me if the $150 per quarter/$300 Q4 is set in stone for every artist.  I'd like to know what goal I am shooting for.  

THE EXACT THRESHOLDS AS LISTED ABOVE ARE:
Total Quarterly Earnings Thresholds are: 1Q = $150     2Q = $150     3Q = $150     4Q = $300  

WE CAME TO THESE THRESHOLDS BY RESEARCH AND FORECASTING OF BOTH INDIVIDUAL ARTIST'S AND COMPANY WIDE DATA AS TO WHAT WAS FAIR AND ACHIEVABLE AND AT THE SAME TIME WOULD PRODUCE THE NECESSARY RESULTS IN THE FUTURE.

ALSO LISTED IN THE ANNOUNCEMENT IS THE FACT THAT THE THRESHOLDS ARE THE SAME FOR ALL ARTISTS.

Why can't artists who are making this threshold already be "promoted" and leave the rest of us at status quo - let this new thing be phased in???

WHAT DOES "PROMOTED" MEAN, PAY MORE?  THAT IS NOT AN OPTION.

What if my big selling quarters are the third and fourth with next to nothing in the first two quarters each month?  For example, I only sell maybe a dozen cards in quarter one and two dozen in quarter two but over a thousand cards between quarter three and quarter four.  I'm sorry if this is all clear to you - I need to have it spelled out more precisely - my apologies for my being unclear on this.

THE THRESHOLD MUST BE MET EACH QUARTER, INDIVIDUALLY, TO RECEIVE THE PREMIUM EARNINGS FOR THAT QUARTER.

Why is each artist now responsible for all traffic to GCU if we are not paid employees?  Doesn't GCU have a marketing staff?  Yes, I know I need to help but I've done all I can at the moment.  Yes I know I can do more but again - looking for goals to set if I can.

EACH ARTIST IS NOT RESPONSIBLE FOR ALL TRAFFIC TO GCU.  NOTHING HAS CHANGED.  WE WILL CONTINUE INVESTING HEAVILY IN DRIVING TRAFFIC FOR CONTINUED GROWTH.  ARTISTS WILL CONTINUE TO BENEFIT FROM OUR INVESTMENTS.  AS WE KEEP GROWING, YOUR SALES WILL KEEP GROWING.  WE ARE JUST FORMALIZING THAT FOR ARTISTS WHO CONTRIBUTE MORE, THEY WILL EARN MORE THAN THOSE WHO DO NOT.

Will purchasing our own cards be part of our sales or the quota must be made by purchases by strangers?

ALL SALES OF YOUR CARDS REGARDLESS OF WHO THE PURCHASER IS WILL BE INCLUDED IN YOUR QUARTERLY EARNINGS USED TO MEET THE THRESHOLD.

Will we still get a quarterly earnings check or will this all be paid up at the end of the year when assessments of our quarterly "reports" are done?

BUSINESS AS USUAL.  QUARTERLY PAYMENTS WILL BE MADE AND ISSUED WITHIN 30 DAYS OF THE END OF EACH QUARTER.

Frustrated, anxious to hear, and trying to decide what is best for me.  I do get that business needs to deal with the obstacles but this is a rather big hurdle dumped on us with only 24 hours to digest it.  I am sorry for my tantrums but really, this was not nice to do to people who ARE working hard to try to do what GCU wants.

WE APPRECIATE EVERYONE'S WORK AND UNDERSTAND SOME ARTISTS ARE ABLE TO DO MORE THAN OTHERS BE IT TIME, KNOW-HOW, DESIRE, ETC.  THESE CHANGES FOLLOW A BASIC PRINCIPLE - WORKER HARDER (& SMARTER), EARN MORE.  

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Mindy
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #13 - Jul 1st, 2013, 4:16pm
 
Quote from Lois_138267 on Jul 1st, 2013, 11:32am:
I'm sorry to have to say this, but this action of GCU's is harsh.  Very harsh.

Looking at it from a purely business point of view, it appears GCU is deliberately culling the herd.  The top producers will stay and all the little guys will leave.  That lessons the burden on the reviewers, which has, as we all know, become a giant problem over the years.  GCU obviously doesn't want to hire or can't afford to spend any more money on more reviewers.  Now, the top producers will get their cards through sooner, GCU won't have to be bothered with sub-par artwork flying into their offices, and the artists who are left and the reviewers and the owners will be happy.

It's survival of the fittest.  

It's a jungle out there!!!

And oh by the way, I'm NOT one of the top producers.

Huh


 
These changes have nothing to do with the review process nor based in any desire or intention to have artists close shop.  We realize and appreciate that each artist brings something different to the table and that is one of the many beauties of community content.  Professional, self-taught, full time and hobby artists alike are all welcome and are provided the same opportunities.
 
You are correct, it is survival of the fittest.  You will see other similar companies making similar changes to thrive and stay competitive.  It is a necessary evil.
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Cori_146275
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Re: NEW - Earnings Modifications Effective 7/01/13
Reply #14 - Jul 1st, 2013, 4:50pm
 
As I have my artwork on many sites my income comes from many sources.  I work the sites that bring me more sales than others.  There is the old saying "don't put all your eggs in one basket".  
 
I will live with the price cut but what I really have a problem with and Mindy they are related is that if we are to increase our sales and help both your business and our business grow, we need to put up more inventory.  Taking 7 weeks to review cards is way to long.  I just had 8 cards approved today that were put in May 9th.  That is not a good sign for keeping your artists or encouraging new artists to join.  
 
When you take away something, in this case cut our commissions you need to give something back in return.  That would be faster turn around in approval.  
 
Mindy you commented in a post, "THESE CHANGES FOLLOW A BASIC PRINCIPLE - WORKER HARDER (& SMARTER), EARN MORE."   We can work harder by getting more inventory out for the public to see but if it is not approved faster it defeats part of the purpose to work harder.
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