Online marketplace Redbubble says trading conditions were particularly challenging during the third quarter as demand softens.

According to unaudited accounts, the company’s marketplace revenue (MPR) for the quarter fell 8 per cent to $88.4 million while its gross profit after paid acquisition was down 2 per cent to $20.2 million.

The company has introduced an ‘account tiers’ system where marketplace artists will be classified under three categories: Standard, Premium and Pro.

The tier system separates accounts on certain criteria including an artist’s success as a seller, account activity and whether they follow the marketplace’s guidelines and rules while being subject to a flat fee based on monthly earnings.

Martin Hosking, Redbubble Group CEO and MD, said: “As consumer demand weakened since the beginning of the year, we expect market conditions to remain challenging in the short term.

“As a result, and to achieve our aim of returning to cash-flow positive by the end of the calendar year, we are looking for further opportunities for cost savings, while making targeted investments in initiatives.”

In January, the group announced several cost-reduction measures that are expected to improve the business’ cost base by $20 – $25 million annually.