Etsy: The Good, The Bad, and The Ugly

As a buyer, especially as a bride, I loved Etsy!  So many creative, one of a kind items, all in one place and from all over the world too; yes please!  Etsy is a bride’s dream come true.  You can find those vintage and hand crafted items that give your wedding a special touch in one place.  It is hard to beat that.  I bought my bridesmaids vintage, collage inspired jewelry from England.  Not only was this jewelry exactly what I was looking for, the owner created a special piece for one of my bridesmaids to complete the collection at no extra cost to me.  I was thrilled to find this shop and felt like Etsy was such a magical place to connect me to this crafter in England!

As a seller, I am starting to become wary of Etsy.  I started selling on Etsy this past February, and have big dreams of turning that little shop into a full-blown website of its own.  I started my shop on Etsy because it was easy, within two minutes I had a business to call my own and a $0 start-up fee!  Doesn’t get much easier than that.  You read through all the articles Etsy publishes and the general promise is you get back what you put in.  Meaning if you take your shop seriously as a business then you will reap the rewards of Etsy, but if you take your shop as a hobby, then that’s all it will ever be.

Behind the scenes, in the forums you start to see the cracks in this promise.  So many discussion threads are based on the question,”why am I not selling?!”  These sellers do everything they are told by Etsy Success and the Seller’s Handbook, yet their views are low and their sells even lower.  As a collective Etsy is generally viewed as one of us, a crafter and lover of all things vintage and homemade.  However, I have come to see them as a corporation that is making bank off the dreamers and the unemployed.

Etsy rakes in millions of dollars every year!  They receive a percentage of every item sold, as does Paypal.  Need I remind you the inventor of Paypal is now playing with cars and rocket ships?  They also receive $0.20 for every listing, and have set up a market that rewards those that renew their listing on a regular basis charge the same $0.20 every time.  Other ways to spend money inside Etsy is to advertise, $7 per Showcase (I still don’t understand what this means), or you could set a weekly allowance to promote your item at the top of the search results only paying when your item is clicked on.  Times all this by millions of items and shops and you get an idea of how much Etsy is bringing in.  (See Etsy Fees.)

I have been told repeatedly this is a slow season for Etsy, but looking at March’s report sells are up 41% from last March and have increased 5.5% from February.  What’s slow about selling over 3 million items with over 1 billion page views?  Etsy takes in 3.5% of all transactions, if they use direct check out they get another 3%, plus listing and advertising fees.  Let that sink in while you look at this number from their March report:

$62.8 million of goods (after refunds and cancellations) were sold by our community in March, 7.7% higher than February’s $58.3 million

Yeah, I no longer think of them as one of us.  By the way, this report is not sent out as part of their newsletter, you have to go searching for it yourself.  Here is what really gets under my sink though, it is stories like how Etsy handled this woman that got suspended for suspected drop-shipping when she shipped her handmade goods from a friend’s house in PA while she was on a military base in another country, Etsy Shop Suspended.  Versus how they’ve handled the recent scandal of Regretsy uncovering a reseller used as Etsy’s Featured Seller.  Instead of suspending the shop that is breaking their #1 rule of selling handmade and taking down the article, she’s still open for business and is being featured on their coveted front page.  While the woman who tweaked a rule to reduce her shipping fees was suspended right away and without notice.

The more I see how Etsy’s admin handles certain situations, the more I am ready to jump ship.  Like this “copyright infringement” story.  I no longer feel like Etsy’s inner workings are on my side.  I think back to the first article I read discouraging me from taking the “easy” route of opening an Etsy shop, Why Etsy Stores are at a Disadvantage, and realize he was right.  I got what I paid for.  I thought I could open my shop and test drive products, but it takes hard work and money even to be seen on Etsy.  You could be putting all that hard work into promoting your own shop, not Etsy itself.

My father is a small business owner and his first bit of advise to me was to advertise on Google.  When I showed him my shop, he immediately retracted his statement.  He said don’t pay for outside adverting when you are bringing your potential customers directly to your competition.  When you pay for advertisements outside of Etsy what you are really doing is paying to promote Etsy’s marketpalce.  To reinforce this sentiment, Etsy has recently changed the search within this shop to feature other seller’s items.  Really Etsy?!  I think it’s time I invested my time and money back into myself.


7 thoughts on “Etsy: The Good, The Bad, and The Ugly

  1. Well, well, well. What to say. I know I was having a hard time finding you on Etsy. Even looking up by specific items was leading me to multiple pages and multiple shops. After 12 pages I gave up. Good for you Margaret and “Looking” into what you were buying. Very informative. I know when I look at my Etsy emails I tend to only look at the items or shops featured. Good move. An E store is a good Idea but owner beware.

    • Thanks Mom. I know I am not getting very many hits even though I am paying to be on top of the searches! Anyways, I learned a lot and will leave the shop open until I get my own site set up. The community and resources found on Etsy are great and open to any member. I am just not pleased with what I am hearing about how Etsy deals with issues.

  2. Hi! I’m Lisa from the Energy Shop (you linked to my suspension story in your article). This is a well-written article, and I can certainly understand your frustrations. Please don’t give up hope, though! Etsy is a wonderful starter house. However, It is okay to outgrow it and build the company of your dreams: a permanent home. All the best to you!

    • Thanks Lisa! That is very good advise. It is hard to beat the resources Etsy can offer you right out of the gate. I certainly won’t be doing anything rash, but your story really got me thinking about setting up a new home for my shop sooner rather then later. Best of luck to you too!

  3. This is a very interesting post! Although I don’t have a shop on Etsy, I’m an avid fan of the site and spend many hours on the shops exploring the items. However, this has definitely changed my perspective of the company. It saddens me that your business is not getting enough traffic–your cards are precious and creative! Stay positive and try other avenues, something’s gotta give! Thanks for this informative post!

    • Thanks Kristyn! The members on Etsy are awesome, I too like shopping and supporting all the small, crafty businesses. I just don’t like what I’m seeing behind the Etsy screen. When you are a running a business hosted by someone else you really need to trust they have your best interests at heart.

  4. This is a great article! I was googling Esty good or bad for business and your article came up. I almost hit submit on my Etsy store but thought I would do some research first. I have a website up and am now thinking I should probably just promote that. I feel like once you turn yourself over to Etsy and Ebay and Amazon that maybe bigger companies won’t take you seriously? Am I wrong? I think your papers are really cute, I too just quit my day job in Finance and am slowly doing the Real Estate thing but found another true passion and have been working day and night and weekends on it. Still questioning Etsy…… Good Luck to you!

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