Etsy | Strategies for Selling Handmade Products Online

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Etsy is a popular ecommerce platform that serves a niche market of sellers. In this article we will look at 1) what is Etsy, 2) selling successfully on Etsy, 3) advantages and disadvantages of selling on Etsy, 4) taking precautions, and 5) Etsy success stories.

WHAT IS ETSY?

The Company

A popular ecommerce website, Etsy is a platform for the sale and purchase of handmade or vintage products. In newer guidelines, relatively unique items that are factory made can also be sold. The product range has considerable variety including art, photography, clothes, jewelry, food, beauty products, quilts, toys and a many other items.

Etsy has strict guidelines that must be adhered to by all sellers. This used to include a ban on non-handmade items which as relaxed in October 2013. Any vintage items must be at least 20 years old. The website functions like a craft fair, where each seller has their own storefront and list items for a small fee.

By August 2013, the site had 30 million registered members and projections for the same year included 1 million sellers and over $1 billion worth of transactions.

The Business Model

Etsy has differentiated itself from other ecommerce platforms by its focus on unique, handmade or vintage crafts and products. Products are displayed in artistic styles rather than in more commercial catalogue styles. Sellers on Etsy include part time sellers, hobbyists, professional artists and full time sellers.

Two key areas have made the Etsy business model a success.

  • Community Engagement: Sellers create personalized stores that encourage authenticity, reliability and a way to do business in a friendly and sustainable manner.
  • New Tools and Educational Material to Support Sellers: Through Etsy created tools and guides as well as support from the community, there is always an effort to help sellers gain more out of their stores and help new sellers establish themselves.

Selling on Etsy

After creating a username, potential sellers can decide a shopname and setup a shop. Etsy will charge a small fee of $0.20 for each item listed in the store. The listing is valid for 4 months on the shop page, or until the product is sold. The price for each item is set by the shop’s owner but Etsy will charge 3.5% of this price per listing. These fees are invoiced at the end of each month and must be paid within 15 days. Sellers can chose payment options to offer to their buyers including credit/debit cards and PayPal among others.

Buying on Etsy

Etsy has a simple interface that is easy to navigate. The main page allows a buyer to choose an option, pick a category or enter a product description in the search field. Products are divided into categories and sub-categories. If a product is selected, the seller’s rating can be viewed for reliability and the product can be added to the cart. To purchase, the buyer must also create an Etsy account. No charges are incurred by the buyer at any point except the listed item’s price and shipping costs.

How to on Etsy – Opening a Shop, Fees, and Listing

HOW TO SELL SUCCESSFULLY ON ETSY

Selling successful on Etsy is more than just creating a store and listing some items. There needs to be a coherent plan accompanied by smart e-selling strategy. Some useful learning can be gleaned from the experience of existing Etsy sellers.

Tips from Etsy Seller Community

  • Treat Etsy like a Real Business: As mentioned, Etsy is not a magic solution. To create a successful profit making business, the Etsy store needs to be treated like a real business with a clear business plan and strategy mapped out.
  • Follow Etsy Guidelines: Esty has specific rules of what can be sold and what cannot be. It is important to read these guidelines thoroughly and follow them completely.
  • Be Part of the Community: Within Etsy, there is a lot of focus on the community, in terms of support and learning. It is a good idea to offer feedback, ask for advice and help promote other items that you like and your customers may appreciate. This will help gain supporters from within the community who will then help you market your brand.
  • Conduct Market Analysis: Given the number of competitors and constantly evolving trends, it is a good idea to look through the Etsy community and benchmark some successful stores. Understand what they are selling and how they are selling it. Take the time to learn from them. It is important to study competitors and similar products to analyze pricing and quality as well as special offers.
  • Have an Interesting About Section: A public profile, which is the about section, can be a great way to tell your story to a browsing potential buyer. People like an interesting story and a real person to relate to. This may end up being a key differentiating element of your shop.
  • Focus on Photography and Photos: A vital component of a successful Etsy store is product photography. Since buyers cannot experience the product in person before they choose to buy it, the next best thing is to have engaging and attractive photos that show off the product and all its features. The photos should be detailed, clear, taken from different angles and be generally attractive. This user lists useful photography guides.
  • Determine the Right Price: It is imperative that you understand your product, the cost of making it, time spent on the creation, shipping costs and its value to a potential client. All these aspects will help establish a realistic price for the product that will help ensure that you neither undersell your product nor oversell it.
  • Clearly Mention Policies: If you have any policies relating to purchase or shipping ensure that they are clearly mentioned and easy to understand. Review periodically to make sure they are updated and relevant.
  • Use Announcements: Use the announcements section to keep your store updated and information flowing. If there is a new product added, a discount or a special offer announce it and make sure it is made up of the right keywords.
  • Focus on Building your Brand: There are thousands of Etsy sellers selling thousands of products. To stand out from the crowd, it is a necessary step to build up your brand. By becoming part of the community, creating and maintaining a blog and contributing to other blogs, you can build up your own brand as well as for your store. A strong store name, a simple but catchy logo and a ensuring that this is displayed prominently across your store, packaging and advertisements will help establish brand visibility.
  • Understand Your Target Audience Market: Both selling online or in physical stores requires a solid understanding of who you are selling to. It is a good idea to ask yourself whether the audience is male or female, what their ages and occupations are, what their buying power is and what their needs are. All these help sell to the right audience at the right price.
  • Work on Search Engine Optimization: A little research into SEO can go a long way towards helping grow a fledgling business. With the right use of keywords, an Etsy shop can be placed high up in google searches. It is a good idea to identify shopper intent to see what kind of words or phrases they are likely to search with. It is also a good idea to determine the search volume of a keyword. If it is too high volume, it will be difficult to place high in the search results. Conversely, a too obscure word may not be searched enough to make an impact. There needs to be a balance between volume and a niche to ensure that there is less competition but still searchability.
  • Work on Social Media Marketing: Marketing through social media such as Facebook, Twitter, Instagram and Pinterest helps increase visibility, followers and potential buyers at relatively no cost to the seller. It also helps build more personal relationships with potential buyers, adding a layer of reliability and credibility which can greatly encourage buying behavior.
  • Provide Great Customer Service: Customers are more likely to return to an Etsy store if they experience great customer service. Make sure that you answer any queries or comments promptly, politely and with a personal touch. Building trust will go a long way towards loyal customers and customer recommendations.
  • Send Samples to the Right People: Bloggers and relevant media people can be great ways to gain endorsements for your products. Free samples can lead to positive reviews and visibility among their followers. Often, smaller businesses also gain popularity with celebrities which are extremely important sources of advertising. It is important to create a fun interesting product or another differentiating feature that excites these people about your product.
  • Make Sure you Have Fun: As long as creative business stays fun and not a task to be done, it will remain an exciting endeavor. It is fails to be so, then it is a good idea to change things around to keep things interesting and challenging.

ADVANTAGES AND DISADVANTAGES OF SELLING ON ETSY

Etsy is one of the largest online platforms for selling handmade and unique products and crafts. However, it is not always an easy task to sell successfully through the website. Some of the advantages and disadvantages of the platform are:

Advantages

  • Strong Reputation: The website has managed to create a name for itself worldwide and thus brings with it a certain level of credibility. There are also hundreds of blogs and forum discussions which help get started selling on Etsy and offer continued support.
  • User Friendly Website: The website is easy to navigate and use. It is quite simple to set up a shop, customize it and list items to sell. It is similarly simple to find and purchase products
  • Strong Community: Given its reputation, there are people from all over the world registered as users on Etsy. This means there are lots of support blogs, forums and discussions to learn. There are also many ways to get good advice and support other businesses.
  • Reasonable Cost: Though there are costs associated with selling your product on Etsy, it is still more reasonable then investing in your own website or selling on other platforms. It can be a good idea to start selling on Etsy and eventually decide whether other ways of selling need to be explored.
  • Worldwide Reach: The Etsy community of buyers and sellers are geographically dispersed all over the world. This offers buyers more choices and sellers more access to a larger audience to sell to.
  • Interactivity: Etsy allows feedback on a product without even purchasing it. This offers a seller valuable feedback when a product remains unsold.
  • Digital Products: Along with physical products, Etsy also allows the sale of online or digital products such as crotchet prints, sewing patterns or other similar items. These can be emailed to a customer on receiving payment.

Disadvantages

  • Crowded Marketplace: Given its reputation and popularity, Etsy is full of sellers often selling similar things. This makes the market very competitive and there is a constant need to evolve and stay ahead.
  • Costly: Though more reasonable than other alternates, there are still costs associated with selling on Etsy. It is a good idea to keep an eye on these costs to ensure that it remains worthwhile to sell products through the platform.
  • No HTML Options: There are limited options to customize the shop and listings as the website does not allow HTML customization. Only the banner can be customized which can often lead to a less interesting storefront that may get lost in the crowd.
  • Selling Successfully Is Hard Work: Because of increased competitiveness, it is an uphill task to establish a brand and a loyal customer base. It is necessary to have a business plan and to understand the ins and outs of selling and marketing online. There needs to be an understanding of search engine optimization, blogging, the use of social media as an advertising and networking tool and how to keep costs low.

TAKING PRECAUTIONS

As a seller, there are several common dangers that threaten safe business practices. These scams can result in a loss of products, loss of money or bad reputation on Etsy in the form of negative feedback from an unsuccessful scammer.

Avoiding Common Etsy Scams

There is a possibility that a after a purchase is made, the buyer may contact the seller and ask to send to a different address than is listed in their Etsy and PayPal account. If the seller complies, they will have to refund the customer if they claim to have never received the item. The scammer will get to keep both the product and the refund amount. The seller will have to bear the cost of the transaction.

If the seller refuses to ship to the alternate address, the customer have lash out by leaving negative feedback which is an undesirable situation in an Etsy store. To avoid this, the seller may have to offer a refund or send the item to the different address.

In a similar scenario, a customer could claim to have moved and never received the item because the seller refused to send to a new address that was different from the PayPal address. This again leads to the same situation as above with either a bad review or lost money and products.

ETSY SUCCESS STORIES

Dave Conrey compiles a list of successful Etsy shops. The top seller in this list is an accessories store called Three Bird Nest.

Three Bird Nest

What is it?

Headbands and Accessories

Average Quantity Sold per Month

2,300

Average Price

$28

Average Revenue Per Month

$65,000

The Story

Alicia Shaffer started her successful business in November 2011 on a whim. A boutique owner, she decided to create some basic headbands to stock in her store. Following their success, she decided to sell a few on Etsy to supplement her income. Alicia named the shop after her three kids and a tattoo that she had of her three birds in a nest.

Her store quickly took off, with Alicia attributing the initial success to Christmas and holiday shopping. Though it was an extremely stressful time with the rush to fulfill handmade product orders, it was also a time of discovery and joy at the warm reception by her customers. She decided to continue with the store and stocked up spring items such as scarves for the next season. Her store continued to thrive until eventually she sold off her physical store to dedicate her time to her successful online store on Etsy.

Within 18 months, Three Bird Nest became one of the fastest growing Etsy shops and now has its own online store as well. Alicia employs several full time staff members to both produce the items and run the store operations smoothly.

Reasons for Success

According to Conrey, there are several factors that have contributed to Three Bird Nest’s (3BN) success. There include:

  • There is excellent SEO and keyword use and consistency across all 3BN listings, including their headers and descriptions. This creates a network of sorts that keeps the products higher up in searches
  • The shop sells a few thousand products a month, which means new products are listed frequently which keeps the store relevant during a search.
  • 3BN uses captivating people in product shots rather than mannequins which makes the product appear more appealing. The quality and variety of the photos also contributes to this.
  • 3BN has created a presence across relevant social media. When the name is entered into a google search, 3BN appears on not only Etsy and Facebook but also an independent site, a Pinterest page and a blog. A combination of these creates a strong presence across channels.
  • 3BN has been featured on many blogs that are popular in the fashion and design spheres. These add to the links that lead back to the store and create visibility and publicity.

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