What Is Etsy?
Etsy is a leading e-commerce platform where individuals can sell their handmade creations and crafts.
On the website, you can choose from various categories such as home decor, jewelry, clothing, wedding gifts, kids’ supplies, and anniversary presents. From earrings to wallets to stickers, you can find a wide array of items.
Having been established in 2005, Etsy is a publicly traded company with sellers in 234 countries. As of now, its market capitalization is around $11 billion.
The latest data reveals that Etsy has a seller base of over 7.5 million. In 2021, the platform experienced a tremendous surge in its annual gross merchandise volume, reaching an impressive $13.5 billion, compared to $10.3 billion in 2010. Additionally, Etsy recorded an annual revenue of $2.3 billion in 2021.
The latest data reveals that over 61 million new and reactivated shoppers became part of Etsy in 2020, signifying that the platform remains prosperous and flourishing.
It’s worth noting that a staggering 13 million users became members from October to December, which represents a significant 76.7% surge in comparison to the corresponding period in 2019. Undoubtedly, the pandemic has played a role in this, as individuals have been opting for online shopping rather than visiting physical stores.
How Does Etsy Make Money?
To post an item for sale on Etsy, sellers are charged a small listing fee of $0.20.
In addition to a processing fee of 3% plus $0.25, the company applies a 5% transaction fee when you make a sale.
Additionally, Etsy incurs expenses for promoting items through offsite ads on various websites. Hence, if a sale is generated from one of these ads, a 15% offsite ad fee will be applied.
Top Features for Etsy Sellers
Here are some of my preferred features offered by Etsy for sellers.
Mobile Access
If you’re constantly busy and juggling between different tasks or side jobs during the day, it’s highly likely that you’re frequently on the move. Luckily, with the Sell on Etsy App on your Android or iOS device, you can conveniently handle orders, communicate with buyers, and update your listings from almost anywhere.
In the Google Play Store, the Sell on Etsy app has garnered a rating of 4.2/5 stars, while it achieved a rating of 4.3/5 stars in the App Store.
Custom Website Templates
While the templates provided by the Etsy marketplace are highly customizable, you do not have full control over the design of your own website.
To get an idea of the appearance of a store, take a look at ChloeandCoStudio and DiosDesigns as they offer a few examples.
Believe me when I say that infusing your online store with your creative touch can provide immense enjoyment—and the effort you invest will yield the desired results.
On-Site Messaging
It is crucial for online sellers to understand that customer service and communication play a vital role in providing customers with positive experiences.
Suppose you are selling T-shirts as an example. A potential buyer may show interest in delving deeper into the details, such as the origin of the cotton used or the type of dye employed. There is an increasing trend among consumers who prefer to purchase clothes that are ethically sourced. If a customer asks you a question and receives no response, it is highly likely they will seek alternatives.
To prevent such an outcome, make use of Etsy’s messaging feature to directly communicate with buyers. Messaging is particularly useful when customizing merchandise, as you can also include images and files in your messages, facilitating collaboration and the creation of personalized goods.
Even with an amazing product, the process of selling can be challenging. Numerous factors, such as pricing, branding, marketing, and more, play a significant role in shaping a successful sale.
Talking with other successful sellers on Etsy who have made small adjustments that have had a big impact on their sales can provide helpful tips for your own business.
Etsy enables these types of discussions through its community hub, where you can stay updated on current trends, seek guidance in forums, and establish connections with local sellers for effective communication and collaborative teamwork.
These are some of the current community discussions that are popular.
By perusing the forums, you will come across users providing candid feedback. For instance, in a forum thread where a user seeks guidance on managing a store, fellow sellers offer valuable perspectives on setting prices.
Seller Newsletter
If you’re too busy to go through user forums, you can stay informed about the latest trends and insights by reading the Etsy seller newsletter.
By subscribing to Etsy’s email list, you will receive a continuous flow of tips in your inbox to enhance your shop and increase your earnings.
Etsy provides a variety of advertising and marketing resources to enhance your brand and expand your customer base.
An instance of this is when the company assists in crafting specific posts for social media platforms such as Facebook, Twitter, Pinterest, and Instagram.
Offside Ads and Etsy Ads enable you to connect with a vast number of shoppers, both within and outside of the Etsy platform.
Investing money wisely in advertising can greatly contribute to the growth of your store. As the saying goes, you need to spend money to earn money.
Etsy Standard vs. Etsy Plus
If you are considering starting a shop on Etsy, you have two choices provided by the site. You can either select Etsy Standard, which is free, or opt for Etsy Plus at a cost of $10 per month.
With Etsy Standard, you receive all the essentials to embark on your business journey. You can showcase your products on Etsy and promote them through sales and coupons. However, it is important to note that using Etsy Standard entails additional costs for services such as Etsy Shipping Labels and Etsy Ads.
If you want more control over your business and aim to expand your operation, Etsy Plus is the ideal choice. By paying a nominal monthly fee, you will have access to a monthly budget for listings and ads, along with the option to personalize your store’s web address.
In addition, Etsy Plus provides restock notifications for sold-out items as requested by shoppers. Moreover, it offers advanced customization choices for your shop and discounts on tailor-made packaging and promotional items such as business cards, signage, and boxes.
My Advice: Spring for Etsy Plus
Etsy Plus would be a more preferable option for you. It only costs $10 and provides a significantly enhanced experience with additional tools and perks, making it worthwhile.
No matter how you approach it, these tools are designed to increase your sales, which will ideally offset the expense of your subscription. Additionally, if your business is generating profits, you should be eligible to deduct the subscription as a valid business cost.
No matter what, do not worry excessively about choosing between the two plans. You always have the option to modify your subscription once you begin. The crucial aspect is to swiftly commence and become operational.
How to sell on Etsy
This is the way to begin selling on Etsy and earning profits:
Decide which products to sell
Although it may be challenging, selecting wisely could mark the beginning of an entirely fresh business opportunity. The venture doesn’t necessarily have to involve tangible products; numerous individuals are successfully selling digital downloads on platforms like Etsy or offering custom visual content for websites and social media purposes.
If you’re facing difficulties in coming up with ideas for selling items on Etsy in order to earn money, why not browse the site to observe what others are doing? Consider this as a chance for inspiration, while ensuring that you do not plagiarize someone else’s concept.
This stage is the most opportune to create or order a prototype of your product if you’re highly perceptive. It enables you to visualize its appearance, facilitate product photography, and evaluate its construction quality.
Choose a name and logo for your shop
There’s no need to overthink the name of your Etsy shop as it won’t significantly affect your sales. Even after your store is up and running, you can still modify the name up to five times. Opt for a simple and catchy name, avoiding excessive obscurity or cleverness. Additionally, make sure to do a Google search of your chosen name to ensure it doesn’t conflict with any existing entities.
After selecting a name, creating a personalized logo with Canva becomes a simple task. Canva, an online program similar to Photoshop but significantly more user-friendly, can be used for free.
If you feel unsure about creating the logo on your own, you have the option to utilize services, such as Fiverr, where you can enlist the assistance of a professional.
We’d also recommend
buying a custom domain
to match the name of your Etsy shop now, just in case you do decide to expand in future. It only takes a few minutes.Create clear and attractive images of your items
Having a captivating photo is of utmost importance on Etsy, surpassing the significance it holds on eBay and Amazon. Given that your product is likely unique, an exceptional photo can greatly impact its success, outweighing the impact of your shop name and logo.
This should be fairly simple if you have placed an order or produced a trial product.
Examine the actions of other stores offering similar products, select the style that you find the most appealing, and then strive to make yours resembling it.
Save up some money
Contrary to many online selling platforms, Etsy is not entirely free to use for selling purposes, as each listing entails a fee of approximately 18p. Investing £1 in listing six items should be adequate for your initial needs, according to our assessment.
Although we suggest beginning with a free Standard account, you might want to contemplate upgrading to an Etsy Plus account for approximately £9 per month. This upgrade provides access to additional features such as bonus advertising credits and shop customization tools, aiding in your distinction from other stores.
It can be challenging to gain visibility in the highly competitive market of Etsy, especially when starting out. But if you are uncertain about making a sufficient profit after covering the monthly fees, it is advisable to stick with a free Standard account.
If you have a good understanding of social media, this is an excellent opportunity to advertise your store online without any cost.
While discussing finances, it is important to consider the expenses associated with your item(s). Dedicate some time to calculate the production costs, including any initial investments distributed among multiple units, and determine an appropriate selling price.
Ensure that you set your prices at a level that sufficiently covers your expenses and enables you to generate profit, but avoid being excessively greedy. Given the nature of the internet, if you charge excessively high prices, there will always be others who will offer lower rates and divert your entire customer base.
Create a postage plan
Investigate the most economical method for packaging and shipping your creations. Opting for the Post Office could be the simplest approach, but in the case of large or heavy items, a courier company might be a more suitable alternative.
Ensure that you are aware of the price beforehand as well. It is highly undesirable to be charged £2.99 for delivery only to discover that you must pay £4.99 out of your own pocket when the time comes.
When setting up your Etsy store, it is crucial to avoid making things overly complicated. The most beneficial approach is to simply begin without hesitation.
If you devote excessive time to achieving perfection, you might never succeed in launching your store. Nevertheless, once you have something published on the website, you can always enhance it later!
How much does it cost to sell on Etsy?
Compared to certain other selling platforms, Etsy’s fee structure is relatively intricate. Whenever a purchase is made from your shop, three distinct types of fees are applicable.
- A listing fee – It costs around 18p to put each item up for sale, and each listing lasts four months, or until it sells – whichever comes sooner. You can set up your items to auto-renew if you have more than one available and you’ll be charged around 18p as soon as an item sells to keep it live.
- A transaction fee – Etsy will charge you 6.5% of the sale price (including postage and packaging fees) when you make a sale.
- A payment processing fee – This is 20p + 4% of the entire payment (including postage).
- Offsite ads fee (optional) – If you allow Etsy to advertise your listings, you’ll be charged 15% on sales made from an ad. You can choose not to have your products advertised.
For instance, suppose you are selling an item for £10 with an additional £2.99 for postage (not from an external advertisement). The listing fees amount to £0.18, the transaction fees amount to £0.84, and there is also a payment processing fee of £0.72. In total, these costs add up to £1.75.
