Etsy
Etsy, Inc. is an American e-commerce company focused on handmade or vintage items and craft supplies. These items fall under a wide range of categories, including jewelry, bags, clothing, home décor and furniture, toys, art, as well as craft supplies and tools. Items described as vintage must be at least 20 years old.[2] The site follows in the tradition of open craft fairs, giving sellers personal storefronts where they list their goods for a fee of US$0.20 per item.[3] Beginning in 2013, Etsy allowed sellers to sell mass-manufactured items.[4]
Company type
June 18, 2005
- Robert Kalin
- Chris Maguire
- Haim Schoppik
- Jared Tarbell
Brooklyn, New York City, U.S.
- Josh Silverman (CEO)
- Fred Wilson (chairman)
US$2.75 billion (2023)
US$280 million (2023)
US$308 million (2023)
US$2.69 billion (2023)
−US$544 million (2023)
2,420 (2023)
As of December 31, 2022, Etsy had over 100 million items in its marketplace, and the online marketplace for handmade and vintage goods connected 7 million sellers with 92 million buyers.[1] At the end of 2023, Etsy had 2,420 employees.[1] In 2023, Etsy had total sales, or gross merchandise sales (GMS), of US$13.2 billion on the platform.[1] In 2023, Etsy garnered a revenue of $2.75 billion and registered a net gain of $308 million.[1] The platform generates revenue primarily from three streams: its Marketplace revenue, which includes a fee of 6.5% of the final sale value,[5] a listing fee of 20 cents per item, and Seller Services, which includes fees for services such as "Promoted Listings", payment processing, and purchases of shipping labels through the platform. Other revenue includes fees received from third-party payment processors.[6]
General[edit]
Selling[edit]
Creating a shop on Etsy requires creating and posting at least one listing in the shop, which costs $0.20. Each listing will remain on the shop's page for a maximum of 4 months, or until someone buys the product. The prices of products are set by the shop owner, but Etsy claims 6.5% of the final sale price of the listing[7] and 6.5% of the postal fee. Shop owners are sent a bill at the end of every month detailing the fees Etsy has charged them, and they have until the 15th of the following month to pay the fees.[8] Sellers can choose which payment options to offer buyers, including credit cards, debit cards, and PayPal, among others.[9]
Buying[edit]
On the Etsy homepage, potential buyers can type a "product description" into the search bar,[10] or they can "browse" through a list of options, which includes Art, Home & Living, Jewelry, Women, Men, Kids, Vintage, Weddings, Craft Supplies, Trending Items, Gift Ideas, Mobile Accessories, and more.[11] Furthermore, buyers may choose from a list of categories by clicking on the "categories" link under "More Ways to Shop". This will bring the user to a page of over 30 categories, each containing subcategories.[12]
When a buyer views a product, they can choose to view the positive feedback of each seller to determine the reliability of the shop. Once a buyer finds a product they would like to buy, they click "Add to Cart", and that product is added to their virtual "Shopping Cart". The buyer may then either continue shopping or purchase the selected item. In order to purchase items, buyers do not have to have an account with Etsy and can instead register with Facebook, Google Account, Apple ID, or email.
Etsy has received criticism for its handling of customer data and privacy.[13] As of 2016, the "Privacy Policy" section on the website reads: "By using Etsy, you authorise Etsy to use your information in the United States, Ireland and any other country where Etsy operates".[14]
Ethos[edit]
In an interview in August 2013, CEO Chad Dickerson emphasized the importance of human interaction. Dickerson described the website as "a platform that provides meaning to people, and an opportunity to validate their art, their craft", and after spending time with Etsy users, Dickerson learned that "all commerce is about real human interaction". Dickerson also provided a summation of Etsy that is a further reflection of the company's relationship- and meaning-based ethos: "At the end of every transaction, you get something real from a real person. There is an existential satisfaction to that."[97]
Climate impact[edit]
In 2008, Etsy received a B Corporation certification but later lost it in 2017.[98] This certification was a recognition of the company abiding by transparent and accountable practices, which includes environmental practices.[98] The environmental impact from depends greatly on the individual seller usage of wholesale retailer and large manufacturers.[98] In Etsy's Supplier Code of Conduct, it states that sellers are obligated to follow environmental laws and regulations and that sellers must conduct business in a sustainable and responsible manner.[99] Etsy's 2020 Climate Change Response outlines the company's annual plan for climate related issues and how it achieves the motto of "keep commerce human".[100] In 2019, the board that oversees climate change at Etsy made a goal of becoming a carbon neutral company in 2020.[100] To achieve this, Etsy is offering eco-friendly packaging to its sellers through a partnership with EcoEnclose.[101] This provides sellers with the option to use certified 100% recycled packaging.[101] Buyers are also given a carbon offsetting option when selecting shipping.[102] Etsy, partnered with multiple companies including Apple, pledged to purchase 165 Megawatts of solar energy through Spotsylvania.[102] By 2025, Etsy's goal is to reduce energy intensity by 25%.[100]
Competitors[edit]
As of March 2016, Etsy's top three competitors according to Hoovers Online are Amazon Handmade, Craigslist, and eBay.[103] Etsy has been compared to "a crafty cross between Amazon and eBay",[47] and to "your grandma's basement".[104] Etsy also has a number of direct competitors. DaWanda, based in Germany, closed in August 2018, Druzza is a global competitor,[105] Bonanza (formerly Bonanzle and 1000 Markets[106]) is based in the United States and focuses on clothing and fashion, Zibbet and Made It which are based in Australia, iCraft is based in Canada,[107] Artfire is based in the United States,[108] and Moksi is an online craft marketplace targeted at South Africans, and offers unique African-made handcrafted goods and art.[109] Tindie is based in Portland, Oregon, and focuses on technology and electronics.[110] Apple Creek Lane, a Canadian-based online marketplace that focuses on health, fitness & wellness products. ArtYah, based in California, United States brought together sellers and consumers of handmade items, vintage and some craft supplies [111] prior to closing in December, 2019.
Asked about competitors, Etsy's European CEO said, "As far as I am concerned, the more people highlighting the value of supporting micro-producers and buying handmade and vintage directly from them, the better."[112]
Seller issues[edit]
Privacy[edit]
In 2011, in an effort to add social networking features to Etsy, the company implemented features that allowed users to search other users' buying histories and to trace their purchasing transactions. Etsy thought this feature would allow Etsy users to connect to individuals with similar buying and/or selling histories and an automatic opt-in was applied to all users without the attainment of prior permission. Users of the service raised concerns over the feature's violation of privacy rights, but an official response was not released by the company.[113]
Production outsourcing[edit]
On October 1, 2013, Etsy changed its policy to allow sellers to outsource production to third parties and factories and to use shipping or fulfillment services.[114] The new rules allow products to be labeled "handmade" as long as the original idea for that item—or its "authorship", as the then CEO, Dickerson, said—comes from its respective seller. Further, the policy changes allow Etsy businesses to hire as many employees as they deem necessary (including workers in different locations) and allow sellers to ship orders via third-party couriers rather than the post office.[115]
The move has prompted at least one Etsy competitor to distinguish itself by committing never to sell manufactured items.[116]
In September 2015, Etsy made further changes to its manufacturing policy with the launch of Etsy Manufacturing, a marketplace allowing sellers to connect with outside manufacturers to fabricate their products. Manufacturers must be reviewed and approved by Etsy to ensure they adhere to certain criteria, although Etsy will not conduct visits or in-person inspections. Sellers must apply and be approved to work with any partners listed on Etsy Manufacturing and are required to disclose their use of outside manufacturers on their pages.[117]
Advertising requirements[edit]
In February 2020, Etsy announced a new "risk free" product advertising program, replacing an existing system allowing sellers to purchase ads on platforms such as Google Shopping from within Etsy. The company will automatically purchase advertising for products on "high-traffic" websites, with sales generated by these leads subject to a 15% cut of revenue from the total of the order. Etsy expected at least "1 in 10" leads to come from these ads. All sellers will be automatically opted into this program, but sellers with an annual revenue of $10,000 or higher (which will be subject to a 12% cut instead) are required to participate and may not opt out. The system has faced criticism from sellers, who have characterized the new system as a means for the company to further siphon revenue from its sellers.[118][119]
Effects of banking sanctions[edit]
On 10 March 2022, due to banking sanctions, Etsy blocked accounts of all Russian customers including those living abroad and delisted all their goods, with the message of "Expanding business restrictions in the sellers' region".[123]
Fake ‘handmade’ products[edit]
In April 2023 the UK Consumers' Association found that some items for sale on Etsy were also for sale at large retailers, including Amazon, Asda and the discount chain B&M, for much lower prices. In a sample of 192 products 23 were found to be available on other online platforms or retailers. Rocio Concha, director of policy and advocacy said, "Our research shows some Etsy sellers are brazenly ripping off customers by making misleading claims about their products".[124]
Etsy treatment of sellers[edit]
In 2022, Etsy faced protests from sellers after raising transaction fees from 5% to 6.5%.[125] In April of 2022, a group of 5,000 sellers united to strike by taking their stores off line for a week in protest.[126]The following year, Etsy placed reservations on seller accounts taking 75% of their takings on hold for 45 days without prior notice or explanation; the UK's Small Business Commissioner, Liz Barclay, said that "we hear that many sellers are women or minority groups and they need this money to pay the bills".[127]
