Etsy is an incredible tool for sellers of vintage handmade items to sell their crafts to a large market of people.
However, for all the benefits you can expect from using a website such as Etsy, there will also be drawbacks.
While Etsy may seem like a clear choice for many artists, it isn’t the only route to market. Deciding if Etsy is right for you can be a confusing decision!
So, is selling on Etsy worth it?
In this article, we’ll break down the reasons for and against using Etsy for your eCommerce business.
Is Selling on Etsy Worth it? Let’s Take A Look At The Etsy Pros and Cons!
The Pros Of Selling On Etsy
1. User-Friendly, Great For Beginners
Starting an eCommerce business is a daunting task.
Many will start by building a website, and then figuring out how to drive traffic to their store. This can take plenty of technical and marketing skills that many artists do not possess, creating a barrier of entry to selling your items.
Many will find that starting out can be costly if they require help designing logos, building the website, or getting their SEO in order.
Lastly, building a brand and getting on the first page of Google’s search results is a process that could take months– or even years!
Joining Etsy means you’ll start selling more quickly and with less technical know-how. While you’ll still need to know what you are doing in order to do well, it does remove some of the difficulties.
Most people will be able to at least earn a small amount of money on the website if they have a good product, although being a top seller will still take a lot of work.
2. Established Market
Shoppers will go to Etsy for particular items. While the website has expanded somewhat in recent years, it still has a strong reputation for handcrafted artsy items with a vintage feel.
Sellers of this type of item are aware that listing on Etsy links them to customers who are likely interested in their products. Regular Etsy shoppers will have some trust in the brand and, therefore, in you as a seller as well.
3. Low Listing Fees
Etsy has gotten some backlash about the rise in fees that occurred in 2022. However, the cost of listing an item has remained at the same low rate of only $0.20.
Even if your item doesn’t sell, there’s not a lot to lose as the more significant fees occur when the item is sold.
4. Free Shipping Guarantee
Etsy’s free shipping policy is a great way to attract customers. Sellers should factor the shipping cost into the price of the item to cover the postage, packaging, and time.
Free shipping is great for customers who prefer seeing all costs in the item total instead of having other fees added at checkout.
This may lead to greater profits because customers will generally be more willing to buy your products!
5. Analytics and Store Management
Etsy offers its sellers tools to help them manage their stores.
These tools provide you with stats about customers who visit your store, allow you to set up waitlist notifications for sold-out items, help you manage ad and listing credits, and so much more.
6. Paid Promotions Can Help You
When your item is not selling as well as you would like, investing in paid promotions can help boost visitors to your store, leading to more sales.
Etsy makes purchasing promotions easy. You can set how much you’d like to spend, and which listing you’d like to promote. You can even select what countries you’d like your listing to feature in, and Etsy will do the rest!
The listings you’ve chosen will be displayed higher in searches on the Etsy website and promoted through other methods. Etsy shows these ads where they are likely to perform best.
You’ll pay each time someone clicks your ad, up to the amount equal to your maximum daily budget. Etsy also provides you with detailed graphs so you can monitor how these ads are performing.
7. Easy Brand Building
Creating a brand for your business is an important way to let your customers know who you are, and what you are about.
Creating a warm and welcoming environment matters not only for in-person shopping experiences but also for online stores.
Customers are more likely to buy something if they love the look and feel of the store, and are also more likely to return if they enjoyed the experience.
While you can create a stronger brand outside Etsy, building a brand within the platform is still possible because of its relative ease.
Etsy allows sellers to control certain features of their shop. You can customize your store name, personalize your Etsy banner, create an Etsy shop icon and logo, and tailor your shop’s color scheme.
Additionally, you can also upload a photo of yourself as the shop owner, create unique product images, and more!
8. Etsy SEO
Figuring out how to improve your SEO can take a lifetime to master.
Many businesses will shell out considerable amounts of money to SEO companies so they will appear higher on the Google research results page. Simply put, SEO is so tricky to get right.
When you are selling through Etsy, you will gain access to tools that allow you to improve your SEO on both the Etsy website and Google.
Etsy explains how to best pick keywords for your items and use your listing title, item description, images, videos, and backlinks to improve SEO to get more buyers to your store.
The Cons Of Selling On Etsy
Once you start doing well on Etsy, some people will take notice and want to share in your good fortune.
Copycats will imitate your products and create direct competition for you. They will use the same tags, item names, and descriptions you use.
Even if their products aren’t of the same quality, they can still trick customers into buying from them instead of you.
Many sellers have gone to forums, such as Reddit, to complain about their experiences with copycats. The experience seems to be a frustrating but inevitable part of becoming an Etsy success story.
When you join Etsy, you are entering a marketplace of around 7.5 million active sellers.
While there are also plenty of buyers, the abundance of choices means they get to be very selective about who they buy from.
Competition is fierce. To be successful, you’ll need a competitively-priced item that stands out and enjoys plenty of demand!
3. Low Customer Loyalty
When you create a standalone shop, you are likely to earn loyal customers over time.
Customers will return to your website to see what new items you have, or to reorder similar items– whether for themselves or as gifts.
This is slightly different when you sell on a large website such as Etsy. Customers may be loyal to Etsy, but having so many options means they’ll shop around each time they return to the site.
Having great customer service and quality products can create some brand loyalty, but using Etsy makes you more likely to have one-off customers.
However, on the flip side, you’re also likely to get new customers who enjoy shopping around from other shops!
4. Recurring Fees
While Etsy charges a relatively low listing fee, it still takes a substantial cut once the item sells.
This cut consists of several separate fees that quickly add up to a significant percentage of your sales.
These fees include the $0.20 listing fee, a 6.5% transaction fee, and a 3% + $0.25 payment processing fee for all items.
You’ll also incur a 2.5% foreign conversion fee if you list items using a different currency than the currency of your payment account. If you opt for off site advertising, you’re also looking at a 12–15% fee.
In total, about 9.5–27% plus $0.45 of each sale goes to Etsy.
5. Cutting Profit Margins For Free Shipping
Free shipping sounds great on paper, but nothing is ever really free.
You have two options to cover shipping costs—you can either raise prices, or shoulder them yourself. The first option risks driving away customers, while the second one means you’re taking lower profit margins.
Offering free shipping can be tricky because the shipping cost will vary between customers. If you’re not charging for shipping, you can’t personalize the shipping cost for each customer.
You can either assume most customers will be fairly local and use a low estimate, or make sure you cover the cost by estimating for rural deliveries or international customers. You could also meet somewhere in the middle and hope it all balances out.
6. Limited Selection of Items That Can Be Sold
You won’t be able to market your products on Etsy if you aren’t selling vintage or handmade goods.
Some sellers with established stores may try to explore selling other related items– only to have these products flagged and removed for not meeting Etsy’s criteria. This can limit a seller in the long run!
7. Time-Consuming Storefront Customizations
Those looking to save time and start selling on Etsy may find that the customization of the storefront is too time-consuming.
Some sellers may prefer selling on markets like Amazon, where all the stores look the same and customization isn’t expected.
However, as most Etsy users are artistic, they will likely appreciate being able to personalize their shop and build their brand.
8. The Etsy SEO Algorithm
Many sellers get frustrated with keeping on top of the Etsy SEO as updates can change the algorithm used.
Carefully nurturing your SEO may feel tedious and lead to some users giving up.
Others may feel that they are unable to get a handle on the SEO as successfully as their competitors, leading to their listings getting buried.
9. No Fulfillment Services
Etsy sellers must pack, label, and ship all items sold or find a separate business to take care of their fulfillment.
For larger stores, sellers may find that they don’t have the space or time to handle fulfillment, driving them to partner with a company specializing in this aspect of the business.
10. Hard-To-Grow Email List
Etsy doesn’t allow sellers to automatically grow an email list.
Sellers need to get creative or painstakingly create these lists manually. Many frustrated sellers are forced to use programs to help them build a list of emails for their newsletter, despite Etsy not permitting their use.
11. Limited Branding Potential
While you can personalize your storefront to an extent, you are much more limited in your branding potential than if you create your own website.
When you’re using Etsy, you can’t set up the look, layout, and functionality exactly the way you want.
So, Is Selling on Etsy Worth It? The Verdict
Unfortunately, there’s no definitive, catch-all answer to whether it’s worth selling on Etsy as it largely depends on each seller’s personal situation and preferences.
Some sellers will have great success, turning their Etsy store into their primary source of income. They will find that joining Etsy allows them to start selling their crafts more quickly.
These sellers have items and strategies that enable them to stand out in an already saturated marketplace. The tools Etsy offers its sellers for advertising and improving their SEO are sufficient for their needs.
Others will do better at creating their own eCommerce store independent of a marketplace.
These individuals may have good technical knowledge or the resources that enable them to succeed, such as people to help them, money to spend on web designers or marketing companies, or the time and ability to learn these skills.
They may prefer more flexibility in creating their brand and enjoy keeping more of their profit for themselves.
Make sure to carefully consider the pros and cons above when deciding if selling on Etsy is worth it for you!