Made with Moxie: Is Etsy dying?

January 20, 2012

Is Etsy dying?

Today a friend posted a blog article titled Is Etsy dying? While I sent my comments to its author, I also wanted to post it publicly here. Often people ask me about opening an Etsy shop and I am more than happy to mentor them through the process. But the important thing to remember is that it is a process. You can't just set up shop, sit back and wait for the money to roll in. Well, you can, but most likely the money won't just roll in. Etsy is an amazing online market place that makes it easy to set up a shop in order to sell your wares, but it is ultimately a business you are going to run. It needs to be run 24/7.

Here is my response to the article Is Etsy dying?**

I have been an Etsy member since 2006 and have run an open shop on Etsy since April of 2010. I think the biggest problem that new sellers at Etsy have is what another commenter called the Field of Dreams syndrome. Etsy makes it so much easier to open a shop than it is to open a brick and mortar shop. You can avoid taxes, the IRS, rent, contracts and a large over head. New sellers that fail to take off on Etsy encounter many misconceptions and mistakes. You are setting up a shop in the world’s largest craft show. Competition is greatly misjudged. Few take the time to ask themselves “What makes my items better than all the others?” Few sellers also think that Etsy is going to drive their sales. Half of my sales from from Etsy searches. And I get those sales because I have done my research about Google search words and how Etsy’s searches work so that my items are labeled and tagged properly. Etsy has also changed their search methods as well. The default search lists items by relevancy instead of recency. The other half of my sales I drive from social media and networking. Namely my Facebook page and blog.

However these shortcomings of new shop owners are not unique to Etsy. They apply to every new small business that opens in America. The largest percent fail because they have not done their research. Just because you are good at making something doesn’t mean you are good at selling it. Or that you are good at graphic design, product description writing, product photography, social media, networking, or have a good business sense. All of these things are necessary to have a truly successful business whether on Etsy or else where.

Also what you call the “Etsy horror story” is not unique to Etsy either. One’s designs are just as easily copied from craft fairs, their own webpages, or in any environment. Knock offs are the nature of any business. But knock offs aren’t what take down a successful business. If that were true, Chanel, Gucci, Coach, etc wouldn’t be in business today. People who claim knock offs ruin their business didn’t have a strong, unique item to sell in the first place. There are items I can make that I don’t sell well on Etsy because the Etsy market it flooded with them and I would have to price them down so much to be competitive that they wouldn’t be worth my time to make. Hair accessories are a great example. Every crafty mom who has a baby girl inevitably can make hair clips and head bands. All you need is a glue gun and some ribbon. So Etsy is FILLED with hair accessories. I don’t bother to post my hair accessories to sell on Etsy. However, in a physical market place where I am most likely the only handmade infant and toddler vendor, I can sell hair accessories like hotcakes. It takes some market know-how to be successful.

There are also flaws in your math and numbers. In business you don’t compare month to month sales numbers to calculate increases. December will always be a much larger sales volume month than January. Just think, how many presents did you buy in December vs January. The retail volume has an ebb and flow all year that is largely holiday driven. So when calculating increases and decreases in sales volume (or any other metric) You want to compare each month’s numbers to those of the year previous. i.e. December 2010 to December 2011. That will give you an accurate picture of business health.

Also because there is no distinction in Etsy accounts between being a seller and a buyer, you are correct in assuming there is no way to determine what the intention of each new account opened is. I am both an Etsy seller and an Etsy buyer and have always been. Also, new accounts could be created in order to favorite items and shops for later purchases, making them neither sellers or buyers. And while you have the number of new accounts opened you do not have the number of accounts closed or left dormant.

Etsy isn’t dying at all. It is making great revenue off of listing fees and sales commissions. People who try to open a shop and fail blame Etsy. When in fact they should look closer at critiquing themselves. Those people would have failed at a brick and mortar shop too. They aren’t putting the dedication and effort it takes into running a business because that is what it is. They say Etsy as the easy way out, when it isn’t at all. It’s a launching platform. It’s a market place. Etsy makes it easier to have a successful shop, but they do not make it easy. Running a business is not easy. In the end the shop owner still has to do most all of the work. And those who don’t will ultimately fail.

If you read all this and still would like help to launch your Etsy shop please do not hesitate to email me at

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Thank you and have a great weekend!