The Big Etsy Pocket: Cha-ching! or, Etsy Sellers Work for Etsy. For Free.

1194985891178996774670a029.svg.medHave you ever considered how much Etsy profits off the Etsy sellers’ hard work?  I’m not talking about 20 cent listing fees, or 3.5% transaction fees, or 3+% direct checkout fees (or the interest on the dc funds), or paid ad fees. I am talking about the profit Etsy makes from sellers promoting outside of Etsy, creating treasuries or favoriting items, providing customer support to Etsy customers. Etsy sellers spend their valuable time working free for Etsy.

Every time a shop owner promotes his or her shop outside of Etsy, they are promoting Etsy as well.  In some instances, like bringing buyers in the door, shop owners may as well be promoting Etsy onlyas Etsy uses every opportunity to redirect customers to other shops: in the checkout process, with an after-sale email, both often advertising competitors. Do you realize the advertising dollars saved by this multi-million (or is it billion?) dollar company by relying on its’ sellers for this free promotion and advertising? And what does the seller get in return? The redirect! (Oh, and don’t forget the Etsy Ambassador ponzi scheme program where Etsy sellers can earn  less than minimum wage $8.00 in free listings for bringing in new sellers.) Think about how many promotional hours are spent weekly by millions of Etsy users. Think of those hours in terms of dollars. Cha-ching, cha-ching! That is tax-free money in the big Etsy pocket!

Whenever Etsy sellers create treasuries and/or favorite another sellers’ items, this creates the front page phenomenon, expertly explained by EtsyTricksy. No dollars to an expensive outside agency for this work! Cha-ching, cha-ching!

The real biggie is the money saved by providing little-to-no customer support. To provide real customer support, especially phone support, would cost Etsy some big, big bucks, in the form of physical space, wages, taxes, insurance, etc. Why do they need to spend their money on such things when they can rely on Etsy sellers to provide support, 24/7?  Etsy banks on sellers graciously wanting to help others out, and doing so freely in the forums. Why do you think the forums exist at all??? It isn’t to give buyers and sellers a voice on Etsy issues, or to give Etsy users a place to question Administration. It is there solely for the purpose of customer support. Take a look at the forums and add up those manhours. Cha-ching, cha-ching, cha-ching!

While the deep Etsy pocket continues to fill with dollars, Etsy sellers are losing out through continuous declines in views and sales, and by working free for a multi-million dollar company. The only ones who stand to gain are the Etsy employees (the paid variety) and investors. Oh. And don’t forget the resellers and the 1%, neither of whom have time for promoting or assisting others.


5 thoughts on “The Big Etsy Pocket: Cha-ching! or, Etsy Sellers Work for Etsy. For Free.

  1. Patty, the difference in your b&m and Etsy is this: As a business owner, you are doing what is expected of any business owner – paying for space, advertising, taxes, insurance.. all of which in turn keeps other “main street businesses” intact, and which puts money back into running the community in the form of taxes. Your business is a give-and-take, and benefits all, not just you. Although Etsy may be a “cheaper” business model, the Etsy seller does the same thing…. pays for space, taxes, insurance, etc… Yet Etsy takes a free pass and is NOT putting dollars back into the community, a community used by Etsy but supported by others. Do you understand the tax dollars Etsy saves (and the community loses) by Etsy using free labor? Unfortunately, Etsy is more take, than give.

  2. Free advertising versus $100 paid to the local corporate media giant? As I stated, the free advertising on Etsy’s part rides on the back of the small, independent artist, at the expense of an advertising agency in lost revenue, and the (physical) community at large in lost revenue and taxes. The $100 you pay to the media giant is taxable income which taxes go back into the community. There is a big difference.

  3. I object to pouring time and energy into an Etsy shop only to find some very unappealing prospects facing me. I can have that shop shut down at any time. Without recourse or reason. After all my own work at “promotion” Etsy has iincreasingly pushed its promotion of OTHER shops into MY shop. At every turn the customer who visits my shop is lured away to “other choices”.

    In my brick and mortar shop, when I’ve paid $100 for an Ad, you can be sure I don’t have competitor’s items on a table at the front door. Nor am I likely to wake up one morning and find my shop GONE. ( Barring nuclear war or a monumental typhoon). When I choose to advertise, I have control over those ads. I don’t find that for some odd reason Etsy focuses on “nursery” out of 13 tags to ensure I lose 90% of relevant views on my paid Ads. Which is why so few people are using this feature anymorre. I finally stripped all my tags to only two relevant ones so I could get rid of that “nursery” tag. I should be able to choose my tags.

    And above all … the real clincher. If I set up a brick and mortar dress shop …. I’m not going to locate right next door to Ross’ or Walmart. To have to compete in a deliberately skewed market is unfair when that market advertises iself falsely as “a place for all things handmade”. and then turns around and sells CHinese factory junk falely tagged as “handmade”. This is outrageous.

    Many people caught onto this long ago … among them a very very successful graphic artist who quite simply used Etsy as her ‘shopping cart’.. She exhibited widely offline and participated in dozens of blogs and online galleries. But int EACH one she linked BACK to her Etsy shopping cart. This worked fine for many years until Etsy began pushing OTHER artist’s work onto her shop site. Etsy didn’t want to provide that shopping cart without a bigger slice of the pie. WHich is what it has done.

    Today for many of us the only option is to use Etsy as a shopping cart. I never link to my shop front … but always to the individual item. And I sell on other sites too.

  4. Patty, I believe S nailed it. Many of those who are successful on Etsy are the ones who don’t rely on Etsy traffic for their sales.They merely use Etsy as a shopping cart (a “venue”). Also, what continues to be taught on Etsy success was, at one time, right on: good product, excellent photos, relevant SEO, outside marketing; and basically what makes any business a success: hard work and dedication. All of those things could still contribute to business success on Etsy if it were a level playing field. It isn’t.

    Hard work and good product, etc. are no longer enough because of the many obstacles in the Etsy road: resellers, relevancy, browse, the redirect, constant site changes, disconnect between Administration and users; and probably most importantly, site features favoring those who can produce the most: resellers and the 1%. Unfortunately, for the independent seller, time spent trying to work around Etsy obstacles is time away from creating, further lowering product output, and making it less likely for success on Etsy.

    As for those independent sellers who continue to do well on Etsy despite the obstacles, what I have noticed is these sellers either (a) have been around for a while and have developed a strong reputation and customer base; or, (b) have a unique, extraordinary, quality product. I do not believe many new (legitimate) sellers will ever have the opportunity, in today’s Etsy market, to rise to the level of the above (a) seller. I do believe if one rises to the level of the above (b) seller, they will become less and less independent and lean more toward outside assistance and mass-production.

    For those legitimate sellers who become overnight successes, I have noticed they are normally one of the first who jump on a fad or trend bandwagon. These shops are at first heavily promoted by Etsy, but dropped like a hot potato when the fad passes, or when the Etsy masses start producing more of the same trendy products (that supply and demand thing.) The overnight successes either have to adapt to the latest fad, or die. (To me, this sounds like a tiring way to do business.)

    I don’t have any answers on how to sell more, and really don’t believe you want to “game the system.” You, like all independents, merely want a viable way to market our products. For former and current Etsy users, we are disappointed that Etsy is no longer that viable market; and most of us are currently struggling with where to go from here.

    • You’ve nailed it perfectly. Most of those big sellers have been on Etsy for many years, since the golden early years. They’ve built up a solid customer base ( on and offline) which is still with them.

      Many of the others, one of whom I know from online activities, simply uses Etsy as their shopping cart.
      ( Even that is now being compromised by Etsy’s “invasion” of our shop space with their outgoing links,)

      And the others have jumped onto a “trend”. Remember the “scrabble tile” pendants … originally being sold for around $20? …Then as suppliers picked up on the scrabble tile “kits” and money to be made out sales of refills for those kits, the original sellers started to drop their prices. Now there are hundreds of these available for as low as 6 or 7 dollars. One of my friends quit her day job when she started out with those pendants. What a fiasco!. SHe coasted aong for a few short months and then the influx began and eventually closed her down.

      The only direction I can see right now is using Etsy as a shopping cart. And I would not hesitate to mention that as a “temporary” measure on my independent website. I also would be sure to add a card to each Etsy purchase offering a discount for any future purchases made offline. Then plan to accept checks and credit cards through personal mail until your customer base is large enough to warrant adding a shopping cart to your independent site. Use Etsy .. don’t be used BY Etsy. And you owe this site no loyalty whatsoever with its new terms. Not a shred.

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