Etsy vs website: How can I start the most successful business?

I’ve often been asked which is better as a starting platform; Etsy shop or your own website and while of course there are distinct differences in how each will work for the business owner, there isn’t a straight answer as to which is ultimately better.

Today on the podcast we are delving a little deeper into the subject to lay out the pros and cons of each choice, so that when you sit down and work out which is right for you and your customer base, you ultimately have a better understanding of what each platform can do for you.

 

What are the pros of selling on Etsy shop above owning your own website?

Selling on a platform dedicated to handmade products and small businesses can feel like an easier place to start, especially if you aren’t technically inclined. It also offers distinct differences from a branded website;

 

  • Etsy have their own way to generate site traffic - There are 35.8 million active buyers on Etsy, 81% are repeat buyers according to DMR Business Statistics, that’s an awful lot of potential buyers for your craft products and part of the fees you pay Etsy goes towards creating new site traffic too. To start in a space like this is the difference between showing at a top-level craft show with thousands of visitors, versus a local church hall where you may get 20-30 people through the door. Your own site will take lots of dedicated work from you to build traffic from the ground up. Choosing Etsy isn’t an outright win though, because just selling at a big venue doesn’t guarantee you will sell out.

  • Etsy have lots of seller tools and options for you to tap into – from tools like monthly sales statistics, to social media tools. Etsy do host a lot of free tools that you might have to pay to create or add on to your website’s own shopping cart.

  • Product listings are easy to set up – Etsy have been around since 2005 and so they have perfected the set up for product listings down to an easy to follow template.

  • Offer a number of payment options for customers – Due to the size of the platform Etsy can offer a number of payment options to your customers at no extra charge to you from day one. On your own website you will have to choose a payment provider that offers a choice of payment options, but also a provider that is value for money when it comes to their fee structure. This can often mean less resulting choice for your customer.

  • Easy to keep on top of inventory – Inventory is easy to find especially if you add Stock Keeping Unit number numbers (SKU). Of course you can do this on your own website too, but with an Etsy shop you can filter inventory by category in a visually easy to follow way, which I have found much easier than some of the self-hosted website platforms I have used in the past.

  • Simple mobile app, ‘Sell on Etsy’ – If you are on the go, or even at a show you can use the Etsy shop app to create social media posts from, or to handle inventory. One day what would be nice is if you could create sales receipts from Etsy for craft show customers, but maybe that’s on the cards for one of the more premium shop owner subscriptions. I talk about the Etsy Plus package here.

  • Custom orders because Etsy have been around for so long and specialised specifically in handmade and small businesses they realise that one of the things that helps sell handcrafted items, especially during the holiday period is product customisation. So if your customer wants that cute teddy bear with their child’s name on it you have the ability to turn an email request into a sale, by setting up a private listing in a few simple steps. Of course most ecommerce website systems will allow you to set up sales outside of website product listings, but how Etsy have set this up helps you and the customer to have a clear paper trail from conversation to order.

  • A great place to experiment and perfect your business – Often when we start out we are in a position where we feel completely overwhelmed by all the business things we need to learn. Having a simple system to use, that helps us to tackle one thing at a time in an easier way feels like common sense. In fact, most small handmade businesses I know have started on a selling platform, like Etsy for this very reason alone. Where did I start you ask? I actually started on eBay in mid-2006 and joined Etsy as a second shop in mid-2007 before later launching my own full ecommerce website (and trying Amazon, Folksy, Not on the High Street and the now defunct DaWanda). That multi-channel sales system is the topic for another day I think!

 

What are the cons of selling on Etsy shop above your own website?

Selling on Etsy alongside 1.98 million sellers (report by Expanded Ramblings) can make things hard going for a new business. Here’s why;

 

  • 1.98 million other vendors at the same craft show as you – your first problem is how you stand out in a crowd of stiff competition.

  • Selling on a site with a high number of active buyers doesn’t guarantee a sale – there is a fine art to learn how to sell on Etsy. You need a balance of attractive, branded imagery, well described products, the right prices and of course search engine optimisation (SEO). Read more here

  • Your customers are not your own – selling on any platform that isn’t your own website leads to non-ownership of the customer’s who frequent the platform. In other words you make a sale in your Etsy shop the customer data belongs to Etsy. You are not allowed to solicit that customer after a sale in future marketing. On your own website the customer is truly yours.

  • Lack of branding – Using an Etsy shop means that just like every other seller you have the same opportunities for customisation and the lack thereof can lead to a situation where you feel like your shop isn’t uniquely identifiable from anyone else’s.

  • If something goes wrong with your transaction Etsy will always side with the customer and offer refunds where you might not – because Etsy own the customer data in effect it means that any issues that customer, has Etsy wants to fix immediately, regardless of the finer details of the problem. For example your customer gives you the wrong shipping address. You ship and of course the item doesn’t arrive at the right destination. Etsy has the right to refund that customer despite your feelings about this. On your own website however, if you state in your terms that no refund will be given on receipt of inaccurate information at the checkout you have the right to refuse a refund, or you have the right to request payment for repeat shipping costs.

  • Fees – sales platform fees can work out more expensive in the long run, over a monthly subscription rate for your own website. There is always a need to be mindful of what you are paying and what percentage of your expenses that comes to.

  • Not entirely clear who is handmade and who isn’t – When Etsy first started out their remit was to provide a platform for entirely handmade product-based businesses. This allowed small scale producers to really sell their unique story and process with the world. Over the last five years Etsy have slowly changed their remit to allowing small scale business who work either on their own producing their product, or with manufacturers who produce small scale runs for them. With the addition years earlier of ‘vintage’ items to the site, Etsy’s message has become a little muddled for those who have been long-term users and identifying which business hand-produces, or effectively small scale ‘mass’ produces, or even ‘resells’ products is difficult. This watering-down of the original purpose of Etsy has been seen by some as a negative impact on the platform.

  • Platform sites can scream ‘bargain’ – as with any selling platform that hosts multiple businesses there will always be price-wars. Someone will always offer a similar product cheaper than you. Depending on the quality of that lesser-priced item it can devalue your business and can certainly slow sales. This is one of the biggest reasons why I stopped selling on eBay and Amazon… price-wars scream ‘grab a bargain’ and that eats into your profits!

  • No listing alerts for items selling out – occasionally there are businesses who sell multiple items within a listing. An example could be a short run of screen-printed t-shirts. As handmade, or hand-produced doesn’t necessarily mean one-of-a-kind it would be good to have a system in your Etsy shop that allows you to know when these listings will be out of stock, so that you can replenish if you wish. Again Etsy may address this in one of their more premium seller subscription packages going forward.

  • Doesn’t feel like an easy way to sell multiple items – Etsy was originally set up to list singular products from sellers and so their additional functions for multiple listings, like our t-shirt example where you may have more than one unit, across a number of sizes isn’t always easy to manifest in the listing templates, or easy for the customers to find on your Etsy shop. Occasionally I think this can mean that potential customers click away empty handed.

  • Slaves to the Etsy search algorithm – Etsy has a duty to their customers to provide the best way to find products and so occasionally this means that the algorithm (the mathematical system they create to predict better matches for you in your searches) can change. As a customer this is often a wonderful change, because it does deliver easy to find relevant search results for products I want to buy. For the seller however, this means learning a new way to set up the SEO (usually) of their listings to maximise their chances at being picked as a relevant listing when a customer searches for their products. Ultimately, it’s extra work, often over and above SEO changes search engines might make that would affect a self-hosted ecommerce website.

  • Visible sales – I’m not sure I’m keen on this. Whilst the vanity of having a large number of sales can be an ego boost and it can certainly help you spot the bigger competition, it doesn’t really mean anything and so I’m not a fan. I think it can also feel deflating to a start-up struggling to get their first 100 sales. I’d rather they stick to showing the seller ratings and let that be the parameter for which customers choose to shop with sellers.

  • Negative feedback plague – This is one of the greatest sticking points I and my coaching clients have with using selling platforms like; Etsy, eBay, Amazon… the negative feedback plague. There are unfortunately a few out there who do go around giving far less in terms of ratings than they should. I once got a one-star feedback on eBay from a customer just because I didn’t answer her email in 20 minutes… in my defence I was asleep here in the UK while she was awake in the US and if she’d waited just 20 more minutes her delivery arrived, on the exact day it was supposed to! I also had someone give me four out of five-stars on Etsy once because she didn’t believe anyone was ever good enough to receive a five-star rating… jeez!! I generally find that this kind of thing only happens on sales platforms. I have literally not come across it on my own website and neither have my coaching clients. I don’t think it should put you off of selling on sales platforms, but it certainly is an issue you may face. Here’s my advice on how to deal with negative feedback on Etsy.

 

Takeaway

When you start out my best advice is to start somewhere where you feel you can comfortably set up your shop in a way that is both easy for you to use and for your customers to buy from. A successful start-up will require work on your product, understanding your customer and how to market to them, as well as having the right ecommerce platform to facilitate sales. Choosing an Etsy shop over a website, or vice versa in itself does not lead to a successful business start-up.

Resources

 

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Where did you choose to start? Tell me about it in the comments.

Thank you for watching! I hope that was helpful, or at least thought provoking?

If you have any questions or comments, please pop them in the comment section below.


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Etsy vs Website
Etsy vs Website
Etsy vs Website
Etsy vs Website