Frustrated on Etsy

Does Etsy’s “Risk-Free” Advertising Affect You?

Without much in the way of notice, Etsy is rolling out a new policy: “Risk-Free Advertising.” And, if you’re a longtime Etsy seller, you may be feeling triggered – this isn’t the first time Etsy has dropped the axe on its sellers. But for many, it may be the last.

The Good News According to Etsy:

“Offsite Ads uses Etsy’s budget and expertise to promote your items on Google, Facebook, Instagram, Pinterest, and Bing. When a shopper clicks on one of those online ads for your products and purchases from your shop within 30 days, you’ll pay an advertising fee. You only pay an advertising fee when you make a sale—eliminating the risk you could pay for ads that don’t lead to a sale.”

Source: https://community.etsy.com/t5/Announcements/Introducing-Etsy-s-Risk-Free-Advertising-Service/td-p/129557055

The Bad News According to Etsy’s Community:

  1. Between the listing fees, the transaction fees on product and shipping, credit card processing fees, and a push provide free shipping if you want to shop up in the search results . . . the new advertising fees are steep. 15% of your sale. [12% if you had $10 or more in revenue last year.]
  2. If you made $10k in revenue on Etsy in the last 12 months, you’re forced into the program. No opt out. If you made less than that, you can opt out after a month; however, as of this writing, there is no dashboard setting for this.
  3. It is unclear if Etsy will be advertising your individual product, linking directly to your shop . . . or, if you are paying 15% of your revenue on ads that promote Etsy in general.
  4. It is unclear how the advertising to sale pathway will be tracked and counted. For instance, if a buyer clicks on an ad for a competitor’s product, then clicks around and sees your products, then comes back to your shop in 29 days – will the 15% fee be taken?
  5. The advertising fee is cost-prohibitive for low profit margin items. For example, print on demand products typically earn a low percentage for the shop seller. A tee shirt might sell for $25, but with the printer’s fees, the listing fees, Etsy’s nearly forced “free shipping” policy – an additional 15% on top of that could reduce the shop seller’s profits to nothing. Or worse, less than nothing.

What to do Right Now

  1. As of right now, the new policy has taken effect. If any of the listings in your shop carry a low profit margin, log in and deactivate them until you have a chance to calculate how the new advertising fees will effect your bottom line. If you are earning less than $10k a year, you (hopefully) will be able to opt out of the program soon enough and you can reactivate the listings then.
  2. Log in to your account and head over to the Etsy community and read the comment about the new policy. Take a moment to “like” the comments you agree with. Also, Etsy published a survey, so add your feedback while it’s still open.
  3. If you haven’t already done so, this is a good time to start that email list. Remember, your email list is one of the only online assets you own in which you can communicate with your clients/collectors directly. If you decide Etsy no longer suits your needs, an email blast is the fastest way to let your people know where to find you next.

Hopefully, the new policy will not be too disruptive to the creatives that rely upon Etsy’s platform. Keep in mind that in the past, Etsy has walked back policies that its users protested. However, now that Etsy is forced to compete with Amazon, it may just not be able to this time.

Bottom line: Etsy has been a valuable resource to creatives, but it has not been without its problems. Keep a watch here . . . we will update as we learn more.

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