This has been quite a week for Etsy sellers. Multiple big changes are coming at what feels like a whirlwind pace. Here’s a brief overview:
- Etsy Payments: Sellers have until May 17 to enable Etsy Payments, the new version of Direct Checkout. Those sellers who had previously opted out of Direct Checkout are now required to add it or their seller privileges will be revoked.
- Etsy Studio: On Monday Etsy launched a new marketplace devoted exclusively to craft supplies called Etsy Studio. Sellers who already sold craft supplies on Etsy will now have their items for sale on both sites.
- Guest Checkout: Today Etsy announced that customers will now be able to checkout on Etsy without first setting up an account.
All of this together feels a bit overwhelming, at least to me. At the same time I applaud Etsy for constantly iterating and working hard to make buying handmade online as easy and fun as possible.
I’ve been covering some of these changes for Craft Industry Alliance (if you’re not already a member, join here) and I thought I’d share some resources and links to help all of us acclimate to all the newness.
Etsy Payments is one of the suite of seller services Etsy offers. Seller services are a key source of profit for Etsy and made up 55% of Etsy’s revenue according to their last earnings report. At that time 51% of Etsy sellers were using at least one seller service (these include Direct Checkout, shipping labels, promoted listings, or Pattern). After May 17 that number will rise to 100% because all of us will be required to use Etsy Payments.
The biggest stumbling block for sellers who haven’t yet enabled Etsy Payments is not having a bank account for their business. Up until now many Etsy sellers have relied on PayPal to serve their business banking needs, but Etsy Payment requires you to have a bank account connected to your shop. Here’s more about why that’s actually a good idea, plus greater detail about the specifics of Etsy Payments including what international sellers need to know.
Etsy Studio is a brand new marketplace. Up until now Etsy has only had one marketplace, Etsy.com which has always included three types of products: handmade, vintage and supplies. What’s new here is a special site devoted exclusively to craft supplies with integrated DIY tutorials to help shoppers get inspired.
When I heard about Etsy Studio one of my first questions was, “Who is creating the tutorials?” It turns out they’re created by a team of three women Etsy has hired as DIY experts; Clare McGibbon, Julie O’Boyle, and Aleksa Brown.
Clare McGibbon, Julie O’Boyle, and Aleksa Brown
The site launched with 70 tutorials and there’s plans to release a new one each week. Etsy has also promised to aggressively promote the new marketplace. There’s no Etsy Studio app yet, but my guess is we’ll see one soon. How long will supply sellers be allowed to stay on Etsy.com? That’s an open question, but this definitely opens the door for there to be two completely separate marketplaces. Perhaps a third for vintage is in the pipeline?
Etsy Studio is significant because it’s the first large scale site devoted exclusively to selling craft supplies from all over the world online and it positions Etsy as a significant competitor to Michaels, albeit with an entirely different business model.
In its 4th quarter of 2016 earnings call Michaels CEO Chuck Rubin explained that online sales make up only a single digit percentage of the company’s overall sales. Although they’re working to expand their online assortment in 2017, Rubin indicated that Michaels doesn’t believe online shopping can ever be a large source of sales for the company. “The tactile nature of the product, the general lack of national brands and a low average item price make it unlikely that e-commerce will grow to be the double-digit penetration of sales as it is for most other retail formats,’ he said. Etsy seems to be out to prove him wrong.
For more about Etsy Studio including how the tutorials and listings are integrated read my piece on the Craft Industry Alliance blog.
Finally, today Etsy announced that it’s added guest checkout. Ecommerce experts concur that guest checkout increases sales by removing the hurdle of creating an account before a customer is able to make a purchase. Reflecting on my own experience shopping online I know this to be true for me.
Time will tell how whether Etsy shoppers will be more likely to complete their orders if they can checkout as a guest. I think they will and that’s going to be a good thing for sellers.
As a craft community I think we’re lucky to have Etsy behind us. This is a forward thinking tech company with great values when it comes to hiring a diverse workforce and board of directors, caring for our natural environment, and lobbying in Washington on behalf of micro businesses. They’ve created a top notch global ecommerce platform and they continue to innovate as the web develops. As an Etsy seller since July of 2005 I’m excited to ride the latest wave.