Unveiling the Truth: My Honest Opinion on Etsy Offsite Ads
Table of Contents
- Introduction
- Explanation of Etsy Offsite Ads
- Changes to Etsy's Offsite Ad Policy
- Benefits of Selling on Etsy
- Offsite Ad Platforms
- Charges for Offsite Ads
- Who is Affected by the New Policy?
- Threshold for Mandatory Participation
- Opting in or Opting out
- Fee Structure for Offsite Ads
- Fees for Top Earners
- Fees for Sellers Below the 10K Threshold
- Comparison with Other Platforms
- Amazon's Fees
- Pros and Cons of Etsy and Amazon
- Sellers' Reactions to the New Policy
- Upset Over High Fees
- Unfair Attribution of Sales
- Understanding Etsy's Motives
- Rising Costs and Competition
- Targeting Dependable Sellers
- The Advantages of Offsite Ads
- Risk-Free Advertising
- Control over Advertising Investment
- Increased Traffic to Etsy as a Whole
- The Disadvantages of the Update
- Mandatory Participation for Successful Sellers
- Permanent Inclusion in Offsite Ads Program
- Unfair Attribution of Sales
- Evaluating Etsy Alternatives
- Considerations for Switching Platforms
- Importance of Established Customer Base
- Recommendations for Sellers
- Keeping Etsy Shop Active
- Branching Out to Other Platforms
- Putting the Fees into Perspective
- Comparison with Online Marketing Costs
- Performance-Based Advertising
- Conclusion
Etsy's New Offsite Ad Policy: Is it Worthwhile to Sell on Etsy?
Etsy, one of the leading online marketplaces for makers, artists, and designers, recently announced changes to its policy regarding offsite ads. This has stirred up a lot of emotions among sellers, as they grapple with the implications of these changes on their businesses. In this article, we will explore what Etsy's offsite ad policy entails and examine whether it is still worthwhile for sellers to continue selling on Etsy or if it might be time for them to start exploring other platforms.
Explanation of Etsy Offsite Ads
Before diving into the details of the policy changes, let's first understand what Etsy offsite ads are and why they have been a key selling point for many sellers. When you sell on Etsy, your store is not only advertised to the visitors on the Etsy site but also to a wider audience through offsite ads on platforms like Google, Facebook, Instagram, Pinterest, and Bing. Etsy expects that at least one out of every ten leads should come from these offsite ads. Until now, this feature has been available to all sellers for free.
Changes to Etsy's Offsite Ad Policy
However, starting from May 1st, 2020, Etsy will be implementing changes to its offsite ad policy. Sellers will now be charged a fee for any orders that result from offsite ads. The fees will vary depending on the earning level of the seller. If a seller has earned over $10,000 in sales on Etsy in the past year, they will be automatically enrolled in offsite advertising and cannot opt out. These top earners will be required to pay a 12% fee on the total order amount of each sale generated from an offsite ad. The fee will also include shipping costs, upgrades, gift wrapping, and taxes charged by non-U.S. and non-Canadian shops. However, there will be a cap of $100 per sale.
On the other hand, sellers who earn less than $10,000 have the choice to opt in or opt out of offsite ads. If they choose to participate, they will be charged a 15% fee on the sales generated from offsite ads within a 30-day window. This means that if a customer clicks on an ad and makes multiple purchases from the seller's shop, the seller will have to pay the offsite ad fee for each of those orders.
Comparison with Other Platforms
To fully evaluate whether or not Etsy's offsite ads are still worthwhile for sellers, it's important to compare the fees and benefits with other online selling platforms, especially Amazon. While Etsy's new fee structure might seem high, it is actually more aligned with the prevailing costs of making sales online. Amazon, for example, charges a referral fee ranging from 8% to 20% depending on the item category, and their handmade platform has a flat fee of 15%.
It's crucial for sellers to consider the pros and cons of both Etsy and Amazon before making a decision. Etsy has the advantage of an established brand and a built-in audience, while Amazon offers a larger customer base and potentially less competition. However, switching platforms also bears the risk of losing regular customers who are accustomed to purchasing from a seller's Etsy shop.
Sellers' Reactions and Understanding Etsy's Motives
The introduction of these fees has generated a range of reactions from sellers. Many are upset about the high fees and the seemingly abrupt implementation of the new policy. However, it's important to understand that rising costs and increased competition are driving the need for Etsy to introduce these fees. Etsy's aim is to keep up with the expenses of advertising and marketing in the online space, which have become more expensive and challenging.
By enforcing mandatory fees for sellers who earn over $10,000, Etsy is targeting sellers who are less likely to quit or move due to their dependence on the platform and existing customer base. Although this might appear unfair to some, it is a calculated move by Etsy to maintain profitability and sustain the services they provide.
The Advantages and Disadvantages of Offsite Ads
The new offsite ad policy brings both advantages and disadvantages for sellers. On the positive side, offsite ads offer risk-free advertising as sellers only pay once they make a sale. By relying on Etsy's marketing efforts, sellers can avoid the challenges and costs associated with learning how to do ads themselves. Additionally, the increased advertising budget resulting from the offsite ad fees will likely bring more traffic to Etsy as a whole, benefiting the entire community of sellers.
However, there are also several disadvantages to consider. For successful sellers who earn over $10,000, participating in offsite ads becomes mandatory and they cannot opt out. Furthermore, sellers in this category will be permanently included in the offsite ads program, regardless of future earnings. Unfair attribution of sales is another concern, as sellers may have to pay ad fees even for customers who found their shop without clicking on an ad. These drawbacks have fueled dissatisfaction among sellers and raised questions about the effectiveness and fairness of the new policy.
Evaluating Etsy Alternatives and Recommendations for Sellers
For sellers who are contemplating leaving Etsy due to these changes, it's important to thoroughly evaluate the alternatives. While there are other online marketplaces like Amazon, they also come with their own set of fees and considerations. It may not be as simple as transferring a customer base from Etsy to another platform. Therefore, it is recommended that sellers keep their Etsy shop active while slowly building up a customer base elsewhere. This way, sellers can diversify their selling channels and mitigate the risks of relying solely on one platform.
Putting the Fees into Perspective
Although the new offsite ad fees might seem high compared to Etsy's previous fee structure, it's essential to put them into perspective. Selling online always incurs costs, and these costs are only increasing due to rising competition. Etsy's fees are now more aligned with the industry standards, and they reflect the efforts and expenses required to make sales online. Considering the performance-based nature of offsite ads, sellers only pay when they make a sale, which reduces the risk compared to doing ads independently.
In conclusion, while the implementation of offsite ad fees by Etsy has sparked controversy among sellers, it is crucial to consider the broader context of selling online. Etsy's offsite ads still offer benefits such as risk-free advertising and increased exposure to a wider audience. However, the disadvantages, such as mandatory participation for top earners and unfair attribution of sales, should be carefully evaluated by each individual seller. By keeping an open mind and exploring alternative selling platforms, sellers can adapt to the changing landscape while still capitalizing on Etsy's established marketplace.
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