The Business of Handmade

Adding Insult to Injury in Etsy Land

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Lately, Etsy corp. has made a number of changes to the website and the way it communicates with buyers. Some of these changes have been helpful, some have been less than helpful, and some have been bad for sellers and thus quite controversial.

The good changes include enhancements to the “shop stats” feature that make it easier than ever for a seller to understand who is viewing their shop and why, which items are their most popular, and what marketing techniques are producing results.

The bad changes Etsy has made include emailing a seller’s recent customers with suggestions of similar items they could buy… from different sellers (as well as an entreaty to link up their Facebook profile); placing a really big, ugly Facebook banner right at the top of the Etsy front page (displacing listings from Etsy sellers); adding Facebook “like” buttons to the top of individual sellers’ shop pages, thereby moving down their own listings; placing ads from competing sellers into purchase confirmation receipts sent to buyer (along with a Facebook link promotion); and replacing a top-of-the-page banner that showcased “recently listed” items with a space for paid ads that are frequently irrelevant to the item a customer is searching for on the site.

Needless to say these changes have inspired heated commentary in Etsy’s on site forums. Etsy has “Admin” staff tasked with periodically commenting in forum threads to push the corporate message forward. As should be expected, these interventions are almost always bland, uninformative corporate-speak. As should also be expected, Etsy’s policy of handling sellers’ dissatisfaction by sporadically responding to feedback with infuriatingly dense ‘non-answers’ conveys the message that Etsy 1) isn’t listening, and 2) doesn’t care. This compounds the problem by adding insult to injury.

Etsy’s “Admins” also have the thankless job of closing down forum threads. Sometimes threads are closed down for good reasons – such as when they become abusive towards individuals – and sometimes the reasons are harder to discern. For example, a long running thread on changes to the site was recently shut down because it was “going nowhere.” While it is Etsy’s prerogative to shut down threads, one has to wonder what they hope to accomplish by compounding sellers’ anger and mistrust.

I see the humor in Etsy (or rather, Etsy’s investors) moving towards making it a social networking site rather than a retail / ecommerce site, and yet wanting to take a fairly heavy handed approach to the communications posted there.

You can’t have it both ways. Either you run it as a “this is our business and we control the tone” site, or you become a Facebook type environment where people say whatever they feel like, with very few limitations. 

Etsy corp. may think they can do damage control simply by shutting down certain forum threads, but they themselves have encouraged interlinking of Etsy shops with blogs, Facebook pages and profiles and so on, and those blogs, pages and profiles will carry whatever negative commentary Etsy wants to block right back into Etsy’s world.

Its a recipe for making a small problem into a long term communications crisis – don’t listen to criticism, shut down criticism, let it build up steam and wait till it establishes a life of its own. Regretsy is a prime example.

Unfortunately, Etsy’s – or rather, Chad Dickerson, Etsy’s CEO – priority is pleasing its investment capital backers, such as Fred Wilson.

These investors have their hands in both the Etsy and the Facebook pots and they will continue to do everything in their power to extract value from Etsy by maximizing the two sites interconnectedness. Whether their actions hurt the sellers who are Etsy’s actual customers (the sellers are the people who pay the fees and a percentage of the their sales to Etsy) is irrelevant to them. They seem to have decided that the revenue from sellers is of lesser importance than the revenue they can gain from data mining, and the personal revenue they can accrue by using Etsy to supplement Facebook.

As a short term strategy, this may make sense for them (and only them). As a long term strategy – long term as in what is best for Etsy’s long term viability – I have my doubts. Serious doubts.

Dissatisfied Etsy customers (again, Etsy’s customers are the sellers who list items for sales there) will invest less on marketing their Etsy shop, and – like me – will place more emphasis on the shops they have set up on platforms that give sellers more control (such as Big Cartel).  Ultimately may leave Etsy altogether, making it a less vital place in the long run.


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