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Etsy is a virtual marketplace for entrepreneurs with a product to sell and many more people are becoming interested in the prospect of using the website as a springboard to start small businesses. Etsy sales grew by 30% in 2011 to $700 million and there are now 800,000 people selling their wares to buyers around the world. Some sellers, or “Estsians,” who have seen success say there are a few important keys to making the website work. One is build the product brand outside of Etsy by being proactive in getting word of the product out into the world; another lesson is to stay current on Etsy features and to be willing to open a dialog with customers. For more on this continue reading the following article from TheStreet.

Etsians. It's a term for those who use Etsy, the online marketplace for handmade and creative goods.

The seven-year-old company is still a growing cult. More than 800,000 creatively inclined entrepreneurs now use the site to reach more than 20 million registered users globally. For sale is unique accessories, clothing, even furniture.

Many who sell on Etsy aren't looking to grow into large-scale companies or develop the newest patented technology. Instead, these entrepreneurs, mainly women with multiple sources of income, want an inexpensive storefront for their handmade, artisanal goods.

Before it was launched, artist and founder Rob Kalin was looking for a place to sell his own creative projects. He tried eBay (EBAY), but didn't think his art was a fit there. He realized there wasn't an online place available for others like him and in just three months, he partnered with two engineers to create, design and write the code for Etsy.

"There was no business plan, no grand strategy," says Matt Stinchcomb, Etsy's vice president of values and impact (a fancy way of saying customer-service relations). "Just a need for something like it." Stinchcomb was Kalin's roommate at the time and Etsy's first employee.

Sales on the website this year were up to $700 million as of early November, up more than 30% for all of 2011, according to the company. On Cyber Monday, more Etsy sellers had sales than on any other day in company history, with a third of the total sales coming from first-time buyers.

"With the current momentum, in 2013 we will begin measuring sales by the Etsy community in billions and sellers in the millions," the 400-employee company says.

While Etsy may be a growing destination to find the perfect hand-painted jewelry box, the company is striving to be more than just another Amazon (AMZN).

Besides being a marketplace where small crafters can sell their items to customers around the world, the company offers a growing amount of support and education, such as SEO best practices, product photography and accounting.

The site charges 20 cents to list each item for four months. Additionally, each time a product sells, Etsy collects a 3.5% commission whether the price of the item is $4 or $400. Etsy does have other ancillary revenue sources, such as an advertising program for sellers to promote their products. It also plans to launch a wholesale platform in the first quarter of 2013, where sellers will be able to connect with boutique owners to broaden the exposure of their goods.

In February, Etsy became one of the first B Corp. companies, or benefit corporation, in New York. Like a growing list of socially responsible companies, the certification means Etsy is legally required to balance its mission between profit-making and contributing to environmental and socially responsible causes.

The B-corp. certification "has been really important for us," Stinchcomb says. "Our mission as a company is to re-imagine commerce in ways that build a more fulfilling and lasting world."

TheStreet spoke to a handful of Etsy sellers about their secret sauce to being successful on the site. While all appreciated Etsy's increasing support, education and general ease in using the platform, success did not come without a passion for their products, being amenable to customer demands and using social media to boost their brand. In between frantically shipping orders to meet Christmas deadlines, five entrepreneurs shared their stories, which are featured below. 

1. Carol's Niece

Silver Spring, Md.

Etsy Lesson: Build your brand outside the platform.

Katrina Briggs Gordon launched Carol's Niece , which sells crocheted fashion accessories as well as handmade greeting cards, in January 2011 after being frustrated with the public school system where she was a school counselor. Her entrepreneur husband inspired her to make a change.

"I'd always crocheted gifts and made handmade greeting cards and my husband encouraged me to sell them," Briggs Gordon says. "I posted one item on Etsy and it sold. That was all the validation I needed. I dove right in and I have not looked back!"

While her Etsy store is still relatively new -- this year was her first at selling a full product line -- every month she sees steady growth in business.

Briggs Gordon says her initial success has already changed her life. "It showed me that this life I was imagining for myself and my family was not a dream, but totally possible," she says.

The community of "like-minded people who spend their time creating and who understand the rewards and challenges of owning a handmade business" is further inspiration, she says. Briggs Gordon has joined several online communities with other local Etsy sellers to share information.

For most of the year, Briggs Gordon also sells her wares at neighborhood outdoor markets, which allows customers to see the products in person and get comfortable with the designer behind them. By enhancing her branding awareness, it ultimately drives traffic back to her Etsy store.

"As a new Etsian, I think people should not get caught up in numbers. Yes, this is a business and you want to get sales, but more importantly you want to build your brand, you want to learn to take great photos, you want to learn the most appropriate words to keep your listings relevant," Briggs Gordon recommends. "Review the tutorials and the Etsy handbook to learn how to make your shop better. Join groups and request a shop critique." 

2. Kind Label

Huntington, N.Y.

Etsy Lesson: Keep current of new Etsy features.

Fashion designer and animal lover Stacey Effman has been frantic this month. Her store Kind Label, where she sells comfort-fitting long and short-sleeve shirts and tanks with inspirational sayings that are hand-printed using a silkscreen, has never seen so much business. She says it's because of Etsy.

Effman, who has a degree in business administration, began designing T-shirts in 2007 as a side hobby. She tried creating an online storefront of her own by using Shopify, but after investing a lot of money in design, set-up fees and monthly maintenance, the site ultimately failed because she couldn't figure out how to drive traffic to the site.

A friend introduced her to Etsy in 2010 and since then she has been learning everything she could about the site to build her business.

Shopify was "was too much of an investment, with very little return," Effman says. "Etsy offers a free e-commerce platform with a built-in customer base, charges 20 cents to list an item and takes a small percentage of each sale. It was an easy switch!"

"Basically, you pay Etsy to bring you customers, and you only pay them if they do! On top of that, they offer a welcoming community of sellers and [administration] to help you when you're stuck with something. You don't get any of that with your own site," Effman adds.

As of last week, Kind Label's revenue had increased more than 15-fold over 2011, she says, though this was her first year of full-time work.

Etsy's commitment to helping sellers succeed by offering resources and information is especially appreciated, but Effman acknowledges that she makes it a point to stay on top of Etsy's ever-increasing features and developments and changing SEO formulas.

"They make it very transparent by making announcements in the forums and through email, so it's easy to do so, but many shop owners don't pay attention to these details," Effman notes.

As for the sayings and prints on her products, Effman finds inspiration in her other passion in life -- animals as well as her husband's music business.

"Etsy allows me to give my ideas a trial run. It's immediate idea to market and that doesn't really happen unless you have your own shop," she says. "It's a unique concept, and I think people are opening their minds to the idea that handmade can equal quality and value."

In the end though it's all about the product.

"If you're trying to sell something that you yourself wouldn't pay money for, no one else is going to either just because it's on Etsy," she says. 

3. Stil Novo Design

Oregon House, Calif.

Etsy Lesson: Open up a dialogue with customers.

Stil Novo Design creates sustainable custom furniture, lighting, and home and wedding decor using recycled French oak wine barrels.

Owners Camilla Pistilli and her husband, Stefano Capaccioli, launched their Etsy shop in 2008 after a friend thought the designs would be a perfect fit for Etsy's 100% handmade philosophy. The market opportunities that Etsy opened up for Stil Novo Designs kept the business from failing during the worst of the recession.

"We had a few successful experiences with selling at fairs and shows, but as we got deeper into the recession, the profits couldn't adequately justify the investment in time and money," she says. "At that time, Etsy was already the largest marketplace on the Internet focused on handmade products, attracting the type of clientele we were hoping to reach. Over the years, we opened a few more online shops on different sites, but none of them had brought us the same volume of success we have experienced on Etsy."

Pistilli emphasizes that they make themselves available to answer any questions a potential customer may have. The pair even encourages custom requests and, more importantly, working with customer's input to produce the exact piece desired.

"Often custom requests have given us the opportunity to create new designs or variations that we wouldn't have thought of on our own," Pistilli says. "This is one of the most valuable aspects of this sort of 'old worldly' relationship between client and artisan, only possible through handmade [objects]."

Pistilli says sellers shouldn't underestimate the value of personal dialogue with customers.

"We like to keep our customers well-informed about every step of the making of their order through multiple emails. We're always happy to accommodate every special request in order to make their experience with us somehow different from the otherwise sterile Internet market."

But being on Etsy doesn't guarantee automatic success.

"Sellers should make their work stand out by keeping it creative and innovative," but also by putting in extreme care to their shop's settings, photo listings and descriptions, she says. "Our returning clients and referrals are a testimonial of how a solid reputation is key to sustain any business."

To be sure, Stil Novo Designs are comparatively pricey, begging the question, will customers who come to Etsy pay for the craftsmanship. Pistilli says yes.

"Surprisingly, our more affordable home décor items at the moment are not the bulk of our sales," she says. "Nowadays most people are confident, experienced online shoppers, more so than even just four or five years ago; therefore they are quite able to determine the quality and suitability of an item even just by looking at a photo on their computer screen." 

4. Manzanita Kids

Seattle

Etsy Lesson: Constantly re-evaluate your business.

Two years ago, the idea for Adrienne and David Minnery's Etsy business, Manzanita Kids, came after David lost his job and decided to spend more time at home, while Adrienne continued at her teaching position.

"Manzanita Kids embodies a lifestyle change for us that began with the birth of our first child," David says. "Having our own business gives us the flexibility to work around our family's schedule."

With David's background in sculpture and design and Adrienne's education experience, it ended up being the perfect combination for making quality wood children's toys -- at first made only for their son.

"One of the amazing things about Etsy is that it is a platform for both hobbyists and craftspeople relying on their business for income," he says.

While the market for their toys seems to be strong, Etsy sellers should be reminded of the old saying "you get what you pay for."

"We work on our business all day, every day. We respond to conversations usually within an hour of receipt. We constantly work on toy design and our photographs," David says.

"It's also about taking your business seriously," he says. "Etsy provides a great framework and access to a community but you still need to work, have a plan and be willing to change. We constantly evaluate our progress, our photographs, our designs and our marketing plans."

Their effort is paying off. This year Manzanita Kids, the Spanish translation of "little apple," doubled their sales vs. 2011, David says.

"With our toys, you don't have to worry about whether the toy contains toxic chemicals, whether it is part of a recall, whether parts will break off, where it came from and who you might be supporting," David says. "Pick up one of our toys and you can feel the weight of the wood, the smooth satin surface and you can see our hand in each piece. These toys are meant to be passed down to the next generation. We have many repeat customers, which is a good indication that we are on the right track." 

5. AHeirloom

Brooklyn, N.Y.

Etsy Lesson: The more unique your products, the more recognized you will be.

It shouldn't come as a surprise that many Etsy sellers got the inspiration for their businesses from shopping on the site themselves. That's certainly the story of AHeirloom, launched in 2010 after Amy Stringer-Mowat was looking for some items for her wedding to fiance Bill. Seeing the dearth of offerings on the site, the two wanted to give their cutting boards a try.

Their product, handcrafted cutting boards in the shape of states, was something they had started making for themselves.

"One of the reasons why the boards are so successful is that our product line is essentially unlimited. While there is a base set of borderlines, state/nation shapes, the placement for the personalization can be anywhere within those bounds, thus creating thousands of options," Stringer-Mowat says. "Our products are manufactured in the USA, using a very specific skill set and this is something that we feel very proud of."

The workmanship shows. Stringer-Mowat recalls hearing from a bride who said her entire bridal party ended up purchasing boards after she received one as a shower gift.

"I think our customers feel really great about supporting a small business that is manufacturing in the United States, as many Etsy artists do," Stringer-Mowat says. "It is also important to note that Etsy is quite beautifully curated and has a strong creative vision. The site ... feels exciting. These kinds of feelings aren't easy to express through the Internet -- you usually get this feeling from walking into a [boutique] shop, but Etsy has managed to replicate this experience virtually with a uniquely vibrant website."

AHeirloom's sales this year rose 15% over 2011. Including wholesale orders (AHeirloom ships blank state boards to places like Amazon and targeted boards to gourmet gift shops), sales are up 20%, according to Stringer-Mowat.

Etsy gave us "an audience that is confident in us because we sell on Etsy -- they have brought us somewhat instant credibility from which to grow our business," she says. "Our brand is recognized as an 'Etsy brand.'"

This article was republished with permission from TheStreet.