Etsy vs Shopify – Pros and Cons 2020 for Handmade Business

Should you have your own site or
stay on Etsy in this video series, I’m going to help you make that decision
and today I’m going to share with you the pros and cons of both
Etsy versus your own website. Hi, my name is may and I help makers, artists and designers make a living
selling their handmade products online. I have both and at shop
and my own website. Before I dive in, actually you first have to understand
that Etsy and your own site are completely different business models in a way
because FC is a marketplace filled with hundreds of thousands of other shops,
right? Just like Amazon and eBay, and it’s completely powered by a search
engine where people type in stuff that they’re looking to buy
like floral tea towels, and then Etsy gives the person
a huge list of floral, tea, towel products from all the
different shops that have them. Whereas your own website is a standalone
site and if you go with something like Shopify, which I recommend that you do, Shopify is just an eCommerce platform. It’s merely a site builder that makes
setting up your own website that people can shop on so much easier. I think the biggest advantage to having
a shop on Etsy is because it is a marketplace site, it has a built in audience full of people
who are already searching for products to buy well. How does Etsy
get all of this traffic? Well, part of it is the fees that
Etsy takes from sellers, right? They use that to pay for ads and marketing
Etsy shops and search listing pages appear really high in Google search and
part of that and how it gets its traffic is because hundreds of thousands of shops
on Etsy is helping it bring traffic to the platform. When you
promote your Etsy shop, you’re inherently also
promoting Etsy as a whole, including other Etsy shops, some of them who you might
consider your competitors, but they’re also bringing in traffic of
their own and some of them might land on your own shop. So it’s almost like shared traffic
and it can be a double edged sword. When you’re on your own site, you don’t have the benefit of starting
out with your own built in audience. I see a lot of people complaining that
they set up a shop on Shopify but they didn’t get any traffic or sales. And that’s the mistake going into Shopify
is having the expectation that it has that built in audience. It doesn’t. Shopify is just a website builder
that specializes in shops. So if you sell a physical product,
Shopify is the best option for you, but it doesn’t have an audience waiting
to buy your stuff. Having said that, that doesn’t mean it’s
easy to make sales on Etsy. The primary way of doing well on
Etsy is pretty simple relatively, and you’ll see why. You have to understand
how their search algorithm works. Meaning you have to have an understanding
of what factors help you get your listings, more visibility and which such as how
new or how recent you renewed your listing. Um, how much engagement
you get on your listing. Are people clicking on your images? What your click through rate is from
when your listing appears in a search and how likely is it that people will
click on your product instead of other people’s products? There are many
factors and as with any algorithm, there will never be a public list of
them because Etsy or anything that uses algorithms like social media, they don’t want people to exploit the
algorithm and find loopholes to misuse the algorithm for their
advantage in a bad way. A lot of Etsy success comes
from understanding search
trends and getting really good at SEO, which stands for
search engine optimization, so that means researching what keywords
to target and putting them in your titles, descriptions, tags, and so on. That is it. You know, many successful sellers on Etsy don’t
have a large social media following. They don’t have any press mentions, they don’t have a blog or an email
list or an active one. Anyway, and yes, of course if you looked at
some of the top sellers, you will see that many of
them have these things, but you have to ask which
was cause and effect, which came first that these Etsy shops
succeed because they had press mentions or did they have press mentions because
they were already doing well and getting a lot of attention. So generally speaking from the patterns
I’ve been seeing and I’ve been selling online for 14 years now
as of this recording, successful Etsy sellers don’t have
to worry a lot about marketing. The way to make sales is a pretty
straightforward and simple one. And again, I’m not saying it’s easy, I’m just
saying it’s simple with your own website, the process to make sales
is a lot more complicated. You can’t just rely on SEO, you
have to have a mailing list, you have to do outreach and get press
mentions and it definitely helps to have an engaged social media following
when it comes to standalone sites. The pattern I’ve seen over and
over again because you know, success leaves clues is successful. Shops have a track record of press
mentions and if it wasn’t that it was paid advertising. Some shops do really well
with just SEO, but that’s less common, so this is a huge disadvantage with
having your own site because you have to worry about a lot more when it comes to
marketing it and sending traffic to it. If you want to make sales and advantage
to Etsy is it’s super easy to start with. If you know anyone who’s
starting a handmade business, it is the first thing most
people would recommend, right? You should cover and there’s validity
in that because they do make it easy. There are no upfront costs that 20 cents
per listing and they really hold your hand to help you set everything up. You don’t have to worry about whether or
not your shop is loading quickly or if your website works correctly
or not. Your shop is secure. You don’t have to fuss about shop design. All you need to do is fill in the blanks
with configuring your shop settings on Etsy. It’s so easy. Etsy is undoubtedly a great place to
learn how to sell online if you’ve never done it before. It’s like if
you don’t know how to swim, Etsy is like starting
at the kitty pool now. Even though it’s also really
easy to set up a Shopify store, it is not nearly as easy
as Etsy and with Shopify. While you don’t have to generally
worry about site security, you do have to still consider site speed
and design of your site and this is where so many people go wrong, especially if you didn’t take the time
to learn what makes a good site design and what makes it bad, and
unfortunately it’s all on you. It’s your responsibility to make sure
your site loads quickly, it looks good, and it gives your potential
customers a great user experience. You don’t have to worry about that with
FC because they’ve already done it for you. You don’t have to worry
about conversion rates as
much when you’re on Etsy because the number of factors to consider
is far fewer. For example on Etsy, it’s really just about
having a good products, getting your photos looking good and
that you have a reasonable price with reasonable shipping and a short
turnaround time. That’s really about it. But with your own site you have to do
all of that and more you have to consider the checkout process and your site
design. And between those two things, a lot can go wrong if you
don’t know what you’re doing. The good news is that
when you’re on Shopify, there are a lot of great themes you can
use that help make all of this a lot easier for you. And it’s almost like a plug and play
and you just have to edit the theme with your brand colors. But even so, there are a lot of Shopify
themes that aren’t good, and I have seen a lot of shops choosing
themes that don’t give them a good conversion rate. So if
you set up on Shopify, just make sure you use a theme
that’s proven to make sales. So ask around or check for the themes,
reviews before you install it. No. At this point, I know I’ve made Etsy
sound like such a dream to work with, right? But that’s because I haven’t
touched on Etsy cons yet before. I do be sure to give this video a thumbs
up and subscribe so you can grow your handmade business and
make more sales. Now, I don’t know if any of these cons
are more frustrating than others. I don’t know if there’s a hierarchy, so I would love to hear from you in the
comments what your biggest beef is with Etsy. There’s actually
a lot to be upset with. I feel like one of the biggest problems
with Etsy is you have almost no control over your shop, which is what balances out the ease of
use and having that built an audience, right? If you want those awesome
things, you have to play by Etsy rules, so they’re going to enforce all sorts of
policies on you that you usually can’t opt out of. Any of you can. Your shop will suffer for it recently
Etsy wanted to encourage people to offer free shipping for their products, which
helps get people to buy on there right? But they made it so that if
you can offer free shipping, you’ll get better rankings
on the search engine, which makes it very unfair for anyone
who doesn’t offer free shipping or who can’t offer free shipping because maybe
they make products that are too heavy and they don’t want to add the
shipping price to their product price. And it’s a catch 22 because if you
raise your prices to include shipping, you now also can’t compete on price and
you’re going to see more expensive than your competition. It’s just this terrible race to
the bottom and it’s cutthroat. And I think it’s just a really negative,
unhealthy environment to be in. And most recently, we have all heard of how Etsy is forcing
shops that make over $10,000 per year to pay an extra commission on their sales
that were generated through Etsy ads that they do on your behalf. And the worst part of that
is you don’t have a in it, you have no option and you’re
just required to do that. Not to mention whenever Etsy makes
design changes on their site, you can’t say yes or no to that. You
just have to take it and roll with it. When their algorithm changes,
your shop will be affected by it. So you know how running a shop feels
like a rollercoaster because sales are inconsistent, right? Some days you make
lots of sales, other days it’s crickets. That feeling is definitely amplified
when you’re on Etsy because it’s not your own site, it’s not your own platform, and you have no control over
where the Etsy ship decides to go. If it sinks, you’re gonna sink with it. I have heard so many stories
of Etsy sellers who used
to do really well on Etsy, like making sales consistently only to
suffer and not see any sales for months because of these changes.
So fundamentally, I believe that Etsy is not a good place
for you if you’ve decided that you want to make your business a
longterm commitment, almost
like a lifestyle choice. If you just want Etsy to be a hobby
business for you and it’s not a big deal. If your sales ebb and flow, then
that’s fine. Etsy will serve you well. But for those of us who want to or are
relying on our business income to pay for our living expenses and
to sustain our livelihood, then do not put all your
eggs in the Etsy basket. So how is it different when
you’re on your own site? Well, you can’t control about 98% of
your site when you’re on Shopify. You can’t really edit the
design of your checkout pages, which is a deliberate choice on Shopify
is behalf because they’re the experts and have so much data to know exactly
how to design a checkout process that gives you the best conversions
and the most sales, right? So they don’t really let you
fiddle around too much with that. It’s for your own good, but for the rest of your site you can
really make it your own. For some of you, you may never care to do that, but I think there is a certain sense of
pride we have in the packaging of our products, right? I mean, just because you’ve made a good product
doesn’t mean we have to stop at that. We spend a lot of time
getting good packaging for it, designing pretty business cards and making
your site look good to represent your product in the best way.
It’s the same thing. Some of us do want that control and
to have the ability to change that, and I think that’s one of the
keys to making more sales. It’s like when you go into a nice hotel,
you get better service, better food, a beautiful room with comfortable
bed sheets and a nice pool and so on. It’s all about the experience
versus if you went to a dinky motel, the experience overall
will be less good, right? Your Etsy shop will always be the same. It’s what Etsy gives you and it’s not
exactly a high end five star hotel experience, but your own site can be
polished up or down however you want it. And if you want your site
to be a three star hotel, you can make it so if you want it to be
a five star hotel, you can do that too. You have the choice. Your own site is better at communicating
your brand to the customer than Etsy ever will. 100% of the time. People buy things on Etsy and not
remember what the actual shop name was. If their friends ask them where they
bought their pretty necklace or their cool wall art, they’re going to
say they got it from Etsy. This doesn’t do your brand any favors, so when you send traffic
to your Etsy shop, you are in advertently
sending Etsy your traffic. It’s that shared traffic
concept I talked about earlier. You may be get about 20% of the traffic
you actually send to your Etsy shop, but Etsy and all the other shops on there
get the majority, 80% of your traffic, and this is why over time at
has all that built in audience. You helped them grow, which
is in itself, not a bad thing, but you could have gotten 100% of all
your own traffic if you had directed them to your own site. One of my pet peeves with Etsy product
listings is when you scroll down, Etsy shows you listings from other
people’s shops directly on my own listing. And I get why they do that. Etsy is number one priority is to make
sales and they don’t care if that sale was for your shop or
for someone else’s shop. Directing your own traffic to Etsy is
like trying to collect water with a leaky bucket. You’re putting water in it,
but so much of it just leaks right out. The competition on Etsy is crazy. Etsy rewards shops and part listings
that are already doing well. So there’s a lot of
pressure to make sales, not just because you want
to make a sale, right? But because you want to get on Etsy, his good side and start ranking better
for your targeted keywords, right? So what do people do? They try to make their product listing
stand out so people click on them. But even then that’s no longer enough
so then they succumb to a pricing war. If I charge less than
other people’s listings, it’s more likely that I will make the
sale and later at sea will push my product more. If you’re thinking that way, I can guarantee you your competitors
are also thinking that way, so they start to charge even less and
it just goes on and on and it becomes a race to the bottom. I wish I could
tell you that people don’t price shop, but on marketplace sites, prices and reviews are two of the biggest
factors that people go off of when deciding on which item to buy and if
you’re not the lowest price with the best ratings, it’s going to be really hard. So let’s compare that with
your own website. Yes, there will always be competition. No matter where you are on Etsy or
Amazon or on your own site or at a craft show. What I want you to pay attention to
is the degree of the competition. The competition on Etsy
is in your own shop, but when people come to your site, you can keep them on your site for much
longer because you’re not sending them away to go look at other shops
or your competitor’s shops. You can design your site in a way that
gets people engaging in sticking around longer. It’s a lot more effort for people to go
to a different shop that sells something similar as you, if they can even
find one to begin with or take. For instance, someone who
found you on Instagram, they loved your work and clicked on your
LinkedIn bio to go check out your site. They’re on your site. Your
site is essentially a dead end. If they like what they see, they’ll buy something or join your email
list or bookmark your site or follow your Instagram, but if they want
it to find another shop like you, how are they going to do
that? It’s not so easy, right? They have to start a search on Google
or maybe go back to Instagram to try to find something similar. There’s
no longterm brand awareness. When you’re on Etsy. You might
get some repeat sales on Etsy, but you get to have a lot
more with your own site. This goes back to people not knowing
your shop name when they buy from you. To me, this is a huge detriment to
building longterm success and growth. You’re always starting from scratch
from zero to make those sales. Whereas if you had your own site where
you could give it a custom brand and a unique and hopefully positive shopping
experience for your customers, they’re going to remember
you so much better, which makes it so that word of
mouth later is more effective. People are saying to
their friends, not I ever, which only helps Etsy and not you. You’re not getting the proper credit
that you’re due on Etsy basically. So while having your own website and
might feel like it’s harder and slower to make sales in the
beginning, in the long run, you’re going to be the last man or woman
standing because every effort you make to promote your shop,
100% of it goes to you. It’s like building equity, right? You don’t get to build equity
when you’re on rented property, which is what at sea is
when it comes down to fees, both ways are expensive. You might
say FC has high fees, but honestly, so does selling on your own site, and it’s just generally just expensive
and it’s getting more expensive over the years to run a business. So that’s
just part of the process. Now.

7 thoughts on “Etsy vs Shopify – Pros and Cons 2020 for Handmade Business

  1. Your videos are fantastic Mei! I've had my own Etsy store for about 8 years and a shopify store and I learn something new every time I watch your videos. I'd love to see an video dedicated to Amazon Handmade and how that compares with Etsy. Keep up the great work!

  2. I got about 1/3 of the way through (slowly) setting up a brand-new Etsy shop when they changed the rules about shipping… which totally derailed my marketing plan, pricing plan, and budgeting. After reworking things for a while, I again picked up the process and got to where I began uploading product photos… and they changed the advertising rules. Around the same time, a couple of friends who do a lot of online shopping told me exactly what you warn about in this video: they knew that the great stuff they kept buying was from Etsy but had absolutely no idea which shop they actually bought from (and each had bought from several). One friend even mentioned that they thought it was "so great" that it didn't matter which shop they went to because Etsy made it so easy to look at other shops, while the other friend thought it was "so great" that she could get things cheaper from "those listings at the bottom of the screen" even if the item wasn't quite as much what she was looking for as the "more expensive" item was in the shop she was visiting… even when the difference was less than a dollar. I'm now reworking my budget to allow for purchase of an Internet domain and creation of a Shopify site. (Back in pre-Etsy days I created a few online shops for clients from scratch — gawd, I hated the Javascript programs for handling online catalogs! — so I have enough experience with SEO and advertising to at least get things off the ground myself.) Thanks for bringing the real-life pros & cons of these two very different approaches to the forefront and making them so easy to understand!

  3. Thank you for sharing your experiences. I am just beginning and am trying to find a place to sell my handmade items.

  4. It is expensive when you are just starting but if you are tenacious and don't give up easily I really prefer Shopify. It makes it so easy to make a good looking store and I love the option to edit, and the variety of apps available. I would never go back to Etsy.

  5. just started in august on etsy made 1 sale from a total stranger I was so happy but now nothing I did everything I could but I feel it's a dead end. I really want to have a little shop on the side I hope I can do it with my own platform.

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