Etsy is pushing sellers to offer free shipping and run social media ads—in an effort to compete with Amazon
The online marketplace has pushed sellers to offer free shipping and run social media ads. In turn,Etsy sellers are grappling with a steep rise in costs of doing business on the platform.
The online marketplace for handcrafted goods has rolled out a series of new initiatives in an effort to help sellers compete with larger e-commerce sites like Amazon. However, it has caused a stir among the site’s 2.7 million sellers, who recognize the benefit of advertising and free shipping but are rankled by the rising costs and the diminishing control they have over their businesses.
The catch? It ain’t necessarily optional. All sellers will be enrolled in the program, and only some can opt out. Its largest sellers—those who have made $10,000 in sales in any 12-month period—are required to participate. They will pay a 12% fee on each sale, compared to the 15% fee that smaller sellers will face. That is on top of Etsy’s transaction and payment processing fees.
Etsy has also been pushing sellers to offer free shipping, which has become table stakes in a competitive retail environment but is an expensive endeavor, especially for small businesses. To encourage sellers, it said it would give a higher ranking in its competitive search results to those who offer free shipping on orders over $35. Sellers rushed to do so and by the end of last year, nearly half of all orders on Etsy were delivered with free shipping.
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