New competing platforms continue to emerge, and Etsy is in danger

It is learned that in recent years, there have been constant frictions between Etsy, the largest handmade e-commerce platform in the United States, and its sellers. Due to the continuous increase in sales commissions and the platform's mandatory advertising, more and more sellers are leaving Etsy. In addition, a series of new platforms are being launched to attract these sellers.

In October last year, Etsy sellers launched a strike and joined other handicraft manufacturers to launch a new alternative platform, Artisans Cooperative. Currently, the platform is undergoing its second testing phase and has more than 70 stores and 1,200 items.

In November this year, Novica launched the handmade e-commerce platform Handmade.com, and Michaels also launched its own e-commerce platform ArtisansMakerPlace, promising free listings, bulk purchase discounts and 6% cash back on supplies purchased at Michaels.

However, despite Etsy's constant dissatisfaction with sellers in recent years, its huge audience and marketing tools are still unmatched by other platforms. By 2023, Etsy will have more than 6 million active sellers and more than 100 million active buyers worldwide. The platform's revenue growth is largely driven by advertising. According to its latest quarterly report, Etsy's advertising business grew 16% over last year.

But as new platforms emerge one after another, Etsy faces increasingly fierce competition.

Roberto Milk, founder and CEO of Handmade, revealed that the platform was established specifically for artisans who sell handmade products, and prohibits mass-produced products and goods from dropshippers. Currently, Handmade has 3,000 sellers, most of which are located near the international Novica artisan centers in regions such as the Andes, Armenia and India.

There are also significant differences in sales commissions across platforms. Handmade.com’s fee structure is no lower than Etsy’s, and is even higher than Etsy’s, but the platform plans to reduce its rates in the future. Handmade will reduce its sales commission by 10% when sellers reach $1 billion in sales, and currently the platform’s sellers have sales of only $130 million.

Meanwhile, Michaels, another handmade e-commerce platform, announced when it launched MakerPlace that sales commissions for its professional account sellers would be as low as 0%, and transaction fees for basic members would be as low as 4%.

As dissatisfaction grows, some Etsy sellers are choosing to test other e-commerce platforms. But overall, it will be very difficult for other platforms to catch up with the growth and brand recognition that Etsy has built in the past 20 years in the short term. In addition, Etsy has relatively large traffic and has advantages in logistics and technology.

Editor✎ Ashley/

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