On Monday, Etsy raised its transaction fees for the first time since 2018 — to 6.5%, from 5% previously — and some sellers backed off. More than 14,000 of them went on strike this week, temporarily closing their online stores, and more than 48,000 buyers and sellers signed a petition opposing the fee hike.
“The problem isn’t necessarily so much that they raised the transaction fee. It’s the amount they collected,” Efthemia Hinman, an Etsy seller who is taking part in the strike, told Retail Brew.
- Etsy announced the 30% increase in February.
Pay the price: Hinman said the increase in transaction fees is the latest in a series of costs that have made it harder to profit at his confectionery, Mia’s Sweets Emporium.
- For sellers earning more than $10,000 per year, Etsy in February 2020 began charging at least 12% for automatic ad placements on sites like Google and Pinterest that drive sales. Hinman said she started seeing the charge in December, after a successful holiday season. “To add transaction fee increases on top of that is really a tough pill to swallow.”
“The success of our sellers is a top priority for Etsy,” COO Raina Moskowitz said in a statement to Retail Brew. “We are always receptive to feedback from sellers and, in fact, the new fee structure will allow us to increase our investments in the areas described in the petition, including marketing, customer support and the removal of listings that do not comply. not our policies.”
Hinman admitted that she was not convinced the strike would change much, but that she was participating in it on principle. Still, she understands that not all sellers are able to participate.
This is the case of Kimberly Keim of Thread and Purls, which sells handmade accessories.
“Sellers who went on strike will lose revenue that week, as well as the next three weeks needed to restart sales, while others who did not go on strike will take their top spot in searches” , she told us. Recovering from this “opens up a different Pandora’s box” that Keim says she simply cannot afford, despite her support for the strike.
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- She told us her sales are down 48% year-to-date — her worst year since 2018 — and she’s heard other Etsy sellers have struggled as well.
Business is business: Nancy Ramsey, an Etsy seller who runs a dessert shop called Diamond Chocolates, is more skeptical. On a practical level, she doesn’t think the strike will hurt Etsy, given the sheer number of sellers on the platform (5.3 million, according to the company).
Plus, the fee is Etsy’s call: “I understand they’re making a lot of money off of us, but they’re also a business,” Ramsey said. “I’m also a business and I had to raise my rates.”
- It increased its costs in January to offset the cost of materials, which rose 10-12% from last year. But Ramsey noted that she has no plans to raise them again just yet, despite the higher transaction fees.
She’s been on the platform since 2011 (initially as the manager of online jewelry store Olive Yew), and said that even with all the policy changes over the years, there’s no better place for sellers. handmade, given Etsy’s profile. And for those who don’t feel the same way, well…
“It’s your choice to be on Etsy, you don’t have to be,” Ramsey said. “You have other places where you can go to sell or open your own website.”
Change it: Launching his own website is exactly what Hinman is considering now. She also mentioned that there was a lot of chatter on the Etsy forums of sellers taking their businesses to platforms like eBay.
- “Usually we complain about every change,” Hinman said. “But I think this one drew people in.”