Today we’re talking about Etsy versus Shopify. I’ve got many different questions from clients and people asking about which e-commerce platform they should be selling and which they should go after first.
It can be unclear whether you’re a Shopify store right for you and what that even means. People probably hear many good things about Etsy. There’s much different information out there. Today, I’m going to walk you through the pros and cons of both Etsy and Shopify.
In the end, I’ll recommend a path for you based on where you’re at in your e-commerce store. E-commerce journey and why I think each of those paths will make sense for you. So let’s get right into talking about Shopify Vs. Etsy
Very basically, Etsy an online marketplace where people buy and sell craft handmade and vintage items. That means if you’re a print-on-demand seller, you can be on Etsy, and you can set up a store.
Then your product would hopefully pop up with many people who are selling different similar things. People would be able to go to your store on Etsy and complete checkout if you are a print-on-demand seller that means you probably want to set it up so that when somebody completes checkout on your store, your supplier is going to make the product and then ship it directly to them so that you don’t have to touch the product at all you don’t have to hold inventory.
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Etsy an excellent platform. It’s growing very quickly. They focus on six countries they focus on the US, Canada, UK, Australia, France, and Germany. As of their first quarterly results that they published, they have 41 million active buyers on the platform, so that’s about 18% growth from Latin this time last year.
The platform’s growing, and there are about 2.2 million sellers on Etsy, and that’s a 13% growth from last year. So both on the buy-side and the sell-side, Etsy’s making some big moves.
PROS OF Etsy-
Let’s talk about the pros first of Etsy. Why do we want to be selling on there? What’s so good about it.
The number one thing is that you’re getting excellent free traffic. With Etsy based on the information, I pulled Etsy today, seeing about 201 visits a month. 55% of those visits are coming from the US. That’s an excellent thing because the US e-commerce customers typically have a higher amount of willingness to pay.
And they have a higher average order value when they check out items, so seeing a lot of traffic from the u.s. to an e-commerce platform is excellent news. If you’re selling their Etsy is number four in the US, far as e-commerce marketplaces go.
Number one is obviously Amazon. Behind them is Walmart number three is eBay. Etsy is right behind at number four. So when you think about those platforms, if you sell on Amazon before you know, it can be quite the jungle out there lots of opportunities and lots of competition. Walmart is known as being a low-cost leader. Hence, it’s not always the most attractive place.
If you’re trying to sell print-on-demand products, you aren’t going and doing a huge run of products beforehand. Then set them in a warehouse. You’re more going after people on Etsy who might be looking for something unique, something customized. They might be looking for a little bit higher customer service level than they’d find on those first three websites. And that’s really the sweet spot of where we can make some moves and as far as print-on-demand e-commerce.
Easy to set up and Leverage Data-
more pros with Etsy is that it’s straightforward to set up and leverage data. Let me tell you about what that means. –
Etsy has a straightforward kind of drag-and-drop interface, and I believe that you can get your store up and running there from zero to accepting your first sale in under 30 minutes. It’s effortless.
Etsy is a platform that limits the amount of customization you can do to the point that it has the negative effect of making your store look fairly similar to others. Still, it’s also good for people on Etsy because they know what to expect from the stores. They don’t get confused when they bounce from store to store, and it’s also good because it limits the number of areas you can screw up.
Etsy is perfect to focus on quality descriptions and listings, and not get too distracted by the customization, it’s also great to use Etsy search analytics data.
Hence, they provide quite a bit of data about how customers get to your store, what they’re searching to find your items, what kind of customers are checking out. There’s just this huge wealth of customer data on Etsy that doesn’t really exist on big platforms like Amazon and Walmart, and eBay.
You can harness that information’s power to make your store listings better and learn over time to improve your store, which is really cool and one thing.
I really like that Etsy has an advertising platform called promoted listings, which is actually fairly easy to set up and optimize for profitability. It’s something I’ve been studying for a while I’ve been implementing. I had a great q4 last year, and with some guidance, the right strategy and guidelines on how to adjust, it can really be profitable for you over time.
Simplify and Automate your Operations-
The last thing I’ll say is that you have a lot of flexibility with being able to simplify and automate your operations what that means is as a print-on-demand seller, it’s pretty simple to integrate a drop shipper like a production partner such as printful to create some of your products and fulfill them on your behalf.
Again, part of the great thing about selling and print-on-demand is that if you set it up the right way, you can automate the fulfillment, and you don’t have to touch the product. You don’t have to buy things in a store or pack them yourself. Ship them yourself. It’s a nightmare doing that.
Outsource it right so you can easily integrate a third party to handle that for you. They have some excellent analytics tools. If you’ve heard of tools like marmalade Villa and Etsy, rank, those are options you can explore.
There’s a pretty decent and growing ecosystem of Etsy-specific products to help you learn. Two of the things that are really big for me are that Etsy’s cash flow is really great. You can get paid once you’ve been on the platform for a few months.
Actually, cash flow is positive when you’re selling materials, right if you’re paying for your product with a business credit card and paying that credit card off in 30 days. Still, Etsy is paying you in one day. You’ve got a net positive of 29 days of cash, which is really great when you’re a small business, and you can reinvest that into your marketing or in your brand. They don’t play many games with cash for sellers, and that’s really important.
They also support digital products and physical, so that’s good if you’re looking to sell art or graphics online, anything like that.
CONS OF Etsy—
Now Etsy’s got pros but let’s talk a little bit about the cons. Like any e-commerce platform.
Their Playground and Their Rules-
It’s their playground and their rules. I used to sell through merch by Amazon.
I got tired of them always changing the rules about what your listings could say, what you can do, what you can’t sell, and Etsy can do that too.
Etsy’s not some magic bullet says this is a beautiful fairy tale eCommerce land where you do whatever you want, and there’s a huge money tree. No, they control the rules there. They’re very specific on what you can sell there, and they’re very clear about they own the customer. You don’t own the customer.
So when people buy from Etsy, they’re just buying from Etsy, and isn’t they’re not buying from you? They may have found you on Etsy. Still, it goes a little bit of weight to dilute your brand if you sell through Etsy because people might be a little confused about where they might be loyal to or whom they trust.
Do they trust your store? Do they trust Etsy? If you had your own store or through Shopify, would that same customer check out on your store or not.
So I think your brand gets diluted a little bit it’s a little bit less professional than having your own domain is to be selling through a platform like this. So if the brand is premium for you and brand is key, then Etsy might not be the place you want to be exclusively for the long term.
Now a big thing on Etsy is the fees you’re going to pay when you sell a net, so you’re looking at about a five percent transaction fee on everything you sell. They recently expanded that to include shipping, so on the revenue that you get from the product and what you’re charging customers for shipping all of that in is gonna they’re gonna take five percent they’re also going to take if you’re in the US about three percent for payment processing plus an extra quarter per transaction.
So now you’re looking at over eight percent. You can also b a listing fee for everything you have on that, so you have to be twenty cents per item every four months to renew the listing. If that item sells frequently, you’d have to pay 20 cents to renew it every time, so it can actually end up costing you more than 60 cents per year per listing if you’re selling through a lot.
So the fees on Etsy conservatively round up to probably about 10%, which isn’t the most expensive in the game. Still, it’s certainly enough to take a second look when you’re comparing different platforms.
The last thing I’ll say that’s not so great about Etsy is competition, so you’re always competing with others for visibility. If you’re selling a poster as I do, many people are selling many different variants of posters.
I have to consistently adjust my keywords and compete with those other sellers to get visibility in search. If a customer can’t find you in search, they’re not going to buy your product, so not only do you have to compete with other sellers.
You have to fight off copycats, and then you also have to learn to adapt to the ever-changing search algorithm that Etsy has. They are constantly tweaking their search algorithm to serve up the most relevant listing for a customer. They also want to show customer listings that sell. Etsy wants to make as much money as possible, so they want to put successful products in front of sellers, so you have to keep up with that change, and the keywords that may have worked for you last year may not work this year, so there are many things to consider both on the Pro and negative side when you’re selling on Etsy.
Before entering in the realm of Shopify Let me give you a warning about- Why 95% Shopify Business fail in their first 6 months?
Let’s talk a little bit about Shopify. After we talked about Shopify, I’ll wrap this up by the writer suggesting two different paths you can base on what your e-commerce journey is.
You can decide what’s right for you, so when you talk about Shopify, it’s an e-commerce platform that lets you run an online store, so very you can own the domain name and the storefront so you can have Spencer’s posters calm.
It will look like a complete standalone website for customers can go there. As the seller chooses the products, you choose the design. You control your store’s look 100%, and Shopify powers the backend, but it’s pretty much invisible to the customer.
Shopify is currently powering over 800,000 businesses online with over a million active users. They claim to have facilitated over a hundred billion dollars of transactions through the platform, so it’s certainly the front runner when it comes to online e-commerce storefronts.
PROS of Shopify—
It means that you can either use predetermined themes that will allow you to launch a beautiful store quickly, or there’s a magnificent ecosystem of developers that can code with liquid, which can help Shopify get tweaked exactly to your visual specifications so if you want to control how our customers navigating through your site very specifically.
If you have that brand really well defined and that experience on the website is super important to you, Shopify lets you do that way more than Etsy does, so if your brand image is key, Shopify is a great place to be.
Strong Community and Third-Party Support-
They also have a powerful community and third-party support network. What I mean by that is if you go to the Shopify app store, you’re gonna find a lot of these different apps that can boost your store’s functionality.
So whether you’re looking to find print-on-demand providers like T launch or printful, they’ll be on the App Store, or if you’re looking to look at how customers are moving throughout your site, you can also find apps that will help you do that on the App Store.
Because there’s so much volume there’s more reviews and you there’s a greater chance that you’ll be able to find something that works for you there and there’s also a lot of third-party services outside of the App Store that work with Shopify just because it’s the biggest player in the space if you run a serious integration like something like zapier for example you’re going to integrate with Shopify because it’s just the biggest in the market so that’s a benefit for you as a seller.
Sell what you want to a Captive Audience-
I would say the biggest Pro of selling on Shopify is that you’re selling what you want to a captive audience. You are not competing with that customer’s attention, or you’re not competing for that customer’s attention with other stores when somebody is on Etsy. They can get distracted by another store, and then they can leave yours when somebody goes to your website.
That’s likely where they’re going to stay. If they intend to complete a transaction, you have a much higher chance to convert with them on your own store where you’re controlling the message. You’re controlling where the listings are and where they’re placed. You don’t need to run paid ads on your own store.
Because you own the real estate, and you own the customer data. Hence, it makes it a lot easier to build an email list getting analytics on where those customers are coming from, and really started to build out a customer profile that you can remarket to when somebody’s coming to your Shopify store.
When you’re on Etsy, they don’t give you as much power to do that. It’s a little bit harder to understand your audience.
CONS of Shopify—
So definitely some good pros on Shopify, the number one thing.
A big con of Shopify is its BYOT – “BRING YOUR OWN TRAFFIC.”
Nobody gets this through. Nobody cares about your store on Shopify until you make them care about it. I made this mistake last year. I opened a Shopify store and wasted money without understanding very much at all about how to drive cold traffic with no marketing to my Shopify store.
Because I didn’t understand that I needed to have a little more marketing expertise, I needed to have a funnel that would flow people through to my Shopify store before setting it up and expecting it to make money.
Shopify is not if you build it. They will come if you build it on Shopify. They might come, but there are no guarantees. I would say hold off on Shopify if you don’t feel like you have an audience already or you don’t have a demonstrated funnel that you can convince people to go through or to your store.
We’ll talk a little bit about that in our next part about which path you should take.
Always remember Shopify’s BYOT one thing.
On Shopify, you have to watch out for too is the fees, so you’re going to be looking at Shopify Lite, which allows you to take advantage of some of the backend functionality of Shopify like powering a Buy button like integrating with T launch, for example, that’s nine dollars a month.
But it doesn’t allow you to run your own fully customized storefront if you want to run your own domain and your full storefront that’s Shopify basic and that’s $29 a month and then if some of these third-party apps are integrating with – can also have fees whether their one-time whether their monthly, so you’ve got to watch out for that. –
especially if you’re a low volume seller to pay for Shopify basic and a credit card transaction fee, which is pretty standard of about almost 3% and 30 cents per transaction, then you’re gonna have to have either a super high priced product with some good margin or at least a little bit of sales volume to make up for those fees or else as I did you’ll lose money on Shopify basic by having a Shopify store that nobody comes to a month over a month. So learn from my mistakes.
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Steeper Learning Curve-
Then the last thing I’ll say about which it can be a negative for Shopify is the learning curve can be a little bit steeper if you are interested in that customization it’s going to cost more, it’s going to take more of your time to learn, but you don’t have to go that route you can also choose a predetermined theme.
Which one should you choose?
so let’s talk about which one you should go with, trying to put me in your shoes and think about if I am reading to this and I’m trying to figure out which one is right for me which one should I go with and why to let’s talk about that—
If you are making under a thousand dollars a month in profit right now, and that’s irrespective of where your platform is on, you might be on it so that you might be on Shopify. Just think of this as if you’re starting the seller and you’re building out your brand. I highly recommend you go with Etsy and focus on Etsy.
Why Etsy at the start?
- Etsy is a meager initial investment.
- It’s almost free to get started.
- You need to pay a minimal amount to get a couple of listings going’s.
- They make it very simple to get started.
- The traffic is there on Etsy. Fifty-five percent of that big bulk of traffic is going through there from the US. People are looking for niche products there. I’ve demonstrated it with multiple stores on Etsy. You can sell hundreds of products and in a short amount of time. If you’re learning and you’re doing the right things.
- The fees there won’t make or break you.
- Some people might say, well, I’m paying 10% on Etsy. Still, I could pay you to know 3% on Shopify and then have a subscription fee, and I’ll make more on Shopify. Still, the point is that if you’re at this level of profit per month, the fees aren’t gonna make or break you. What’s going to break you is your lack of focus. You are splitting your attention, and you’re trying to do too many things at once, so when you’re focusing your efforts on Etsy. There’s certainly enough traffic there to get you beyond this that was another month in profit level depending on what products you choose to sell then it’s that’s really important that in this stage you’re just proving out your concept you don’t want to invest in splitting your attention to building out a bunch of stores before you’ve really proven out that product you’re selling will sell.
- People want it and sell it at the right price point and provide good customer service.
Try Etsy + Shopify—
So when you go with that, see when you focus this effort down when you’re in this range, you’re giving yourself a better chance to succeed, and your growth on Etsy can fund your expansion.
I recommend starting at this under a thousand dollars profit a month and going with Etsy and then once you’re more significant than a thousand dollars profit per month in profit, try Etsy and Shopify.
Pull Customer from Etsy to Your Shopify Store-
Do them both simultaneously. Then, you can put some strategies to pull customers away from Etsy. You can put packing slips in your product that say, hey, here’s a 10% off if you buy your next purchase at Spencer’s posters.com.
Instead of Spencer’s Etsy shop that sells posters right, there are strategies you can do to pull people over once you’re on Shopify.
Start Building an Email list-
You can start building an email list. We talked about how it’s essential to remarket to different customers and grow your business.
Invest in Learning and in your Brand-
And then when you’re starting on Shopify, you can use that thousand dollars per month in profit you’re making to start funding you’re learning in marketing and advertising. You can now focus on that budget on whatever your content strategy will drive new customers, whether it’s partnerships with influencers, pay-per-click, or marketing at trade shows.
After that you can focus that budget on how to draw people to your store instead of Etsy. You can start to invest in your brand, understand your customer data, and leverage it to grow beyond there.
So to summarize, under a thousand bucks focus on Etsy. If you’re over that mark, try both in parallel. There’s no harm to selling on both unless you’re in your brand is so premium and well-defined that you only sell on Shopify. You’re probably far beyond needing to listen to this kind of beginner’s introduction of which one to sell on, so there’s no downside if you’re in the small to intermediate seller range to being on both Etsy and Shopify.
Taking advantage of Etsy’s free traffic is a huge win, in my opinion. I think this is a smart approach for those of you who are tight with your money, and all of us should be tight with our money. Still, I really want you guys to learn from my mistakes and that I set up a Shopify store before I was really ready to drive traffic. It just I would have had more fun burning the money literally than having it go to waste with a Shopify store that got no traffic.
Start with that’s the move to Shopify when you can and start to pull customers over as soon as you can because you will drive that higher margin and get that better customer data on Shopify.
Now the real question is what you’re going to do about it. Which one you’re going to try if you’re interested in checking out Shopify? Yes, you can do that. Shopify has a 14-day free trial, and Etsy is Completely free for you to set up.
Still, I think Etsy is a great place to get started and after that use both Etsy and Shopify to reach 6 figure.