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Etsy: Crafting an Online Marketplace with an Engaged Community
The community-minded online crafts marketplace Etsy has risen through the ranks of e-commerce ventures in just a handful of years, carving out a huge niche where previously few would have realised one existed.
Founded in New York by the multitalented painter, carpenter and photographer Rob Kalin way back in 2005, Etsy has always stuck to its original mission – and so far it is succeeding.
Recently, Etsy’s Seller Education Lead Danielle Maveal was in Sydney at an Etsy conference where, luckily, she had a few spare moments to answer all of our questions about this handmade virtual market.
“The site was started to help support small creative businesses and that really is our focus: how can we help support that and change the world economy as a result?” Maveal says. “It’s always been that way, but we just keep finding new paths to reach that end goal.”
It Takes One to Teach One
As the head of seller education at Etsy, Maveal’s work is critical in helping small businesses and craftspeople to earn a living via the website. Her wisdom is spread via tips in Etsy’s Seller Handbook, in the Etsy Success newsletter, as well her work in live workshops at Etsy’s Online Labs.
However, her experience comes not only from her years with Etsy, but also in the fact that she was an accomplished seller on the platform before being hire. Maveal is a trained goldsmith and, having started trading on Etsy just over four years ago, managed to sell over 1,000 unique pieces in her first six months.
“When I started working for Etsy, the business was very nimble, and in a company like that your job can change on a dime. I was really excited about that as an entrepreneur. I love new challenges and I don’t think I’d be happy with a job that was the same every day.”
Tinkering for Strong Growth and Controlled Expansion
During her time with the company, Maveal has witnessed Etsy grow from an organisation with a dozen staff in the US, to one with 300 employees worldwide. Etsy now has offices in the UK, Canada, The Netherlands, Germany, France, Japan and Australia.
She has also seen more than one CEO come and go, but with the arrival of Etsy’s current CEO, Chad Dickerson, Maveal says she’s seen the fastest growth and innovation yet.
“When Chad joined Etsy, he really focused on building the engineering and product team, which have since grown to roughly triple their original size,” she recalls. “That’s when things really picked up speed and we started being able to launch new products really quickly. Before that it was a little bit of a slower process.”
Dickerson, who previously worked in a Senior Executive position at Yahoo, has ramped up Etsy’s in-house technical abilities. It is this potential to provide innovative and easy-to-use tools and resources for sellers that makes the marketplace so appealing, and Maveal often gets to preview these features well before anyone else.
“One cool thing about my job is that I’ve been in the role so long and had such a variety of responsibilities that I now consider myself a bit of an internal consultant,” Maveal says. “I’ll often be called in to test out a product and provide my feedback, letting the developers know what sellers might think of something before they even test it with the sellers.”
“Practically everything is developed entirely in-house. The only exception to that are the tools that third party developers are able to create using our own API – some cool things that help shipping, tracking and inventory have been made so far.”
The Mother of All Arts and Craft Shows
Etsy now facilitates the sale of over 3 million items each month, with $65.9 million dollars of goods sold in May alone. Membership numbers have risen above 15 million, and with over 875,000 active shops to choose from, there’s no reason to stop going back for more.
The website draws revenue from the sellers and their transactions, with a 20 cent free on every item listed as well as a 3.5 percent commission on every sale. In 2011, total sales reached $525, 600, 000 – and 96.5 percent of that amount went directly into the pockets of the independent, creative businesses that Etsy was created for. It is this dedication to the community that has launched the business to such steady success, according to Maveal.
“I think the community is really important to Etsy. That’s what pulled me in – I was previously in this goldsmithing industry where everyone was really protective of their secrets and what made them successful, whereas with Etsy I could access forums and ‘Etsy teams’, which are groups of sellers that get together around a location or craft, and they were very open about what they were doing well.”
However the sellers are only one side of the coin, Maveal points out, and it’s the engagement of the buyers that really completes the picture.
“The buyers at Etsy are more interested in supporting creative small businesses. They come to Etsy because they want something unique, they want something that has a story; that when they wear it they’re going to feel really special and want to talk about it. They’re a different kind of buyer – it’s a totally different kind of market at Etsy.”
How Big is Too Big?
Etsy has so far attracted $91.7 million in funding and has so far invested that money in technologies and strategies for expansion. In some ways, the expansion of the sales component of the marketplace is the easier part – getting far-flung sellers to set up shop on the platform can be a different story.
“How to scale the education of sellers is a big challenge,” Maveal explains. “With over 800,000 sellers it becomes hard to just hire more people to handle that, so we’re trying to innovate and find ways for the experienced sellers to easily provide some support for the new ones.”
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