What’s Really Up With Etsy Off-site Ads

Since Etsy started their “off site ads” there has been quite a bit of confusion and annoyance among seasoned sellers. Sellers who have been using the Etsy marketplace for years have recently noticed that Etsy seems to be going the way of Amazon (even referring it to Amazon 2.0) with fees, service, and money grabs like these “off site ads” where you forced to participate (with few exceptions).

So what’s the story (the REAL story) with Etsy’s “off site ads” program?

Etsy in their infinite wisdom (or infinite desire to make more money) has implemented this program with the premise that it will help sellers reach more customers and drive sales.

But how?

Etsy takes listings at their discretion and enters them into paid advertising through Google, Facebook, Etc.  When a sale is made on your shop that they deem resulted from one of those ads, then you pay an extra 12% – 15% IN ADDITION to your regular selling fees.

That seems straight forward, but it’s not really.

First, Etsy states that for an ENTIRE month, if a buyer clicked on ANY of the items you sell and have been featured in “off site ads”, you will be charged. But it’s not just that item! It’s your ENTIRE SHOP. And it’s not only the ENTIRE SHOP, it’s EVERY order on EVERY item in your ENTIRE SHOP for the full month after someone clicked on an ad, that you have zero control over.

Some sellers are claiming that they have realized an increase in sales while most are up in arms about the fact that margins are generally pretty low anyway and an additional 12-15 percent is all of the profit they would have otherwise made.

You may wonder why someone is only making 12-15 percent profit on an item?

If you figure that Etsy has strong armed sellers into offering free shipping in addition to the increasing fees, listing fees and now these off site ad fees – you can quickly see how it adds up and where some people may actually be selling at a loss.

Just raise your price, right?

Well, no – Adding an additional 15% to the price of all items across your entire store can rapidly get to the point where people will just not buy from you due to pricing alone. But there are few options.

Just opt out of the ads?

Not so fast! If you have sold more than 10,000 US Dollars in product in the last 12 months, you’re stuck.  Yes, totally stuck. No way to exit from the program.

It boils down to the fact that the more successful you get on Etsy, the more you are paying them for the pleasure.

Don’t get me wrong, these selling platforms are incredibly important for the e-Commerce ecosystem and present opportunity for new sellers to try their hand at offering their goods at a low entry cost. But at what point does this turn into a large company taking advantage of the “little guy”?  If the Etsy “off site ads” were optional for everyone, then yes – it’s all fair. But to require shops to participate in an advertising strategy that may not align with their business is simply bad business (and unfair).

Additionally, there is poor tracking (or non-existent) tracking to how these ads were generated and the basic metrics in which to see how the ads are being shown and clicked through to your products. Basically, you’re taking the word of a company that is taking money from you. What they say is attributed to their marketing effort is correct and valid and has no audit trail.

In summary, the “off site ads” may offer a boost to some sellers, but for many others it may just be an additional way to grab fees in a somewhat arbitrary manner. The latter appears to be the consensus in many discussion forums such as Reddit.

The only way to completely protect your bottom line and profit margins is to control your entire store, advertising and selling strategy by having your own shop. While it’s important to implement multiple selling strategies to include platforms like Etsy, none will ever be as profitable as your own selling efforts away from marketplace platforms!

 

 

 

 

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