|Type of site||E-commerce|
|Created by||Robert Kalin, Chris Maguire, Haim Schoppik, Jared Tarbell|
|Launched||June 18, 2005 in Brooklyn, New York City, USA|
|Alexa rank||173 (August 2012[update])|
Etsy is an e-commerce website focused on handmade or vintage items as well as art and craft supplies. These items cover a wide range including art, photography, clothing, jewelry, food, bath and beauty products, quilts, knick-knacks, and toys. Many individuals also sell craft supplies such as beads, wire, and jewelry-making tools. All vintage items must be at least 20 years old. The site follows in the tradition of open craft fairs, giving sellers personal storefronts where they list their goods for a fee of $0.20.
The site was launched on June 18, 2005 by iospace, a small company composed of Robert Kalin, Chris Maguire, and Haim Schoppik. The initial version had taken two and a half months to build. Later Jared Tarbell joined the team. Former NPR executive Maria Thomas joined as COO in 2008, was promoted to CEO and left Etsy in December 2009. Robert Kalin resumed his role as CEO from December 2009 until July 2011. Investors include Sean Meenan, Spencer and Judson Ain, Union Square Ventures, and founders of Flickr and Delicious.
Kalin said that he named the site Etsy because he "wanted a nonsense word because I wanted to build the brand from scratch. I was watching Fellini's 8 ½ and writing down what I was hearing. In Italian, you say 'etsi' a lot. It means 'oh, yes.' And in Latin, it means 'and if.'"
In Etsy's first year, it attracted attention for frequently adding new tools and functionality to the site to help sellers gain exposure and traffic, including Adobe Flash-based visualizations and a taxonomy of categories with tags. Etsy passed $1.7 million in sales in May 2007. On July 29, Etsy had its one-millionth sale and anticipated its two-millionth sale would occur mid-December 2007. In November 2007, buyers spent $4.3 million purchasing 300,000 items for sale on Etsy, an increase of 43 percent from October 2007. In June 2007 it expected to be profitable by the fall, but in December 2007 it was not a profitable company. In January 2008, Etsy received an additional $27 million in funding from Union Square Ventures, Hubert Burda Media, and Jim Breyer.
In February 2008, trouble at eBay, including a strike by some dissatisfied sellers, brought speculation that Etsy could be an increasing competitor. At the same time, however, some Etsy sellers expressed unhappiness with how Etsy was handling complaints about stores. At the time, a comparison of the two websites included complaints that on Etsy, items are difficult to find, the interface "feels slow", and the buying and selling process is United States-centric. Other reviewers enjoyed using Etsy's specialized search options, including the "Shop Local" tool.
In July 2008, Rob Kalin ceded the position of CEO to Maria Thomas. Some longtime Etsy employees left the company in August 2008, including founders Haim Schoppik and Chris Maguire. In September 2008, Etsy hired Chad Dickerson, who formerly worked at Yahoo!, as Chief Technology Officer. The company acknowledged concerns about vendors selling other people's work as their own.
In April 2009, users organized an "etsyday" promotion on Twitter that brought extra attention to the site. As of May 2009, it had approximately 60 employees and sales of $10 to 13 million per month, possibly boosted by consumer interest in cheaper and more personalized goods due to the United States recession.
In March 2010, Kalin said that the company is profitable and "plans to go public, though not until at least next year." In December 2010, Etsy said it had seven million registered users and predicted $400 million in transactions for the year, and that it would continue to focus on a personal community feel as it grows larger, as that is part of what distinguishes it from eBay. In 2010, Etsy saw revenues increase from $180 million to $314 million, which fell short of the $400 million prediction.
In March 2011, Etsy "introduced a Facebook-style social networking system called People Search...to help buyers and sellers connect with each other and become friends." By doing so, Etsy made any past purchase with feedback easily searchable, which caused many complaints. Etsy then made changes to the site to better guard information regarding users' purchases.
In April 2012, a newspaper article about Etsy covered its fraud detection efforts; Etsy had been criticized in the past for inconsistently applying its rules about items having to be handmade. Later in April 2012 the writer of Regretsy, a popular blog, did independent research into a specific featured vendor, Ecologica Malibu, and found evidence to accuse the vendor of being a reseller, which would be against the Etsy Terms of Service. The vendor asserted that it was in line with the Terms of Service, stating that the shop had simply failed to identify itself as a "collective" that included the work of several individuals, and many Etsy community members posted on the Etsy forum expressing unhappiness with the action (or lack of action) taken by Etsy. As of June 2012, the vendor's account is no longer active on Etsy.
In May 2012, Etsy raised $40M in Series F funding, and announced the company had become B Corporation certified. This funding is partly going toward expanding Etsy in international markets, including France, Germany, and Australia.
Main Features 
A variety of products are sold on Etsy, including arts supplies, handmade products, and vintage pieces. Vintage pieces can only be listed if they are a minimum of 20 years old. In order to sell products on Etsy, users must create a username and have the option to create a shop name. The username cannot be changed once created. Creating a shop on Etsy is free, however each listing that is posted in the shop costs $0.20. Each listing will remain on the shop's page for 4 months, or until someone buys the product. The sale prices of products are determined by the shop owner, but Etsy claims 3.5% of the sale price of each listing. Before a shop owner lists a product for sale, Etsy will show the fees he/she will be charged to make sure the shop owner is aware of the net profit to be made. Shop owners are sent a bill at the end of every month containing the fees they owe, and they have until the 15th day of the following month to pay the Etsy bill.
Searching for products to buy on Etsy is generally intuitive and simple. On the homepage,the potential buyer can type a product description into the search bar. Alternatively, buyers may also choose from a list of categories by clicking on the "Categories" link on the left side of the homepage. This will bring the user to a page of categories that include: Accessories, Art, Bags and Purses, Bath and Beauty, Books and Zines, Candles, Ceramics and Pottery, Children, Clothing, Crochet, Dolls and Miniatures, Everything Else, Furniture, Geekery, Glass, Holidays, Housewares, Jewelry, Knitting, Music, Needlecraft, Paper Goods, Patterns, Pets, Plants and Edibles, Quilts, Supplies, Toys, Vintage, Wedding, Woodworking. Each of these categories have sub-categories to help the buyer refine the search.
When a buyer views a product, he/she can view the positive percentage feedback of each seller to determine the reliability of the shop. Once a buyer finds a product he/she would like to buy, he/she clicks "Add to Cart", and that product is added to his/her virtual "Shopping Cart". The buyer may then continue shopping or purchase the selected item. In order to purchase items, buyers must have an account with Etsy. The account is free and can be integrated with Facebook to make the sign-in and registration process faster. The total product and shipping costs are shown to the user prior to entering payment information so the user knows exactly how much is being paid. Products listed on Etsy can be paid either with a Visa, MasterCard, American Express, or Discover Card credit/debit card or with PayPal.
Etsy is popular as a side-business as well as a place to buy goods made from recycled and upcycled materials, along with less expensive or more unusual versions of mass-produced items. The unique nature of many of the items for sale is part of their appeal to some shoppers. Product photos on Etsy tend to be editorial or artistic instead of commercial catalog style. Sellers can add tags to their products to help buyers find them, and buyers can choose to search for items available locally. Etsy staffers publish lists of featured items.
Etsy makes money by charging a listing fee of 20 cents for each item and getting 3.5% of every sale, with the average sale about $15 or $20 and mostly sold by women who tend to be college-educated and in their twenties and thirties. Etsy offers multiple options for paying for items, including credit card, check, money order, PayPal, bank transfer, and gift card.
Etsy sellers range from hobbyists to professional artists who use the site to make a living. According to artists who have developed their Etsy stores into their primary jobs, scaling up production of handmade items can require more than full-time work, especially during the holiday shopping season.
Etsy's main office is located in DUMBO, Brooklyn, and it has hosted open crafting classes in the "Etsy Labs". The site's technology, customer support, marketing/PR, business, and communications teams operate out of this office. Etsy Labs has a workspace that provides equipment and donated materials where members gather to make items, take and teach workshops, and attend special events. Etsy also has an office in Berlin. In April 2012, Etsy announced that it was taking steps to hire more women engineers to improve the gender balance of its team, as a website with majority women users but few women engineers.
Etsy was one of the main members of the Handmade Consortium, a 2007 effort to encourage buying handmade holiday gifts. Etsy has partnered with the retail chain West Elm to sell some Etsy products in its stores. In December 2012, Etsy opened a temporary holiday storefront in SoHo, New York City.
Etsy has been compared to "a crafty cross between Amazon and eBay," and to "your grandma's basement." Etsy also has a number of direct competitors. DaWanda, based in Germany, focuses on growing in European countries. Bonanza (formerly Bonanzle and 1000 Markets) is based in the US and focuses on clothing and fashion, Zibbet and MadeIt which are based in Australia, iCraft is based in Canada, and Artfire is based in the US. Tindie is based in Portland, Oregon and focuses on technology and electronics.
Asked about competitors, Etsy's European CEO said, "As far as I am concerned, the more people highlighting the value of supporting micro-producers and buying handmade and vintage directly from them, the better."
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