In 2011, Etsy launched an ad program in which sellers could pay for extra exposure in Etsy search results, paying a minimum $5 for 5,000 impressions in a week. This week, Etsy changed the program to a cost-per-click model, meaning sellers only pay when a shopper clicks on their paid ad listing – instead of paying each time the ad is displayed.
The online marketplace called it a “simpler, more direct way to understand the success of your ads and how you are being charged.”
Sellers select keywords, and when someone types the keyword into Etsy’s search engine, their ads may appear. Etsy controls the keywords available to sellers, and it updated the list to reflect the new CPC pricing, saying each keyword would be based on an average price according to the demand of that keyword, as was the case under the CPM pricing.
While Etsy said sellers who advertise through Etsy Search Ads did not need to do anything – their budgets would remain in place – Etsy recommended advertisers review their budget. And looking at the average cost per click of the keywords shows why this is a good idea.
For example, “acorn cap” costs 11 cents, while “acorn charm” costs 35 cents. The term “address stamper” costs $1.06. Sellers will have to study their margins to assess whether the new CPC costs make sense for them. Some of the sellers discussing the change on the Etsy boards said the average keywords cost too much for their products.
A few sellers expressed concerns about the possibility of other sellers clicking on their ads to max out their budgets. In response, Etsy said, “We have systems in place that prevent click fraud, whether it be from a competitor or a bot. Rest assured, the clicks you are charged for will be from real Etsy shoppers.”
See the full announcement on the Etsy forums.