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Etsy Feature Makes Seller Ads More Effective

Etsy Feature Makes Seller Ads More Effective

If you’ve ever searched an online marketplace, you can imagine how difficult it is to get a listing to the top of results, which often include thousands or tens of thousands of listings. Advertising is one way of boosting visibility – for a fee, of course.

Etsy said it added a feature called contextual bidding to make its sellers’ ads more effective. In a blog post describing the feature, it explained that sellers who participate in the Etsy Ads program (which is optional) only pay for a promoted listing when a buyer clicks on their ad.

In the past, Etsy Ads gave sellers the option to set static bids for their listings based on their best estimate of value, but over time, Etsy changed it to an automated, real-time auction that allowed listings to be highlighted alongside organic search results when the ad system judged them to be relevant.

“Over the past year, we’ve doubled down on improvements to the bid system, developing a neural-network-powered platform that can determine, at request time, when the system should bid higher or lower on a seller’s behalf to promote their item to a buyer,” Etsy techies wrote on the company blog on Tuesday.

“We call it contextual bidding, and it represents a significant improvement in the flexibility and effectiveness of the automation in Etsy Ads.”

The feature accounts for variables when determining conversion rates: “Our data shows that conversion rates differ across many axes: hour-of-day, day-of-week, platform, page type. In other words, context.”

(Estimated conversion rates are important, since paying for ads that never convert into sales would be fruitless. Etsy made the point that making the same bid at the highest-converting times during the weekend as at 4 am on a Tuesday, for example, would not be optimal.)

The authors of the post explain in detail how they implemented contextual bidding using machine learning.

The post sums up the initiative as follows: “We took on a lot of responsibility two years ago when we moved all our sellers to our automated bidding system, but we can confidently say that even the most sophisticated of them (and we have some very sophisticated sellers!) are benefitting from our improved bidding system.”

While sellers should understand whether their investments in Etsy Ads are showing a return, it’s difficult for sellers to know whether they are over-paying for ads. Could they have paid less for the same number of clicks?

If you’ve seen an improvement in your Etsy Ads performance over the past year, let us know.

Ina Steiner on EmailIna Steiner on LinkedinIna Steiner on Twitter
Ina Steiner
Ina Steiner
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.

3 thoughts on “Etsy Feature Makes Seller Ads More Effective”

  1. I tested their onsite ads out over the last month and the cost is so expensive. Forty five cents a click on a pair of jeans, sixty cents for a coat. My budget is always devoured within thirty minutes to an hour. I gave up on using them because they never give my shop a good return. I miss being able to set our bid price, you used to be able to set it at two cents a click and I would get a lot of traffic and orders.

    I haven’t tried their off site ads yet. I did notice starting in February all my organic traffic dried up from Google and my items from Etsy where no where to be found on their product/item search. But, my items from Poshmark are still in the results and the same with Pinterest/Blog.

  2. Certainly not more effective for me across my 5 shops. I was have good success with the old Etsy ads but not with these – I have turned them off. Not being able to control our top CPC is one of the fatal flaws. I am yet to meet someone who does like this new ad system. The best I do is make $1 for every $1 I spend on ads – so ending up doing the work for nothing.

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