Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Tue Oct 1 2013 16:48:08

Can Etsy Fix Reseller Problem with Transparency?

By: Ina Steiner

Sponsored Link

Etsy announced a major change that broadens the definition of "handmade" on its marketplace. But some artisans and crafters fear Etsy is turning the site into eBay and will actually exacerbate the problem of resellers. When asked that question during a town hall meeting this morning, Etsy CEO Chad Dickerson said, "Believe me, I don't want to be the CEO that turns Etsy into eBay. I don't even like eBay."

Etsy and its sellers have long struggled with what it means to hand make goods given Etsy's restrictions in the Handmade category - see this March 2012 EcommerceBytes article, "Etsy Struggles to Define What's Allowed in Handmade Category."

But limiting sellers from scaling their business means they look for other channels on which to sell, and it means Etsy itself is limiting its revenue growth. Broadening the definition of handmade can increase its bottom line, but if the site becomes inundated with mass-produced goods (even if those goods were designed by Etsy crafters), it could turn off its base of buyers looking for unique arts and crafts.

Etsy will now allow sellers to hire an unlimited number of employees and hire outside firms to manufacture part or all of their goods. Sellers hearing the announcement during a Town Hall meeting that was also webcast appeared to be struggling to understand how Etsy would prevent resellers from taking over.



After the call, I spoke to Dickerson about these issues and asked him if search could become inundated with manufactured goods. "The definition of handmade is not shared by all people - everyone has a different opinion about what it means." He used an example of a knitter - do they have to raise the sheep, shear the wool and make the yarn and knit it to be considered a seller of handmade goods?

Defining handmade is difficult given the breadth of items on Etsy. "We need to do a better job with search and browse and make sure that the small seller and other larger sellers are represented in a fair way - that's on us, on the product side."

So would Etsy have a checkbox to indicate a seller is a solo maker and then allow shoppers to filter those items in search? Dickerson said now, when you list an item, you'll have to indicate if you use a manufacturing partner. But there are lots of things under consideration, no one thing in particular has been decided on.

Etsy seems to believe that by giving sellers more flexibility in the "making" process but requiring them to disclose information about that process - including the use of employees, designers and manufacturing partners - then buyers could make better informed decisions about who they purchase from. It's all about transparency and authorship, and telling the story behind the products.

There was a lot of news coming out of the Town Hall Meeting, which will be covered in Wednesday's EcommerceBytes Newsflash newsletter, including the following:

- Sellers will be able to use shipping and fulfillment services - and that includes dropshipping in which a manufacturing partner ships to the buyer, according to Dickerson.

- Etsy wll create urgent phone support for Etsy sellers (restricted to questions about payments, Direct Checkout or about shop suspensions).

- Etsy will create an appeals process for users who find themselves "permamuted" on the Etsy forums;

That first point will be good news for vintage sellers who use automation to ship or fulfill orders.

Let us know what you think of this major shift in thinking at Etsy and how it will impact sellers, search, traffic and sales.

UPDATE:
See my interview with Etsy CEO Chad Dickerson in EcommerceBytes Newsflash. Part One is now available.

UPDATE: Part Two is now available.




Comments (59) | Leave Comment | Permalink

Readers Comments

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Zojja This user has validated their user name.

Tue Oct 1 19:16:45 2013

It was a sad day today for real artisans that have shops on Etsy.  But we are not naïve.  We saw the writing on the wall.  Money talks and Etsy chose to go this route because of the money involved.  Over the last couple of months, many sellers have been either set up their own websites or moved items to another craft venue.  In the end, Etsy it will be another EBay and their reputation for quality handmade items will be destroyed.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: LukeEss This user has validated their user name.

Tue Oct 1 21:27:33 2013

Etsy is a two-faced company.  Nothing has really changed other than the PR fake authentic words.

Before the "new" policy "allowing" factories it was called "collective" and "vendors."

Nothing they say ever really adds up and it continues.  rustbelt/Rockford, artisans, handmade, local, global, international manufacturers.

Also, the stability of having a shop to own and grow organically doesn't exist with Etsy.  They close shops and mute customers across their site at random.

Check out the comments to Etsy articles off the internet and also type (I'm not plugging these sites) in "Etsy Fraud" on consumer complaint sites RipoffReport.com, Sitejabber.com, Consumeraffairs.com, Pissedconsumer.com

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: adama This user has validated their user name.

Tue Oct 1 22:04:57 2013

The town hall meeting started off this morning with high hopes and promises of transparency. Until Chad made it clear that it was the etsy seller that would be required to be more transparent. During the meeting, one audience member expressed concern over a smaller shop's ability to have success if it had to compete with larger shops. A very valid concern considering that most sellers at etsy today started when etsy represented itself as a handmade indie maker's haven. The larger operations that Etsy is opening up to can be unlimited in scope as long as the seller has a hand in the creation of the goods. Are China-made factory goods not created by somebody? These large organizations can afford to hire marketing and seo experts - they can delegate tasks to several people. They benefit from economies of scale that are not available to the people that are the heart of etsy, the indie makers.
Etsy employee Kimm answered this audience member's questions, and several others, by paraphrasing the questions to mean that etsy sellers are ''afraid of competition''. This is so not the case and very indicative of etsy's attitudes towards sellers. We are not afraid of competition. This is about large sellers having an unfair advantage. This is about etsy leaving it's original mission (and branding) and many sellers behind. Later, Kimm explained that etsy offers the same tools to small sellers that it does to large sellers. This hardly addresses the issue. Tonight many etsy sellers are trying to figure out how they will support their families and their businesses with the new etsy. Etsy employees are patting themselves on the back for opening etsy up to the unlimited possibilities of re-sellers and mass made goods - though they deny this is the case. Etsy has been doing a lot of this lately. Double talking and reinterpreting the truth. It is developing quite the integrity problem. At what point do they realize that with all of the tinkering, they are leaving the etsy brand, which carried a great deal of value, far, far behind.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: ShopGirl This user has validated their user name.

Tue Oct 1 23:15:27 2013

um ... and this is new how? Etsy has long courted and protected commercial sellers.

Seven years ago, I was a dewy eyed newbie. Seven years later and now muted over Coral-gate, I have complete disrespect for Etsy and those who run it.

I do feel badly, however, for those who naively supported these hucksters and advertised their shop as "... now in my Etsy shop"

Good luck starting all over re-branding your goods.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Garcia This user has validated their user name.

Tue Oct 1 23:29:17 2013

This was a veiled  affirmation by Etsy that they allow resellers to sell on the site. The definition that Chad proposed for handmade is not even in the dictionary.  Nothing is required of the seller except to create a design and even that is a vague rquirement.  There is no way of enforcing seller transparency. What seller wants to admit using a manufacturer to produce their handmade items? Anyone who lists Etsy as a handmade site, is fooling buyers into thinking that most of the items sold are handmade.  That is no longer true. If you are going to talk about Etsy you must say they are a handmade, mass produced, vintage and supply site.  Buyers should do their research before purchasing anything labeled handmade.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: marcellina This user has validated their user name.

Tue Oct 1 23:39:35 2013

Etsy needs to make a category for non-vintage and non-handmade and be done with this bs already. The top sellers in the handmade categories are all mass producers. The poor search engine capabilities, horrible category design and out of control keyword spamming make it near impossible to find anything on that site. If they had categories that made sense there could be a place for everyone on Etsy. Shoppers who desire authentic handmade and vintage could find it and the people who want to sell mass produced can stop lying and be in their own category. So sick of all this nonsense and the lying pretenses of Etsy.  

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: summer in the city This user has validated their user name.

Tue Oct 1 23:48:29 2013

Does the phrase ''No touchee Jack Sheng'' ring any bells?

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Sierra This user has validated their user name.

Tue Oct 1 23:50:38 2013

Welcome to Etsy-bay!
I'll bet there's news of an Etsy IPO within a year.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Patricia This user has validated their user name.

Tue Oct 1 23:50:54 2013

I never really trusted this company and the only reason i've listed anything at all there was to take advantage of the low listing fee.  I got their letter today and I'm not surprised.  The five stars...the inability to give buyers feedback and now this... They are slowly morphing into a mini Ebay and who needs that?  Even one is one too many.  I'm sorry, but in no way can several people combine to make an item or items and call it "handmade".  This company is shooting themselves in the foot by turning sellers against them.  They will go from something that used to be unique into a cheaper and cheesier imitation of ebay.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

This user has validated their user name. by: elpereles

Tue Oct 1 23:53:22 2013

Sorry to read it. I don't sell in Etsy. Good luck to sellers over there because it clears that money is more important than the original focus of the site.

Now I understand why I read in other forum Etsy sellers testing other handcrafting sites.  

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: richknobsales This user has validated their user name.

Wed Oct 2 00:14:06 2013

Last month it was the destruction of the feedback system. I was still reeling from this, too! I was wanting to leave FB about the seller who got my supplies that I didn't order timely to me with such speed that I never missed a beat! But I was not allowed to leave FB at the time of delivery because I was not supposed to have the items for five more days.

So today, Etsy says it is OK to have YOUR DESIGN manufactured in China and drop shipped using the Free Shipping agreement that a US seller can't get with the USPS. It's still a ''handmade'' item since You designed it.

I am ashamed to be listing on a site that not only permits this, but now condones and encourages it. Thank God there is ArtFire, and it looks like Zibbet is overwhelmed with the rush out.

By the first of the year, Etsy is going to look like Walmart the Monday after Thanksgiving. Chaos. I really feel bad about all the super people I have met there over the years, but the charm-on-a-chain crowd has won.

I don't have a problem with a ''handmade'' site sharing space with the supplies needed to make said handmade items, but the handmade sellers need to at least do some ''work'', like open and close a jump ring. Now I just need to design the next Bird Charm that 5000 sellers will list, many of whom will not even bother to take their own pictures. I'll have Wan Hung Lo make them and drop ship and I'll rake in big bucks and Etsy will get their 20 cents for every one of those bird charms.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: KathleenJohnson This user has validated their user name.
Web Site

Wed Oct 2 00:31:24 2013

The ''handmade'' issue appears to be the differential between who ''designed'' and ''who'' is doing the work. If the designer is also part of the production ''team'', no matter the size of the team or the geographical location, then Etsy appears to have given carte blanche to that being the definition of ''hand made''.

No longer is Etsy restricted to a ''home'' business, it has become part of the Industrial Revolution and the focus has moved to production and sales in a factory environment.

It does not preclude the homespun business from operating, it will have to compete on the same platform as the ''factory''.

It is certainly going to be impossible to ''police'' despite any called for transparency.  But, then, I am not sure Etsy is very concerned about that as it has shifted the focus to factory type volume as the potential income is going to certainly not hurt their bottom line - which is making money.

Sadly, Etsy has moved from its rural type roots to the Industrial Online Market place and its Sellers along with them - for good and bad. Maybe now, when competitors file complaints - we will not have to provide a blow by blow of every stitch we put into our product. We will just have to provide a picture of the factory with the designer on the production line.

Kathleen Johnson

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Tiffee Jasso This user has validated their user name.

Wed Oct 2 00:55:00 2013

This just clarifies what I have seen this past year. Massive amount of handmade items being shipped in from Asia and stated to be locally made. At least Etsy is willing to come forward and state they now take Asian made good and even factory made goods as long as one states the finished product is their idea or design.  

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: marcello This user has validated their user name.

Wed Oct 2 01:14:30 2013

I think it's pretty outrageous and childish that Etsy is going to make public the amount of flags a shop has received. I for one have had major problems with jealous, vindictive people unjustly flagging my items and shop. So much for Etsy's bs about empowering sellers, now they're in the business of punishing them!

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Cloud This user has validated their user name.

Wed Oct 2 01:40:01 2013

I saw this one coming. After repeatedly reporting and providing links where items could be purchased wholesale and seeing these very same sellers displayed front page, it wasn't hard to figure out that Etsy had given in to the all mighty dollar. Its overrun with cheaply made mass produced items with hundreds selling the same items. Just do search for bubble necklace. it's sickening.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

This user has validated their user name. by: Rexford

Wed Oct 2 07:12:03 2013

Sorry Etsy, handmade is not made in a factory.

The CEO knows this.  It's all about the money in the end and he should just admit it.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: Watching the Wheels This user has validated their user name.

Wed Oct 2 08:07:09 2013

Transparency?????

Etsy doesn't have a clue.

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: FREDDY This user has validated their user name.

Wed Oct 2 08:13:40 2013

Again, GREED.
I think it should NOW be illegal to call the site as handmade items. Chad has admitted that sellers from Asia run factories are okay to sell on the site. The site has to breakdown search, by handmade and factory made. Also, enforce clean up when items are not in the proper class. Supplies belong in supplies, not in handmade, etc.. When they - (doubt it will happen) enforce these rules, maybe these chinese factories that will take a loss of insertion fee on each item, repeatedly  will stop putting the listing in and on every search.
As far as design by crafter etc.. How many items are just copied by a chinese factory. Even if you patented every single item it does no good up against chinese company.
Whichever politician(s) came up with free(subsidized) shipping from Asia (China) should be given life in jail or shot as a traitor. Wonder how much money they pocketed for that move. Fair trade or job creation or whatever you want to call it - nothing more than hurting American workers and jobs across the board. Someone became very wealthy from that move. Which politicians were involved?????

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: MamaBear452 This user has validated their user name.

Wed Oct 2 08:18:55 2013

They can't fix a problem that they won't even accept exists.  Let's use everyone's favorite - bubble necklaces.  They don't even think it's strange that over 50 sellers came up with the same design at the same time, use the same pictures and verbatim listings.  None of the shops reported are shut down, even with proof positive they are a factory or an affiliate of a large corporation.

Their allowing people to have their items made in factories has now opened the doors wide for resellers and those who private label.  As an example of a some who private labels, I'll use someone who buys their items from a wholesaler, like bath and body products, has them delivered already generically packaged, then throws their own label on it and claim they make it.

The resellers were never honest in the first place.  If they were, there wouldn't be the massive problem with them already.  Why on earth do they think they're going to be in the future?  

Perminate Link for Can Etsy Fix Reseller Problem with Transparency?   Can Etsy Fix Reseller Problem with Transparency?

by: FREDDY This user has validated their user name.

Wed Oct 2 08:18:58 2013

I doubt if any ceo or government official even knows what the word ''transparency'' even means. I know da--n well Obama doesn't have a clue.
Chad goesn't care about that word. All he can see is dollar figures in his mind. Obsessed with the almighty dollar. With regards to Chad and money - it will never be enough. Same philosophy as JD.
Chad - I don't even like ebay. Then why copy them??? Please answer that.

Click to view more comments
1 2 3  [Next Page]


Login is required to post comments.
To sign in to leave a comment using your AB Verify User Name, fill in the form below. If you have not yet signed up for AB Verify, or if you'd like more information, go to the Registration Page
.

Login for AB Verify
Be sure and use your email address and password to log in.

 
Email:
Password:
 
 Forgot Your Password?
 Even though you are signed in with the AuctionBytes Blog, you will have to sign in to the EcommerceBytes blog. But you can sign in with your existing AB Verify info.