EcommerceBytes-NewsFlash, Number 2635 - September 21, 2011     0 of 5

Etsy Launches Ad Program for Sellers

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Etsy is giving sellers a new way to promote their items by introducing Search Ads that appear at the top of search results pages. Sellers pay a minimum $5 for 5,000 impressions in a week, and Etsy keeps tight control on the keywords each seller can purchase to help ensure relevant listings are shown to shoppers who are searching the site.

Search Ads for Etsy is different from ad programs like Google AdWords in a number of ways. While advertisers pay Google every time someone clicks on their ad (a cost-per-click model), Etsy sellers will pay for the number of impressions - the number of times someone sees the seller's listing at the top of search results.

Etsy Product Manager Frank Harris said there was no bidding on keywords as happens on Google AdWords, so sellers are not competing with other sellers in terms of cost per click. "If you spend more money, you will get more impressions," he said.

The new Search Ads for Etsy follows on the heels of its new search algorithm that displays listings in order of relevancy rather than recency. Although many sellers had criticized the old program because some sellers used a strategy of frequent relistings to gain exposure (they paid extra in relisting fees), the change to relevancy sort got mixed reviews.

After EcommerceBytes reported on the Blog last month that Etsy was opening the site to some form of advertising, there were many comments about what such a program might look like and how it might affect sellers.

Harris said the announcement about the "Etsy Surprise" resulted in much speculation, including fears that the program would only be affordable to big sellers - which is not the case, he said. The feedback following the teaser announcement allowed Etsy to understand the issues that were most important to its community, Harris said, and it was able to update its communication and messaging to make those issues clearer.

When a seller signs up to promote their items with Search Ads, Etsy's algorithm suggests keywords based on the tags and titles in their listings. Sellers who have good tags will see relevant keywords when they set up their ad campaign, and may not need to delete keywords in their ad campaigns - although they can. Sellers don't have the option of adding keywords, however.

Sellers who tag indiscriminately when they list items for sale and who then choose to set up a search ad campaign may end up paying for irrelevant keywords.

Etsy Product Marketing Manager Natalie Schwartz commented that a small number of sellers are not taking advantage of tagging when listing items - in their case, they may see very few keywords suggested to them for advertising purposes. (When setting up an Etsy listing, sellers can use up to 13 tags per listing.)

Sellers cannot run multiple campaigns, and will not find it necessary to hire an SEO search expert, Harris said. Sellers may not choose a keyword unless it is included either in their title or tag, and Etsy has restricted keywords available for the Search Ads program to about 5 thousand. Harris said 95% of items on Etsy have at lest one of those 5,000 keywords available in Search Ads.

"Our system supports the ability for a shop to promote a diverse set of items," he said. "We've specifically designed the system so a the seller doesn't have to organize similar items together when promoting. When a seller selects keywords, our system is smart enough to understand which set of keywords go with which item - all under a single budget."

Etsy does not support different budgets for different groups of items - so while a seller can advertise earrings and rings at the same-time, they cannot specify different weekly budgets for each.

Harris said the program was set up deliberately to be self service for its sellers.

Etsy will start displaying advertising in search results on September 27, 2011. Any seller can sign up to be among the first Search Ads displayed. There is no preferential treatment for people who sign up faster: everyone who signs up before the launch will have ads displayed on that date, and keywords never sell out.

While sellers can remove keywords when setting up their ad campaigns, Harris suggested they initially cast a big net and see what works. Sellers can measure their ad campaign in a new Search Ads module of the Shop Stats page. Etsy will also send emails to advertisers at the end of 7 days.

The Search Ads Stats page displays a topline view with total number of impressions, orders and revenue resulting from the campaign. It then presents more detailed results in two sections: by keyword and by actual item title.

The stats show how many impressions and views each keyword received, and how many each listing received (sellers may be disappointed to see that Etsy does not display the number of orders by keyword or item, only in the aggregate at the top of the page).

Harris recommended looking at the impression-to-view ratio to help measure the performance of the campaign. ("Views" are primarily measured when a shopper clicks on an ad to view a listing. But because the shopper can then share the ad's URL on Twitter, email or via forum post, the system also counts views of the listing page that come from those sharing activities).

What about the problem of resellers? And if someone spends a lot of money on a particular keyword, would they dominate the Search Ads?

Harris said Etsy has a set of signals they use to evaluate Reseller activity but they are not specific to Search Ads. "The reseller challenge we have is being addressed and evaluated separately from Search Ads."

There can be up to four ads appearing on a search results page (on the first page of search results and on subsequent pages). Harris explained that no matter how much money they spend, one seller could never have four ads in a row.

You can find more information and a tutorial on the Search Ads page, and you can leave a comment on the EcommerceBytes Blog.

Comment on the EcommerceBytes Blog.


About the author:

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.


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