Etsy has been home to many independent sellers and small businesses since its launch in 2005. The platform has grown to a billion-dollar enterprise with a focus on handmade and vintage items and craft supplies. In February, the company’s CEO Josh Silverman reported that Etsy had seen its most profitable year on record, with revenue and shares at an all-time high.
While this was good news for executives and investors, in a surprising turn of events, there is some less than promising news for sellers: Etsy was raising its transaction fees by 30 percent. Fees increased from 5 percent to 6.5 percent from April 11.
Etsy sellers didn’t take this lying down. Shortly after hearing of the increase in seller fees, Kristi Cassidy, an active Etsy seller since 2007 known for gothic wedding dresses, decided to take a stand. She headed to the Etsy sellers subreddit and wrote “I wonder what would happen if, on April 11, so many sellers put their shops on vacation mode that Etsy starts shitting bricks.” Thus, the Etsy strike was born.
ADVERTISEMENT
On April 11, thousands of Etsy shops went into vacation mode, suspending sales for a little over a week to protest the changes. They have also asked shoppers to refrain from buying on Etsy, and their coworker campaign in support of the strike received over 15,000 signatures in a week. Around 5,000 sellers have participated in the strike, suspending business by however many days they thought appropriate.
When Cassidy learned of the increase in sellers’ fees, she went to the Reddit Etsy seller’s forum and said they needed an Etsy sellers’ union. According to MarketWatch, Etsy currently has 5.3 million active sellers, which means Cassidy had her work cut out with seller outreach. The strike petition went live in the middle of March, but quickly garnered attention, and numerous sellers put their shoppers on vacation mode or paused sales.
“We’ve gotten a reaction from Etsy,” Cassidy said. “Sellers have tried to open a dialogue with Etsy, but the most we get back is a generic email saying they care about their sellers and how they are increasing transaction fees to better the platform, but we are trying to tell Etsy that’s not how this works.”
While Cassidy has considered looking into alternative platforms to Etsy, there is little available with the size of Etsy’s marketplace audience, and the only other alternatives would be sellers hosting a store via Shopify. The advantage to Etsy is the built-in search engine and its eight-figure users per year.
Etsy originally started as a marketplace to help small business owners sell and thrive, but Cassidy says the promise of what it would be when she started has been broken. “Etsy is not living up to its promise of what it is claiming to be,” Cassidy said. “There’s a major discrepancy between Etsy’s brand and selling on the platform. We were hoping the company would at least open a dialogue with us, but it doesn’t look like that’s happening. Sellers are hoping to carry the strike efforts for in a different way, but if Etsy doesn’t listen to us, we will get to a point where will have to leave the platform.”
Cassidy says that Etsy is trying to turn into an Amazon 2.0 but given that most Etsy sellers are vintage sellers and people doing handmade products, it is impractical. “We are sellers who make things quickly, handmade, or to-order, we are not mass-market producers,” Cassidy said. “Our products are unique.”
While the transaction fee seems to be the major gripe of sellers, it goes beyond that. Etsy can take up to 30 percent from one transaction with additional fees including the listing fee to post products on Etsy, a payment processing fee for processing payments, and a fee for offsite ads that’s around 12 percent.
“The real reason the transaction fee led to so many Etsy sellers striking is that it was our final straw,” Cassidy said. “Etsy is not providing a service worth 5 percent right now, and they are raising it to 6.5. This pushed sellers over the edge, and we’ve had enough.”
Cassidy is currently looking into forming a union for the Etsy sellers, although nothing is set in stone yet. Cassidy’s hopes Etsy will meet sellers’ demands to keep the seller fee at 5 percent, allow sellers to opt out of expensive off-site ads, and provide better customer service support for shops.
Balmung Furuya, an Etsy seller who sells 3-D print Dungeons and Dragons figurines, decided to launch on Etsy because the nature of the platform brought in many more customers than when he was trying to run his website via Squarespace. While he said Squarespace was more customizable and he had more control, the volume of his Etsy shop is ten times what it was via Squarespace.
“With Squarespace, I’ve had a total of 15 sales trying to actively push the site, whereas with Etsy I’ve broken 1,400 sales,” Furuya said.
While he’s fairly new to the platform only having joined in 2020, he says from the time he started with Etsy until now one of the things he’s noticed is the customer service getting worse. When he got started with Etsy during the height of the COVID-19 pandemic, he was very forgiving about it because nearly every business faced issues during COVID-19, but it’s gotten progressively worse.
“I needed proper help with a legal issue earlier this year, and it took me two months to get a response,” Furuya said. “When I heard about the increase in seller fees, I didn’t think the price was that much, but they are claiming the increase is to help support sellers better, but I’ve only seen that get worse. I don’t see how that fee increase is related based on how customer service for sellers is going.”
Furuya ended up putting his shop on vacation mode for five days to protest the fee increase. He had decided to shut down his store for a day to boycott the fee increase before he learned about the protest, but once he saw more collective organized efforts he was on board. Furuya says his only real hope for the strike is Etsy taking a more face-value approach to consider the needs of their sellers.
“Etsy seems very against their seller base,” Furuya said. “While I don’t know exactly what I want to see, I’d like some more genuine support from the customer service team. Some better communication would be better, and while I’d prefer a decrease in prices, if the services for sellers were there it would be different.”
Although Furuya says if Etsy sellers were to unionize, he would give himself several weeks to consider and weigh the pros and cons, he also says the rhetoric that unions are bad that’s been driven in America is propaganda. Although he says pausing his store was scary, his customers immediately returned once his shop was active again.
Brooklyn-based costume and swimwear designer Courtney Gamble, founder of MessQueen New York, has been an Etsy seller since 2010. She joined Etsy because she found the platform seamless, but over the years she’s found it increasingly frustrating to use.
“Now, they demand more keywords for my products to show up in the listings, it can be very time consuming,” Gamble said. “I’m constantly fixing my shop, product titles, and tags. I understand they are trying to streamline the search optimization, but I wish it was a little bit easier and it’s not realistic for me with 300 plus listings.”
Gamble says that while Etsy says they are trying to do the best for their sellers, she no longer believes that because “everything is about their bottom line dollar and shareholders.”
In September 2021, Etsy launched its Star Seller program, which was to let shoppers know what sellers offer consistently excellent customer service. While this sounds great in theory, it has proven to be a nightmare for sellers like Gamble.
“It is unrealistic for small shops to live up to the standards of the Star Seller program,” Gamble said. “Etsy expects us to message people back in 24 hours, or it lowers your qualifications and percentage points to be a Star Seller. You need 95 percent to be a Star Seller, and it’s very unclear as to what even qualifies you to be a Star Seller. My sales were slow in winter, and I still made star seller, so who knows?”
Gamble, unfortunately, had to raise her prices to compensate for the increase in transaction fees, and she feels guilty passing the cost onto her customers. “Etsy expects us to add onto our costs and have the customers pay for it, but that’s not a guarantee,” she said. “I’ve had customers tell me: ‘This is too expensive now; I’ll just find something similar on Amazon.’”
Gamble said if Etsy sellers were to form a union, she would look into it, and she’s hoping there will be some form of protection for sellers soon. “The sellers’ concerns need to be at the forefront of Etsy because without us they don’t have a marketplace,” she said.
Rebekah Grippen, an Etsy seller focused on vintage fashion and vintage décor, started selling on Etsy in 2017. Previously, she had been an Etsy shopper since 2006. When Grippen began as an Etsy seller she didn’t notice the extra fees at first because she was just happy to be making sales and income. After she began, every four months or so, she would begin getting corporate emails about changes they were making to terms and conditions for sellers.
One of the first big changes that got her was Etsy’s free shipping program which prioritized free shipping for U.S.-based customers. Grippen describes it as a “nightmare” for small businesses because the threshold for free shipping is 35 dollars.
“For sellers who opted into the free shipping program, anything over 35 dollars was free shipping,” Grippen said. “The problem with this is customers could combine items that weren’t individually 35 dollars to get to the amount of 35 dollars, and then sellers would make no money because it would all go toward shipping.”
Etsy pushed sellers like Grippen to raise the cost of their products to essentially pass the cost of items onto customers. Grippen says this was unfair to her international customers because “International customers would be buying items and paying for both U.S. shipping on top of international shipping. 1/4 to 2/3 of my customers are international, and this would alienate them. I love my international customers because they leave me great reviews, and I don’t want to risk losing them.”
Grippen’s other grievances with Etsy are she did not even receive a tax form from them this year, which they guarantee to all sellers who do more than $600 in sales. This forced her to manually calculate all her Etsy income, making tax season very tedious for her.
She learned about the Etsy strike from her mother, who read about it in a Buzzfeed article. Grippen is one of the biggest strike organizers to advocate for sellers to unionize. While she says they haven’t figured out the mechanics of how that would work, the idea is still in the works.
She currently describes dealing with Etsy’s corporate structure as “hostile.” She also says that while many news outlets are saying the strike is due to the fee hike, the fee was truly the last straw. Between the stress of free shipping and trying to make the Star Seller program, sellers have had enough.
Etsy user Kittynaut is known for her anime-inspired accessory pins. She made several semi-viral infographics around the Etsy strike. Kittynaut originally started off doing handmade clay products which she began selling on the platform in 2009 back when she was in college just trying to make some extra money. Now, she primarily sells accessory pins, and she’s also made tumblers and designed a purse on Kickstarter.
Kittynaut became frustrated with Etsy in 2015 when the platform raised its transaction fees from 3 percent to 5 percent. She says what Etsy does to sellers is “fee them to death.” Her biggest frustration with the platform is how they promised not to have resellers, but lately mass-produced, injected molded products like things sold on Ali Express have made their way onto the platform.
“Resellers are very detectable because they use the same pictures from Alibaba and other mass-market sites,’ Kittynaut said. “Sellers aren’t the only ones mad about it either. Customers are mad as well because they come to Etsy expecting handmade products, next thing they know, they get a product on their doorstep from a reseller with a Made in China label somewhere on it. Customers feel tricked. Resellers are causing undue trust issues with buyers in some sense.”
Kittynaut says nowadays most of her traffic actually comes from using her social media platforms, like Instagram, to drive traffic to her Etsy shop. She says that since Etsy went public in 2015, she’s seen nothing but raised fees, increased costs for sellers on shipping, and increased costs for offsite ads. She saw the Etsy strike as something a long time coming.
After years on the platform and now being established, Kittynaut says that it would be virtually impossible for her to start from scratch on Etsy now. “When I look back at where I was in 2009, I couldn’t have broken into this space easily with how Etsy is set up now,” she said. “I think about how unfair that is for younger artists, and I want to be able to shield and protect them from those problems.”
Recently, members who participated in the strike appeared to be targeted by union busters. According to Grippen, members received a suspicious email from a private research firm starting on April 20 trying to dig up data and info about strike participants. The group doing research was not an academic institution, and their clients were all large corporations.
Grippen says that she and fellow strike participants are suspicious it is Etsy or a competitor and the insights could be used to harm their movement. “We’ve seen similar things happen at Amazon,” she said.
While the formal Etsy strike is over, the sellers’ fight is far from over. One of Kittynaut’s biggest grievances is around how Etsy is run on a corporate level. She recently began reviewing Etsy’s SEC reports and learned high-level executives were taking seven-figure bonuses and offered multi-million dollar severance packages. Her big question is why that money isn’t going toward investing in sellers. She also sees Etsy as trying to become a competitor to Amazon, to which she says, “Etsy sellers are a bunch of mom and pop craft makers. We can’t compete with overseas manufacturing and a company like Amazon. Does the CEO of Etsy know what Etsy actually is?”
In a statement to The Daily Beast regarding the strike, Etsy COO Raina Moskowitz said, “Our sellers’ success is a top priority for Etsy. We are always receptive to seller feedback, and the new fee structure will enable us to increase our investments in areas outlined in the petition, including marketing, customer support, and removing listings that don't meet our policies. We are committed to providing great value for our 5.3 million sellers, so they can grow their businesses while keeping Etsy a beloved, trusted, and thriving marketplace.”
