by Carolyn Edlund
Amazon is launching a new “Handmade” marketplace to compete against Etsy, which went public in mid-April.
Although it’s too early to tell which way things will fall, events are happening at a rapid pace that may affect the outcome of this upcoming rivalry.
- Etsy sellers have bemoaned the retail giant’s practice of allowing mass-produced merchandise from China to compete with the handmade-only merchandise on the once-purist site.
- Investors have filed lawsuits against Etsy, alleging that millions of items sold through the site may violate copyrights or trademarks from brands such as Disney, the NFL, Chanel, and others.
- Although the IPO just launched weeks ago, the stock price has plunged almost 25% due to these concerns.
Amazon is a retail monster, even compared to multi-billion dollar Etsy, and has already gotten into the business of art sales through its Fine Art category. Now they are headed into the handmade arena. They are reportedly wooing selected Etsy sellers with an offer and an attempt to migrate them over to Amazon’s new marketplace.
Although it’s been voiced that sellers may reject the 15% commission rate Amazon plans to charge versus the much smaller commission + listing fees on Etsy, I tend to disagree. I’ve spent the past couple of years compiling the internet’s largest directory of places to sell art and craft online, and 15% is on the lower end of the range of commissions charged. Plus, there seems to be no upfront listing fees – which means that if you don’t sell, you pay nothing (this is a trend among online marketplaces that seems here to stay.)
In my opinion, it’s going to be an emotional decision for the thousands of Etsy sellers who will be making up their minds whether or not to move over to Amazon. How mad are they that Etsy has made sweeping changes in their policies and that they are competing with mass-produced goods for sale? How frustrated are they that they spend hours working on their listings in an attempt to get found on the massive site? Will they actually be relieved to find an alternative that may offer greener pastures? Or do they have a sense of loyalty to the site that will win out?
On the other hand, Amazon will have to handle this launch carefully. If they promote a “handmade only” message and police knock offs and mass-produced goods aggressively, they might prevail. If they keep integrity at the top of their list and offer lots of benefits for artists and makers, they have a good chance. Plus, with their enormous marketing capacity, Amazon has the ability to be just about everywhere. And that might just appeal to a lot of small creative entrepreneurs who want to cash in on a shiny bright new opportunity.
Are you an Etsy vendor? What do you think – would you switch, or stick?