The Truth About Etsy: What Every Seller Needs to Know

If you’re a seller on Etsy or considering becoming one, you’ve probably heard all the success stories. Etsy can seem like a dream come true—a place to sell your handmade, digital, or unique products to a vast audience, and many sellers have indeed built thriving businesses through the platform. But, as with every marketplace, there are downsides that you need to be aware of, and it’s crucial to understand both the pros and cons to avoid any surprises.

While I’ll sprinkle in a little bit of good about Etsy throughout this post, I’m here to give you the real deal. Grab a cup of coffee, sit back, and let’s dive into some common seller complaints and why you need to have a backup plan – just in case Etsy suddenly shuts down your shop.

Fees, Fees, Fees… Did I Mention Fees?

One of the first and most glaring complaints from sellers is Etsy’s fee structure. Initially, Etsy started with a modest 6% fee, which felt fair to many sellers. However, the fees have gradually increased over the years, now sitting around 30% for some sellers when all costs are accounted for. This includes:

• Listing fees

• Transaction fees

• Payment processing fees

• VAT (for certain regions)

• Marketing fees (if you opt for Etsy ads)

   

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For example, many sellers expect a simple 6% cut but end up paying closer to 19% of their monthly sales after all the fees add up—and that doesn’t include potential advertising fees that can boost that percentage even higher. It’s easy to get disillusioned when you’re working hard on your craft, but your profits seem to dwindle with each sale.

One seller of eight years, who recently hit 20,000 sales, expressed their frustration: “The ever-raising fees with no additional support or benefits to the sellers… it’s where I make my living, and I’m grateful to have the platform, but it could certainly be managed a lot better.”

A “Love-Hate” Relationship

A lot of sellers on Etsy describe their experience as a “love-hate relationship.” It’s a great platform for exposure – the traffic is undeniable. But that exposure comes with costs, and it’s not always just about money. Sellers face situations where their listings are unexpectedly removed for reasons that feel unfounded or mismanaged.

For instance, one issue is Etsy’s copyright policy, which sometimes removes listings claiming they violate copyright—even if you created the product yourself. Imagine the frustration of designing a completely original product, only for it to be taken down without a detailed explanation. Then, you have to navigate customer service, which can feel like an endless loop of blank apologies, no clear solutions, and little to no transparency on how to resolve the matter.

Another common complaint is how Etsy handles store reviews. While it’s understandable that they base reviews on the past 12 months, they keep the cumulative number of reviews the same. For example, let’s say you have 30 reviews over multiple years and receive one new 1-star review. This can drop your overall rating to a glaring 1 star on your storefront, even if the math doesn’t make sense when you average it out. Such changes make it appear that your store has horrible ratings to potential buyers, regardless of your real sales record. To make things worse, when you try to get help from Etsy, you may encounter automated responses and no real resolution.

Customer Service Woes

It’s no secret that many sellers have struggled with Etsy’s customer service. Gone are the days when you could pick up the phone and speak directly to a support representative. Now, you’re often met with the challenge of submitting support tickets, receiving vague responses, and waiting long periods without clear resolutions.

One seller recalled, “My first year selling on Etsy, I had an issue, and I called and talked to a person on the phone, and it was solved. They don’t even have a phone number anymore.”

Etsy’s focus has shifted over the years, especially as more and more sellers have joined since COVID-19. This has brought new policy changes that, while intended to prevent scams, have also made it more difficult for legitimate handmade sellers to thrive. The new focus seems to be on optimizing for digital and print-on-demand (POD) sellers, which has shifted the marketplace’s dynamic and made some traditional sellers feel out of place.

The Star Seller Program: Good Intentions, Flawed Execution

The Star Seller Program was supposed to be a way to recognize outstanding sellers, but it comes with a catch. To maintain a star rating, you must respond to messages within 24 hours – even though Etsy’s own support doesn’t adhere to this standard. You can set an auto-response, but it’s only valid for five days at a time, forcing sellers to manually set it multiple times a week. This becomes especially taxing if you’re trying to balance Etsy with another job, family commitments, or any semblance of a personal life.

One seller explained, “I get I’m running a business, and I do treat it as such with a high level of professionalism, but the expectation to put in a 32-hour week on top of a job and studying… it’s not easy.”

For some sellers, it feels like they’re being held to standards that even Etsy doesn’t maintain. This pressure, combined with the demand for fast shipping and the constant push to offer free shipping, can make Etsy feel like an Amazon wannabe rather than the handmade marketplace it once was.

Listings and Search – A Marketplace Free-For-All

A huge pet peeve among sellers is the lack of regulation when it comes to listings. Etsy’s search engine has become a bit of a “Wild West,” with duplicate listings, stolen photos, and fake shops crowding the space. This makes it increasingly difficult for honest sellers to stand out, and sometimes, your hard-earned traffic gets poached by these imposter stores.

Furthermore, even if you send your shop link or direct product link to a customer, Etsy may automatically suggest similar products from other stores right below your listing. Imagine spending money on advertising your product, only to have customers redirected to competing items when they land on your page. While this strategy may help Etsy’s bottom line, it doesn’t do sellers any favors.

What About the Good Stuff?

Despite the flaws, Etsy still boasts a high amount of organic traffic, making it a great place for new sellers to get their feet wet and draw in customers. Many find that Etsy’s reach and visibility are unmatched, which is why they stick around even with the complaints. For someone who’s just starting out, especially if you have limited time or resources, Etsy can still offer an effective way to attract new buyers.

One seller summed it up: “The most expensive customer is a new customer, and Etsy honestly cannot be beaten when it comes to a broad marketplace where new customers can find me and get a sense of both me as a craftswoman and why my products are unique.”

It’s a love-hate relationship. The exposure Etsy provides is hard to match, but the frustration of operating within its confines makes sellers dream of a day when they can fully transition to their own independent platform.

Time for a Backup Plan – Create Your Own Website

This brings us to an important point: having a backup plan. If Etsy has taught sellers anything, it’s to diversify. You don’t want to be in a position where one unfavorable review, sudden policy change, or unexplained store shutdown wipes out your income stream.

The solution? Build your own website. It’s easier than ever, and platforms like Hostinger make it effortless. With just a little bit of setup, you can have a professional-looking online store, where you’re in control of your listings, reviews, and profits. Best of all, with your own site, you avoid all those annoying fees and the risk of Etsy making decisions about your business that could negatively impact your livelihood.

If you’re ready to leap to your own platform, check out my referral link to Hostinger. They offer easy-to-use website-building tools, domain registration, and support that’s there when you need it—unlike Etsy’s automated responses. By creating your own space on the web, you can still leverage Etsy for its traffic but send your loyal customers to a place that you control.

Conclusion: Know What You’re Signing Up For

Etsy can be a fantastic way to start selling and reach a broad audience, but it comes with challenges – from rising fees to customer service woes and unbalanced policies. While many sellers are grateful for the exposure, it’s essential to understand the downsides and be prepared to diversify.

Create a backup plan by building your own website and taking control of your business. Platforms like Hostinger can make this transition painless, allowing you to build a thriving store without worrying about sudden policy changes or unexpected disruptions.

Remember, you have options. Etsy may be a great starting point, but don’t let it be the only foundation your business is built on.

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