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Protect Your Shop From the Amazon vs Etsy Battle

by Arianne Foulks

October 27, 2015 / Updated: March 11, 2022

We have been talking about Amazon Handmade, the new challenger to Etsy, on my newsletter the last couple of weeks. This is big news for all crafters, makers, designers, and small creative businesses. Even if you don’t sell on Etsy, the current state of handmade online speaks to how important the handmade/indie designer movement is. Handmade at Amazon vs Etsy! Creative small business has big corporations fighting over it now. How impressive that handmade has become such a big deal!

How makers feel about Handmade at Amazon

Amazon has spent many months getting in touch with handmade sellers to launch Handmade at Amazon. There has been a lot of talk about this in the Facebook groups I’m a member of. People seem to fall into one of two camps: the one that feels that Amazon and handmade aren’t a good fit, and have no interest in joining, and the camp that feels dubious about Amazon, but thinks it’s worth giving it a try to see if it pays off or not. The billions of people who shop on Amazon are certainly a temptation.

I haven’t yet heard from any makers who are wholeheartedly supporting this new venture. On a side note, watch the video on Amazon’s page I linked above – so many uncomfortable smiles at the end there!

Lots of people are dissatisfied with Etsy for many reasons which I don’t need to recap here – just Google it if this is a new concept to you. Some see Handmade at Amazon as a viable alternative, and some see this as a sign pointing to the end of Etsy.

What does this mean for handmade in general?

Etsy is ten years old now. In all that time, they haven’t had any competition that’s made them sweat. There are other online marketplaces that you can sell handmade goods on, but none have become large enough to be a threat to Etsy. I, for one, would not feel calm if Amazon specifically targeted my business as competition, like they have with Etsy.

In a perfect world, competition is a great thing. We don’t want Etsy having a monopoly on the handmade marketplace, because that gives them less pressure to improve things for their sellers and customers. Abby Glassenberg wrote an article that outlines why some healthy competition would be a good thing for Etsy. The problem here is that that competition is Amazon, and Amazon is not known as a company that fights fair. Amazon will tear its own leg off if clubbing their opponent with it will be the lethal blow.

Most media outlets are calling Handmade at Amazon the Etsy Killer, which must be what Amazon wants people to say. It wasn’t in the press release I found, but it seems like odd wording to be coincidentally repeated across so many news stories. What if Amazon isn’t interested in making a good solution for makers, but a “good enough” one, so they can corner the handmade market? Amazon has a history of losing money strategically to destroy their competition.

I’m not going to pretend that I’m an expert on stock valuation, but if my business relied entirely on Etsy’s continued existence, I wouldn’t feel confident about this:

Etsy's dropping stock valuation

Google “AMZN stock” to see a graph that’s basically the opposite of this, if you’re curious.

What should you do to protect your business?

After reading my newsletter, some people got in touch with me with the realization that if their Etsy site was shut down tomorrow, they wouldn’t have a business at all. If you sell exclusively on Etsy and rely on the traffic they send you, now is a great time to start making a Plan B.

While Etsy may be working wonderfully for you right now, you don’t want to put all of your eggs in someone else’s basket. I feel most comfortable with my eggs in my own basket, and you will at least want to distribute them around. You don’t want your entire business to rely on a single company that is out of your control.

Even if Etsy survives and thrives under Amazon’s attack, there is nothing stopping them from making a wee change to their search algorithm that leaves your shop out in the cold. I have heard from some of you that your views and purchases on Etsy have reached an all time low recently – bad news before the holidays, and I’m hoping it’s only temporary.

Wouldn’t it feel better to have some control over this? Here are steps you can take towards a healthy independent business.

Purchase your own domain name

If you currently send people directly to your Etsy URL when marketing your business, I would advise against that. You want to promote yourself, and build a following that can actually follow you if you need to move.

At the bare minimum, purchase a domain name (I’m using and recommending DNSimple right now), and ask customer support at the domain registrar to point it to your Etsy shop. Then, always send people to your own domain (myhandmadeshop.com, not myhandmadeshop.etsy.com) when promoting or marketing your shop.

Your own domain name should be on your business cards, in your social media profiles, and in any kind of advertising or promotional opportunities you get.

Think of your URL as an address people can always use to find you. If you decide to move your shop, people will still have your address, and you won’t lose traffic from links or bookmarks. You won’t need to tell people that you moved – they will come along with you.

Set up a little online home and learn how to market your business

The next step up in claiming your own “land” on the internet is to set up a simple informational site that tells people about you, has some way to contact you, and directs people to shop with you on Etsy. This way, you have a bit of a home built and the transition won’t be as tricky if you end up moving away.

There are a lot of ways to do this. Many domain registrars and web hosts offer a free home page or splash page. To go a step further, you could set up hosting and install WordPress, using a pre-made theme that fits your brand’s style.

At this interim stage, you don’t need to worry about setting up your own shop, but this is a good time to learn how to drive traffic to your own site. If you are going to go to the effort of getting press for your business, the new customers should be sent to your own site, otherwise you are just spending time doing marketing work for Etsy.

Etsy should be sending you sales via etsy.com and you should be sending your own hard-won new customers to your own website. You sending new customers to Etsy is not the best use of your efforts.

It is great having the work done for you, but if you let Etsy send you traffic without learning to market your business yourself, your fate is tied to theirs. If you “learn to fish,” you can be independent and carry on in business regardless of what happens to the marketplace(s) you sell on.

Setting up your own shop

Your most future-proof move would be to set up your own shop off of Etsy. You direct all of your marketing efforts to your own shop, and let Etsy send you customers from their search engine as well. You no longer promote Etsy or send traffic to Etsy yourself.

Your goal will be to make more money on your own shop than on Etsy, so that Etsy is just supplemental income to you. You don’t want a change to their search algorithm or rules to be devastating to your business.

We like Shopify, which is built to make ecommerce as accessible as possible for you. You can learn more about Shopify and set up a free trial account here. There are, of course, plenty of other options as well.

“But isn’t that just switching from relying on Etsy to relying on Shopify?” you ask. The difference is in the structure of the service. Etsy is a marketplace, they set the rules, and they are seen as the company customers are buying from. If they closed their doors tomorrow, you wouldn’t have a great way to let people know that your shop still exists and where to find it.

Shopify provides software and web hosting to allow you to set up your own shop. You set the rules, and customers know that they’re buying directly from you. If Shopify ceases to exist a few years down the road, it will be inconvenient, but it’s just a matter of moving your shop to new software.

Once that is done, you can route all your traffic to wherever your new shop is, using your own website domain name. People won’t be forced to find you again. In fact, if you make the move seamlessly, customers won’t even know you moved.

You can’t rely on any service provider to be able to serve you forever, or even to continue being a good fit for your needs. But purchasing your own domain and learning to market your own business protects you from changes that would devastate businesses that haven’t taken these steps.

What to do today

  1. Don’t have a domain? Buy your domain from DNSimple or any other reputable domain registrar. Point your domain name to your Etsy shop or set up a simple home page to do this.
  2. New to marketing? Learn how to pitch your products to bloggers and editors to tell the world what it is you do.

I’d love to answer questions or hear your thoughts in the comments today – let me know what you think!

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