9 ms·

The Fall of the House of Etsy

111 points by nutshell89 2y ago

Animats 2y ago
"This pattern of scale > internal ad products > clusterfuckery > user exodus is generally referred to as “Enshittification,” a very fun term coined by Cory Doctorow in 2022 to explain why, broadly speaking, everything on the internet now seems way worse." That used to be called "pulling a Myspace". Myspace pioneered that way to screw up. Can anyone name a company that went down this road and came back? Someone should do a tracking site for companies which fail in this way. Something like "deadmalls.com", or "fuckedcompany.com". YC idea: develop a LLM model to detect early signs of enshittification and generate sell signals.
- stavros 2y ago
  "Enshittification" originally had a very specific definition: > First, they are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves. Then, they die. Nowadays it's just used as a catch-all for "made worse".
  - resolutebat 2y ago
    Etsy fits Cory's original definition to a tee though.
    - stavros 2y ago
      Maybe, I'm not too familiar with their story. Who were the business users on Etsy?
      - mintplant 2y ago
        The sellers. Doctorow's original article uses Amazon as an example; you could fit Etsy into the same framing.
      - sumeno 2y ago
        This provides a good overview https://spy.com/articles/lifestyle/gifts/etsy-downfall-1203000173/ https://spy.com/articles/lifestyle/gifts/etsy-downfall-12030...
        stavros 2y ago
        Please point me to the part where it talks about Etsy putting the users first, then the sellers, then Etsy itself.
      - resolutebat 2y ago
        - The users were the original arty-crafty people selling actually handmade products - Businesses come in to exploit the users by flipping AliExpress crap at 10x margins, Etsy does nothing to stop this because $$$ - Etsy realizes they could make even more money off businesses by eg forcing them to buy ads from Etsy once their income exceeds $10k - Now both users and businesses are pissed off and Etsy has entered a death spiral
seattle_spring 2y ago
The prevalence of drop shipping is what killed Etsy for me as a buyer. I guess I was too trusting originally, but I was very disappointed when I found out that several items I had bought from them, all marketed as handmade, were just cheaply made pieces of garbage from places like Ali Express, then marked up 10x.
- acheron 2y ago
  Where do people actually handmaking stuff sell now?
  - haunter 2y ago
    OnlyFans
    - pylua 2y ago
      Do people on only fans ship handmade contents to subscribers ? I thought it was a subscription website, but they may have more streams.
      - hprotagonist 2y ago
        you can absolutely purchase physical goods on onlyfans. it often comes in a ziplock bag!
  - noodlesUK 2y ago
    The real answer is where they always have: local markets and craft fairs. Most towns and cities have some kind of periodic craft market, which is often related to a farmers and/or food market. They usually have some kind of weird schedule like first Sunday of every month or similar. You can also see if your local arts centre/university/whatever has some kind of market. There's also usually different kinds of conventions for specific industries where people will set up booths.
    - hprotagonist 2y ago
A_D_E_P_T 2y ago
Yeah, I began to notice this a year or two ago. Etsy used to be a place to check out artisanal craft goods. Not necessarily antiques, but the sort of small-batch stuff that was hard to find elsewhere on the internet. Exotic jewelry, one-off wooden carvings, semi-custom knives, etc. Now it's a place to check out mass-produced Indian and Pakistani merchandise. It has become worse even than eBay in that regard. It's superficially the same stuff it has always been -- exotic jewelry, wooden carvings, knives, etc. -- but the quality is much lower and the value just isn't there. And it could well be that you buy something on Etsy only to see it later on Amazon.com. Also I feel like prices on Etsy have risen in an unusual and remarkable way over the past few years. Could be because of higher platform costs to vendors & the forced advertising scheme mentioned in the article.
sbierwagen 2y ago
This isn't new. The Regretsy blog extensively complained about dropshippers in 2010. The problem is that operating a two sided marketplace connecting small makers to customers just really sucks as a business. Tons of churn, intractable problems with quality and fulfillment, having to pay for a lot of customer service agents who fundamentally can't solve any problems, since they don't actually work for the person who makes the stuff, and can only hit the "refund" button. Etsy has every reason in the world to want to get away from small sellers and move to high volume manufacturers, (who have actual QA and customer service departments, which a guy hand carving chess pieces in his basement doesn't have) and nothing to stop them. So the obvious thing happens. (Except then you're competing directly with Amazon in its area of greatest strength, which historically has been corporate suicide...)
- marcinzm 2y ago
  > and nothing to stop them Except Ebay and Amazon already existing.
  - gunapologist99 2y ago
    And Amazon having rather high fees. Jeff Bezos used to say, "Your margin is my opportunity", but I'm not sure he even cares anymore.
- derefr 2y ago
  > intractable problems with quality and fulfillment • Re: fulfillment — why not ask Etsy sellers to pre-stock everything that's not made-to-order into fulfillment centers like Amazon's? And, in fact, to send anything that is made-to-order to a fulfillment center first, where it'll be inspected, re-wrapped and re-shipped by the fulfillment center — with the buyer's card only having a hold, not a charge, on it until the seller's goods are inspected by the fulfillment center as good? (In other words: turn the process into a goods-for-money mediated escrow.) • Re: quality / drop-shipping — I feel like a lot of this could by solved just through simple semi-automated verification. Require for a product to be listed, for the seller to upload a video of themselves making the thing. Then pass those videos to MTurk workers to evaluate them for tricks. > Etsy has every reason in the world to want to get away from small sellers and move to high volume manufacturers Except that... that's their whole niche. Specifically, 90% of Etsy's value at this point is in the market of buyers they have slowly marketed and engaged and cultivated brand recognition with over decades — and those buyers are people looking for low-volume goods. They don't want to buy high-volume goods from Etsy. That's not the association they've been painstakingly educated to have. If Etsy wanted to get into Amazon's business, they'd have to create a new brand to do it with, because that's just not the business that people associate with the Etsy brand. And that would mean starting from scratch.
noodlesUK 2y ago
The automatic enrolment in the Etsy advertising program means the platform fees for anyone selling more than 10k USD increase sharply at that point to ~20% of total revenue. What that means is that any artists/makers that are doing volumes that represent anything even close to a full time wage are totally shafted. If I were an artist selling stuff, I would strongly consider a switch to something like Shopify, especially as you then aren't on a storefront sitting next to a whole bunch of drop shipped garbage.
- marcinzm 2y ago
  > The automatic enrolment in the Etsy advertising program means the platform fees for anyone selling more than 10k USD increase sharply at that point to ~20% of total revenue. That seems to assume a very very unrealistic 100% of orders being from offsite ads. In reality it's probably 10% for most shops if even that many.
  - noodlesUK 2y ago
    Thanks for clearing that up - I thought the fees applied to all sales, not just ones with attribution to their ads. (I'm not an Etsy seller myself, but I'm friends with people who are) The fees are still astronomically high even without the ads program.
- lancesells 2y ago
  I would do run both and try to port over customers to Shopify. The advantage of Etsy is people.
- derefr 2y ago
  If I were an artist selling stuff on Etsy, my storefront would undergo mitosis under new PO-box identities every time it hit 5k USD of sales.
majormajor 2y ago
There's still not a better alternative that I've found (searching eBay, Amazon, AliExpress) for specific niche items in some pretty broad ares, from fandom to vintage jewelry to 3d-printed or gray-market custom parts/accessories for cars. Ebay/sometimes Amazon seems better for electronics or manufactured parts; AliExpress if you're willing to gamble more, but for "accessory" things I've had really good luck with Etsy. Whether you can turn that into a profitable public company... eh. And there are certainly some blogspammy listings in all those venues (Amazon and AliExpress probably the worst for that), but good luck solving that without human curation - and then you're an even worse investment as a business.
UberFly 2y ago
The best version of Etsy is long gone. Hand crafted items from their original source just won't satiate IPO investors. There REALLY needs to spring up a (good) Etsy alternative that's content to be what it is and not an exponential growth machine that poisons the roots they originally built on.
- readyman 2y ago
  >not an exponential growth machine This is increasingly impossible under capitalism for fundamental reasons, which are illustrated most clearly in modern financialized capitalism by shareholder interests. Your desires (and mine) will require a reorganization of society as we know it. https://en.m.wikipedia.org/wiki/Tendency_of_the_rate_of_profit_to_fall https://en.m.wikipedia.org/wiki/Tendency_of_the_rate_of_prof... https://en.m.wikipedia.org/wiki/Capital_accumulation https://en.m.wikipedia.org/wiki/Capital_accumulation
  - marcinzm 2y ago
    > Your desires (and mine) will require a reorganization of society as we know it. So far every attempt to do this has done the exact opposite.
    - readyman 2y ago
      Nonsense. Capitalism was a great success compared with feudalism. It is outright defeatist, senslessly conservative, and frankly anti-scientific to insist there is nothing more to be done merely because it has yet to be realized.
      - JumpCrisscross 2y ago
        > It is outright defeatist, senslessly conservative, and frankly anti-scientific to insist there is nothing more to be done Nobody said that. It’s just that I haven’t seen a better proposal to date.
      - bradleyjg 2y ago
ilikeitdark 2y ago
I thought this was in THE Spy magazine of long days gone.
jonahhorowitz 2y ago
Etsy is just an alternative storefront for Aliexpress at this point. I rarely find something on there that I can't also find on Aliexpress. It's cheaper to drop ship it myself.
- gnicholas 2y ago
  I get that many/most non-customized items are also available on Aliexpress. But all of the handmade is bespoke, and many of the customized items aren't available elsewhere.
deleted 2y ago
[deleted]
AtlasBarfed 2y ago
Let me save you the reading: Enshittification. Next.
gnicholas 2y ago
Eh, from my perspective as a buyer it's still a decent place to look for customized or handmade items. I have many treasured items that were purchased on Etsy, and I wouldn't hesitate to buy items like these again. For example, I bought hand-turned knurled wood pens and razor handles (as gifts for myself and my groomsmen), with wood chosen based on my color preference. The seller is still on the platform, and I'd happily buy gifts from him again. I also have several carved/engraved wood items from other sellers. Is there tons of non-customized stuff that's drop-shipped from somewhere else? Yes. But you can ignore if what you want is the old-school Etsy stuff. I'm sure some sellers have bailed as they've been edged out by big sellers. But for me, it's still a useful platform that I enjoy using.
casenmgreen 2y ago
1. Etsy far as I can tell charge a 20% mark-up on sale price direct from the merchant's own web-site. This is too high - this is Apple tax money. 2. Etsy also look to be charging 4% for currency conversion (which occurs if you view the Etsy site in a currency different to the currency the store issues its prices in). Esty I think are deliberately hiding this charge; it is listed _nowhere_ in the invoice or in billing. Furthermore, Etsy base their conversion choice on the country the bank card comes from, which is not correct for multi-currency cards, and so you can end up paying Etsy 4% and the 0.5% to the multi-currency FinTech as well (when you should be paying only the 0.5% to the FinTech).
- jeromegv 2y ago
  Etsy does not charge a markup. Etsy has fees but seller decide their pricing.
  - casenmgreen 2y ago
    Is the fee a percentage of the price of the sale?
ChrisMarshallNY 2y ago
I'm sad. When I saw "spy.com," I was hoping that Spy Magazine[0] had risen from the ashes. No such luck. :'( [0] https://en.wikipedia.org/wiki/Spy_(magazine) https://en.wikipedia.org/wiki/Spy_(magazine) (It was the only dead-tree magazine that I have ever personally subscribed to).
- nytesky 2y ago
  I had same expectations

111 points by nutshell89 2y ago

"This pattern of scale > internal ad products > clusterfuckery > user exodus is generally referred to as “Enshittification,” a very fun term coined by Cory Doctorow in 2022 to explain why, broadly speaking, everything on the internet now seems way worse." That used to be called "pulling a Myspace". Myspace pioneered that way to screw up. Can anyone name a company that went down this road and came back? Someone should do a tracking site for companies which fail in this way. Something like "deadmalls.com", or "fuckedcompany.com". YC idea: develop a LLM model to detect early signs of enshittification and generate sell signals.

stavros 2y ago
"Enshittification" originally had a very specific definition: > First, they are good to their users; then they abuse their users to make things better for their business customers; finally, they abuse those business customers to claw back all the value for themselves. Then, they die. Nowadays it's just used as a catch-all for "made worse".
- resolutebat 2y ago
  Etsy fits Cory's original definition to a tee though.
  - stavros 2y ago
    Maybe, I'm not too familiar with their story. Who were the business users on Etsy?
    - mintplant 2y ago
      The sellers. Doctorow's original article uses Amazon as an example; you could fit Etsy into the same framing.
    - sumeno 2y ago
      This provides a good overview https://spy.com/articles/lifestyle/gifts/etsy-downfall-1203000173/ https://spy.com/articles/lifestyle/gifts/etsy-downfall-12030...
      - stavros 2y ago
        Please point me to the part where it talks about Etsy putting the users first, then the sellers, then Etsy itself.
    - resolutebat 2y ago
      - The users were the original arty-crafty people selling actually handmade products - Businesses come in to exploit the users by flipping AliExpress crap at 10x margins, Etsy does nothing to stop this because $$$ - Etsy realizes they could make even more money off businesses by eg forcing them to buy ads from Etsy once their income exceeds $10k - Now both users and businesses are pissed off and Etsy has entered a death spiral

seattle_spring 2y ago

The prevalence of drop shipping is what killed Etsy for me as a buyer. I guess I was too trusting originally, but I was very disappointed when I found out that several items I had bought from them, all marketed as handmade, were just cheaply made pieces of garbage from places like Ali Express, then marked up 10x.

acheron 2y ago
Where do people actually handmaking stuff sell now?
- haunter 2y ago
  OnlyFans
  - pylua 2y ago
    Do people on only fans ship handmade contents to subscribers ? I thought it was a subscription website, but they may have more streams.
    - hprotagonist 2y ago
      you can absolutely purchase physical goods on onlyfans. it often comes in a ziplock bag!
- noodlesUK 2y ago
  The real answer is where they always have: local markets and craft fairs. Most towns and cities have some kind of periodic craft market, which is often related to a farmers and/or food market. They usually have some kind of weird schedule like first Sunday of every month or similar. You can also see if your local arts centre/university/whatever has some kind of market. There's also usually different kinds of conventions for specific industries where people will set up booths.
  - hprotagonist 2y ago

A_D_E_P_T 2y ago

Yeah, I began to notice this a year or two ago. Etsy used to be a place to check out artisanal craft goods. Not necessarily antiques, but the sort of small-batch stuff that was hard to find elsewhere on the internet. Exotic jewelry, one-off wooden carvings, semi-custom knives, etc. Now it's a place to check out mass-produced Indian and Pakistani merchandise. It has become worse even than eBay in that regard. It's superficially the same stuff it has always been -- exotic jewelry, wooden carvings, knives, etc. -- but the quality is much lower and the value just isn't there. And it could well be that you buy something on Etsy only to see it later on Amazon.com. Also I feel like prices on Etsy have risen in an unusual and remarkable way over the past few years. Could be because of higher platform costs to vendors & the forced advertising scheme mentioned in the article.

sbierwagen 2y ago

This isn't new. The Regretsy blog extensively complained about dropshippers in 2010. The problem is that operating a two sided marketplace connecting small makers to customers just really sucks as a business. Tons of churn, intractable problems with quality and fulfillment, having to pay for a lot of customer service agents who fundamentally can't solve any problems, since they don't actually work for the person who makes the stuff, and can only hit the "refund" button. Etsy has every reason in the world to want to get away from small sellers and move to high volume manufacturers, (who have actual QA and customer service departments, which a guy hand carving chess pieces in his basement doesn't have) and nothing to stop them. So the obvious thing happens. (Except then you're competing directly with Amazon in its area of greatest strength, which historically has been corporate suicide...)

marcinzm 2y ago
> and nothing to stop them Except Ebay and Amazon already existing.
- gunapologist99 2y ago
  And Amazon having rather high fees. Jeff Bezos used to say, "Your margin is my opportunity", but I'm not sure he even cares anymore.
derefr 2y ago
> intractable problems with quality and fulfillment • Re: fulfillment — why not ask Etsy sellers to pre-stock everything that's not made-to-order into fulfillment centers like Amazon's? And, in fact, to send anything that is made-to-order to a fulfillment center first, where it'll be inspected, re-wrapped and re-shipped by the fulfillment center — with the buyer's card only having a hold, not a charge, on it until the seller's goods are inspected by the fulfillment center as good? (In other words: turn the process into a goods-for-money mediated escrow.) • Re: quality / drop-shipping — I feel like a lot of this could by solved just through simple semi-automated verification. Require for a product to be listed, for the seller to upload a video of themselves making the thing. Then pass those videos to MTurk workers to evaluate them for tricks. > Etsy has every reason in the world to want to get away from small sellers and move to high volume manufacturers Except that... that's their whole niche. Specifically, 90% of Etsy's value at this point is in the market of buyers they have slowly marketed and engaged and cultivated brand recognition with over decades — and those buyers are people looking for low-volume goods. They don't want to buy high-volume goods from Etsy. That's not the association they've been painstakingly educated to have. If Etsy wanted to get into Amazon's business, they'd have to create a new brand to do it with, because that's just not the business that people associate with the Etsy brand. And that would mean starting from scratch.

noodlesUK 2y ago

The automatic enrolment in the Etsy advertising program means the platform fees for anyone selling more than 10k USD increase sharply at that point to ~20% of total revenue. What that means is that any artists/makers that are doing volumes that represent anything even close to a full time wage are totally shafted. If I were an artist selling stuff, I would strongly consider a switch to something like Shopify, especially as you then aren't on a storefront sitting next to a whole bunch of drop shipped garbage.

marcinzm 2y ago
> The automatic enrolment in the Etsy advertising program means the platform fees for anyone selling more than 10k USD increase sharply at that point to ~20% of total revenue. That seems to assume a very very unrealistic 100% of orders being from offsite ads. In reality it's probably 10% for most shops if even that many.
- noodlesUK 2y ago
  Thanks for clearing that up - I thought the fees applied to all sales, not just ones with attribution to their ads. (I'm not an Etsy seller myself, but I'm friends with people who are) The fees are still astronomically high even without the ads program.
lancesells 2y ago
I would do run both and try to port over customers to Shopify. The advantage of Etsy is people.
derefr 2y ago
If I were an artist selling stuff on Etsy, my storefront would undergo mitosis under new PO-box identities every time it hit 5k USD of sales.

majormajor 2y ago

There's still not a better alternative that I've found (searching eBay, Amazon, AliExpress) for specific niche items in some pretty broad ares, from fandom to vintage jewelry to 3d-printed or gray-market custom parts/accessories for cars. Ebay/sometimes Amazon seems better for electronics or manufactured parts; AliExpress if you're willing to gamble more, but for "accessory" things I've had really good luck with Etsy. Whether you can turn that into a profitable public company... eh. And there are certainly some blogspammy listings in all those venues (Amazon and AliExpress probably the worst for that), but good luck solving that without human curation - and then you're an even worse investment as a business.

UberFly 2y ago

The best version of Etsy is long gone. Hand crafted items from their original source just won't satiate IPO investors. There REALLY needs to spring up a (good) Etsy alternative that's content to be what it is and not an exponential growth machine that poisons the roots they originally built on.

readyman 2y ago
>not an exponential growth machine This is increasingly impossible under capitalism for fundamental reasons, which are illustrated most clearly in modern financialized capitalism by shareholder interests. Your desires (and mine) will require a reorganization of society as we know it. https://en.m.wikipedia.org/wiki/Tendency_of_the_rate_of_profit_to_fall https://en.m.wikipedia.org/wiki/Tendency_of_the_rate_of_prof... https://en.m.wikipedia.org/wiki/Capital_accumulation https://en.m.wikipedia.org/wiki/Capital_accumulation
- marcinzm 2y ago
  > Your desires (and mine) will require a reorganization of society as we know it. So far every attempt to do this has done the exact opposite.
  - readyman 2y ago
    Nonsense. Capitalism was a great success compared with feudalism. It is outright defeatist, senslessly conservative, and frankly anti-scientific to insist there is nothing more to be done merely because it has yet to be realized.
    - JumpCrisscross 2y ago
      > It is outright defeatist, senslessly conservative, and frankly anti-scientific to insist there is nothing more to be done Nobody said that. It’s just that I haven’t seen a better proposal to date.
    - bradleyjg 2y ago

ilikeitdark 2y ago

I thought this was in THE Spy magazine of long days gone.

jonahhorowitz 2y ago

Etsy is just an alternative storefront for Aliexpress at this point. I rarely find something on there that I can't also find on Aliexpress. It's cheaper to drop ship it myself.

gnicholas 2y ago
I get that many/most non-customized items are also available on Aliexpress. But all of the handmade is bespoke, and many of the customized items aren't available elsewhere.

deleted 2y ago

[deleted]

AtlasBarfed 2y ago

Let me save you the reading: Enshittification. Next.

gnicholas 2y ago

Eh, from my perspective as a buyer it's still a decent place to look for customized or handmade items. I have many treasured items that were purchased on Etsy, and I wouldn't hesitate to buy items like these again. For example, I bought hand-turned knurled wood pens and razor handles (as gifts for myself and my groomsmen), with wood chosen based on my color preference. The seller is still on the platform, and I'd happily buy gifts from him again. I also have several carved/engraved wood items from other sellers. Is there tons of non-customized stuff that's drop-shipped from somewhere else? Yes. But you can ignore if what you want is the old-school Etsy stuff. I'm sure some sellers have bailed as they've been edged out by big sellers. But for me, it's still a useful platform that I enjoy using.

casenmgreen 2y ago

1. Etsy far as I can tell charge a 20% mark-up on sale price direct from the merchant's own web-site. This is too high - this is Apple tax money. 2. Etsy also look to be charging 4% for currency conversion (which occurs if you view the Etsy site in a currency different to the currency the store issues its prices in). Esty I think are deliberately hiding this charge; it is listed _nowhere_ in the invoice or in billing. Furthermore, Etsy base their conversion choice on the country the bank card comes from, which is not correct for multi-currency cards, and so you can end up paying Etsy 4% and the 0.5% to the multi-currency FinTech as well (when you should be paying only the 0.5% to the FinTech).

jeromegv 2y ago
Etsy does not charge a markup. Etsy has fees but seller decide their pricing.
- casenmgreen 2y ago
  Is the fee a percentage of the price of the sale?

ChrisMarshallNY 2y ago

I'm sad. When I saw "spy.com," I was hoping that Spy Magazine[0] had risen from the ashes. No such luck. :'( [0] https://en.wikipedia.org/wiki/Spy_(magazine) https://en.wikipedia.org/wiki/Spy_(magazine) (It was the only dead-tree magazine that I have ever personally subscribed to).

nytesky 2y ago
I had same expectations