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Launched in 2005, Etsy has built a worldwide reputation as a popular online marketplace where “people connect to buy and sell unique goods.” It’s a great place to look for one-of-a-kind holiday gifts, and with 1 million sellers and 30 million items for sale, you won’t lack for choices.

To help you navigate the Etsy landscape this holiday season, we turned to the data. We analyzed publicly available data from Etsy’s website and our sample size included data for almost 300,000 sellers and over 3.5 million products. Here’s a taste of what we discovered:

  • 91% of Etsy items are listed as “handmade,” but Etsy’s definition might be broader than how you would define the label
  • The smallest sellers on Etsy have the best average ratings, with 20% higher average customer rating than the largest sellers
  • Navigating the wealth of options on Etsy can be overwhelming, we’ve got a trick to fast-track you to finding the perfect gift

Read on for the details on our data-driven Etsy gift guide. Happy shopping!

Crafty nerds, rejoice: your data-driven #Etsy gift guide is here! ow.ly/ESr10 pic.twitter.com/C0QqwBjyqw

Tip #1: Think about what “handmade” means to you.

The Etsy brand is synonymous with handmade. It conjures images of the ceramic artist sharing his craft with a small audience, the stay-at-home mom selling gloves she knits during naptimes, the quirky artist who makes funny hats for dogs. And the product assortment supports this brand quality — 91% of the items for sale on Etsy are labeled as handmade.

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Along with the idea of handmade, many of us also think small. Again, the vast majority of Etsy stores, 79%, fit that expectation, carrying 100 or fewer items in their store. This makes intuitive sense. We would expect that the stereotypical image of the lone and committed Etsy crafter is going to be stretched thin if they’re selling over 100 products in their store.

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But here’s where things get interesting. While only 21% of Etsy stores have suspiciously large product lines of 100+ items, these stores are driving 75% of the orders on Etsy.

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It seems highly unlikely to us that big sellers, defined as those with 100+ items in their product lines, could really be handcrafting all of these items. But if it’s these very stores driving the majority of Etsy sales, is Etsy really the place to go for handmade?

Turns out the definition of “handmade” is trickier than it appears at first glance. In fact, it’s a question that Etsy has been struggling with over the past few years. On one hand, Etsy is faced with resellers, who buy factory products wholesale and then re-sell them, using the Etsy brand to falsely peddle their mass produced goods as handmade. But on the other hand, Etsy wants to continue being a part of the long-term success (and thus growth) of the artisans that have built their success on the Etsy platform.

In October 2013, Etsy officially announced how they define handmade. Its stance is now that sellers are eligible to use outside help (ie, factories) to produce their goods, as long as those goods are “designed and created by the shops that sell them.” According to the CEO, Chad Dickerson, “handmade” is not linked to any method or process. Instead, it’s “about values that we as a community prize.”

How can you tell if an #Etsy product is really #handmade? ow.ly/ESr10 pic.twitter.com/C0QqwBjyqw

In other words, on Etsy, a “handmade” good can also be a mass-produced good, as long as the shop owner is clearly linked to its design or creation. This is the perfect solution for small shops that need to outsource parts of the process to keep up with sales, but it also leaves Etsy vulnerable to the resellers who want to cash in on Etsy’s powerful handmade brand.

What this all means for you: Etsy continues to crack down on resellers and sweatshops masquerading as “handmade” businesses, but it’s up to you as a shopper to use a critical eye to spot the fakes. Make sure your expectations of handmade match the seller’s. For example:

Ultimately, it’s your call on how rigorous you want to be in your definition of handmade. What makes you feel connected to the seller?

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Tip #2: Shop the small stores

Many feared that the new, expanded definition of “handmade” would result in an influx of bigger shops on Etsy. And while the large stores exist and claim a big chunk of sales on Etsy, the small stores do a much better job at leveraging the power of Etsy’s community.

First, on a per product basis, the tiny stores (those selling fewer than 20 products) are outperforming their massive competitors (those selling greater than 1000 products). On average, the smaller shops have 35% higher sales per product.

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Second, they are much better at gaining admirers in the Etsy community. Tiny stores have 7x the number of admirers per sale than their massive competitors.

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Finally, while their massive competitors get more reviews per sale:

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…the ratings are much higher for the tiny shops. The smallest stores (under 20 products) have the highest ratings (4.76) and the biggest stores (over 1000 products) have the lowest ratings (4.02).

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Across the board, Etsy sellers get great reviews. This is due to the company’s strict monitoring for negative buyer experience, a practice that is common in the world of online marketplaces. The data shows a roughly one-star difference in ratings based on shop size. Etsy’s smallest stores consistently get the best reviews.

What this means for you: For a better customer experience, stick to the tiny shops.

Tip #3: If you want to shop the tiny stores, head over to the art and home and garden categories

Of course, the obvious next question is: how do I find the smaller shops? While Etsy makes this information publicly available if you’re willing to crawl their entire site, a shopper can’t easily search based on store size. The trick to getting around this is in the data.

The largest sellers tend to sell more craft supplies, jewelry, and vintage products. Tiny shops are selling more art and home and garden items.

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What this means for you: If you want to increase your chances of picking a gift you’ll be proud to give, start your search in the art and home and garden categories. These products are more common in the tiny shops that garner the best reviews.

Tip #4: Use Pinterest as a fast track to finding the right gift on Etsy

When we analyzed Pinterest data earlier this year, we were immediately impressed by Etsy’s popularity on the site. While Etsy’s follower count (491,000) pales compared to brands like Nordstrom (4,407,000) and Lowes (3,470,000), Etsy is crushing it on repins.

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The data indicates two reasons for this. First, demographically, the user base is very similar: 80% of Pinterest users are female, 87% of Etsy shops are female-owned.

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Second, there clear subject-matter alignment. The top categories on Etsy are Home & Garden and Craft Supplies.

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The top categories on Pinterest are Food & Drink, DIY & Crafts, and Home Decor.

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What this means for you: Before you attempt to find the perfect gift hiding in Etsy’s 30 million items, check Pinterest first. It’s the perfectly tuned discovery platform for Etsy products that people love.

Happy Etsy Shopping

Etsy is still the premiere destination for unique handmade items. Where else can you find a cat face purse, doll arm earrings, or a copper meditation pyramid all on the same website? And, just in case you’re looking for something for the data nerd in your life *hint hint*, we already did the hard work for you. We recommend the following:

Happy holidays!


Photo credit: Etsy Labs