How to Make Money on Etsy: Tips to Make More Money

how to make money on etsy
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Anyone looking to start a profitable side hustle or business online should learn how to make money on Etsy.

There has been a rise in Etsy sellers over the past few years. There were 7.5 million active sellers on Etsy in 2021, much higher than the 4.4 million sellers just the year prior.

So if you want to join the gig economy, you should highly consider selling on Etsy. In this article, you’ll learn how to join the Etsy revolution and make money through the marketplace.

What Is Etsy and Why Is It So Popular?

how to make money on etsy Etsy is an online marketplace that has helped many people earn a significant income online. What sets the platform apart from other platforms is its focus on a few specific niches— handmade goods, vintage items, and craft supplies.

The website launched in 2005. A company named Iospace created Etsy in two and a half months. Robin Kalin, Chris Maguire, and Haim Schoppik were the first people on the Etsy founding team. Jared Tarbell and Maria Thomas would also later join the group.

Etsy is like a digital version of the traditional open craft fair. It has become a promising avenue for artists and sellers to sell their products.

Etsy isn’t the only option if you want to sell online. There are other significant marketplaces like eBay, Amazon, and Craiglist. You can also create a website or sell your products on social media.

Yet, despite all the options available to online sellers, Etsy still has its advantages.

For one, it has built a strong sense of customer loyalty amongst millions of its shoppers. There were over 96.3 million buyers on Etsy at the end of 2021.

Etsy has also created a strong brand preference among people looking to buy something unique, handmade, or vintage online. It is an excellent platform for artists and handmade and vintage products sellers because it provides:

  • Ease of communication between buyers and sellers
  • On-platform transactions
  • Access to ratings and reviews
  • Convenient distribution channels
  • A significant social media presence
  • Availability in various languages
  • And many others

Moreover, the online platform has also pursued helping micro-entrepreneurs by creating proposals to provide economic security for all, especially for solopreneurs and people who fall outside the traditional employee-employer relationship.

How to Make Money on Etsy

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If you want to improve your personal finance by increasing your cash flow, selling on Etsy is a great idea. Still, that doesn’t mean becoming a successful Etsy shop owner will be easy.

However, with enough time, dedication, and ingenuity, Etsy sellers can profit considerably from selling products. The primary way to make money on Etsy is to create a product that matches the marketplace’s niche and list them on the website for sale.

But simply getting on the platform isn’t enough. You’ll have to deploy tactics and strategies to market your products and store. You’ll learn more about that further in this article.

How Much Money Can Etsy Sellers Make on Etsy?

Can you make money on Etsy even if you’ve just started? How much money can Etsy sellers make by selling on the platform?

As per Etsy’s 2021 seller survey, the growth merchandise sales of the average Etsy seller was $1,641 in the first year. That figure grew to $2,875 in the second year, $4,090 in the third year, and $6,538 in the fourth year.

It’s important to understand that these figures come from aggregate records over a long period. Ultimately, the amount of money you earn on Etsy depends on the effort, time, and strategies you deploy to sell products online.

The success of your Etsy shop also depends on your products.

When you’re clear about your offering and who you want to offer it to, it becomes much easier to sell more products online.

An Etsy seller can earn between $5,000 to $50,000 in a year if they put in the time and effort.

How to Sell on Etsy

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1. Do Some Research on What to Sell on Etsy to Make Money

Before setting up your shop and selling products on Etsy, you must first figure out what to sell to become a profitable business.

Perform market research and find out what products sell well on the platform. You can go through different shop pages to see what other successful sellers are already offering. Consider how your products might differ from theirs and differentiate your value proposition.

Find top-selling listings you might enjoy creating and selling yourself. If the crafts you’re marketing align with your passion, you won’t just have a profitable business. You will also enjoy the process.

While Etsy has a specified niche of products to sell on its platform, there is still a wide variety of products that you can sell on it. These are some of the most common products listed if you want to know what to sell on Etsy to make money:

  • Handmade jewelry
  • Bags
  • Clothes
  • Home decor
  • Furniture
  • Wall art
  • Sculptures
  • Toys
  • Jewelry supplies
  • Handmade products
  • Art supplies
  • Craft tools
  • Digital art or graphic design
  • Vintage items at least 20 years old
  • Others in the same category

Your products should also have the following characteristics to make them more appealing to buyers on the Etsy marketplace:

Create a Unique Product

Artistic products sell well when they have a unique personality. Your Etsy products should have that if you want them to sell well online.

Try to hone your skill and make your products unique. Ask yourself what you can create that will stand out from other products in the same category.

Potential customers on Etsy are looking for something creative, so let your creativity show through your work.

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Create a Quality Product

Many Etsy sellers might promise beautiful products, but the question is, are they of good quality?

Quality isn’t just aesthetics. Use quality material that will make your product durable. If you’re selling digital items, ensure your delivered files are high resolution.

Price Your Products Well

Like any marketplace, Etsy is where millions of people come for a bargain and look at the different Etsy offers. Accordingly, you should have a reasonable price tag attached to your product on Etsy.

Consider all costs when setting a price for your products. Take Etsy’s fees, payment processing fees, and the cost of your materials. You should factor shipping costs into your pricing if you plan to cover them.

What Products Can’t You Sell on Etsy?

Not all products are allowed on Etsy. If your product falls into these specific categories, you cannot sell them on your Etsy store, and it would be best to selling them on your own website..

Prohibited items include the following:

  • Tobacco products
  • Drugs or drug paraphernalia
  • Weapons
  • Hazardous materials
  • Items that use someone else’s intellectual property
  • Other products that cross these categories

2. Set Up Your Etsy Store

There are a few simple steps to create your own Etsy shop. Here is a guide on how to set up your Etsy store.

Step 1: Create Your Etsy Store

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To create an Etsy store, head to Etsy.com/sell and click on Get started.

You will then select your shop language, country, and currency. After you’ve done so, click on Save and continue.

Enter your shop name and then click on Save and continue.

Your shop name should follow a few simple rules:

  1. The name should have between 4-20 characters
  2. Your name should have no spaces or special characters
  3. Profanity in the name isn’t allowed on Etsy
  4. You should use a name that other Etsy shop owners haven’t used yet
  5. Your name should not infringe any trademarks or copyrights

Step 2: Set Up Your Payment and Billing Details

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You will need to connect a bank account to your Etsy shop to receive payments from Etsy.

To do that, simply follow these instructions:

  1. Add your personal information on the ‘How To Get Paid’ page
  2. At the bottom of the page, select the country where your bank is. You can find that under ‘Where is your bank located?’
  3. Schedule your payments. Most online store owners on Etsy choose to get paid weekly.

When you’ve registered your shop, you’ll have different payment options for your customers, including:

  • Credit card
  • Debit/bank card
  • Etsy Gift Cards and Etsy Credits
  • PayPal
  • Apple Pay
  • Google Pay
  • Klarna installment payments (for buyers in Australia, Spain, United Kingdom, United States, and Canada)
  • Klarna Invoice (for buyers in Germany)
  • iDEAL (for buyers in the Netherlands)
  • Sofort (for buyers in Austria and Germany)

Step 3: Set up your Etsy store

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After you’ve set up your Etsy account and payments, you’ll need to set up your storefront to show your items for sale. Add a photo to your account to make it more legitimate looking.

Typically, shop pages will also include considerations, such as production time (if you’re pre-selling handmade items), store policies, and shipping arrangements. So, you should consider adding those in too.

3. Take Nice Photos of Your Art, Craft Supplies, Etc.

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Once you have your store and products ready, take nice photos of your products. The quality of your photos is a driving factor in bringing more sales.

Use high-quality photos that showcase the best things about your products. Use natural light as they’re easier on the eyes and more enticing.

If you’re selling digital downloads, create a mockup. For example, place an image of your digital prints on a mockup of a frame on a wall. This will help buyers visualize the artwork once printed.

4. Write Eye-Catching Copies

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On top of great photos, your Etsy store will also need good copywriting. Do not belittle the importance of your product listing’s description. Take the time to lay out your Etsy store’s specifications, benefits, and terms.

The copies you use on your product listing’s headline and descriptions play a significant factor in your searchability. Enter words that people often type into the search bar when looking for products like yours. That way, your products will appear on search results more often.

5. Start adding product listings

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Now that you have your own Etsy store and products to promote, the only thing left is adding products to your page. Etsy stores can list huge numbers of products.

There’s a listing fee on Etsy. So try putting up a few products beforehand to test the market’s response to your products.

Once your products are up, you’re ready to sell on Etsy and start making money!

For more tips, considerations, and instructions, you can check out Etsy’s seller handbook; an excellent resource for a new small business or seller on Etsy.

Click here to get to the page.

How Much Does It Cost to Sell on Etsy?

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When learning how to make money on Etsy, it’s crucial to know the costs involved.

Like any business, you will have associated costs with running successful shops on Etsy. These can include selling fees, transaction fees, and other expenses you must pay when you list and when the item sells.

Here are some costs to cover when you sell on Etsy.

Listing fee — Etsy charges a listing fee, a fixed amount you pay to get your product on the platform. Currently, the price is $0.20 per product listed.

Transaction fee — There is also a transaction fee that gets deducted from your customers’ payments once your product sells.

This serves as Etsy’s payment processing fee. Etsy takes 6.5% of the price displayed per listing and the amount you charge for shipping and gift wrapping.

Shipping fee — While this cost mostly goes to the buyer, sometimes you might opt to give a free shipping incentive for a minimum order. Consider this cost, too, when selling online.

Etsy Plus monthly fees — Many top Etsy sellers use an Etsy Plus account, which provides additional support and features. If you want the benefits Etsy Plus provides, you’ll need to set aside $10 a month to pay subscription fees.

Getting Etsy Plus gives you access to credits for shop listings and Etsy advertising, access to a custom web address, restock requests, advanced customization, and so on.

Etsy Seller Tips to Make More Money

Now that you have your Etsy account ready and know the associated costs. The next thing to do to start making money through your Etsy business is to deploy strategies that can drive traffic.

The following are proven strategies to help you drive visitors who can turn into customers for your Etsy store.

1. Don’t Neglect Your Social Media

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Creating social media profiles on various platforms is a great way to showcase your products and start selling to people there.

Some social media sites you can start promoting on include Facebook, Instagram, Pinterest, Twitter, and even LinkedIn.

Consider creating a YouTube channel where you might show your creative process if you’re selling artwork and handmade items.

Instagram and Facebook Reels are the most popular forms of content today, so make sure you create content for those channels.

Drive your social media followers to your Etsy listings by leaving links to your store or products in the caption area. On Instagram, place a link to your store in your profile bio.

2. Manage Reviews on Your Etsy Shop

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Maintaining good social proof is a great way to build brand trust on Etsy. The primary way you can do that is to manage your reviews.

Collect customer reviews as often as possible, especially those who love your products. Maintaining a good rating on your Etsy profile will help encourage sales.

Don’t get too dismayed by negative reviews. They are bound to happen. When they do, respond to the customer politely and find a way to make things right if you can.

3. Start an Email Newsletter

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Another great way to market your products to potential and existing customers is to maintain an email newsletter for your store.

Create a list of people who will get exclusive access to special sales, announcements, and even members-only products.

Some software you can use to create newsletters are:

4. Provide Top-Notch Customer Service

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When running an online business, your existing customers are your best contacts. Studies show that returning loyal customers spend about 33% more on your products than new ones.

Keep close contact with customers and answer their queries as soon as possible. You can also post the hours you’re available to respond to follow-ups and questions.

5. Invest in Etsy Ads

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Paying for sponsored ads is a great way to appear on Etsy search results more often. Target keywords that people might often search when looking for products like yours.

Make sure to track the conversions on your ads, so you know that you have a good return on ad spend.

Final Thoughts

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Congratulations! You now know how to set up an Etsy business and make it grow. It’s time you stop reading Etsy seller success stories and become one of them.

Begin your journey as an online entrepreneur and start selling on Etsy today!

What kind of products would you like to sell on Etsy?

The first step is always the hardest. So take that step today and follow the steps provided in this article.

We wish you all the best on your journey towards reaching your goals and becoming a successful Etsy business owner.

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