The once starving artists of homespun craft marketplace Etsy.com have officially achieved mogul status. Last month, the site posted $133.1 million in annual sales—all before the holiday rush.
(Would it be bragging to say we saw this coming?)
At a time when everyone seems to be spending less, the average cost of items sold on Etsy has increased by about two bucks since last year to around $17 per hand-woven stocking cap or couture set of earnings, according to company spokesman Adam Brown.
How? Etsy seems to have figured out that it only gets richer if the artists they highlight can actually earn a living. In a survey last February, the site noted that it owed expansion primarily to the gushing of happy creative types. (As the chart below shows, about 36% of new customers arrive though word of mouth.)
Not surprisingly, artists seem interested in maintaining their autonomy, too. (The chart below shows how many still run their own blogs for self-promotion.)
So, rather than harness the crowd like a sweat shop, Etsy has invested heavily in supporting them. In January 2008, it leveraged an additional 30 million in VC funding—then its approximate annual sales revenue—to help make the site as functional and aesthetically pleasing as its products. The company also added tools that promoted individual virtual storefronts, such as a shop locator that is searchable by city, state, or country. That's lead to at least 100,000 new sellers in the last two years and a few million more buyers, who've helped boost sales by more than $40 million. (Not to mention the fact that sellers are still charged a nominal fee to post.)
Next up, a handful of company blogs to push awareness of foreign vendors hoping for similar traction in their own countries—with the same intrinsic selling point. "Each thing is made by an actual person. There is a story behind it," Brown says. A success story.
Image Via MrRaccoonsempire Etsy page