Shipping Tips & Solutions

Etsy’s Steady Rise—and How to Make the Most of It

By: Shippo | February 28, 2020

Highlights:

  • Etsy’s popularity has been on a steady rise for years, with about 2.5 million users and nearly 45 million customers
  • Offering free shipping can help you stand out—and pay additional dividends
  • Etsy offers a smart pricing tool that will automatically make price adjustments for you

The Story:

For the past several years, Etsy has been killing it. 

Its rising popularity and amazing growth is the end result of a highly manageable and easy-to-use platform that enables makers, solopreneurs, creatives, and other aspiring business owners to hawk their unique wares to new and expanded audiences. As of 2019, there are nearly 45 million customers that shop on the e-commerce marketplace. 

And while opportunities abound for potential customers, there’s also a lot of competition. The platform has more than 2.1 million active sellers. That means it’s up to you to find ways to stand out and seal that deal. 

One way to help do just that is to offer free shipping on Etsy.

Benefits of Offering Free Shipping on Etsy

First, if you’re not currently selling on Etsy, it’s helpful to understand the fees involved with selling on the platform. While it’s free to sign up and open a store, it costs $0.20 to publish a listing to the marketplace. These listings expire when the item is sold or after four months, whichever comes first. For every sale, Etsy takes a transaction fee and a payment processing fee. You’ll also have to pay the associated shipping costs. 

Shipping costs really depend on what you sell, where you ship to, and how you ship it. 

Knowing your specific numbers can help you understand if you can afford to offer free shipping. 

Okay, now that we have that out of the way, let’s look at the impact free shipping will have on sales. Etsy shoppers are 20 percent more likely to complete a purchase that has free shipping than one that doesn’t. 

Etsy shop Crystal’s Crafties ran their own test to discern the effectiveness of free shipping. They found that free shipping is a more compelling offer than a 20 percent discount. 

Plus, free shipping will earn you brownie points with Etsy—they prioritize free shipping listings in search results. 

Ways to Offer Free Shipping on Etsy

Etsy sellers have a few different options when it comes to offering free shipping

Include Shipping in the Product Price

For small merchants in particular, it can be difficult to eat the costs of shipping and still make a profit. Instead of charging for shipping separately, you can incorporate the costs into your overall product price. 

Here’s an example: You sell a pair of earrings for $20. It costs anywhere from $5–$10 to ship them to your customers. You could price it at $30 per pair to cover the costs for all, or meet in the middle at $27.50. 

Of course you’ll still need to be able to price competitively, but over time you should be able to find a sweet spot. 

Offer a Free Shipping Guarantee

As Etsy pushes to make free shipping the norm, they continue to release new features and tools to allow merchants to do exactly that. They’ve released an option called the “free shipping guarantee.” With this setting, Etsy automatically applies free shipping to any U.S.-based customer for purchases valued at $35 or more. 

To do this, you can adjust your shipping settings in the Free Shipping Guarantee tab. 

This sounds like a big risk, right? However, merchants who opt for free shipping will actually get preferential treatment from the marketplace. That could mean favorable positioning in search results, offering increased visibility. 

In addition, Etsy recommends merchants revisit their pricing strategy, as well as offering them the option to reprice items in their shop to recover shipping costs. You can also use the smart pricing tool … 

Use Etsy’s Smart Pricing Tool

If you want to recoup the costs from Etsy’s free shipping guarantee but don’t want to meddle with product pricing yourself, check out the smart pricing tool. Etsy’s smart pricing tool that will automatically make price adjustments for you. (Note: this feature is only available to U.S.-based merchants.)

Create a Shipping Profile

With shipping profiles, you can set parameters for categories of purchases that qualify for free shipping. Essentially, you tell Etsy which types of purchases qualify for free shipping, and Etsy will automatically apply that offer based on each individual user’s experience. This makes it easier to offer free shipping only when you know you can afford it.

Some options include shipping profiles based on buyer location, purchased product(s), and transaction amount. Etsy will automatically place free shipping on qualified purchases. 

Run a Free Shipping Promo

If free shipping isn’t sustainable for your business, you can use it to generate a bit of buzz on a limited-time basis. With coupon codes, you can 

You can set these to expire or you can make it so they never expire. Only the most savvy and connected customers will get these promo codes. 

This is also a great tactic to build your email list—require a newsletter signup in exchange for the promo code. Etsy has a full step-by-step guide for setting up coupon codes.

Moving Forward With Your Etsy Shop 

If Etsy is part of your multi-channel (or single channel) selling strategy, it’s important to do whatever you can to reduce shipping costs for you as a seller and for your end customers. With the right pricing strategy and convenient Etsy shipping labels software, you can figure out how to offer free shipping on Etsy and turn a profit. 

Whether you opt for selling on Etsy, doing your own thing, or both, explore Shippo to streamline your shipping operations. 

For further information, check out these resources: 

Shippo

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