On Tuesday evening Etsy announced the company’s first $1 billion quarter. In its fourth-quarter earnings call Etsy’s CEO, Josh Silverman, said sales grew 17.8% over the fourth quarter of 2016.
“In a sea of sameness Etsy stands for something special and we need that now more than ever,” Silverman said. “We believe we have a long runway of growth and we’re acting with urgency to move faster.” There are now 50 million items for sale on Etsy, 1.9 million active sellers, and 33 million active buyers.
In an email sent to all sellers on Wednesday afternoon, the company announced that later this year they would be shutting down Etsy Studio, the crafts supply marketplace that launched in May, and Etsy Manufacturing, a site that matched sellers with small batch manufacturers. Since Silverman took on the role of CEO in May Etsy has been laser-focused on sales growth in the core marketplace.
“We’ve accomplished a lot since last May,” Silverman said on the call, citing the launch of approximately 350 product enhancements. New features include multishop checkout, bestseller badges, tools that allow sellers to create shop-wide sales and offer free shipping and gift wrapping. He said the company plans to keep up the rapid pace of implementing new features. “The more we can ship product enhancements, the quicker we learn, and the quicker we get better,” he said. “Going quickly from idea to testing to market is really important.”
A focus in the fourth quarter was on fostering better holiday season sales. Silverman said that a new tool that allows buyers to filter items that are available to ship within 1-2 days, and items that offer free shipping, helped to extend the holiday shopping season on Etsy.
For the first time, Etsy ran site-wide sales events in 2017, one on Labor Day and another during Cyber week (the week after Thanksgiving). Results for those events were financially “incremental,” but according to Silverman, they were important for meeting consumer expectations. “Running a cyber sale puts us on equal footing with other e-commerce sites so that people coming to the site expecting to find deals do find deals,” he said.
Etsy may be planning an event like Amazon’s popular Prime Day for some time in 2018. “There might be things during the year that we could do that are unique to Etsy that nobody else is doing,” he stated. “You should keep your eye on that.”
Other plans for 2018 include:
- Continuing to develop machine learning and artificial intelligence to improve search
- Clarifying to buyers how each seller handles returns and exchanges
- Further clarifying shipping costs and timelines
- Sending more targeted emails and push notifications to buyers
“Marketplace models get better as they get bigger,” said Silverman.
The importance of the human connection between buyer and seller, once a focus at Etsy, wasn’t mentioned in either the earnings call or the email to sellers, nor was there any focus on the value of handmade goods.
When asked during the call to address seller complaints and resistance to the new features Silverman said, “We’re focused on growing the pie for everyone. As a platform, our job is to make the experience better for all buyers and sellers. On any individual day, there will be winners and losers. The main thing is how do we make the pie bigger.”