When the US-based ecommerce artisan marketplace Etsy started operations in India in 2018, it had big plans to expand its presence and find more opportunities for growth in the as yet untapped market.   

In 2022, the company appointed Pankaj Jathar, a former top executive of Amazon, as the Vice President and country head for its India operations. This move aimed to grow the company’s position in India, making it one of its seven core markets.   

However, within two years of Jathar’s appointment, the company’s operations in India encountered significant problems. Jathar departed Etsy recently, along with other key management in the country, and new seller onboarding in India has been suspended for over eight months now.

The indications suggest that while India was previously a crucial market for the company, Etsy has adjusted its strategy and seems to have now deprioritized the Indian market. (The Etsy India Instagram account, for example, has not been updated since November 2023.)

Tax and shipping woes

Tejasvi Patel, based in Ahmedabad, a city in Western India, sells acrylic paintings through Etsy. She was a stay-at-home mother a few years ago before she started painting and joined the marketplace right after the pandemic began.  

Initially, Patel struggled to understand the site’s SEO and algorithms, but then things started running smoothly once she figured it out. She was happy that Etsy attracted many international clients from the US and Canada.  

However, her experience dealing with the seller support was less than satisfactory. Etsy had partnered with the shipping provider Yakit so Indian sellers could purchase and use shipping labels and Patel says that Yakit levied a goods and services tax but never provided her with a proper tax invoice. Without the invoice, she was unable to apply for the refund she was owed.  

She took her complaint to Etsy and continued to pursue it for nine months without success. She then decided to try shipping directly using courier services DHL and FedEx, but since Etsy sellers in India were required to use Yakit for shipments, these courier service providers would not accommodate her request.     

After months of navigating the bureaucratic maze, Patel realized she couldn’t find a solution.

“I was extremely stressed. I informed them they needed to solve my problem or allow me to go through DHL directly. I consulted with lawyer friends who helped me draft an email to Etsy.”

She says Etsy did finally allow her to ship using DHL, but she is still waiting for the invoices and her GST refunds.  

India based Angad Creations sells embroidered handloom products through Udayvir Bahri, based in Canada.

Customer service challenges

Mohammed Iiliyas, from northern India, who sells handmade carpets on Etsy, says the customer support he received from Etsy India deteriorated over time. He says customer support for Etsy India was outsourced Iksula, a prominent global e-commerce solutions provider for brands and retailers.

“The support was excellent at first, and they always resolved our issues. However, the numbers have stopped working over the past few months,” he explained.  

Now he can only reach out to support through the chat feature, which has also stopped working. Since May, he has yet to receive a response to his requests.  

Iiliyas also struggled with dealing with customer expectations. The majority of his customers are based in the US and poor customer reviews are a recurring issue for his business. Iiliyas explains that, like all handmade crafts, the final product may differ from the representative photo, which is clearly stated in their policy.     

However, customers dissatisfied with the final product often requested cancellations, resulting in a significant loss for his business. 

To salvage the deal, he would ask his customers how to modify the final product best to meet their requirements or convince them to purchase another product. This approach had varying degrees of success.   

Despite issuing refunds, customers would still leave negative reviews, accusing him of being a “fraud” and a “scammer.” Even though he goes out of his way to meet their requirements, he doesn’t sense that his efforts are truly appreciated.   

“I would understand if the product was damaged or lost, but this is an unreasonable loss. After making the carpet, I send the customer a picture of the finished product and ship it once they approve. We make changes as they request,” he adds.  

Switching payment providers

Etsy’s decision to pause new seller onboarding was supposed to assist in transitioning existing sellers to Etsy’s in-house payment system, Etsy Payments, but caused further disruption.  Previously, Indian sellers were given the option to integrate with Razorpay and Paypal.  

When Patel joined Etsy, she received calls encouraging her to enroll as a seller for the Indian market, which she did. However, her sales in India never took off. She soon realized that for a period customers in India could not purchase from her store because there was no payment method available to them. 

Mughal Arts Daggers sells vintage Mughal-era handcrafted weaponry and other antique items to a mostly oversees customer base. 

Domestic sales stalled

According to Etsy’s Global Buying Trends report released in 2023, the company claimed to have tens of thousands of small business owners from every state in India, selling unique products to buyers worldwide.  It added that in September 2023, Indian sellers on Etsy exported products to 168 countries worldwide, and India was among the top three fastest-growing seller markets. 

But Etsy’s Indian sellers say they have not been set up to succeed at home. Etsy faces tough competition from well-established brands in India including Amazon, Flipkart, and eBay. Sellers say there’s been an absence of effective promotional strategies.

Mukesh Narang, the owner of Mughal Arts Daggers, specializes in selling vintage Mughal-era handcrafted weaponry and other antique items. He mentioned that most of his customers are overseas, particularly in the US. He also noted that only a small percentage of the local population knows about Etsy. 

“They should promote this platform more here. Everyone knows about Flipkart and Amazon, but there are hardly any ads or promotions for Etsy,” he says.  

Narang also encountered problems with seller support. Early on, he would receive calls every month or so asking for feedback and inquiring about ways the company could assist him in improving his business. However, he hasn’t received any calls in the past year. 

Udayvir Bahri, based in Canada, handles the online sales and marketing of Angad Creations, which is based in India and sells embroidered handloom products. “If people want to buy Indian products, they will rather buy from well-established [market]places,” he says.