Online marketplace Etsy announced last week that it will launch a purchase protection program beginning August 1. According to this new program, if a buyer never receives their package or if their item arrives damaged, they’ll now be able to receive a refund paid by Etsy itself, rather than the seller.
“We know that sometimes things happen outside of your control and up until now if an item got lost or damaged in transit and a buyer requests a refund, it can be time-consuming and even costly to navigate. This new program will help protect both sellers and buyers if that happens, said COO Raina Moskowitz.
Some restrictions apply, of course. Only orders up to $250 inclusive of shipping and taxes will qualify, and the order must be shipped with tracking or with an Etsy shipping label. For items shipped by Priority Mail, the seller must first file a claim with the shipper before Etsy will issue a refund for a lost or damaged item. The item must also have been shipped on time, with an estimated delivery date set by the seller and careful packaging. The item listing needs to have an accurate description and clear photos as well.
According to Etsy, it’s very rare for buyers to file a claim that their goods arrived damaged. Therefore, items are only eligible for purchase protection for damaged goods once in a calendar year. Sellers don’t need to opt into the program; it applies automatically beginning August 1.
Etsy says they will monitor fraud associated with the new program. Buyers who abuse the program could lose access to purchase protection going forward.
According to updates in the Etsy Seller Handbook, the purpose of the program is to encourage more sales. “We’ve heard from buyers that trust is an important factor that drives their decision-making. We want them to shop confidently on Etsy knowing that if something goes wrong with their order, they can easily get the help they need.”
Luci Ayyat, who sells her digital embroidery patterns on Etsy, is hopeful that the program will encourage buyers to feel at ease about purchasing on Etsy.
“I think it’s a good thing for buyers, she said. “Porch pirates are a big problem in some areas and this might boost buyer confidence. Not all sellers insure their packages.”
Other sellers expressed concern about how the claims might impact their shop standing. “Unless I’m missing something, it seems that in order to take advantage of the protection, a buyer has to open a case with Etsy. So will the number of cases opened to get a refund for missing or damaged packages count against our shops like other cases do?” asked Sharon Yetter of the shop StainedGlassYourWay. “If so, then it’s really not ‘free’ for sellers as there are still consequences for taking advantage of it.” According to the Etsy Seller Handbook, cases opened against a shop are one of the factors used to determine search ranking.
Sellers outside of the US pointed out that the new program will mostly not apply to their shops due to the costs of using Etsy shipping labels and tracking internationally. “Tracking is an expensive optional extra and Etsy labels are not the cheapest way to post and they only offer a few options, not every service Royal Mail has,” said seller UK seller David Goulding of Thequiltsanctuary.
Janet Zeh, who sells paintings in her shop, ZehOriginalArt wrote in the Etsy forums, “I hope the wording for buyers is done carefully in order to not discourage shoppers from purchasing items over $250. That concerns me.” And the seller EightMileVintage remarked, “Seems to me this new program encourages me to ship via an uninsured service like Parcel Select and stop buying third party insurance so I don’t have to make an insurance claim first. I don’t think that’s Etsy’s intention.”
Still, other Etsy sellers remain optimistic about the program’s impact on sellers. Seller Lisa Nolte who sells fabric on Etsy explained, “I had a buyer who didn’t receive their package, but USPS said it was delivered and there was no recourse for me at all. I had to ship a new package at my own expense. This seems useful and could bring more customers.”