Learn what Etsy ads are and if they are worth it. I explain my 30 day and 4 year experience with Etsy ads as well as go into a case study with numbers in the video and article below.
Read and watch to learn if Etsy ads are right for you.
The main reasons people list on Etsy are:
a) so they can quickly and easily create a storefront that has their products and accepts payment, and b) so they can take advantage of Etsy’s audience and traffic to get more sales because Etsy does have a large audience and they are able to drive sales to the stores that list on them.
If you’re not familiar with Etsy, the fees they charge are $.20 per item you list on their platform and then another 5% of the total price including shipping for each sale.
They also have two ad programs, one is called offsite ads and one is Etsy ads. Offsite ads are Etsy run google shopping ads where they take a 15% commission off every sale that comes from an offsite google shopping ad run by Etsy PLUS the normal 5% Etsy commission for a 20% total Etsy commission which is a sweet deal for Etsy. The other ad program they offer is Etsy ads are ads you pay for to boost your own listing visibility on the Etsy platform.
Even if you think Etsy ads aren’t worth it, if you’re making $10K or more a year on Etsy then you don’t have a choice and are required to participate in their offsite ad program which I don’t think it is fair to sellers because it can really cut into margins especially for sellers who handmake goods or have less profit per sale.
I’ve been selling on Etsy for 4 years now, you can check out my T-Shirt shop here, and when I started you could control bids on Etsy ads so you could pay less per click if you wanted, and I used to set my ad bids at $.01 per click and had crazy profitable ad spend. This past year they changed it so you cant set your Etsy ad bids and they get to pick how much you pay for a click, and you simply choose the listings you want to advertise and choose the daily budget you want to spend.
I am opted into their offsite ads because it’s like having an affiliate promote your products, you only pay when the person makes a sale, and you only pay 15%, so as long as you have at least a 30% profit margin I personally think it makes sense to use affiliates and pay per sale where you’re guaranteed a profit per sale. Anyone who runs ads for their livelihood or even owns a business will get what I’m saying.
When you run any type of ad there is never a profit guarantee, but when you use something like an affiliate or pay a % commission per sale to either a salesperson or to an Etsy offsite ad, you’re simply paying for results that don’t cut out your entire profit, they only take a small piece of it so it is worth it to opt into their offsite ads in my opinion in the majority of cases.
Since offsite ads have started Etsy has paid for 205 google shopping ad clicks on my listings and I have made 5 sales, $303.05 in revenue and paid $45.47 in offsite ad fees to Etsy plus another 5% $15 for Etsy flat sales fee.
It does cut into revenue rather deeply and for me it doesn’t even drive a ton of sales, but its still worth it to me because it’s like paying an affiliate commission payout where you pay a set amount per sale that is always still profitable even if it hurts to see such a huge amount paid from each sale to Etsy. I would love to see the stats on their offsite ads for them because my guess is they’re losing money from the amount of ad clicks they have paid for on google shopping and the amount of revenue theyre getting from this because they have so many low cost items on their platform I just dont see how it could be profitable for Etsy but Id love to see their stats.
That’s my opinion on their offsite ad program, now let’s dive into their Etsy ad program:
I’ll explain to you guys the ads I ran the past 30 days using their regular Etsy ad program and we can talk about whether it was worth it or not:
Etsy ads charge by click and not by percentage of sale like offsite ads. However they also keep track of the click through rate your listings get per view and they tell you when you have a good click through rate or a bad one, and when you have a good one ad clicks seem to be cheaper and you get more views and clicks. They actually optimize for the phrases each listing has higher click through rates on, so it is to your advantage to optimize for a nhigh click through rate.
To get a high click through rate, you simply have to make your title target your key keywords that are uber specific to your product, then you also need your keyword tags to match these keywords as well. If you have too broad of words in your title or keyword tags youll end up having low organic and ad click through rates and end up getting fewer clicks and paying more per sale.
Let’s look at my Etsy ad results for this year and the past 30 days:
For this year I spent $53.82 on etsy ads, got 26,398 views, 186 ad clicks, 2 orders and $29.98 revenue from ads,
Past 30 days I spent $13.53 on ads, got 3,637 ad views, 47 ad clicks, 1 order and $13.79 revenue from ads.
Looking at both these stats the Etsy ads were not even close to worth it.
Just for fun let’s scroll back and look at my lifetime ad spend and order revenue, which includes my newer ad spend and the old ad spend when you were able to control bids and click costs:
My total lifetime Etsy ad spend $209.70, 201,200 ad views, 1,458 ad clicks, 24 orders from ads, and $624.76 revenue from ads.
Back when you actually had control over your bid amount, which is crazy Etsy doesn’t let you do this as every single other ad network does, my ads actually had a 300% ROI and were slightly profitable.
This year and the past 30 days however I was losing money on ads, and even the past 30 day break even spend $13 in spend and $13 in revenue, is not actually break even because you have to factor in the 5% I paid to Etsy in addition to ad spend and the money I pay to manufacture the product, so I actually lost money using Etsy ads to sell products these past 30 days. This entire year my ad spend was unprofitable.
As you can see this year my total store visits have been 1,624, 31 orders and $1053.28 in revenue some of that has been direct traffic I’ve driven but the majority has been driven by Etsy, so Etsy does drive free traffic to listings. In the stats, it shows that Etsy drove 67% of my total visits and that I brought 33% with direct traffic and the ads I have run. This is why I like having some listings on Etsy because Etsy does have a loyal audience and is able to drive traffic and sales to my store.
For those of you who run Etsy stores and are watching, what I would recommend is still testing running Etsy ads for 30 days using the minimum $1.00 a day ad spend.
Put your most specific title tag and keyword tag, best listings as ads, and let it run for 30 days. Check in every few days and look at the keyword and click through rate data so you can turn off or optimize listings with low click through rates or that are showing for non-specific terms. Doing this will let you test if Etsy ads will work for you and allow you to optimize for the best chance of having them work.
If I kept my ads running and really kept optimizing title and keyword tags I bet I could get my ads to perform better but my items have such low profit margins and it’s simply not worth it to me right now. I can get a better ROI on my time elsewhere and I dont see the need to pay Etsy more right now. They can show my listings for free to people but it’s not a focus for me to sell more using their platform at the moment.
Comment below if you want to try Etsy ads and why or why not! Do you think Etsy ads are worth it? I’d love to have a conversation with you guys below, let me know your thoughts!