Etsy sellers aren’t happy with the platform pushing them to offer free shipping

Etsy announced today that it will begin prioritizing items and shops that offer free shipping, and sellers aren’t thrilled. Starting July 30th, Etsy will give priority placement in US search results for items that ship free and for shops that guarantee US buyers free shipping on orders of $35 or more. An email sent to sellers by the company’s CEO advises them to include the cost of shipping in their retail prices, a change that many sellers on the platform, which primarily focuses on handmade goods from artists and small businesses, take issues with.

Etsy justified the decision by saying that Etsy buyers are 20 percent more likely to buy items with free shipping. But the news has elicited a passionate reaction from sellers and buyers alike on Twitter and on a Q&A about the announcement on the Etsy forums, which has currently garnered over 1,300 replies.

Implementing flat shipping fees in prices can pose a challenge to international sellers who ship worldwide. Cambridge-based artist Katie Fuller, whose run her Etsy shop since 2015, says including the cost of shipping in her products would put her at a disadvantage. “If I [raise my prices], then I’ll be making my prices uncompetitive for customers elsewhere. Most of my customers are in the UK; it wouldn’t make sense for me to do it so it sounds like I can wave goodbye to my American sales.”

Etsy CEO Josh Silverman acknowledged that the change might be hard for some sellers in a Business Insider interview, saying, “We know that this is going to be a lot for sellers to absorb — it’s a real change in how they think about pricing.” The new policy is written primarily for an American audience, but Silverman’s letter includes a line about bringing more support to international sellers: “We’ll continue to invest in your success by increasing our digital marketing efforts aimed at bringing more buyers from the United Kingdom to Etsy.” An Etsy spokesperson told The Verge that the company is starting with the US, its largest and most mature market for now, and is providing guides for international shipping strategies in the meanwhile for non-US sellers.

A good portion of the listings on the first page of search results already feature free shipping, and buyers can turn on the ‘free shipping’ toggle to find items they won’t have to pay extra shipping for. The new policy, when it goes into effect at the end of this month, would show a majority of items with free shipping on the search results, in the most visible top rows. Etsy also says it’ll prioritize these items in its ads, through email marketing, social media, and TV.

“Most of us are tiny businesses – we’re not Amazon or eBay, we can’t compete with “the rest of e-commerce” and it won’t make sense for all of us to absorb our shipping costs into the overall price,” Fuller says. “But Etsy will penalise us for that.”

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