Etsy How-to

How to Make Money on Etsy

Do you want to know how to make money on Etsy? Are you wondering if the largest online marketplace for handmade and vintage goods still presents an opportunity for sellers? Or maybe you’re ready to ditch your 9 to 5 and become your own boss?

Well, you’re in the right place to figure it all out.

Etsy is an online marketplace where individuals (people like you and me) can sell handmade, vintage, and artisanal products. These products generally can’t be found in stores or other giant marketplaces; therefore, the customers who shop on the Etsy marketplace are usually looking for something “unique.”

This means that customers are generally willing to pay a little more for an organic t-shirt that’s ethically made rather than a mass-produced t-shirt in a Bangladeshi sweatshop. 

In other words, you can charge more for better-quality products, handmade or locally sourced by you, the seller. 

The trick to making more money on Etsy

How to make money on Etsy - Etsy shoppers using credit card to purchase from Etsy.

When it comes to making money on Etsy, the challenge is often figuring out a better quality product to sell that’s competitively priced. This is because there are many other sellers on Etsy doing the same thing. And many categories are being increasingly flooded with more average-quality products being sold at an increasingly lower price. 

Well, the trick to making money on Etsy is selling something desirable. Something that stands out from what’s already there. Something that people want to buy. And something that people are willing to pay a premium price for.

Making money on Etsy takes time

Opening an Etsy shop is a free, 5-minute process. 

But setting up a business that uses Etsy as a profitable sales channel can take significantly more resources – namely time and money. 

The most significant investment in setting up an Etsy shop that makes money is time. Time to learn how to do things, fail, and then do it again, but better.

It’s free to upload photos, but learning how to take good pictures with your mobile device takes time. 

Understanding payment methods, a lenient return/refund policy, shipping methods, and how to price your products amidst Etsy’s various fees will require some trial and error.

Generally speaking, nobody gets everything right the first time they try it. And the same goes for selling on Etsy.

But the most important step is to start. If you wait for everything to fall into place first — you know, for the stars to align, then you’ll never start selling on Etsy. And you won’t make any money.

So start now. Do things wrong. Learn. Do things wrong again. Learn some more. Then maybe you’ll start doing things right. And then you’ll be on your way to actually make money on Etsy.

How to make money on Etsy by finding your niche

Princess kissing a frog statue.

To make money on Etsy, it helps to sell products in a market that isn’t already saturated with hundreds of competing shops. This is where market research comes into play, and it’s one of the most important first steps for any new or expanding Etsy business.

Through market research, you can find out which categories on Etsy are already flooded with too many sellers. This will allow you to do two things:

Option A: Learn which markets have lower competition, meaning there’s more room for a seller like you to jump in and start selling better products.

Option B: Learn which markets are high in competition, meaning there’s probably room for a seller like you to jump in and start selling highly specific products.

In both scenarios, you’ll benefit by finding your niche.

Here’s an example of finding your niche to make money on Etsy

Through market research, you may learn that there’s a viable market for frog statuettes and figurines. Quite a few shops are selling them. But they’re popular, and people buy them. With Option A in mind, you could consider selling better frog statues than what’s already being sold. Maybe your frog statues take inspiration from the Wind in the Willows or Frog and Toad — meaning they wear suits and drink tea.

Or, with Option B in mind, you could sell a specific product within this market that’s not really being sold by anyone else. Something like a floating lily pad. And you can market your product as the perfect accessory to any suit-wearing, tea-drinking frog statue. So now your customer’s frog statues can float around the pond instead of just hiding at the water’s edge.

Regardless of whichever option you choose to pursue for your Etsy business, finding your niche is an incredibly potent and overlooked element of making money on Etsy. 

Keyword research tools like Marmalead are fantastic for finding under-supplied niches. For example, you can find keywords with large search volumes, then niche down into long-tail keyword suggestions.

This is just an example of niche marketing. First, try dominating an under-supplied area, then gradually build up your business to put your market on the map.

Source your product after you’ve identified your market

How to make money on Etsy - Etsy seller sourcing local vintage clothing.

Once you’ve found your niche, you need to find the best way to create your product with your overall profit in mind. This means thoughtfully sourcing your materials. Because whatever materials you use will ultimately determine the final outcome of the product you create.

Cheap materials could mean that your product is also perceived as being inferior. Although you’ll end up with less overhead, potentially increasing your profit margin.

However, using expensive materials doesn’t mean your target audience automatically perceives your stock as a “premium product.” That takes excellent marketing chops and outstanding customer reviews.

Keep these two product categories in mind when sourcing the materials you use to create your product:

  • Do you want your product to be considered a bargain bin? A competitively priced product that’s standard quality?
  • Or do you want your product to be considered premium? Highly sought after, with a steep price tag?

Only after you’ve researched your market will you understand the market rate for your product, allowing you to source materials that guarantee a healthy profit margin.

Either way, the point is this – many sellers source a product before doing proper market research, which is why many Etsy shops fail. Source a product only after you’ve identified a niche, and you’ll set yourself up for long-term success.

Only after you’ve researched your market will you understand the market rate for your product, allowing you to source materials that guarantee a healthy profit margin.

How to make money on Etsy by pricing your products effectively

How to make money on Etsy - Etsy shoppers browsing handmade boots on Etsy.

It costs money to make money. And if you’re not pricing your products with Etsy’s fees in mind, you’ll be losing money instead of making it.

There are many ways to price a product on Etsy, but you must price your products competitively without aiming to be the cheapest. And a race to the bottom is simply a waste of time.

When establishing your pricing, consider your brand and how you add value to your product. Value that your competitors aren’t adding to theirs.

Your competitors may deliver their products in a plain mailer box. So boring! This could be an opportunity for you to go above and beyond and create an unboxing experience. Pair this experience with a thoughtful note to your customer, and you might snag a 5-star review.

This is just one example of pricing your products competitively and maintaining a healthy profit while making your customers feel they got a lot more than they bargained for. 

Make more money on Etsy with better product photos and descriptions

People are visual creatures – we consume a lot with our eyes. And when you can’t touch the product you want to buy, our eyes play an even more critical role. 

This is why your product descriptions and imagery must be up to scratch. 

For photos, it’s essential to show your product with a neutral background, show your product in a few lifestyle shots, indicate a range of variants if available, and create an eye-catching thumbnail

When writing your product description, you must remember that Etsy customers do a lot of research. They typically look through all the photos and read the product description entirely. Therefore, you must simultaneously tell a story with your product description while providing all essential information.

The best way to do this is with short, concise sentences while listing all the important information your customer needs to know.

Keep both your photos and descriptions in line with your tone of voice, and you’ll take a massive step in creating a consistent brand message. 

Using Etsy SEO to make money on Etsy

How to make money on Etsy - Two Etsy shoppers purchasing product from Etsy.

Search Engine Optimisation, or Etsy SEO, is the process of refining your listings to rank higher in search results. When your product ranks higher, you get more traffic and are more likely to get the sale. 

Marmalead is a fantastic tool for fine-tuning your Etsy SEO. Marmalead will help you find relevant keywords for your products through real Etsy search data, helping you understand how many shoppers are searching and engaging within your market.

Investing time and money in your Etsy SEO is the best way to sell more products on Etsy and make more money doing it.  

Rely on your data

Etsy’s seller dashboard gives you access to important stats you don’t want to turn a blind eye to. Traffic and favorites are essential stats, but they’re just vanity metrics.

Sales, profit, and other data are necessary to make the right business decisions.

Do more of what’s working and less of what’s not working. Essentially, that’s how to make more money on Etsy.

And the only way to find this information is to look at your data from the Etsy seller dashboard and decide with that data in mind.

Consider setting up Google Analytics for your Etsy shop to get an even more granular view of your Etsy data and traffic stats.

Summing up

Etsy presents a genuine opportunity for you to make money as a business owner and self-made entrepreneur. And the simplest way to start is by making it your side hustle. But do just that — start.

You can research all day, every day. But if you don’t start your Etsy shop now, you’ll be no closer to making money on Etsy than the day before. The best way to learn something is by doing it. So with our advice in mind, identify your market, then start selling.

You’ve got this.

Grow your online business, develop your SEO, and launch your sales into the stratosphere.

Read The Squeeze each week to see what’s new with Etsy and the growing industry of eCommerce. There’s a lot of noise out there getting in the way of your success. Cut to the chase with tips and tricks you can implement in your business right now. Let The Squeeze be your guide.


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