Why The Ongoing Debate About Shopify Vs Etsy? Here Are 3 Things You Need To Know
- Jun 24, 2022
- 7 min read
Updated: May 17, 2023
Written by: Silvia Myers, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
Recently, I’ve seen and heard an incredible amount of debating about Shopify vs Esty and which one is better for your eCommerce business. We get it, you want to make sure that whatever platform you choose for your eCommerce business will be a strategic decision and fulfil the right requirements.
So here are a few things you need to know.
First up, I just want to point out that when it comes to the Shopify vs Etsy battle, it’s not really about which one is better. Both platforms are great in their own right. It’s just that they are very different and serve very different purposes in your eCommerce business.
So first we'll be diving into the most important things about the Shopify and Etsy platforms. Then we'll be comparing some details that might be really important to the eCommerce business you’re in.
So let’s have a look at the three things you really must consider before you settle on either Shopify or Etsy for your eCommerce store.
1. Shopify vs Etsy is like deciding between taking your goods to a crafts market or opening a store in a shopping mall. Neither is better, they’re different business models.
Comparing Shopify vs Etsy for your products is like deciding between buying goods from your nearest crafts market or heading to a shopping mall.
Yes, it really is like that. One of them is like a market and the other one is more like a shop. And if you’re not aware of it, that can impact your eCommerce business.
How Etsy Works
So first let's talk about Etsy. Etsy is like a market. So imagine that you are going to your nearest crafts market and then the market does its own ads to get people in and gets the grounds ready for artisans to display their products and for visitors to come in.
In other words, Etsy gets people in, that's their job, it's a marketplace. And these people who go to Etsy mainly go there because they have a great relationship with Etsy. You could even go further and say that they are Etsy’s customers.
Originally, Etsy was designed exactly for handmade products, for artisans who continuously create new boutique products in small batches kind of like for craft makers to take their headache away of having to create their own website. To make it easy for them to sell online.
Customers who go to local markets or visit Etsy, know that they are supporting a small local business and that’s part of the experience. So Etsy as well as local markets attract a specific type of crowd as well and therefore there is one super important thing.
The important thing is that whilst Etsy brings the crowd to the market where you’re participating, which is great because, in this way they’re essentially promoting your business, they’re bringing the crowds and promoting everybody else's business as well.
And so when you search on Etsy for your products, you’ll be seeing all of the stores that are selling those products just like you are. So whilst each of them is going to be a little bit different, there is always going be competition next to you selling something similar to what you’re selling.
On top of that, it's not really that easy for you to have a relationship with your customers and build brands and customer loyalty because remember, Etsy brings the crowd and the crowd has a relationship with Etsy, not with you.
How Shopify Works
Now Shopify, on the other hand, it's kind of like that a store inside a shopping mall. It can take more effort to set it up initially, but it’s not going to get shut down just because the weather is bad or because the market organizers decided not to open the market this weekend.
Imagine that you’ve secured a physical store space from Shopify and they have also given you the fit-out of the store with it. It's kind of like Shopify has given you the checkout, the shelves, the whole experience with frills. You’re leasing the space, but the store is completely yours. If you choose to move locations, you’ve got the brand and the business with it.
It's a beautiful store, however, be careful, you are responsible to bring people in. With Shopify, you’ve got more independence, but it also brings responsibility with it. It's kind of like a standalone shop where you decide what part of town you want to have the store in and how to incentivize people to visit. The Shopify platform is not going to do that for you just like a landlord of a physical store wouldn’t do that for you.
The good news is that it's your store, you’re independent, you’ve got a business and a brand outside of your Shopify ‘space‘ and it’s your own ecosystem which means that you have a direct relationship with a customer. You’re not just a seller, you are a brand.
So with Shopify, once you have a visitor who came to your store, they are all yours. And your eCommerce business is not competing with anybody else side by side who might also be selling similar products to you. They just come to your store and they may as well buy all of the products that you've got.
2. Decision time! Are your products mostly the same or are they custom-made?
So the next thing you must consider is the actual fulfilment of your products and orders and how Shopify and Etsy are different.
If you are refilling the same stock, then Shopify could be better for you
If you produce more of the same products or at least you are planning to sell at least a few thousand dollars worth of each product, then Shopify could be better for you because you essentially crate your store, your collections, specify how much stock you have and it doesn’t require that much maintenance.
Also, not all people in the eCommerce business make their own products and some won’t even hold them in stock and just source them on demands from a third party. So if that's you, then Shopify could be better for you because you can automatically send the orders to your suppliers without actually having to do that manually.
If you’re creating custom products, then Etsy could be better for you
Etsy on the other hand, was originally designed for handmade boutique products that are typically in the single digits. You can of course sell more of one specific product but Etsy just hasn’t been designed for brand building and repeatable sales of the same product as it doesn’t have the right features for it.
However, what Etsy is really great at is specifically that artisan boutique handmade products. If you always create new products that are different to the product you've made before, like a little bit more artistic and every single product is a little bit different, then Shopify is not very good for you because you would constantly need to create a new product listing and in that case, you might want to go with Etsy instead.
3. Understanding the Shopify vs Etsy fees is something to consider
Shopify or Etsy which one has better fees for you and gives you a better return on investment?
Shopify Fee Structure
In very basic terms, for Shopify, you pay a monthly flat fee and a smaller fee for every transaction you make and you can pretty much create the store the way you want it and include as many products as you want. Just like if it was a physical shop and it’s up to you how many products you put inside.
Etsy Fee Structure
For Etsy, the fees seem a little more complicated because it’s a long text article and you have to read between the lines to understand the pricing model. Essentially, you pay a small fee for each product in every listing and once that product sells you then pay a listing fee for the next product in line. On top of that, you pay a higher fee for every transaction.
Shopify vs. Etsy Fees compared
To put this into other words, the more products you sell on Shopify essentially the lower the overall fees will be per product and the higher the fees will become on Etsy because there’s a significantly higher transaction fee for each product.
However, if you’re not planning on selling many products and you want to keep your costs low, Etsy is actually really good because if you have multiple quantities of the same item, the initial listing will be 20 cents. And then the listing will be automatically renewed and another 20 cents after each of the items sells.
So if you, for example, have 20 of the same products and you're going to list all of the 20, you are only going to pay for one to start with. But the transaction fee on each sale will be 6.5%. So again, to summarize both with Shopify, you pay more upfront with Etsy, and you pay more from your transactions.
So if you are really strapped for cash and you just want to start listing your product, Etsy might be better for you. However, if you want to build a brand that is also resalable in the future and you have that consistency and you want to be able to influence how your store looks and you want to make sure that you've got different apps in there that are giving in a certain feel or an experience, and you have that loyalty with your customers, then Shopify could be better for you.
Your eCommerce business needs buyers
Whether you’re using Shopify or Etsy though, if you’re serious about your business, the thing that really matters is bringing the right traffic to your eCommerce store.
You can either pay to advertise on Facebook or other social media platforms and bring your ideal customers to your store.
The other option is to learn how to bring traffic to your store for free. If you’re just starting out with your eCommerce business, I personally would learn how to bring traffic for free to start with.
Now that you’re clear on what’s the difference between Shopify and Etsy, it’s time to build your business and actually make an income. If you want to learn more about how to get more people to buy your wonderful product, just head over to our Traffic Ninjas YouTube channel for more great info.
Silvia Myers, Executive Contributor Brainz Magazine Silvia Myers is co-founder of Traffic Ninjas, teaching product makers and brand builders how to sell their incredible products online without having to discount or spend their hard-earned cash on things that don’t work.
Together with her husband and co-founder, Kristen, Traffic Ninjas equip eCommerce stores with an underground Ninja method specifically designed for small business owners, teaching them how to be profitable and sustainable and actually earn an income from selling their products.
The Traffic Ninjas community has grown from Sydney, Australia to 35+ countries around the world with small business owners achieving amazing results.
