Let’s talk about the latest Etsy announcement about free shipping.
I’m going to quote from the email that went out, with my responses below, then discuss some further implications. All of the quotes are from Josh Silverman, Etsy CEO, July 9, 2019.
“Starting on 30th July 2019, we’ll give priority placement in US search results to items that deliver for free and to shops that guarantee free delivery to US buyers on orders of $35 USD or more.”
The question is – how important will this priority placement be? What will it look like? Will EVERY listing with free shipping rank higher than EVERY listing without it?
Of course, this isn’t really new – Etsy have been telling us since their search update in September 2018 that items with free shipping are getting a boost in search results.
And that’s not all…
“We’ll also begin to prioritise these items wherever Etsy advertises in the US — in email marketing, social media and television ads.”
So, you’re also more likely to have your items feature in Etsy marketing promotions if you offer free US shipping. Not a huge deal day-to-day, but sometimes these marketing features can skyrocket a shop’s success.
“To simplify the process for you, we created a tool that lets you guarantee free delivery to US buyers when they spend $35 USD or more in your shop. The tool will be available in the next week”
We don’t know exactly what this looks like yet – we need to wait and see.
“For shops with items $35 USD or more, we also created a way to bulk edit listings so you can adjust your item prices to recover your postage costs. Keep in mind that how you determine and set prices is up to you. This tool will be available in August and we’ll be sure to update you as soon as it’s ready.”
Would have been nice if they’d made this available BEFORE July 30th, so sellers could have everything updated and ready to go before the change, but at least it’s coming.
“We know that many of you have buyers from countries other than the US. You may want to consider how much of your business comes from the US when deciding if a free delivery guarantee for shoppers based there is right for you.”
Okay, so as an international seller, this stood out to me. The bulk of my buyers are in the US.
Now, I already offer free shipping store-wide, and have for quite a while – but I can afford to, because I ship small, light items.
I suspect that Etsy is going to release a tool that will allow international sellers (well, all sellers, hopefully) to set DIFFERENT prices for the US and elsewhere.
This will allow you to roll your shipping costs into your item price for US buyers, BUT keep the item cost and shipping cost separate for buyers outside of the US.
I have heard on the grapevine that this tool was available to the test group for this change – so that gives me hope that this will be happening, which will ease the minds of a lot of international sellers.
The last thing we international sellers want to do is to have to put international shipping costs into our prices and force our local customers to pay for it!
Let’s talk about a few other issues around ‘free’ shipping.
First – I think it’s important to note that Etsy have confirmed that shipping upgrades are not affected.
So if you – like me – offer free economy shipping, but also offer shipping upgrades (tracking, express etc.) this will still be the way it was, and won’t impact your search ranking.
So long as your default shipping option is free, you’re fine.
Second – let’s talk about competition.
Everyone is in the same boat.
Your competitors have the same issue. Their items are the same weight, size, and shipping cost to you (apart from people in different countries – this is where some people in countries with cheaper shipping may have an advantage).
You (and they) have 2 choices for each product.
1. Change to free shipping and include the price in the item cost.
2. Keep shipping costs separate.
Your (and their) search rankings will be dependent on the choice made. But we ALL have to make the choice – increase our prices and rank higher, or keep the prices separate – and therefore look cheaper in search… if people find us.
But any customer doing a direct comparison of 2 products will work out that the cost is pretty much the same IF you both have similar product costs and shipping costs.
Third – let’s talk about diversification.
You do NOT have to have free shipping on EVERY item in your shop!
The items that you DO offer free shipping on will rank higher for their particular search terms in their particular niche, and get all the benefits listed above.
But – don’t think all or nothing. Yes, Etsy is going to release a tool that:
“…lets you guarantee free delivery to US buyers when they spend $35 USD or more in your shop. The tool will be available in the next week.“
However, from what I’ve read, this tool will simply be a setting you turn on in your shop so that all future listings default to free shipping. That said – I don’t know for sure exactly what this will look like, so we need to wait and see for sure.
Even so – I believe you will still be able to choose which listings are free shipping and which are not, so keep that in mind.
Make your lighter, smaller products free shipping, and keep charging a shipping cost on the larger, heavier ones.
Fourth – returns. If someone wants to return something, will you will have to refund the whole shipping AND postage costs?
This one came up in my Thriver Circle community – and the answer is… yes.
I cannot see any way that you can separate out the costs ‘officially’. However, anyone already offering free shipping has already come to terms with this.
It’s just one of those costs we have to bear. Keep in mind, if you accept returns, this should only happen very, very occasionally, so it shouldn’t put too big a dent in your bottom line – it is a business loss.
This might be a good time to review your returns policy to ensure it’s not TOO generous.
In summary – don’t panic!
This is just another in a long line of changes that Etsy has made in the 10+ years I’ve been selling on the platform – and there will be many more in future.
Most of you WILL be able to find a solution that works – especially if Etsy DO release a tool that allows us to set different product and shipping prices for US and other destinations.
That’s the big fly in the ointment right now for me – and for many of you, no doubt. So let’s hope they make that happen. If they don’t… I’m not going to be impressed.
Because it will impact sellers.
Either you decide to not offer free US shipping and know that US sales will likely drop, or you do, and our customers in other countries may drop a bit due to the increase in price (and, if you’re a seller outside the US, you may as well offer free shipping to all international destinations at this point).
But in that case, it will be our domestic customers (here in Australia, or wherever you sell outside the US) that will suffer the increased costs.
To come back to this quote again: “We know that many of you have buyers from countries other than the US. You may want to consider how much of your business comes from the US when deciding if a free delivery guarantee for shoppers based there is right for you.“
That is – he’s saying to choose the option that will impact the LEAST number of buyers. Do remember, however, that in this quote he’s referencing the new ‘free shipping guarantee’ tool – which we don’t know the details of yet.
Finally, one point I did see a seller make – and that stuck with me – was this.
Is it fair for Etsy to be charging the same fees to all sellers, and then prioritise some over others due to offering free shipping… or not?
Food for thought.
But at the end of the day – Etsy is a publicly listed company, and they’ll make the best decisions they can for their shareholders. That means bringing in more buyers, who purchase more goods.
So they’re going to continue to make changes that make buyers lives easier – which sometimes, makes the lives of us – the sellers – harder.
If you’d like to share your thoughts on this – come on over to this instagram post.
Keep thriving,
Jess x
