Etsy: Empowering Creators and Connecting Buyers with Unique Treasures
Company profile
Company business details
Motivation to build the product
The founders were motivated by the desire to create a platform that supports independent artists and makers, allowing them to sell their unique creations directly to consumers. They recognized the need for a marketplace that values handmade and vintage goods over mass-produced items.Problem that their product solves
Etsy solves the problem of finding unique, handmade, and vintage items that are often unavailable in traditional retail stores. The end users are consumers looking for personalized and distinctive products, particularly for gifting. Solving this problem is important as it supports small businesses and fosters creativity in the marketplace.Their unfair advantage
Etsy's unfair advantage lies in its strong community of independent sellers and buyers who value the uniqueness and personal touch of handmade and vintage products, differentiating it from larger e-commerce platforms.Strategies
Pre-Launch (Product Development & MVP)
Etsy Ads Experimentation
A new strategy involves testing Etsy ads by turning them on and off at specific times to see if it affects sales and spending. The experiment aims to determine if running ads only during peak buying hours can lead to better conversion rates and more efficient use of the advertising budget. This approach allows sellers to gather data on customer behavior and optimize their ad spend accordingly.
Launch Stage
Focus on Core Business
Upon joining Etsy, the new CEO recognized that the company was spreading itself too thin by pursuing numerous new ventures instead of focusing on its core business. He challenged the team to identify the fewest things that would drive sales and emphasized improving the buying experience on Etsy. This led to a significant reorganization where the team was tasked with generating at least $10 million in gross merchandise sales from their initiatives within a year. The CEO also implemented a new org chart to streamline operations, resulting in a fivefold increase in product velocity with 20% fewer employees.
Niche Differentiation
Etsy's CEO, Josh Silverman, emphasized that Etsy is not competing with low-cost platforms like Teemu or Amazon. Instead, they are focusing on becoming the go-to platform for unique, handmade gifts. This strategy involves positioning Etsy as a marketplace that celebrates the individuality of sellers and their products, rather than engaging in a price war. By doing so, Etsy aims to attract customers looking for unique gifts, thereby carving out a distinct niche in the crowded e-commerce space.
Revised Mission Statement
As part of the turnaround strategy, Josh Silverman led an initiative to rewrite Etsy's mission statement to better reflect the company's purpose. He formed a team to gather input from employees about what the mission should encapsulate, ensuring it resonated with the collective aspirations of the organization. The new mission, 'making commerce human,' was designed to be memorable and meaningful, allowing employees to connect their work to a larger purpose. This revision was crucial in aligning the company's culture and goals with its operational strategies.
Growth Stage
Accountability Meetings
The CEO established a monthly metrics meeting for all directors and above, where they would report on their key performance indicators (KPIs) in front of their peers. This meeting was designed to foster accountability and transparency within the leadership team. By requiring leaders to report on their progress, the CEO aimed to create a culture of accountability and ensure that everyone was aligned on the company's goals. This practice not only helped diagnose business performance but also encouraged leaders to take their responsibilities seriously.
Learn more about Etsy
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