So you’ve started your Etsy shop. You have created your first listing and now what? Do you have a growth strategy to help you reach your dreams?
Is the sound of crickets all you hear rather than the sound of cha-ching?
If you want to know where to put your effort to get the highest return, then follow this growth strategy to get you back on track.
I’ve developed a growth strategy that incorporates a 5 stage process to identify where you are on your Etsy journey. Once you know what stage you are at, you can try some of the tried and tested actions appropriate for that stage.
This means looking at your Etsy statistics.
Yes I know, the boring numbers!!
I know you might want to stab pins in your eyes rather than work out what all those numbers mean, but they really do help!
Here is a post about some of the useful statistics are.
Define your goals
Before you start looking at any statistics, you need to define what your goals are for your Etsy shop. Only once you know your goals can you know what to work on.
Just to state the obvious – the business targets for a side hustle compared to something that will give you a full-time income are two different things.
Yes, we all might want to earn £10k a month. But realistically, if it is just you working on and in the business, you are not likely to get £10k in your first year. Maybe never! The same is true if you can only work evening and weekends.
A generous dose of realism is also required when you first start. You may want to earn a full-time income, but you are unlikely to get there right off the starting blocks. Unless you are incredibly lucky, it is probably going to be a bit of a slow burner until you learn the ropes and work out what works for you.
Your goals should reflect what you think is realistic for you to manage, create, ship, etc. with the time you have available.
Taking it slow and steady will help you create routines and enjoyable processes. This will set you up for whatever Etsy throws at you. Meaning that every time Etsy makes a change, you won’t have a full-on panic leading to burnout.
So what goals do you need to think about?
- Firstly what revenue would you like to make each month? For ease, base this on the Revenue from Etsy. This Revenue value includes taxes and fees. It isn’t the amount you actually take home, so make sure you add roughly a further 20% on to cover the taxes and fees. This won’t be exact, but it will get you nearer to what you will actually get paid into your bank. Obviously, if you know your full profit figures use those.
- What are the regular expenses that you know about? Knowing what you have to pay out to keep your business running is vital. You will need to meet these costs as a minimum to keep yourself in profit. This doesn’t need to include your material costs, labour, etc. as you should already have these covered in the pricing of your product.
- What is the average price of your listings? If you have products at various price points, it is useful to know what the average amount you are hoping to make. This indicator helps work out the average revenue you earn per order.
Using these figures, and your target conversion rate, you can calculate how many visits you need to generate your revenue goal.
Visits = (number of orders/conversion rate) x 100
Getting visits is key to making sales as if no one sees your products, no one will buy them. Yet if your product is already selling then getting it in front of more people will create more sales.
Now you have your goals, it’s time to follow my growth strategy. Taking the appropriate action at the right time will minimise your effort to maximise your revenue.
This strategy involves following the process flow below:
It also uses the statistics that we have previously discussed here.
Stage 1 – Are you getting less than 25% of your targeted visits?
Until you exceed 25% of your target visits, your focus should be to get more visits (traffic) to your shop.
Here are some actions you can take to increase your traffic:
- Work on your SEO. Improving your SEO will see you placed higher in Etsy searches, which will result in more visits. Be careful not to use the same keywords for all your listings as you will end up competing with yourself.
- Add more listings. Adding more listings means that Etsy has more opportunities to find you. Etsy has millions of products in its marketplace. If you have only one listing, Etsy can only see you for that one listing. It’s a bit like looking for a needle in a haystack. If you have many listings, then you are effectively increasing your market share. If you can’t create many products, create new listings for the same products but use them as a testbed to play with keywords and image styles. Maybe you have the same product but in different colours, or styles. Spilt them out to increase your listings. Increasing the number of listings gives people more opportunities to find you, which in turn can help you get more visits.
Stage 2 – You have a reasonable amount of visits, but you are still not getting sales for your products?
Once you have the traffic, you need to make sure your listings are good enough quality to get sales. Your focus at this point should be on the quality of your listings to improve your Conversion Rate.
Improving your listings will make it easier for the visitors you ARE getting to want to buy your items.
Here are some actions you can take to improve your conversion rate:
- Always make sure your images are the best they can be. You need to be better than your competition.
- Write better descriptions, making sure you answer any possible questions. Tune in to the benefits your customer will get by buying your product.
- Make sure your pricing, processing times and shipping costs are appropriate.
- Make sure you don’t direct people to your products who have no intention of buying them.
You can find more information about the importance of your conversion rate here. It also provides more suggestions for improving your conversion rate.
Stage 3 – You have a reasonable amount of visits, and your products are selling well. Is your revenue per order what you hoped?
Once you are getting a reasonable amount of traffic AND you know your items sell, it is useful to check your revenue per order. Is this meeting your target?
If you are getting less than your target, then you should investigate why this is and try to increase your average revenue per order.
Here are some actions you can take to try and increase your revenue per order:
- Promote and market your higher value items more
- Create higher value listings
- Increase the price of the lower-priced products that are currently selling well
- Bundle up some of your products together. This gives the customer a good deal, and you get more spend.
- If you sell your products in packs, try increasing or decreasing the number in a package. If you price this right, then you can see what works best for your customer.
Try a combination of any of these tactics to try and increase the amount of money spent per order.
Stage 4 – You are getting a reasonable number of visits. Your products sell at a reasonable rate, and your revenue per order is on target. Are hitting your revenue target?
If everything else is working, but you are still not hitting your revenue target, then you need to figure out why.
This could be because you are also not hitting the number of visits you need to bring in your target revenue.
Your focus here is to get more visits to your listings, i.e. get more traffic.
Here are some actions you can take to try and increase your visit numbers:
- Concentrate more on marketing and promoting your shop and its listings
- Add some new listings
- Review your most visited listings and see which ones are NOT selling well, i.e. they have a LOW conversion rate. These listings are already getting a fair amount of visits which means your SEO is good. If you can improve the listing quality (images, descriptions, etc.), then you should enhance their sales.
- Review your least visited listings and see which ones are selling well, i.e. they have a HIGH conversion rate. These listings are selling well even though they are only getting a few visits. So if you can increase the number of visits they get, the sales should also increase. This means working on the SEO of these listings.
Stage 5 – Are meeting your revenue target?
At the moment, you are on track to reach your yearly revenue target.
If you are only partway through the year, then you are not there yet. So don’t lose focus now.
Unfortunately, trends and popular keywords change. Even your competition can increase.
Listings that were doing well can suddenly bomb through no fault of your own.
Make sure you work consistently on your marketing, add new listings or work on the SEO of poorly performing listings.
Keeping on top of these activities are vital to make sure you stay on track.
At the end of the year, it’s time to review your goals. The growth strategy doesn’t change but your goals might.
If you met your targets, why not increase your goals, you are clearly doing something right!!
By increasing your goals, it may take you back to a previous stage in the growth strategy. But don’t worry, just work on the actions and you will soon get to your new goal.
We have created the Etsy Shop Statistics Tracker to help you make this growth strategy work for you. It takes the effort out of what needs working on. You simply enter your monthly stats, and it tells you where you are and what needs doing. It even tries to take the effort out of checking the performance of your individual listings.
Don’t feel that the actions described in the above stages are only worth doing if you are at that stage. You could do any of the above activities at any point. But this process has been developed to help you focus on what is the best thing to do based on where you are. But every business is different.
Adding new listings, looking at your SEO and promoting your existing products is never wasted effort.
But if you have only got a limited time to work on your shop, concentrate on the actions for the step you are currently at. This will give you the best bang for your buck.
Please let me know how you get on.