7 July 2020 | 10-minute read

Podcast Transcript: An Inside Look at Etsy Ads

Learn how the tool works and get tips on how to build an ad campaign to help you reach your business goals.

Avatar image for Etsy Staff by Etsy Staff
Title image for the article
Want to open your own Etsy shop? Create your shop today!

The following is a transcript of a podcast episode released in July 2020. The transcript has been edited slightly for this format. You can listen to the episode on Apple Podcasts, Spotify, or wherever you get your podcasts.

Tess: Today I’m talking with Arjun Malhotra, who’s a product manager at Etsy. Arjun, can you tell our listeners a little bit about what you do?

Arjun: Yes. I’m a product manager at Etsy which means I work with designers, engineers, researchers – really all kinds of people across the company – to build tools that Etsy sellers can use to grow their business. One of the main tools that we’re working on right now is our on-site advertising platform, Etsy Ads.

Tess: I want to start by talking a bit about what that tool is. What is Etsy Ads and what does it do for sellers?

Arjun: Etsy Ads is an advertising platform designed to make it easy for Etsy shop owners to maximise their traffic on Etsy and help them make more sales by reaching more shoppers. We wanted to take the guesswork out of advertising by using Etsy’s data insights, around which buyers are searching on Etsy, to optimise a seller’s ads. When we talk to sellers about their experience with advertising, they often tell us that it can be really time-consuming and hard to figure out. But with Etsy Ads, we do a lot of the work for you.

Tess: So how exactly does Etsy Ads do this hard work you’re talking about?

Arjun: Across Etsy, we have access to data about what works for advertising campaigns, who the buyers are, and what they’re searching for. So ultimately we can design a really smart campaign that will show your ads in places where buyers are most likely to purchase your items. With Etsy Ads, all you really need to do to start advertising is set a daily budget. We’ll test to see where your ads perform best. Then we promote your listings on Etsy pages to bring the shoppers that are searching for items like yours straight to your shop.

Tess: What about Etsy sellers who haven’t tried advertising before? Why should they consider starting an advertising campaign?

Arjun: So there are millions of shoppers in the world looking for items just like yours. And right now, more than ever, they’re coming to Etsy. But if they can’t find your listings, then you’re kind of out of luck. So the great thing about Etsy Ads is that your ads help you connect directly with shoppers who have entered a search term that matches your listings. That means that they’re already on Etsy looking for items like yours. And those shoppers tend to be the ones that are the most motivated to make a purchase because they’re on a mission to find something really specific. And when you advertise, your listings really stand out because ads are featured especially prominently in the first row of an Etsy search page.

Tess: It sounds like it’s more efficient for both the shopper and the seller. The shopper can find what they’re looking for more quickly, and the seller’s items are shown to more people who are actually interested in their products and less people who aren’t, right?

Arjun: That’s exactly right. Plus by running their own advertising campaigns, sellers can really make the most of Etsy’s brand marketing, including some of our most recent national television commercials. Shoppers may be seeing those commercials for Etsy and then coming here to search for an item to purchase. The great thing is that we’re always committed to bringing even more buyers to Etsy, and Etsy Ads can help those buyers find your shop.

Tess: I’m wondering how this looks for those shoppers. Let’s say someone is watching TV, they see an Etsy commercial, and they decide to log on to Etsy.com. What do shoppers see on their end when a seller is running an Etsy Ads campaign?

Arjun: When a seller is running an Etsy Ads campaign, we take the thumbnail photo, the title, the price, and any other information about their listing– like free delivery or if they’re running a sale or discount – and turn that into an ad on Etsy. It actually looks exactly how the listing would show up on Etsy, but it’s placed in our ads box. Since we want to surface the most relevant ads to our buyers, we pinpoint buyers who are searching for specific items or browsing through themed pages like yours.

Tess: What do you mean when you say themed pages?

Arjun: By that I mean listing pages with similar items to yours, which includes category pages that are relevant to your listings or market pages that are relevant to your listings. Buyers that reach these pages have indicated that they’re already interested in similar items, so we want to make them purchase as much as you do. We try to be as relevant as possible to shoppers. If a shopper likes what they see and clicks on your ad, they’re brought straight to that listing and your shop. Once there, they can easily complete their purchase or explore other items in your shop as well.

Tess: Earlier you mentioned how Etsy Ads connects sellers’ listings with shoppers who have entered a search term that matches their listings. Is there anything else happening on the back end?

Arjun: Yeah, we are using a ton of buyer inputs and data that we know about your listings and the rest of the marketplace to make sure that we’re showing your listing in the most relevant ad spots on Etsy. And, exactly as you said, we look at what the buyer is searching and this means that we’re matching their specific search to your titles and tags. This is one of the main things that we found can predict how likely a buyer is to purchase your listing after they click on your ad.

There are also a bunch of other inputs about the buyer, like what device they’re using or when or where they’re searching, that can help us understand the buyer better and ensure that we’re serving the right ad at the right time. We also factor in details about your specific listings, like price and performance, to show shoppers the ads that they’re most likely to click on and purchase.

Tess: So if a seller is just getting started with Etsy Ads, what should they keep in mind?

Arjun: There are a few things to keep in mind. One is that when you start your campaign, we suggest waiting a few weeks so that enough data can be collected to make informed decisions about how to start optimising your campaign. So my advice is to sit tight and try not to make too many changes in the first month.

Second, the budget that you invest each day controls how many shoppers see your ads. The higher you set your daily budget, the more shoppers see your ads and the faster you’ll start to see results. Think through your advertising goals and try to plan your budget accordingly.

Tess: Can you give an example of how a seller might plan their budget based on their advertising goals?

Arjun: Yeah, let’s walk through an example: I’m a seller on Etsy and my goal is to use Etsy Ads to drive an additional 50 buyers to my shop per day. I check my dashboard and I can see that I typically spend about 20 cents per click on my ads. I would initially set a budget of 10 USD per day. Fifty buyers times 20 cents per click is 10 USD.

That would be 50 more clicks that I’m getting on my ads per day, and across the month that would be about 1,500 more clicks a month. And if my shop’s conversion rate (which you can find by looking at your shop stats page) is 2%, that would mean that from these 1,500 new clicks that I’m getting, I can expect about 2% of them to result in a sale. So that’s 2% times 1,500, which means 30 new orders from Etsy Ads that month.

Tess: And when we talk about planning a budget, we also have to talk about choosing listings to promote because those two decisions are related. What tips do you have about deciding on an advertising budget and choosing which listings to promote?

Arjun: There are a lot of different ways you can think about your budget. If you’re just getting started with advertising, you might want to start by advertising all of your listings, so you can see which items bring you the most traffic. You might need a higher budget during this time to make sure that they’re all getting impressions. For example, if, after 30 days, you see that there’s a particular listing that drives a lot of visits but doesn’t drive a lot of orders, you might want to consider turning it off so that your budget can be reallocated to the ads that are proving to have a better return on that spend.

Tess: That makes sense, especially for sellers who might be newer to Etsy. What about shop owners who already have a sense of which items are their best sellers? What are your recommendations for them?

Arjun: For those types of shops I would recommend thinking about using your budget to send extra traffic to your top performing listings, especially during really busy shopping seasons. For example, searches related to fall or autumn start to pick up in July, then they increase in August, and then they start to peak in September. Say you sell items that are related to autumn, like embroidered shirts that have some patterns with autumn foliage or autumn colours. In order to ensure that those items are seen by these buyers at the beginning of July, you should increase your budget and make sure you’re advertising your autumn-related items.

Tess: Arjun, thank you for joining me on the show. Where can sellers get more information about Etsy Ads?

Arjun: Sellers can check out our Ultimate Guide to Advertising on the Seller Handbook to learn more about developing an advertising strategy and getting started with Etsy Ads. And to set up an Etsy Ads campaign, it’s super easy: Just visit etsy.com/advertising.

Learn how one seller used Etsy Ads to take her business to the next level in our case study with Brie Moore of the Etsy shop Breezy Tee.

Avatar image for Etsy Staff Words by Etsy Staff

Connect with the community

Looking for a place to share questions and spark new conversations?

Join the conversation in the Forums and get inspired

See more

Latest articles

The Ultimate Guide to Pricing

The Ultimate Guide to Pricing

Get the smartest, most up-to-date guidance on developing your pricing strategy to reach new customers, increase profits, and grow your business.

How to Craft a Killer About Section

How to Craft a Killer About Section

Telling the story behind your business can create a connection with customers – and boost your visibility. Learn how Etsy sellers are doing just that.

The Essentials of Online Advertising

The Essentials of Online Advertising

Advertising is one way to help shoppers discover your products. Get to know the basics of online advertising to accelerate your marketing efforts.

Tools for Growing Your Business – and How to Fit Them Into Your Pricing Strategy

Tools for Growing Your Business – and How to Fit Them Into Your Pricing Strategy

Learn how discounts, advertising, and sales events can help support the goals you have for your shop while protecting your bottom line.