Etsy Plans to Raise Seller Fees and Invest More in Attracting Buyers

June 14, 2018, 2:40 PM UTC

Etsy will soon be raising its seller fees as a means of investing more into attracting buyers to its online marketplace, as well as creating new seller tools.

The handmade goods site announced on Thursday that it will be raising the transaction fee on sales from 3.5% to 5%, effective July 16. In order to discourage sellers from hiding their pricing with low prices and high shipping costs, Etsy also stated that the transaction fee will now apply to shipping costs.

“We plan to invest more in bringing buyers to the platform, building tools that make it easier for sellers like you to run your shops, and providing the support you need to grow. To help make this happen, we’re updating our transaction fee,” Etsy wrote in the announcement.

Etsy stated that part of the new seller tools will come in the form of optional monthly packages designed to “jump-start growth and express your brand.” The “Plus” package will cost sellers $10 per month, while pricing for the “Premium” package has yet to be announced.

As for attracting buyers, Etsy revealed that it invested $78 million in marketing throughout 2017 — the most it had ever spent — and plans to invest more than $110 million in marketing in 2018.

In 2017, Etsy cut costs and streamlined its workforce by eliminating more than 20% of its employees.