Do you have products that would be a good fit for Etsy and also on a standalone eCommerce shop?
Are you trying to choose one platform over the other?
Depending on where you are in your eCommerce journey, the choice could be one over the other, and sometimes it can be both. Each ecommerce platform offers different benefits for small businesses, and understanding the key differences is crucial for long-term success.
In this post, we’ll go over the differences between Etsy and Shopify for online stores, when you should use one platform over the other, and also the times it makes sense to utilize both platforms.
Software vs. Marketplace
The first thing to know: Shopify is software to help you build your eCommerce store, and Etsy is a marketplace for selling handmade products. Etsy offers a built-in audience, while a Shopify store provides full control over your online business and branding.
That means your Shopify store is an eCommerce site like any other out there (including Amazon, Walmart, Nike, and all other sites that sell products), while Etsy is a marketplace where you sell your individual items on the platform to an existing customer base. Selling on Etsy allows new entrepreneurs to start quickly with lower upfront costs and access to potential customers browsing vintage items and craft supplies.
Costs: Etsy vs Shopify
Running your business on each site has its own unique pricing structure. Since Etsy and Shopify both function as the back-end of your business, they will process credit card payments for a fee and will charge in different ways for you to host your product listings.
Shopify’s Costs
- Listing products: $29 per month starting
- Transaction fees: No transaction fees
- Credit card payment processing fees: 2.9% + $0.30 per transaction
- Other costs: Apps to boost the functionality of your store can cost upfront $ or require a monthly subscription.
Etsy’s Costs
- Listing Products: $0.20 per product listing fee… also an “Etsy Plus” option for long-term sellers to avoid some product listing fees– $10 per month.
- Transaction fees: 6.5% of every product sold
- Credit Card payment processing fees: 3% + $0.25 per transaction
- Other costs: 15% of a transaction if an ad run by Etsy leads to your product being purchased
Etsy really charges for the privilege of granting you access to their customer base, and will even charge you a whopping 15% if they attribute a sale on your store to one of their advertising campaigns.
So in the end, if you’re worried about costs being a sustainability factor for your business, Shopify is the clear winner here.
With no listing fees and better scalability, Shopify offers better value for businesses planning to grow.
Winner based on cost structure: Shopify;
Flexibility of Each Platform
Shopify is software to help you sell whatever product you may want to sell. As long as it’s not illegal to sell, it’s fair game to sell on your Shopify store. You can even integrate dropshipping or print on demand with Shopify using user-friendly templates and plugins.
Etsy, however, is a marketplace that focuses on selling “handmade” products, so if the products you sell don’t fit in their guidelines, then you can’t sell it.
Also, marketplaces like Etsy and Amazon tend to have a lot of rules that are always changing and are very picky about what kind of products you can and can’t sell, what words you use, and how you display your products to potential buyers. While Etsy provides ease of use for beginners, its strict policies can limit your ability to scale or expand your product line.
You are essentially always at risk of having your listings, or even your entire store, taken down at any time when you sell at a marketplace, whether the reason for being punished is your fault or not. This lack of control makes marketplaces risky for small businesses trying to build a stable online presence and long-term brand through customized storefronts and consistent customer support.
Also, marketplaces typically have a “punish first, figure it out later” approach to dealing with their sellers, which can be absolutely catastrophic for your business. For entrepreneurs relying on consistent cash flow and reliable ecommerce platforms, sudden suspensions can disrupt inventory management, customer communication, and overall business operations.
If you are worried about restrictions and being able to sell what you want, brand how you want, and hate the idea of having your listings shut down arbitrarily, you should definitely stick with Shopify. With Shopify, you own your domain, manage your SEO, and have full control over your online presence and inventory management.
Winner on flexibility: Shopify.
Starting Your Business: Etsy or Shopify?
When starting your business, this is a time when choosing between Shopify or Etsy actually matters and you should choose one to focus on over the other.
Sure, you can expand to more selling channels later, but spreading yourself thin too early is not a great idea.
In general, marketplaces are much easier places to start businesses. This is because there is an already existing large audience that converts well. Etsy’s built-in traffic makes it ideal for new sellers without the resources for a full marketing campaign or SEO strategy.
Also, in marketplaces, it’s possible to start a business with a smaller set of launch products (as low as one), while in a traditional eCommerce store your potential customers might expect a more fleshed-out product line. Etsy shops are especially appealing to creators of unique or niche handmade goods who are testing the waters.
Beginning your eCommerce business on a marketplace can also be a faster way to get things set up so you can focus on marketing and product development. Marketplaces tend to have simple product listing creators, they will handle transactions and checkout, and they will even send purchased sales straight to your account. These back-end tasks take a lot of time and oversight, which is another plus for marketplaces when starting out.
The only reason you should really start on Shopify is that you really want to and don’t like the idea of marketplaces. Shopify also benefits entrepreneurs who already have a community from social media, email marketing, or in-person selling.
Winner for which platform to start your business: Etsy
Which Platform to Sell On Long-term?
Since Shopify is for creating your own standalone eCommerce shop, and Etsy is a marketplace whose customers you would not have access to unless you list your products on their site, it is entirely possible and even beneficial, to sell your products on both platforms (if you can). Using a multichannel strategy can help you diversify your traffic and boost your brand’s visibility.
If you started on Etsy and your product catalog is getting large enough and your products are popular enough to start selling on your own, you can totally expand into a Shopify store to start building your brand outside of a confined marketplace.
If you started on Shopify, you can easily create listings on Etsy (or even Amazon) to expand your product line to a group of people who may have never seen your products otherwise. Listing your bestsellers on Etsy gives you a chance to tap into its massive buyer base and drive traffic back to your own website . One thing a lot of Shopify-only sellers don’t realize is that if they abstain from selling on Amazon or Etsy because they don’t see the value in it, someone else will piggyback off the branding built up for those products and take those easy sales.
At the end of the day, the answer to this question is much like anything in eCommerce: It depends.
It depends on your product mix, the type of product you sell, its category, how specialized it is, how niche it is, and how passionate the community behind it is. Some businesses thrive in online marketplaces, while others succeed with a standalone store where they have full customization and control. Knowing this information will let you know if you need to stick to one channel to sell, you should build a brand, you should go omnichannel, and you should expand your product line or boost the sales of your existing products.
Look at what you’re selling and see all the possible options out there, create a business plan, then execute that plan and grow your business!
FAQ:
Q: Should I sell on Etsy or Shopify?
A: It depends on your business goals. Etsy is a great place to start if you sell handmade, vintage items, or craft supplies and want access to a built-in audience. Shopify is ideal if you want to build a standalone online store with full control over your branding, product listings, and customer experience. Many successful sellers eventually use both platforms to grow their reach.
Q: Which is cheaper, Etsy or Shopify?
A: Shopify has a fixed monthly fee starting at $29 but lower transaction fees. Etsy charges per product listing, a 6.5% transaction fee, and additional fees if your sale is from an Etsy ad. Over time, Shopify tends to be more cost-effective for scaling a business, especially if you’re investing in SEO and marketing tools.
Q: Can I use both Etsy and Shopify at the same time?
A: Yes! Using a multichannel strategy allows you to leverage Etsy’s built-in customer base while also building your own Shopify store. Many sellers use Shopify for branding and SEO while keeping a presence on Etsy to increase product visibility.
Q: Is Shopify good for beginners?
A: While Shopify requires a bit more setup, it offers user-friendly templates, POS options, and access to the Shopify App Store for tools like inventory management, email marketing, and SEO optimization. Beginners who want more control over their ecommerce business often prefer starting with Shopify.
Q: What are the key differences between Etsy and Shopify?
A: Etsy is an online marketplace with an existing audience but limited customization and control. Shopify is a comprehensive ecommerce platform that lets you build your own storefront, use your own domain, and implement advanced customization options. Etsy is easier to launch on quickly, but Shopify offers more long-term scalability.
Q: Will my Etsy listings get traffic automatically?
A: Etsy provides some built-in traffic thanks to its marketplace structure, but competition is fierce. You may need to invest in Etsy ads, improve your SEO, and use social media to drive more traffic to your Etsy shop.
Q: Do I need technical skills to use Shopify?
A: No. Shopify is built for ease of use, offering intuitive templates and drag-and-drop functionality. You don’t need coding skills, and there are plenty of tutorials and community forums to help you get started.
Q: Is Etsy or Shopify better for SEO?
A: Shopify gives you full control over SEO tools like meta tags, page titles, and URLs. Etsy has limited SEO capabilities because you’re working within their ecosystem. If driving traffic through search engines is a priority, Shopify is the better option.
