My take on Etsy's Free Shipping Guarantee, final part - Why I Turned it Off

In the last few posts we've talked about the pros and cons of Etsy's Free shipping guarantee (TLDR version: it's a good thing and you should try to price to accommodate it.) but I'd like to end with a post sending some questions out there. I've emailed Etsy a couple of times but have never heard back, so I'll just get these thoughts out here and hope they'll be resolved in the future.

Again, let me emphasize, I love the fact that Etsy is urging us to think about offering free shipping. It bugs me when someone thinks Etsy is "forcing" shops to offer free shipping ("pushing free shipping off on shop owners" is another term I've heard. Ugh, c'mon people!) or that it's "unfair" of Etsy to place shops with free shipping higher in the search ranking. We don't get mad when Amazon or other online stores do the same thing because it's convenient for us as shoppers. Why not make it as easy for your customers to find you and buy from you?

Anyway. Onward before I digress all the way back to the first post.

In the last post I ended by mentioning that I turned off Etsy's Free Shipping Guarantee for my shop.

There is one thing that bugs me about the Free Shipping Guarantee, and that's the lack of customizations available. I'll describe my problem:

My minimum purchase amount for free shipping varies depending on the time of year and whether I have special packaging (so things don't get melty). Right now I offer free shipping on all purchases over $15. That might go up or down in the future, but I love having the freedom to change it myself.

Etsy's Free Shipping Guarantee doesn't allow this. The minimum is set at $35 and you can't lower it. (When Etsy set up a survey about this before they implemented free shipping I even suggested a nifty slider bar. I'm so disappointed that it didn't happen.)

In my case, I have to offer free shipping using a sale or coupon. Etsy doesn't recognize this as a free shipping offer- only items that are already free to ship are eligible to be higher in the search rankings. And what's worse, I can't have the free shipping guarantee on and have my own coupon for free shipping at a lower minimum. The free shipping coupon doesn't apply to items with a free shipping guarantee. 

In short, my free shipping offer is better than most offered on Etsy but I don't get the search ranking perk. Not placing high up in the search rankings for opting out of the guarantee is definitely not a punishment. But not placing in the search rankings because you have a better shipping guarantee than Etsy that just isn't accommodated by their setup kinda feels like an oversight at the very least.

I've asked people to explain and nobody has been able to help me understand the logic behind the locked $35 minimum. Is it because of Amazon's minimum? Then why lock it at $35? Are they worried that shop owners would expect a higher ranking in the search if their shipping has a lower minimum and that seems too complicated? 

Maybe they just didn't like the slider bar idea.

(Pshhh, impossible! LOL!)

In any case, I really hope Etsy allows us to customize our free shipping offers in the future. Until then, I'm going to make it my goal to improve my SEO, photos, and marketing, including building my email list instead.

Have you already implemented free shipping, or are you making different improvements to drive traffic to your Etsy shop?

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Etsy's Free Shipping Guarantee, part 3 - Things to consider

Happy October! :-) To recap- in parts one and two  we've already discussed why Etsy offering free shipping is a good thing and why we shouldn't panic if we decide not to turn it on. Today I'd like to chat about two points that are closely related to the issue of free shipping (aka, if you have a product based business, these two points should be considered even if you're not on Etsy.).

Want to offer free shipping? Don't feel like you can? Two things that should be on people's minds since Etsy has us all thinking about it:

1. Etsy's introducing free shipping should be a reminder for all of us to check our pricing.

You are checking your pricing at least once a year

... right? Experts suggest checking your pricing every quarter or even once a month. But pretty much every day I see posts from people who set a price arbitrarily and/or have never recalculated their pricing.

Sad fact: most handmade businesses underprice. 

Maybe they use the "materials plus labor times 2 equals wholesale, double that for retail" pricing formula alone, or maybe they have based their pricing on someone else's pricing, or maybe they started out pricing low due to their local economy. Then they keep telling themselves "I can't charge any higher, people won't pay it, I'll lose my customers", etc.

If you are a maker and you don't feel you can ever offer free shipping, there's a good chance your overall pricing is too low. The cost of materials, overhead, and the cost of living goes up daily, yet a lot of us think we have to keep our prices the same for years, sometimes even decades, to be "fair".

"I can't ever change my pricing" is a myth that kills a lot of businesses.

When relatively small things like Etsy's program for free shipping over $35 come along and people freak out because their business just can't support it, their pricing is possibly to blame. 

Here's an easy-read book recommendation: "Pricing For Profit" by Kendra Cote. It's for bath and body product makers mainly, but the principles apply to any business and it will completely change the way you think about, and calculate, your pricing.

But wait... *fake shocked gasp* Is it ethical to tell people their shipping is free while they're basically still paying for it in your pricing? I've come across this issue a few times in recent months. This leads me to #2...

2. If you check your pricing and decide to turn on Etsy's free shipping guarantee, you aren't ethically obligated to eat the entire shipping cost!

Why does this come up? There has been some debate about the term "free shipping" and some business owners have a really negative feeling about it: "If it's free, the customer should not pay even one cent for it. I have to pay it." If you feel that way, it can still work! Especially with Etsy's reasonable baseline of free shipping after a $35 purchase.

When I decided to offer free shipping over a certain purchase amount I changed my packaging a little and found a faster way of doing a few things in other areas. I had already raised prices previously (to actually pay myself for the first time in ten years, don't get me started on that story...) so free shipping fit into my pricing with very few changes.

If you feel the need to pay shipping instead of spreading the estimated price out over several items, don't be tempted to just pay the shipping out of pocket. See if you can make your supply and materials costs, labor costs, or overhead percentage stretch just a little more to help cover it. 

If you are thinking of raising your pricing to help accommodate Etsy's Free Shipping Guarantee, (or if you'd like to offer free shipping even if you're not on Etsy) don't feel guilty that you're not paying out of pocket for shipping. Buyers don't mind that we don't justify how we break down our pricing. When was the last time you walked into the store and demanded to know why their prices went up, or for a breakdown of their costs? No sane person does this... yet many business owners worry constantly that they must justify their pricing or explain how they can offer free shipping. This can cause pricing paralysis, stopping you from ever raising prices. (aka, slowly killing your business.)

"Free shipping" conveys to shoppers "shipping is included in the price you see up front". In other words, no matter how much they purchase, they won't get to their shopping cart and find an unexpected astronomical shipping cost on top of what they're already spending. (Cart abandonment comes from this more times than any other factor.)

Here's something to think about: Whenever a company (big or small) offers you free shipping, your shipping has been factored into the costs you pay. Did they raise prices a little over their whole product line? Did they find one or more of their raw materials at a better price? Did they skimp a little on quality to make up the cost? Since companies never disclose to us how they price their products, we never know- but most of us would agree that we'd prefer the first or second option. It's okay to do the same in our businesses. (Just stay far away from option three, amiright?)

Okay, so now that we've talked a bit about the financial and ethical side of Etsy's Free Shipping Guarantee, and you have seen how happy I am with the idea, the final topic might come as a surprise:

Why I turned it off for my shop!

Talk with you again soon!

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Etsy's Free Shipping Guarantee series, part 2 - aka, "Things Everybody Should be Working On Anyway"

We last chatted about why Etsy offering free shipping is a good thing. Now let's discuss two reasons why you don't have to worry about the Free Shipping Guarantee ruining your Etsy sales.

1. You don't have to turn in on. How is this a good thing? If you look over your pricing and decide it's not going to be feasible, no problem! Etsy hasn't made it mandatory. You're not going to be penalized for not turning it on. (Before you say anything about the search rankings, wait for #2.) Free shipping is a good offer as a rule, but there are always exceptions- if you've got larger items or heavy items, or items that have to be packed and shipped with extra care, free shipping might just not be possible. That's fine too! Because...

2. A higher place in Etsy's search rankings does not necessarily guarantee one shop will make sales over another. If someone lands on Etsy looking for something handmade, they are not going to arbitrarily buy the first thing on the search page. 

They'll be searching using the same method anyone uses anywhere else- search, narrow their search to something more specific, narrow their search again, then look for a brand and shop they feel fits, then choose a specific item. This is a pattern most people follow when they're shopping, even if they think they're just browsing.

It's true, as I type this Etsy is causing another frenzy with the news that you might not be on the first page at all if you don't offer free shipping, and "oh-btw-83%-buy-from-page-1". Please don't panic! Most of the people who find you will find you because of your overall marketing strategy, not through Etsy search alone.

While it would be nice to be the first thing they see on a search page, there are a lot of factors at work in getting your products noticed.

Here's one: People will see your photography before they really notice where your item sits in the search rankings. Do you have a good grasp of who your target market is? Are your photos designed to catch the eye of your target market? (I'm guilty of boring, unbranded, untargeted, photos. Working on it!)

Here's another: Have you worked on refining your SEO or are you still using random tags for your items? That has an effect on where your items fall in the search results.

And one I mentioned already, are you marketing your products well on the platforms your target market is on and keeping in contact with your email list, or are you sticking only to the platforms you feel comfortable with and neglecting the people who want you to keep in touch with them? (I'll admit, I'm sooooo guilty here too. *hides face*)

In conclusion... the good news: While being higher in the search rankings is a nice bonus, it shouldn't be what any seller pins their hopes on to get sales. Whether you decide to use Etsy's Free Shipping Guarantee or not, working on your target market, clear branding, and marketing, will put you ahead of many of the sellers on Etsy. (For example, when someone finds me, it's usually through Instagram or Pinterest, not the Etsy search. My "people" are also on YouTube, which for most Etsy sellers is a completely untapped resource!)

Next time, we'll chat about things to consider whether or not you decide to use the Free Shipping Guarantee.

In the meantime, let me know what aspect of your marketing strategy you're trying to improve on...

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My take on Etsy's Free Shipping Guarantee, part 1 - It Really Will Be OK!

It's been a while since Etsy introduced this new program but there is still a lot of division in the camp about it. Popular bloggers and YouTubers have panned the idea in very strong terms, and nearly every day I see angry comments on social media where someone thinks it's unfair, honestly believes that Etsy is trying to kill their business, or has decided to leave Etsy and try and sell on another platform.

I'm going to take the next few posts to discuss a few positive points about Etsy's free shipping guarantee, including some things to keep in mind whether you turn in on for your shop or not.

I have to admit that the negative response in many places was a surprise to me! My first feeling when I heard about the Guarantee was excitement. Offering free shipping is a win for many businesses- studies have been done that show, oddly enough, that more people are more likely to buy more items when a shop offers free shipping. For example, you're on Amazon looking for something and choose a $25 item with free shipping over exactly the same item where the price is $20 plus $4.99 shipping. Or you're buying online and spend $10 extra so you don't have to pay that pesky $5 shipping fee. It doesn't seem to make sense, yet most of us have done it!

Etsy getting onboard with offering free shipping is a good thing for Etsy sellers. Etsy wants more people to buy more things from more small businesses.

I have a feeling Etsy urges free shipping to get more people to come to the website and shop, instead of shopping through Handmade on Amazon or finding a brand through a web search. Etsy wants to be THE place to get all things handmade, so they're helping us sellers stay competitive with these other sites. They've added the incentive of placing items with free shipping higher in the search rankings, but this shouldn't worry you if you decide not to turn the guarantee on. (More on that in the coming days.)

Stick with me over the next few posts while I talk all things free shipping. 

(And let me know in the comments if you're one of the many who will spend $10 extra not to have to pay $5 shipping!)

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