Taking Etsy Steps Toward Success

CHICAGO (MainStreet) -- Microbusinesses are a hot topic in discussions of Third World economies, but many of us overlook thriving examples of small-scale entrepreneurship closer to home.

Just as eBay(EBAY) created a new kind of marketplace -- and allowed those outside the traditional retail world, such stay-at-home moms and retirees, to bring in new income -- the craft-focused site Etsy has created its own commercial niche. The site's huge range of sellers and buyers, all of whom share a love for handcrafted pieces and/or vintage style, prove there is a market for unique items that can't be found at the local dollar store.

The craft-focused Web site Etsy has created its own commercial niche among people who love the homemade and vintage.

First, some background. Started in 2005, Etsy was created as an online marketplace for designers and craftspeople to sell directly to the public. Unlike some other e-commerce sites, it was designed to appeal to design-conscious consumers, with plenty of soothing white space and no glaring colors or flashy fonts.

To maintain the site's integrity and vision, products sold on Etsy must fall into one of three categories: homemade, vintage or crafting supplies (such as fabric, buttons or yarn). Would-be sellers must first set up an online "shop," then pay 20 cents to list an item for four months, plus a 3.5% transaction fee for each item sold.

The plus for sellers is that Etsy takes on the burden of setting up a Web presence. (Let's be honest: Most creative types would rather be sewing or painting than learning the ins and outs of HTML.) A jewelry designer or potter can create a site quickly using the Etsy template, then have Etsy process their payments as well. Joining Etsy also gives sellers access to the site's devoted fan base, with a built-in community of fellow artists and crafters who interact online.

In September, the site reached a milestone of 1 billion page views. More than 2.3 million items were sold during the month, up 45% from the same period a year ago; total dollar sales were up 75% from a year ago.