The #1 Mistake Etsy Sellers Make (And No One Is Talking About It)

By Scott Voelker •  Updated: 11/11/22 •  8 min read

I've been in the e-commerce world for quite a while now and I keep seeing new sellers making one potentially fatal mistake.

Nowhere is this more pronounced than when I take a look at most Etsy stores.

Let's dive into the number one mistake that I see Etsy sellers making and how to avoid it.

What is the Mistake?

All right, let's jump right into it, the number one mistake that I see Etsy sellers making is that their store does not focus on a niche.

It seems that the topic of what is and isn't a niche can be confusing for people, so I wanted to quickly dive into the ins and outs of what is and is not a niche to help clarify the issue once and for all.

What Isn’t a Niche

Let's start with what is not a niche, since this is where most people seem to go wrong.

Focusing your store around a niche does not mean that you are focusing on launching trendy products or that your store has a single product focus.

One of the most common responses that I've seen to whether Etsy sellers have a niche or not is ” of course I have a niche, I sell mugs.”

Selling just one product, whether it's trendy or can come with a bunch of different sayings on it, is an example of your store being product-focused.

Why It's Wrong

The biggest issue with this product focus is that it leads to your store being entirely too generic.

Although you may get the occasional person that happens to see two of your mugs, one designed for geeks and one designed for athletes, chances are that you will have very little in the way of multiple-item purchases.

Additionally, Etsy has made it very clear that they are shifting away from being purely a search-driven platform and are building in lots of new features designed to favor stores that can create repeat purchases between the same customer and store owner.

Although the Etsy platform is still a bit of a wild west marketplace, those days are ending very quickly, and having a product-focused store will very soon See you left behind.

What Is a Niche

At this point, I know you're screaming at your screen…” but what is a niche then?”

If we look at the dictionary definition, we'll see that a niche is a specialized portion of the market designed for a specific product or service.

That definition is nice and all but it doesn't clarify it for anyone.

I like to think of a niche as something that someone could be interested in or identify as. 

For example, You would never hear (outside of one weird mid-2000s comedy movie) someone identify as a lamp.

You would, however, hear people say that they like contemporary design.

In this case, we could sell a contemporary lamp, along with many other things that have a contemporary design, to that same person.

Another example would be something along the lines of fishing.

You will often hear people say that they like to fish or you may hear them say I am a fisherman.

By thinking about niches in this way, something people are interested in or can identify as it becomes much easier to understand whether or not your store is focused on a single product or a niche interest.

Why Does It Matter

All of the examples and definitions in the world aren't very helpful if it doesn't make a difference to our business.

There are a few key ways in which being niche-focused helps you grow and thrive, especially within the Etsy platform.

The two most obvious reasons are directly related to sales.

If someone comes to your shop, looking for a Father's Day gift for their dad who is a fisherman, and we're able to offer them a mug that has to do with fishing and nothing else, chances are they're not going to take the time to dig around to see if we happen to have any other products that might catch his interest.

On the other hand, if they see that we have a few different fishing-related products, there's a high chance they will not only purchase him the world's greatest fisherman mug, but also a pillow or hat to go along with it.

Additionally, when our store is niche focused, we have the potential benefit of gaining a large number of future sales.

Etsy is rolling out more and more features designed to connect customers with the brands that they love.

The combination of these two things makes it critical that we have multiple products that the same customer may be willing to buy from us in the future.

For example, let's say A new customer favorites your store on Etsy.

Etsy has begun sending notifications to those people for a variety of activities, including sales on your products.

Do you think someone is more likely to dig through your entire catalog of mugs to try to find one that they resonate with or purchase something from your catalog that you know they are already interested in because they purchased from you in the past?

It's almost always the second option.

How do we know they will be interested in the new products that we have on sale?

Because they've already expressed interest in all of the products that we have, by being interested in the thing that is still where is based around… our niche.

Additionally, people are much more likely to recommend stores in a niche to their friends and family.

For example, if you buy something fishing related for your father for Father's Day, chances are that at least one of your siblings, nieces, and or nephews, will ask you where you got it because it fits his personality so perfectly.

If the store you purchased it from has a variety of other things that would perfectly fit his fishing personality, chances are your friends and family will return to that store the next time they need to purchase a gift for him.

To clarify this even further, let's take a look at three real-life examples that are thriving right now on the Etsy platform.

Sugarhouse Swaddles 

The first example we're going to take a look at is SugarHouseSwaddles.

Although they have swaddles in the name of the store, they seem to be selling just about everything. A new parent or friend of a new parent would need to swaddle or help their baby sleep.

If we dive in and look at some of their top-selling products, we can see they have two different products that are each selling more than 200 units each month.

Additionally, because they are taking the niche approach rather than the general store or product-focused approach (creating blankets for a bunch of different kinds of people), they can sell both of these products to the same person at the same time.

Even better if we continue to look through their products catalog, we can see that their top-selling products would be very likely to be purchased by the same person when they go to check out.

This means, not only do they have a great chance of increasing their average card value but also any product that leads someone to their store is likely to pair well with one of their other top-selling products.


Like the last store we took a look at, this boutique also focuses on the baby niche.

However, they're taking a slightly broader approach and selling essentially anything you could think of to buy for you or a friend or family member's new baby.

Simply by taking a look at their product, we can see that just like in the first example, they are likely to have multiple different products purchased by the same customer as everything they sell Compliments each other.


Just to mix the examples up a little bit, I wanted to throw in this next store.

Not only are they in a different niche, this time serving the wedding space, but this shop is only 8 months old as of the time of writing this article.

This store is focused on not just generic wedding things, but a variety of products for each group of people at the wedding.

As we dig through here, we can see that they serve not just the bride or the groom, but also the in-laws, the bridesmaids, and even the groomsmen.

Additionally, we can see that they've branched out beyond the wedding itself into the anniversary space, meeting, people who could continue to buy from them even after their wedding is over.

Quick Recap:

Regardless of whether you're selling on the Etsy platform currently or you're just looking to get started, make sure you aren't making the critical mistake of trying to be everything to everyone.

Although having a product-focused store may feel like it frees up your creativity, it's actually a recipe for disaster.

Not only does it make product research significantly more difficult, but it also massively limits the ability of people to buy from you over and over again.

If you'd like to learn the step-by-step process that we use to select niches on Etsy, you may want to check out the Etsy Product Magic Workshop here.

Scott Voelker

Over the years I’ve helped thousands of people TAKE ACTION to UNLOCK their true potential on building their ultimate freedom business, by developing the skills to make them resilient, confident and FUTURE PROOF. I’ve clocked my 10,000 hours over the years working in the trenches myself and helping others build and grow their brands. I know the power in TAKING ACTION better than anyone and I’ve seen people lives changed as a result of it...including my OWN!