It's official, I've decided to come out of e-commerce retirement and throw my hat in the ring once again.
In case you didn't know, I've built and sold successful e-commerce businesses and helped thousands of people do the same.
After I sold my last business, I took a little break from the e-commerce world, but after seeing the success my wife was starting to have with her Etsy store and seeing the potential of the market, I thought I could help her grow it to at least $100,000 per year.
The Quick Backstory
On November 14th, 2020, my wife launched her first Etsy store making her first sale just a few days later on November 24th.
By the end of the first month, she had made six sales and by the end of December, she generated over $2,200 in revenue.
In 2021, the first full year of the shop, we did just over $20,000 in revenue ( not too shabby!).
After a quick conversation this year, we realized she was going to almost double that revenue in 2022, and that got my attention.
After a little bit of digging, I realized that this brand has the potential to be a mid-6 or even low seven-figure brand at the end of the day.
I had a long talk with my wife and we decided to take advantage of my background in building and growing e-commerce brands to see if we could take this brand to $100,000 a year and beyond.
If you're interested in how we plan on doing…We broke this plan down into three simple steps which you can check out below.
Step #1 adding more products:
The first step in growing this brand to $100,000 per year is going to involve us adding more products to our shop.
Before I dive into The two main reasons we will be adding more products. I wanted to quickly debunk a popular myth.
There's a common myth in the Etsy world that the number one thing you can do is to add as many products as you can to your catalog, regardless of their quality or if your audience is looking for them or not.
The theory goes, that the more lines you have in the water the more fish you will catch.
Although that is true to some extent, the popular conception simply revolves around throwing up low-quality designs or variations on existing products to potentially get a few more people to your Etsy store from their search feature.
While this myth is true to some extent, I wanted to quickly caution against throwing up low-quality pointless products, simply as a way of trying to get more traffic to your store.
It's important to keep in mind that the products we will be creating are designed to sell.
Our goal here is for every new product that we launch on Etsy to be a success.
Obviously, that's not possible, but we should be focusing on quality which plays heavily into the second reason I'll be discussing below) over sheer quantity for quantity’s sake
I'm sure at this point you're wondering” okay, so why are you launching new products to grow”.
So let's take a look at the two reasons we will be adding products and how they will help us grow to the six-figure mark and beyond.
The New Product Bump:
The first reason we are going to be adding new products to our store is because of what we refer to as the new product bump.
I mentioned a moment ago that there was a grain of truth to the myth that all you have to do to be successful on Etsy is at as many products to your store and this is where it comes from.
One of the side benefits of the way that Etsy's search algorithm seems to work is that they do a very good job of showing new products to potential buyers as quickly as possible, to see if people are interested in them.
It makes sense right?
I mean, after all, Etsy makes money in one of two ways.
Yes, They take a small $0.20 commission to create a listing, but their real money is made when you make a sale and Etsy does not want to survive just on their $0.20 listing creation fees, they want a bigger bite at the Apple.
Because of that, they have an incentive of letting new products show to people in their organic search algorithm ASAP and that's something we can take advantage of.
The trick is this only really benefits us if we are creating products that people are interested in and have the potential to buy.
We can't take advantage of this new product bump if we just load up a bunch of low-quality designs or things that people are never going to buy.
Sure, we'll get search impressions on Etsy…but if no one buys anything we just paid Etsy $0.20 and spent time designing something that doesn't help us in the long run.
For us, we're going to be focused on creating additional variations of products we've already had success with and taking a risk on a few products where we are taking a bit more of a guess about whether they will perform.
This balance allows us to take advantage of the organic search, bump and plays a key role in the number two reason we will be continuing to add products to our store as one of the main ways to grow to six figures.
Increased Cart and Customer Value:
In addition to getting more eyeballs to our store through the new product bump, the second reason we want to add new products is because of the benefit it has on increasing our average cart value (how much we make on each sale) and our lifetime customer value.
Increasing Average Cart Value
By increasing our average cart value (how much someone has in their cart when they make the purchase) we can increase the amount of money we can use to acquire that customer.
This means we can spend more money on Etsy PPC, Facebook ads, growing our email list, etc in order to get someone to buy one of our products
These ads in turn lead to even more sales, giving us more money to spend to get more customers (my favorite kind of flywheel!).
The way Etsy is designed means if you have multiple products that the same person may be interested in purchasing, there's a high likelihood that they'll buy more than one thing from you.
Increasing Customer Lifetime Value
Etsy customers tend to be extremely loyal (to the platform and to the sellers they bought from in the past) and Etsy does a great job of marketing new products that their existing customers may be interested in.
Because of these two things, if we continuously add new products to our store, our previous customers may also be interested in purchasing from us again increasing their overall lifetime value.
Step #2 Maximize Etsy PPC
The second thing we're going to be doing to take this brand to six figures and beyond is by maximizing what we can do with Etsy's pay-per-click platform.
Now, I'm not sure if it's because most Etsy sellers are part-time or hobby business owners or because they're scared to spend money on their marketing, but this is an extremely powerful part of the Etsy platform and is almost always overlooked.
Since we're focused on creating good quality products that have a chance to sell (like we talked about in step one ), there's no reason we shouldn't spend a bit of money marketing them to see if they will work.
I mentioned previously that sales tend to lead to more sales because Etsy wants to put products in front of customers that they know will sell.
By investing a few dollars per day (literally $5 -$10 to start) we instantly start bringing in traffic from Etsy searches.
Not only does this mean we can test products more quickly ( We don't need to wait for organic search traffic to come in and rely on the good graces of the Etsy algorithm).
Oh, and did I mention it helps us scale successful products faster as well?
Whether you're just getting started or you're trying to grow a store to six figures like we are, don't sleep on Etsy's pay-per-click platform.
It's super easy to set up and with a very low budget, you can start to see some amazing results.
Step #3 Email Marketing
The third thing we are going to be doing to our Etsy store is putting a big emphasis on email marketing.
You've probably heard us talk in the past about how email marketing is one of the least utilized and also one of the highest return marketing activities that any commerce business can do.
Even the lowest estimates of the return on investment from email marketing for e-commerce puts the number somewhere around $38 in revenue for each dollar spent on email marketing.
One thing to keep in mind is that just like with Amazon or eBay, you can't email Etsy customers directly (I'll share a clever way around that further on in the section).
That being said, there are three ways that we are going to use to leverage email marketing to grow our Etsy store.
One of the bread-and-butter suggestions for using email marketing in e-commerce stores is to send abandoned cart emails.
When someone adds a product they're interested to their cart and doesn't purchase, you. Send them an email in order to remind them to finish their checkout.
Although we cannot email this potential customer that added something to their cart on the Etsy platform, Etsy has the built-in ability to do this. All you have to do is turn it on.
Once you've enabled Etsy to send abandoned cart emails to people who added stuff to their cart on Etsy, they will automatically send them for you.
One thing we like to do to help incentivize them to come back and complete their purchase is to include a small discount on their order (Something like 10%).
All we need to do is create a coupon code inside Etsy and make sure that that is included in our Etsy abandoned cart email.
Favorite Follow Up
Just like abandoned carts, we can use a very similar process with products that people have ” favorited”.
If you're not familiar with the concept, think of it as bookmarking or saving the product for later.
As people are browsing through the Etsy platform, they may see a product that catches their eye but they're not ready to purchase it yet and they have the ability to favorite that product to come back and purchase it later.
By creating a promotional code and automation to market to these people, (both are easily done inside the Etsy platform), we can turn a large number of these favorites into purchases as well.
Off Esty Email Marketing
Although we don't get access to the email addresses of people who have purchased from us from Etsy, nothing is saying that we can't create an email list of our own of people who might purchase from us on Etsy.
In fact, if you're in the e-commerce game at all, you should be doing this whether you sell on Etsy, Amazon, or your own platform.
One of the easiest ways to do this is by using the giveaway model.
Essentially, we create a small bundle of products (worth $100+) that only people in our niche would be interested in.
Once we've created our product bundle, we use a tool called KingSumo to help us quickly and easily set up a contest.
Then, we run a few dollars a day in Facebook ads for our niche.
When people in our niche see the ad, they enter their name and email to get their chance to win and they're now on our email list.
Once the contest is over, we send an email letting them know who the winner is and giving them a nice discount to purchase something at our Etsy store.
If you do the first part of this correctly and follow up, chances are you'll gain a good number of sales immediately.
The long-term capability of this list really is the key.
Even if somebody doesn't buy from us right away, we can email them far into the future, and eventually, we know they will!
One side benefit of having the ability to drive your traffic with an email list is that Etsy rewards stores more for driving external traffic that leads to sales.
Not only do we get the benefit of direct sales from our email list, but we will also typically see an increase in sales from organic search which gets that sales flywheel started.
My goal for the next year is to use those three tactics to grow our store to six figures and beyond.
Be sure to check back for updates and if you have any questions about how you can grow your Etsy store, feel free to let us know.