Wondering if Etsy offsite ads are worth it before you turn them on for your listings? It doesn’t help that Etsy sellers report wildly different experiences.
Unfortunately, you can’t get a useful answer without testing ads for your Etsy shop. And you can run a test that limits your risk.
Do a trial run. Turn on Etsy ads on your bestselling items. Set a daily budget at $1. This way, you aren’t out much if the ads don’t work. Let the ads run for a week and then look at the data.
If the ads perform (bring in more sales) and there is enough profit from each sale after the cost of the ad, then increase your daily budget.
If your ad cost is so high that you are losing money, turn Etsy Ads off.
If you see a profit, continue to monitor your Etsy ads reports to make sure your results remain consistent over time. Always check to learn if you are earning more than you spending on ads.
There’s a wide variety of comments on Etsy ads from other shop owners in social media posts. Some have positive Etsy Ads returns. Some don’t.
Regardless of what others report, run test campaigns on your shop. That’s the only data that will matter.
*** Find Etsy Ads in your Shop Manager, under the Marketing tab. ***
How Do Etsy Ads Work?
You turn the “Etsy Ads” feature on, select which of your listings to promote, and set a daily Etsy Ads budget. You only pay when someone clicks through from an ad to your product listing.
In the Fall of 2019, Etsy changed what was known as Promoted Listings into a new program called Etsy Ads. Under the Promoted Listings program, I (and many other sellers though not all) could and did make a profit running ad campaigns.
However, as soon as Etsy made the change to Etsy Ads, my profit disappeared. In 2020, I turned Etsy ads on and off several times, but always with the same result. Etsy spends my ad budget like pouring water down the drain.
I hoped that looking at the analytics of the Etsy Ads page would tell me which of my listings sold from ads and it did. Then, I only turned on ads for listings that actually sold from ads. I also tried varying my daily budget: first at $1 per day and then other amounts. Still no profit.
Below is a screenshot of my Etsy Ads results in 2020:
Do Etsy Ads Work?
Depending on your shop, your results will differ. But, in general, Etsy ads do work, in that, visitors click on the ads. However, do not be fooled into thinking clicks always turn into sales.
On my screenshot above, I drew a red line through the word “made” as it is a misleading statement from Etsy. Etsy claims I made $397.35, but in reality that number is only my gross sales. Subtract my ad spend of $225.66, and what I actually grossed from Etsy ads was $171.69. After deducting the cost of production, I lost money on those sales.
In my opinion, Etsy is attempting to mislead me in their analytics by falsely stating gross sales as what I made. It is unfortunate that they use these tactics to make me think I am doing well, when in fact I’m losing money. Notice how large Etsy’s font size is for how much I “made” compared to the tiny font size for how much I spent.
Of course, they want me to spend more money on ads. But it’s unfair to manipulate the data towards the seller making a false assumption.
How Much Do Etsy Ads Cost?
How much Etsy Ads cost depends on your annual sales. If you sell at least $10,000 a year, offsite ads will cost you around 12% of your sales. If your yearly sales is less than $10,000, expect to pay around 15%..
Here’s a quote from the Etsy support page: “For most sellers, one in 10 sales—about 10%—will come from Offsite Ads. So, let’s say you make $1,000 a year on Etsy and 10% of your sales come from Offsite Ads, that would mean your advertising fees for the year would be just $15 based on a 15% advertising fee. If you sell $10,000 on Etsy each year and 10% of your sales come from Offsite Ads, you could expect to pay about $120 with a 12% advertising fee.”
What is Etsy Ads Cost Per Click?
Etsy Ads cost per click is an unknown. Etsy doesn’t let you set a cost per click bid amount. You can set a daily ad spend limit, starting as low as $1 per day. But you cannot adjust cost per click.
How to Use Etsy Ads Effectively
Etsy sellers have the option of paying for “Etsy Ads,” a feature under “Marketing” in your “Shop Manager.”
You can quickly test a new product listing without waiting for it to show up in Etsy search results by turning on Etsy ads for that listing. Set a low daily budget of $1 per day and run ads for at least 5 days. If you don’t get any sales, turn off Etsy ads and look at factors that go into converting visitors into buyers:
- Are your images eye-catching?
- Are you using all 10 allowed images?
- Is your listing title and tags relevant to what you are selling?
- Is your product description compelling?
Another approach is to only test “Etsy Ads” after you have had organic sales. Driving traffic to listings that don’t convert into sales won’t make them convert any better.
Etsy Ads Budget
Etsy doesn’t offer any find tuning of ad campaigns. Set a daily Etsy Ads budget and select which of your listings to advertise. Etsy does everything from there. You only pay when someone clicks through from an ad to your product listing.
As mentioned, start your Etsy ads budget low as a test to learn what happens. You can set your maximum daily ad spend as low as $1. If Etsy ads are profitable for you, you can scale up to an ad spend of $50 a day. But don’t do this until you have determined you can make money from your ads.
So Is It Worth Paying for Etsy Ads?
You can’t know without running a test for several days. Pick listings that already have a solid history of organic sales (as in shoppers found your listing through search.)
The following video explains why your Etsy ads may not be getting good results.
My shop makes enough sales annually that it is now automatically enrolled in the compulsory ad program. Those ad results do make a profit. The manual Etsy Ads that you turn on or off isn’t profitable for me.
I’m not the only seller who was unhappy when Etsy switched to the new program. Hundreds of other shop owners also complained.
Despite my complaints about their advertising program, I remain a fan of everything else about selling on Etsy.
I’ve posted several articles to help you get better results from your Etsy listings. See all articles about how to sell on Etsy here.
Learn more about Etsy Ads from their official post here.
After your Etsy store is open, how will you get in front of more buyers?
Check out my bestselling book: Sell Your Crafts Online along with other craft business books that can help you get your handmade products in front of more online shoppers.