Etsy vs. Shopify – Which Is Right for You?

When you start a fashion brand, you have a lot of options on how to sell your clothes to customers. Fashion entrepreneurs wanting to build a successful e-commerce shop have a mind blowing array of resources at their disposal. Two of the most popular are Etsy and Shopify.

What’s the difference between Etsy and Shopify?

Etsy and Shopify, while both very popular, are very different platforms. Think of Etsy as space your virtual shop rents out in someone else’s virtual mall. It’s your job to pay the bills to lease the space, but you can set up your store however you like, and, as long as you obey the rules of your lease, you can continue operating your store as you want. Shopify is more of a warehouse of tools that you need a subscription or membership to access. You can then use those tools to build a stand alone virtual store, on your own domain, independent of a virtual mall leasing agent.

So which platform is right for you? Let’s take a look at two of the factors that could most influence your choice: cost and customer retention/attraction.

Which Costs Less?

The Standard Etsy shop plan is completely free, but there’s also an Etsy Plus plan for $10 a month, with more features included. A Premium option will debut next year with likely even more advantages and a higher price tag. However, be aware that despite the low subscription cost, Etsy does charge shop owners a number of fees. There’s the:

• Listing fee of $0.20 for each product you add to your shop’s inventory
• Transaction fee charge of 5% of the list price for any item you sell
• In-Person Selling fee of $0.20 charged when you conduct in-person sales
• Payment processing fee for shop owners using Etsy payments

Since Shopify is more of a tool provider for e-commerce shop owners rather than a marketplace like Etsy, they do not provide a free subscription. Instead, they offer a $29 Basic Shopify package, a $79 Shopify package, and a $299 Advanced Shopify subscription, each with corresponding features and benefits.

The credit card processing fees for all Shopify users varies from 2.9% + $0.30 to 2.2% based on your subscription level and whether the sale occurred in person or online, but transaction fees only get charged when the shop owner uses a payment processor other than Shopify Payments. Those fees can very between 2% and 0.5%, depending on your subscription. There are also fees for any apps you choose to add to your Shopify shop to give it more complex e-commerce capabilities.

Which Does More to Help Turn Browsers into Customers? 

To earn success as e-commerce platforms, both Etsy and Shopify need their customers to be successful. One way they help do this is by discouraging shopping cart abandonment:

• Shopify allows shop owners to send customers who abandon their cart a reminder email to complete their purchase.
• Earlier this year, Etsy made it possible for shop owners to do something similar, and send abandoned cart customers targeted coupon codes to incentivize a return to cart and purchase.

Both services provide tracking and analytics on the reminders.

However, before you can remind a user to return to your store, you must get them there in the first place. Etsy does this through their promoted and featured listings.

• Promoted listings are ad space you can buy on Etsy that present to shoppers in a way that functions similar to Google Adwords. Whether or not they show up depends on what you’ve opted to pay for each shopper who clicks on your ad and how likely Etsy feels a buyer is to click on your ad.
• Getting featured can happen to any Etsy business owner in good standing. However, it helps to be active in their community, and as with traditional SEO, it helps to have good content and search engine optimized product listings.

Shopify, on the other hand, offers a number of paid and free apps that business owners can add to help market their store to online shoppers via a number of platforms.

As mentioned above, Etsy’s promoted listings function similar to Google Adwords and earning an Etsy feature works similarly to good SEO, which are both tools that e-commerce shop owners can and should use either in addition to their Etsy marketing tools or along with their Shopify shop apps.

Finding Success with Etsy or Shopify

To run a successful e-commerce store on either Etsy or Shopify, you’ll not only have to take the time to set up a good store, you'll have to invest in some sort of marketing. You’ll also have to have clear, beautiful images of your clothing and unique products that will catch shoppers’ eyes and stand out online.

While setting up an Etsy store is more straightforward than setting up a Shopify shop because you won’t have to purchase a domain, arrange for hosting, or assemble a website, no matter which platform you choose, you’ll still need to do the branding and marketing grunt work to make your brand really sing.

Do you use Etsy or Shopify to sell your products? What’s been your experience? Let us know!