Ready to start your online business, but not sure which platform to choose? In this article we explain what is the difference between Etsy and Shopify, and how these platforms work. After reading this post, you’ll have a clear picture of the two, and you’ll be able to decide what works best for your business now.
What is the main difference between Etsy and Shopify?
Etsy and Shopify are two very different types of platforms. While Etsy is an online marketplace (similar to eBay), Shopify is an e-commerce website builder.
Essentially, if you want to open a business on Etsy, you need to create a seller profile, and start adding products to your store, on Etsy.com. Etsy is a marketplace. So you are competing with millions of other Etsy sellers around the world. Etsy works as a search engine, made for people who are looking to buy handmade, vintage, custom-made products, and more.
It’s easy to understand how it works if you compare it to eBay, which also acts as a search engine. You enter on the website, you search for what you intend to buy, and the results shown are products from multiple sellers around the world. Although eBay and Etsy are very different markets, they have a similar way of functioning – as online marketplaces.
Shopify, on the other hand, is an e-commerce website building platform. What does this mean?
It means you need to buy a website domain name for your business first. (Let’s say you decide to sell handmade candles. You need to search for a free website domain name for your business and purchase it – like candle.com, etc.).
Then you will create an account on Shopify.com, and the platform will allow you to design the actual store front/website that people will see when they access your domain name.
In order to create your website via Shopify, you don’t need to have any website building experience. You don’t need to know any code, which is very easy and convenient.
Shopify offers a variety of website themes – free and paid, which allow you to easily create a beautiful online store, appealing to your customers, and mobile-friendly.
What are the main advantages of selling on Etsy?
Here are the main advantages of creating a store on a platform like Etsy:
- Etsy is a huge website that has a lot of traffic. That means your products on Etsy will have a lot of visibility and potential sales. Etsy is a marketplace that works actively to attract buyers to their website for sellers like you.
- You don’t need to invest as much time in marketing as you would do for your own website.
- It’s very easy to use, especially if you don’t have any previous experience selling online.
What are the main advantages of creating a Shopify store?
- Shopify is definitely the platform to choose if you’re looking to create a website for your business. Even more so if you want to create a brand.
- It’s an easy-to-use e-commerce website builder. It allows you to create a website without having any programming experience or knowing any code.
- Shopify offers a multitude of e-commerce tools, helping you design attractive websites and allowing you to create a fluid customer experience. Moreover, you get access to a wide variety of marketing tools. These can help you promote your business and grow your audience.
- It’s great for building your brand. You can personalize your website as you wish, for it to reflect your brand’s aesthetic, colors, values, etc.
- It’s a very versatile platform, ideal for small and large shops. Not to mention that you have the freedom to sell whatever you wish, and to list as many products as you want.
- People will remember your website and store name, and can become repeat customers.
- From our experience, the Shopify support team is very helpful and has a short response time. As opposed to the numerous issues we had when contacting Etsy support.
What are the main disadvantages of selling on Etsy?
- Etsy is an online marketplace where you are only allowed to sell some types of products. Please refer to their seller policy.
- Selling on Etsy implies paying a lot of fees. You’ll pay a $0.20 fee per listing created, 5% of the total payment collected, and a $0.25 fee if the transaction is processed via Etsy’s Direct Checkout. If you have a wide variety of products, your fees will amount to quite a lot. Each time one of your items sells, you pay a renewing fee: ” If you decide to list a higher quantity than 1, you’ll only be charged for listing the multiple quantities when you sell them. ” – read more here.
- When you sell on Etsy, you’re just a simple seller, and not necessarily perceived as a brand. You can add branding elements to your Etsy store, packaging, etc., but people are likely not to remember which store they ordered from on Etsy.
- Etsy has the right to close your store and revoke your selling privileges at any time. So your business can easily go up in the air if you don’t have a back up (such as your own website).
What are the main disadvantages of having a Shopify store?
- The main disadvantage, or better yet – the main challenge, is to drive traffic to your website. With a new website, you need to invest more time in SEO-optimization, marketing, link-building, and so on, for the website to have visibility and get more traffic and customers.
- A possible increase in expenses. There are a lot of amazing apps that help you improve your Shopify store experience (e.g. e-mail marketing apps, payment processing apps, website translation apps, etc.). But if you use many apps your monthly expenses for the website can increase significantly.
- It’s a learning process. Managing a website can be challenging. Problems may arise that you haven’t thought of – like building a website that has a very low loading speed, or not knowing how to market/promote your website to the right audience (which means traffic, but no sales), etc.
Etsy vs. Shopify 2022: Which platform to choose for my online business?
Simply put, if you are completely unexperienced when it comes to e-commerce and selling online, Etsy is a much simpler choice for you. But first of all, you need to check if you can sell your type of product or service on Etsy.
We advise you to consult their seller policy thoroughly before thinking of opening a store. If you don’t comply to the rules, your shop can be closed and your Etsy seller privileges revoked. So if you put a lot of work into it, it might all go to waste.
Shopify is the best choice if you’re looking to build a website for your business. Shopify is easy to use, they have a lot of free tools to help you create and promote your website, you can sell pretty much any type of product and service (within reason), and we highly recommend them.
If you’re at the start of your journey, you can try opening an Etsy store for a while, and as your experience grows, start focusing on building a Shopify store. That’s what we did for our business, until we transitioned 100% to our e-commerce store, powered by Shopify.
Get our FREE PDF-Workbook for a Successful Start on Etsy
If you want to open an Etsy store, make sure to get your Ultimate FREE Guide to a Successful Start on Etsy. It’s a full PDF-workbook that takes you step-by-step on what you need to do to open your Etsy store: from choosing a shop name to creating your first product listing. And all the mistakes to avoid, in order to start a business that’s well set up from the beginning.
If you have questions, or if you want to share an experience with Etsy or Shopify that can be useful to fellow entrepreneurs, please do so in the comments section!