Etsy Facing Competition In Handmade At Amazon Market

Etsy has been the dominant player in the online arts and craft market for many years. That might be set to change, however, as a gorilla named Amazon just stepped into the ring with Etsy for round two.

The new online arts and crafts marketplace is named Handmade at Amazon, and opened for business early Thursday morning with more than 80,000 items from around 5,000 sellers in over 60 countries. The online market is designed to allow artists and craftspeople to earn income by selling their handmade goods, and is run on much the same model as Etsy.

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Amazon coming in to take a share of the arts & crafts pie

Over the last decade, Etsy’s handicrafts marketplace has mushroomed to $2 billion a year in sales, making it clear that there is a large and thriving market for quality handmade merchandise.

Amazon is the elephant in the ecommerce sector, sporting more than $75 billion in annual sales, and they have decided they want their piece of the handmade goods action. To prepare for the launch of Handmade at Amazon, the firm has sent out thousands of invitations to artists and artisans (including Etsy sellers), asking if they would like to be considered to sell on Handmade.

Handmade at Amazon is another effort to extend the firm’s reach into yet another segment of e-commerce. The company also launched Amazon Home Services this spring, which connects consumers with professionals who perform small tasks such as plumbing or appliance installation, muscling into an already crowded market served by Angie’s List, TaskRabbit and others.

Ecommerce analysts suggest the new Handmade marketplace will pose a major challenge for Etsy. There have been rumblings of discontent since Etsy changed vendor rules, and now permits sellers to outsource some manufacturing. These changes have upset many sellers over what they see as a betrayal of Etsy’s hardworking artisans and craftspeople, and argue nearly all those who originally sold on the site are artists who do not want to compete with “business people” who pretend to be artists.

Statement from VP heading up Handmade at Amazon

“You can think of it as a factory-free zone, a mass-produced-free zone,” commented Peter Faricy, the Amazon vice president who is overseeing the launch of Handmade at Amazon.

“For the first time on Amazon, we’re going to have a picture of the artist, a little icon of what state they’re from, what country they’re from,” he said in an interview. “We’re going to launch with an experience that’s very different. Customers are going to see the difference.”