Etsy Customer Service Program Could Hinder Growth Of New Sellers

As Etsy attempts to hold onto consumers who found their way to its marketplace amid the pandemic, the company is setting out several initiatives. One is an improved search function using proprietary technology, which allows customers to more easily find what they’re looking for. Another will allow sellers to use videos in their product listings to show how an item is made or how it can be used.

And starting earlier this month, Etsy sellers got access to a “Star Seller” section of the Shop Manager dashboard, giving them insights into how they’re performing in various customer service areas, including message response times, shipping speed and five-star ratings.

In order to become a Star Seller, shops must respond to 95 percent of messages within 24 hours, ship 95 percent of orders on time with tracking, have 95 percent of reviews with five-star ratings, and have had at least 10 orders and $300 in sales over the past three months.

Etsy CEO Josh Silverman said the Star Seller program is meant to provide agency to sellers and show them which customer service metrics buyers care about and how to improve their performance. Advice that’s readily available online, such as “keyword stuffing” to put more keywords in the title of the product, “doesn’t necessarily make the buyer experience better,” he noted.

“We believe this [Star Seller program] creates a ‘race to the top’ for sellers, who will understand even more what actions they can take in order to further delight customers,” Silverman told analysts last week. Etsy declined a request for comment from PYMNTS.

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Etsy’s Star Seller program follows similar programs on other eCommerce platforms, such as Poshmark, eBay and Mercari, which all visibly reward sellers who meet certain expectations for customer service. Unlike some other programs, though, Etsy’s is much more shop-owner-centric with more attainable goals, according to Gloria Stitt, vice president of marketing at social shopping platform Gamitee.

“eBay’s general program is very focused on high-volume sellers — the thresholds in place make it difficult for small sellers to achieve this status,” Stitt told PYMNTS. “Etsy has created more achievable standards, leveling the playing field for the smaller shops on Etsy.”

While it’s unclear whether this new initiative could bring more business owners to consider Etsy as a storefront, Stitt said it will certainly help attract more shoppers to Etsy. “Confidence in the seller is key to the online shopping experience, and this program will help consumers instill confidence in who they are buying from or who they are shopping with,” Stitt said.

Impacts On Sellers

Next month, Etsy plans to begin putting Star Seller badges on qualified shops, though the company said sellers will have more time to reach Star Seller status before buyers start seeing the badges ahead of the holiday shopping season. The badges will be awarded on the first of every month based on the last three months of a shop’s performance.

In the future, Silverman said that being a Star Seller may influence a shop’s prominence in search results; additionally, Etsy is considering doing featured marketing of different Star Sellers.

“It’s not the only way we can do this, but it is a powerful example of how we can tell sellers exactly what they can do to be more prominent … in a way that creates a race to the top and lifts all boats,” Silverman said.

Michael Osborne, president of retail marketing platform Wunderkind, told PYMNTS that the Star Seller program could bring out a more “serious” and dedicated side of Etsy sellers, and will ultimately have the biggest impact on newer sellers, potentially making it more difficult for them to rise higher in search results or rankings.

“While from a consumer perspective this is as intended, it could present a challenge for sellers to maintain their current popularity on Etsy,” Osborne said.

The Importance of Reviews

Brynn Gibbs, CEO of online reputation management company Consumer Fusion, told PYMNTS that 87 percent of consumers read online reviews before making a purchasing decision, with eCommerce buyers reading at least four reviews before purchasing a product.

“The volume of new reviews every year is growing,” Gibbs said, with negative reviews recently seeing an uptick as consumers increasingly live their lives primarily online and a shortage of workers creates customer service delays. “We always push our clients and businesses to be very proactive and prompt with responding and communicating,” she added.

Etsy said sellers who respond to buyer messages within 24 hours are four times more likely to make a sale than those who take longer to respond, and buyers who leave five-star ratings are more likely to come back and shop again.