Are Etsy ads necessary to grow your business in 2024? Not necessarily. 

However, they can help you bring in more sales faster, especially when you already have established products performing well in your shop. 

Keep reading to learn all about how Etsy Ads work, the difference between offsite and onsite ads, and how to use Etsy Ads effectively to grow your business.

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How Do Etsy Ads Work?

Etsy Ads work on a bidding system, meaning an ad auction takes place, and your listings will compete against other sellers’ listings for paid ad spots in Etsy search results.

So, what ultimately determines whose listing shows up in search results?

The quality score Etsy gives your listing is the biggest factor determining if your listing is chosen for paid advertising space. According to Etsy, the quality score indicates how likely shoppers are to click on your products. Some things that go into this score include strong titles, tags, a positive shop history, and more. 

The other factor is your bid amount, which is how much you’ll pay per click for your Etsy Ad. The relevance to the shopper’s search and likelihood of sales make up this factor when determining your listing’s performance in the ad auction. 

For some sellers, this system works wonderfully. Others experienced a downturn in profit in 2020 when Etsy initiated these ad auctions. 

Ultimately, it will take a lot of experimenting on your end to see what does and doesn’t work for you and your shop. Before turning to ads, always go through your shop, listings, and analytics to see what can be improved. A strong foundation will help you earn a better quality score from Etsy, improving your chances of making more sales from your ads. 

An example of an offsite Etsy Ad on Pinterest. Source

What Do Offsite Etsy Ads Cost?

In 2020, Etsy introduced its risk-free advertising service for items promoted across the web, aka on Google or other websites that aren’t Etsy. It’s risk-free because Etsy sellers only pay a fee when they get a sale, so you never pay for ads that don’t work. 

For sellers with over $10,000 in sales over 12 months, you are automatically enrolled in the offsite ads Etsy program. If you have less than $10,000 in sales within 12 months, it’s strongly recommended that you participate in the program to benefit your shop. 

Here’s what Etsy has to say about what this could mean for you: 

“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.”

In short, you only pay an advertising fee when you make a sale, so participating in the offsite Etsy ads program is generally a good idea. 

What Do Etsy Ads Cost?

You can put in as little as $1 per day or much more. However, these ads are not risk-free and will run even if you’re not making many sales. As a result, you must monitor your results closely to ensure you’re not losing money and are benefiting from the sales. 

Unfortunately, you can’t set a specific cost-per-click bid amount. The Etsy Ads cost per click is unknown. However, the daily ad spending limit, which is as low as $1 per day, will help you keep your budget in check. 

How to Use Etsy Ads to Boost Your Shop’s Sales

For successful Etsy Ad campaigns, always start by looking your shop over with fresh eyes. Start by checking that: 

• Your listing photos look amazing

• This product has already made sales

• You know your target market and the search intent of the customer

Often, beginner Etsy sellers rush into running ads too early, ultimately wasting their money. You have to understand how to optimize your listing first and ensure the product is something customers are interested in before investing in Etsy Ads. 

Once your listings meet these parameters, promote your active listings on Etsy. Etsy recommends giving your Etsy Ad campaign about a month with all your active listings, then assessing the campaign analytics to see what is performing well. 

I recommend looking at the click-through rate. If your rate is low, you’ll want to change the listing’s photo, tags, title, and description to make it more appealing to shoppers.

An example of the Etsy Ads click-through rate for several products. Source

Another key analytic is your return on advertising spend. Are you making your money back and more per dollar spent on advertising? 

Here are a few more factors to consider for optimizing your listings for effective ad campaigns: 

• Is your product’s description engaging? 

• Are all of your images high-quality and eye-catching? 

• Are you maximizing your listing by using all ten allowed images?

• Are your tags and title relevant to your product? 

Is It Worth Paying For Etsy Ads?

For some sellers, paying for Etsy Ads is worth it. However, it’s not strictly necessary to grow a successful business on Etsy, nor do I recommend spending money on ads if you are not making organic sales already. 

Remember, paying for ads to help you convert a product won’t make up for a lack of organic traffic. Focus on generating organic traffic to your listings before experimenting with ads and seeing if that boosts your sales even more. 

Concerned about building organic traffic and creating return customers?

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