Economy

Etsy opens Melbourne showroom as part of its Australian push: Five things you didn’t know about the online marketplace

Engel Schmidl /

Online marketplace Etsy has turned to bricks and mortar with the opening this week of a showroom in Melbourne to increase awareness of the site ahead of further planned growth in Australia.

The announcement of the showroom comes as the Brooklyn-based American company embarks on a new phase of expansion after raising $40 million from investors last week.

Kirsteene Phelan, Etsy’s Australian spokesperson, told SmartCompany opening the showroom was part of the online marketplace’s push into Australia.

“Australia is one of Etsy’s key markets, we are early adopters of anything online. We make great things and we are really confident with online shopping,” says Phelan.

“Etsy is very different to other online shopping as it is all user generated and very community focused, this is an offline way of demonstrating that community.

“You can’t actually buy from the showroom; it is display only. It is to encourage passers by and people who may not have experience of Etsy to engage with the site.”

Phelan says the additional $40 million in funding, which comes from existing partners, means Etsy will be launching a lot of initiatives to develop its international markets.

“Etsy really wants to speak to people globally,” she says.

In 2011 Etsy sold $15.2 million in gross merchandise sales in the Oceania region, which includes Australia and New Zealand, with 96% of the money going back to sellers.

Phelan says the Oceania sales make up 2.9% of the group’s total sales and reflect a 73% year-on-year growth in the Oceania region, with 15 million international members.

The Melbourne showroom will also operate as Etsy’s first office in the southern hemisphere according to Phelan.

“The room is in the Nicholas building in Melbourne’s central business district and we will fill it every three months with a curated selection of sellers’ work from around Australia,” she says.

“It will be themed to reflect major initiatives at Etsy. At the moment that is our wedding registry and buying experience.

“We also have the ability to assist sellers with any queries they have about their shops.”

The showroom follows behind similar Etsy showrooms in the Netherlands and Germany, however these only operated on a temporary “pop up” basis.

Caitlin Phillips, who runs the Australian Etsy shop Little Miss January, is one of the Etsy sellers who has been asked to participate in the Etsy showroom

“This week, I received an email from Etsy International’s Melbourne office, asking if they could use one of my products in three upcoming Etsy showrooms,” Phillips posted on her blog.

“I am so excited about this, it’s such a big opportunity for me so early on in my Etsy career.”

If you are still wondering what exactly Etsy is, here’s five things you did not know about the online retailer.

1. Etsy is an online handmade marketplace

Etsy describes itself as “the world’s handmade marketplace” and the website hosts online shops for sellers.

Where Amazon revolutionised online sales and eBay made its name allowing people to sell off their unwanted goods, Etsy taps into trends for hand-crafted and personalised items.

Etsy has three revenue streams: it charges a 3.5% sales fee on every transaction; it has a listing fee of 20 cents for every item; and it allows sellers to buy advertising to promote their items within the site.

On its website the company says it aims to “empower people to change the way the global economy works.”

“We see a world in which very-very small businesses have much-much more sway in shaping the economy,” the website states.

2. Etsy has been around for seven years

Etsy was founded by Rob Kalin in early 2005.

The painter, carpenter, and photographer, found there was no viable marketplace to exhibit and sell his creations online as he thought other E-commerce sites were to focused on electronics and appliances.

Along with Chris Maguire and Haim Schoppik, Kalin designed the site, wrote the code, assembled the servers, spliced the cables, and launched Etsy on June 18th, 2005 after three months.

Kalin has now sold out of the company and Chad Dickerson took over as chief executive 10 months ago.

3. The website was an immediate success

Within two months of its launch Etsy had 1018 sellers, 8451 items listed and over $10,000 in sales.

The site’s rate of growth has been exponential with worldwide sales in 2011 now $525.6 million, and Etsy has over 15 million members, 875,000 active shops and 42 million unique visitors a month.

4. The handmade ethos continues if you work at Etsy

Etsy’s main offices are in a Brooklyn warehouse where employees are served staff lunches twice a week called “Eatsy”.

Each new member of the Etsy staff gets a $100 credit from the company’s website to decorate his or her workspace.

5. Etsy tries to shake up traditional sales techniques

Etsy’s innovative sales approach includes letting shoppers browse by colour and allowing geographical searches to support local suppliers.

Every seller has their own shop, with a little biography to encourage a personal connection.

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