julieooly
Cave Dweller 
Member since October 2018
Posts: 721 
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Post by julieooly on Sept 27, 2019 8:56:07 GMT -5
Hi all, I hope this is the right place for this topic. I'm reaching out to those of you who are unhappy with the new combined Etsy/Google advertising campaign. In a nutshell, Etsy used to have two separate advertising campaigns, one for Etsy Promoted listings and one for Google Shopping. The shop owners were allowed complete control to choose the programs allowing them to set a daily maximum budget to spend. (Shop owners also have the option not to advertise and shop owners can choose which items they advertise). Advertising fees were generated on a CPC - Cost Per Click system where the shop owner could bid and pay a certain amount of money each time their ads were clicked. Etsy provided a suggested CPC rate, and the shop owners had the option to change those suggested rates. With the new campaign there are two options. Either advertise on BOTH Etsy and Google or don't advertise. Here's the big kicker - Etsy now sets the CPC for all advertised items and doesn't give the shop owner the option to change it. (You can still choose which items to promote and set a maximum daily budget). Etsy's suggested CPC's are now about two to three times what my CPC's were. Before September my sales were growing and my shop was really taking off. I was spending roughly $1.30 a day which has soared to my max of $3.00, I'm advertising far fewer items and my sales have tanked. My shop has only been open about six months. I've created a thread in the Etsy Forums and would love to generate some activity and hopefully gain more attention. The thread can be found here: community.etsy.com/t5/Managing-Your-Shop/Cost-Per-Click-Advertising-GIVE-IT-BACK-LET-US-CONTROL-OUR-OWN/m-p/127915963#M1055508If you know of other Etsy sellers who aren't on RTH, I encourage you to contact them and ask for their support. Julie |
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Post by rockjunquie on Sept 27, 2019 9:08:20 GMT -5
I like your post, but as the commenter said- Etsy ain't changing their minds because a few people bitch. They never have; they never will. Unfortunately, it is up to us to suck it up. It's the etsy way. And just an FYI, now is the slow period for selling supplies. I expect it every year. Your problem could just be that people who need supplies to create Christmas items have already bought their supplies and are now working on their items.
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Don
Cave Dweller
He wants you too, Malachi.
Member since December 2009
Posts: 2,616
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Post by Don on Sept 27, 2019 10:27:37 GMT -5
Now that I have almost a full month worth of data under the new Etsy Ads system I can do some analysis, with the caveat that I do not know exactly when in September my shop was changed over to the new system. Etsy doesn't seem to think this kind of information is important to shop owners... | Month | ROI | CPC | Average Cost | Average Revenue | Conversion Rate | Average Daily Budget | | September | 2.88 | 0.21 | 4.31 | 12.44 | 4.79% | 16.22 (max 20) | | August | 5.36 | 0.16 | 3.45 | 18.50 | 4.57% | 9.80 (max 20) |
September advertising performance compared to August: ROI (return on investment) has fallen to 2.88 from 5.36. This means that on average, I'm making $2.88 in revenue for every $1 spent on advertising. Before Etsy Ads, I was making $5.36 per dollar. My average advertising cost per sale is up to $4.31 from $3.45. Cost per click is up to $0.21 per click versus $0.16. I've seen single click cost as high as $2. No longer having control over this is frustrating to say the least. Average revenue per order is down to $12.44 from $18.50. Conversion rate is slightly higher at 4.79% vs 4.57%. My average daily budget went from $9.80 to $16.22. My max budget is set at $20/day. Etsy is spending the entire max budget now. The only reason why the average this month is less than $20 is because the switch over happened mid-month. So, my ads are performing a little better with Etsy Ads with a slightly higher conversion rate, but they are costing me more money per click and I'm generating less revenue per sale. |
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Post by rockjunquie on Sept 27, 2019 10:31:45 GMT -5
Now that I have almost a full month worth of data under the new Etsy Ads system I can do some analysis, with the caveat that I do not know exactly when in September my shop was changed over to the new system. Etsy doesn't seem to think this kind of information is important to shop owners... | Month | ROI | CPC | Average Cost | Average Revenue | Conversion Rate | Average Daily Budget | | September | 2.88 | 0.21 | 4.31 | 12.44 | 4.79% | 16.22 (max 20) | | August | 5.36 | 0.16 | 3.45 | 18.50 | 4.57% | 9.80 (max 20) |
September advertising performance compared to August: ROI (return on investment) has fallen to 2.88 from 5.36. This means, that on average, I'm making $2.88 in revenue for every $1 spent on advertising. Before Etsy Ads, I was making $5.36 per dollar. My average advertising cost per sale is up to $4.31 from $3.45. Cost per click is up to $0.21 per click versus $0.16. I've seen single click cost as high as $2. No longer having control over this is frustrating to say the least. Average revenue per order is down to $12.44 from $18.50. Conversion rate is slightly higher at 4.79% vs 4.57%. My average daily budget went from $9.80 to $16.22. My max budget is set at $20/day. Etsy is spending the entire max budget now. The only reason why the average this month is less than $20 is because the switch over happened mid-month. So, my ads are performing a little better with Etsy Ads with a slightly higher conversion rate, but they are costing me more money per click and I'm generating less revenue per sale. Great post, Don. Nothing better than facts. |
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Post by stardiamond on Sept 27, 2019 11:10:19 GMT -5
I am new to Etsy and still figuring things out. I don't pay anything for advertising. My stats say 8.6% from external searches.
For my Tahoma cabochons, all or most show up on a Google search. A lesser amount on Bing. For what I'm listing I'm not seeing any benefit for paying for Google.
What I have also noticed is that more Etsy listings for category combined with the total search results, the higher percentage of those listings appear on Google
When I put the name of my shop and cabochon as Google search parameter I get four pages of results which may b ell my listings.
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Don
Cave Dweller
He wants you too, Malachi.
Member since December 2009
Posts: 2,616
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Post by Don on Sept 27, 2019 11:22:31 GMT -5
Great post, Don. Nothing better than facts. Thanks Tela. I have to admit that 53% loss in ROI is a kick in the teeth. Here's what I'm doing: 1. Eliminating all dead weight listings from my advertising campaign. Any listing that has had 0-1 sales in the last year of advertising is cut. Etsy's system for removing individual listings from advertising is horrendously bad. I think they're making it difficult on purpose. 2. Reduce advertising budget. I cannot sustain a $20/day cost based on these performance numbers, so It has to be cut. 3. Raising prices. I have been reluctant to do this, but my costs are increasing and I have little control over it, so prices must go up. The problem is, all those other shop owners that are basically "asleep at the wheel" and will just continue to be satisfied with an ever decreasing profit margin year after year without making any price adjustments... 4. Re-tool all of my titles and tags (AGAIN!) to try to increase organic search results so that I am less dependent on advertising. It takes months and months of labor to do this, only to have Etsy change how it works again in 6 months, but what else can I do? Gee, it sure would be nice to have some time for making jewelry at some point... |
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Post by rockjunquie on Sept 27, 2019 11:29:09 GMT -5
Great post, Don. Nothing better than facts. Thanks Tela. I have to admit that 53% loss in ROI is a kick in the teeth. Here's what I'm doing: 1. Eliminating all dead wight listings from my advertising campaign. Any listing that has had 0-1 sales in the last year of advertising is cut. Etsy's system for removing individual listings from advertising is horrendously bad. I think they're making it difficult on purpose. 2. Reduce advertising budget. I cannot sustain a $20/day cost based on these performance numbers, so It has to be cut. 3. Raising prices. I have been reluctant to do this, but my costs are increasing and I have little control over it, so prices must go up. The problem is, all those other shop owners that are basically "asleep at the wheel" and will just continue to be satisfied with an ever decreasing profit margin year after year without making any price adjustments... 4. Re-tool all of my titles and tags (AGAIN!) to try to increase organic search results so that I am less dependent on advertising. It takes months and months of labor to do this, only to have Etsy change how it works again in 6 months, but what else can I do? Gee, it sure would be nice to have some time for making jewelry at some point... Very sound approach. Yes, raising prices is hard when you have so many sellers who don't price to make a profit, but just cover the cost of making things. Yes, it would be nice if Etsy didn't change things up all the time. Working for Etsy is a lot of work. |
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Post by stardiamond on Sept 27, 2019 12:45:04 GMT -5
Trying to earn some kind of wage on Etsy is tough. Most of my cost for inventory is sunk. I've already spent the time and bought the materials and equipment. Pricing using time, materials and selling expenses is not relative. My goal is to make the hobby self supporting, but I price everything by slotting against similar that is being listed. I'm not trying to maximize revenue by selling more.
If I wanted income, I would go back to work. I'm retired and want to spend my time enjoying what I am doing.
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julieooly
Cave Dweller
Member since October 2018
Posts: 721
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Post by julieooly on Sept 27, 2019 16:07:04 GMT -5
Very sound approach. Yes, raising prices is hard when you have so many sellers who don't price to make a profit, but just cover the cost of making things. Yes, it would be nice if Etsy didn't change things up all the time. Working for Etsy is a lot of work. It's super hard to know how to price cabs when everything in your workshop is brand new and you don't know how long your equipment will last! I'd love to make a profit at some point, for now I'm hoping my prices are set within some sort of market value as to not negatively effect those who make a living on lapidary. Is there a place here on the forum that helps store owners like me figure out how to charge for cabs? I know that by-the-hour just doesn't cut it! I've had a couple of Etsy shop owners from here in the forum take a look at my shop over the past couple of months and I "seem" to me to be in line with them but it would be awesome if there were some kind of formula to follow. I had a thought a while back about maybe forming some kind of RTH "union" where Etsy shop owners like myself could discuss things like this and create a system but have no idea if that would work (probably not, people just do what they want so often, and that isn't necessarily wrong!) Ideas? |
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Post by rockjunquie on Sept 27, 2019 16:13:13 GMT -5
Very sound approach. Yes, raising prices is hard when you have so many sellers who don't price to make a profit, but just cover the cost of making things. Yes, it would be nice if Etsy didn't change things up all the time. Working for Etsy is a lot of work. It's super hard to know how to price cabs when everything in your workshop is brand new and you don't know how long your equipment will last! I'd love to make a profit at some point, for now I'm hoping my prices are set within some sort of market value as to not negatively effect those who make a living on lapidary. Is there a place here on the forum that helps store owners like me figure out how to charge for cabs? I know that by-the-hour just doesn't cut it! I've had a couple of Etsy shop owners from here in the forum take a look at my shop over the past couple of months and I "seem" to me to be in line with them but it would be awesome if there were some kind of formula to follow. I had a thought a while back about maybe forming some kind of RTH "union" where Etsy shop owners like myself could discuss things like this and create a system but have no idea if that would work (probably not, people just do what they want so often, and that isn't necessarily wrong!) Ideas?
I think everyone stresses abt pricing, at some point. It's not easy. From what I have seen of your prices, I don't think you need to worry too much. I suppose one of the best and easiest things you can do, is just look and see what other people are charging for much for same thing.
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julieooly
Cave Dweller
Member since October 2018
Posts: 721
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Post by julieooly on Sept 27, 2019 16:17:27 GMT -5
It's super hard to know how to price cabs when everything in your workshop is brand new and you don't know how long your equipment will last! I'd love to make a profit at some point, for now I'm hoping my prices are set within some sort of market value as to not negatively effect those who make a living on lapidary. Is there a place here on the forum that helps store owners like me figure out how to charge for cabs? I know that by-the-hour just doesn't cut it! I've had a couple of Etsy shop owners from here in the forum take a look at my shop over the past couple of months and I "seem" to me to be in line with them but it would be awesome if there were some kind of formula to follow. I had a thought a while back about maybe forming some kind of RTH "union" where Etsy shop owners like myself could discuss things like this and create a system but have no idea if that would work (probably not, people just do what they want so often, and that isn't necessarily wrong!) Ideas?
I think everyone stresses abt pricing, at some point. It's not easy. From what I have seen of your prices, I don't think you need to worry too much. I suppose one of the best and easiest things you can do, is just look and see what other people are charging for much for same thing.
Like always Tela GMTA and that’s exactly what I’ve been doing. Thanks for the confirmation! |
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Post by rockjunquie on Sept 27, 2019 16:24:52 GMT -5
I think everyone stresses abt pricing, at some point. It's not easy. From what I have seen of your prices, I don't think you need to worry too much. I suppose one of the best and easiest things you can do, is just look and see what other people are charging for much for same thing.
Like always Tela GMTA and that’s exactly what I’ve been doing. Thanks for the confirmation! Half of selling is knowing what the market will bear. Say someone gave you a great deal on some expensive rough. Do you do all the figuring and determine that a cab is worth 25.00, or, do you look around and see that people are charging and paying 60.00? No brainer. I try not to get bogged down in what I paid for something. Sometimes you buy well, sometimes you don't. As long as it is a well made cab and has nice eye appeal, I figure to make my money. I have taken a few losses in some things that just never got any attention, but mostly I do OK. |
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Don
Cave Dweller
He wants you too, Malachi.
Member since December 2009
Posts: 2,616
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Post by Don on Sept 27, 2019 16:42:39 GMT -5
Very sound approach. Yes, raising prices is hard when you have so many sellers who don't price to make a profit, but just cover the cost of making things. Yes, it would be nice if Etsy didn't change things up all the time. Working for Etsy is a lot of work. It's super hard to know how to price cabs when everything in your workshop is brand new and you don't know how long your equipment will last! I'd love to make a profit at some point, for now I'm hoping my prices are set within some sort of market value as to not negatively effect those who make a living on lapidary. Is there a place here on the forum that helps store owners like me figure out how to charge for cabs? I know that by-the-hour just doesn't cut it! I've had a couple of Etsy shop owners from here in the forum take a look at my shop over the past couple of months and I "seem" to me to be in line with them but it would be awesome if there were some kind of formula to follow. I had a thought a while back about maybe forming some kind of RTH "union" where Etsy shop owners like myself could discuss things like this and create a system but have no idea if that would work (probably not, people just do what they want so often, and that isn't necessarily wrong!) Ideas? A basic formula is material cost X 3 or even material cost X 5. That usually is enough to cover all your basic costs like labor, equipment, consumables, and give you some profit too. Example: Slab cost $10 and you cut 2 cabochons from it. $5 x 3 = $15 Add "free shipping" cost = $20 Add Etsy's 10% cut cost = $22 Add a little extra for advertising costs = $25. This is kinda simplistic and doesn't account for a large number of variables, but it's a good place to start IMO. It's also a good idea to do some comparison shopping to see what similar cabochons are listed for. Make sure your price is somewhere in the middle of the price ranges. You don't want to be the cheapest and race to the bottom, and you usually don't want to be the most expensive unless that's part of your marketing strategy/branding and have a following of buyers that are willing to buy your cabs regardless of price, for example, Lexx stones, Sam silverhawk come to mind. Some stones can command a higher price simply based on desirability, so while your formula may give you a $25 price, if the material is "hot" in the marketplace, don't be afraid to price it at what the market will bear on it. Keep in mind the replacement cost of the material too. That Tiffany Stone slab you bought for $5 20 years ago will be much more expensive to replace now. your material cost should be based on current market values. Everyone has their own take on this subject though. And this formula doesn't really work if your plan is to sell wholesale. |
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jasperfanatic
spending too much on rocks
Member since January 2019
Posts: 463
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Post by jasperfanatic on Sept 27, 2019 17:27:59 GMT -5
It's super hard to know how to price cabs when everything in your workshop is brand new and you don't know how long your equipment will last! I'd love to make a profit at some point, for now I'm hoping my prices are set within some sort of market value as to not negatively effect those who make a living on lapidary. Is there a place here on the forum that helps store owners like me figure out how to charge for cabs? I know that by-the-hour just doesn't cut it! I've had a couple of Etsy shop owners from here in the forum take a look at my shop over the past couple of months and I "seem" to me to be in line with them but it would be awesome if there were some kind of formula to follow. I had a thought a while back about maybe forming some kind of RTH "union" where Etsy shop owners like myself could discuss things like this and create a system but have no idea if that would work (probably not, people just do what they want so often, and that isn't necessarily wrong!) Ideas? A basic formula is material cost X 3 or even material cost X 5. That usually is enough to cover all your basic costs like labor, equipment, consumables, and give you some profit too. Example: Slab cost $10 and you cut 2 cabochons from it. $5 x 3 = $15 Add "free shipping" cost = $20 Add Etsy's 10% cut cost = $22 Add a little extra for advertising costs = $25. This is kinda simplistic and doesn't account for a large number of variables, but it's a good place to start IMO. It's also a good idea to do some comparison shopping to see what similar cabochons are listed for. Make sure your price is somewhere in the middle of the price ranges. You don't want to be the cheapest and race to the bottom, and you usually don't want to be the most expensive unless that's part of your marketing strategy/branding and have a following of buyers that are willing to buy your cabs regardless of price, for example, Lexx stones, Sam silverhawk come to mind. Some stones can command a higher price simply based on desirability, so while your formula may give you a $25 price, if the material is "hot" in the marketplace, don't be afraid to price it at what the market will bear on it. Keep in mind the replacement cost of the material too. That Tiffany Stone slab you bought for $5 20 years ago will be much more expensive to replace now. your material cost should be based on current market values. Everyone has their own take on this subject though. And this formula doesn't really work if your plan is to sell wholesale. You don't factor in labor costs? |
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Don
Cave Dweller
He wants you too, Malachi.
Member since December 2009
Posts: 2,616
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Post by Don on Sept 27, 2019 18:01:56 GMT -5
Labor is factored in with the multiplier. Like I said, this is a simplified pricing model. I don't try and calculate labor with an hourly rate, too variable. Sometimes sh!t happens and I spend twice as long on a piece than I should have...I can't charge the customer for extra time, and if I'm faster than normal I might not charge enough. The multiplier keeps things consistent.
If you wanted to do a more complicated price analysis, you could eliminate the multiplier and do a detailed breakdown of your material costs, average labor costs, supplies cost, equipment depreciation, SG&A, etc, and then factor in a profit margin and then wholesale price, keystone, triple keystone, retail, and then etsy fees, shipping, packaging, advertising, etc., but this tends to be overly complicated for someone who's just looking to sell cabochons on Etsy.
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julieooly
Cave Dweller
Member since October 2018
Posts: 721
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Post by julieooly on Sept 27, 2019 20:59:03 GMT -5
If you wanted to do a more complicated price analysis, you could eliminate the multiplier and do a detailed breakdown of your material costs, average labor costs, supplies cost, equipment depreciation, SG&A, etc, and then factor in a profit margin and then wholesale price, keystone, triple keystone, retail, and then etsy fees, shipping, packaging, advertising, etc., but this tends to be overly complicated for someone who's just looking to sell cabochons on Etsy. Agreed. It's much easier to go with the idea that I've heard from more than a couple other cabbers which is "If I can't sell it for about 30 bucks than it isn't worth my time". So I start at around 30 then take it down a bit for small stuff and go up for better/expensive materials and overall composition and style. That plus Tela's advice to see what others are charging is how I start figuring my cab prices. My simplified formula is: 30$ cab with 10% advertising on top of Etsy's 10% fees and 4$ shipping/packaging yields 20$ toward material/labor/equipment. I guess I do have it figured out  I guess what I'm curious about now is what percentage a seller should expect to pay for advertising and how much more our customers will be willing to pay for our goods  |
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NRG
fully equipped rock polisher
Member since February 2018
Posts: 1,688
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Post by NRG on Sept 28, 2019 10:42:02 GMT -5
This is a far different discussion than we had 3-5 years ago. Few knew how to price their goods and fewer had the courage to test higher prices.
Today we are discussing real world numbers including actual costs.
As a life long salesman/sales manager/merchant I recommend everyone test some higher prices for bit. Maybe just a $1 or two a month.
Warning: The following is too long.
This is an old pet trade story. A friend of mine was offering millet sprays (a healthy treat for parakeets and similar birds) at 99¢ each. He was the cheapest in town. But rarely sold any. It often went rancid before it sold. (I realize rocks don't go rancid, but to put all that labor in to see a cab lay fallow is disheartening).
He asked his millet salesman what he could do better. The dude was so happy he asked! They partnered up and made some changes. The rep said the biggest volume seller in the region was at $2.29ea and he sold a few cases weekly.
Thusly, our hero suggested our shop owner ask $1.99ea and make signage claiming "fresh millet" and to put it in a better place near the cash register. Put a case on display and sold out in under a week. Restocked and found he could sell 2.5 cases a week.
Then a new harvest came in. Price down at wholesale so, they offered a sale "marked down to $1.49". He sold 6 cases in a week. Then he tested $1.59 and $1.69 and $1.89; he found that $1.69 was the sweet spot. His volume was steady at 6-7 cases a week. A huuuuge difference.
Interestingly, what happened was he did have the freshest millet in town, the birds knew it and his customers spread the word like butter on toast. Soon, his traffic almost doubled and his sales in general went up significantly. All because of some stupid seed that was pissing him off.
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Post by stardiamond on Sept 28, 2019 11:38:10 GMT -5
All though I have only been selling for a short while, I have learned a lot about pricing.
1. The market determines the price.
2. More expensive cabs take longer to sell. There is a shop that sells nice Morrisonite cabs and they are priced well and they have been out there for a while.
3. In addition to slotting against same, I consider uniqueness and the ability to find material to replace what is sold. I am willing to pay the 7 cents a month for listing and just wait for the irreplaceable to sell.
4. For cabs, people collect specific types of material and beauty and uniqueness won't make a cab sell.
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julieooly
Cave Dweller
Member since October 2018
Posts: 721
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Post by julieooly on Sept 28, 2019 14:41:09 GMT -5
All though I have only been selling for a short while, I have learned a lot about pricing. 1. The market determines the price. 2. More expensive cabs take longer to sell. There is a shop that sells nice Morrisonite cabs and they are priced well and they have been out there for a while. 3. In addition to slotting against same, I consider uniqueness and the ability to find material to replace what is sold. I am willing to pay the 7 cents a month for listing and just wait for the irreplaceable to sell. 4. For cabs, people collect specific types of material and beauty and uniqueness won't make a cab sell. The 7 cents a month is inaccurate. The listing is .20 for four months. If an item sells the first day of the four months or the last day it is still .20 If you renew then you're at .40 for four months, but the same logic applies. |
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