The Online Artisan Marketplace: A Huge Boost for Handmade Products

Published earlier today on Triple Pundit.

At a first glance, it is easy to lament both the decline of the small store and the artisan marketplace in North America, as big-box stores have redefined conventional and online shopping. E-commerce behemoths such as Amazon, where one can buy anything from dog food to king-sized beds, have also done a number on small goods. Plus, the rise of China as the world’s factory hardly helps the cause of the small shopkeeper or artisan.

All of this has been on my mind while I’m spending some time in Montevideo, Uruguay, where it is easy to avoid the malls and hypermarkets: There is something to be said about going to five or 10 different businesses while walking to do errands, from the laundry service, to the cheese store, to the vegetable stand, to finally the kiosk to recharge my phone. Living here, it would be easy for me to change my profile picture to that icon, “I didn’t buy it on Amazon.”

At the same time, however, the Internet has made it far easier for artisans, artists, and craftsmen and women to highlight and sell their wares. The creative types who have long been priced out of neighborhoods, such as Williamsburg in Brooklyn or Fillmore in San Francisco, can open a store, online, with no overhead. And for their customers, while the experience may not be as social, or convivial, as walking from store to store, finding that perfect item can be rewarding as he or she bypasses Amazon, Walmart.com or the other online giants. The result is a welcome trend for handmade goods.

Take a look at Etsy, the e-commerce site focused on vintage, handmade or, as the popular saying goes, artisanal products. Founded in 2005, Etsy stands out among Internet companies for the fact that it makes money (profitable since 2009) and is actually wildly successful. In 2013, sales of merchandise passed $US 1 billion for the first time, in part because of the sharp rise of consumers shopping on their mobile phones. On the business side, its growth and business approach are similar to other Internet companies: acquisitions, muscling in on policy when it can, and embracing new consumer trends and technology. And on the social side, Etsy does what it can to train potential sellers, which helps the un- or under-employed boost their financial prospects while adding to the company’s bottom line in the long run. The result is an online open market where 1 million vendors pitch 26 million products between 200 nations and territories.

Etsy’s growth has occurred in part because of how seamless it is to sell products on the company’s site. Etsy charges 20 cents for each item and takes only a small cut of the sales — eliminating the headache of expensive rents and, in many cities, greedy landlords. So anyone from a central California artist to a vintage maven in North Carolina can run a business out of a home or studio — and either make it a full-time job or a way to source some extra cash. As a result of the possibilities Etsy and its competitors have fostered, publications from Forbes to the Harvard Business Review has touted the ties between 21st century technology and 19th and 20th century crafts.

Not everyone is praising the re-emergence of artisanal goods, however. One Australian report actually suggested that a focus on such products can actually be a drag on the economy, citing the example of consumers’ increased demands for “handmade bread” and similar products. That probably has a degree of truth when considering productivity as part of classical economic theory, but in the end, the rise of more handmade goods offers far more benefits in the long run. The reality is that handmade soaps, sweaters and ceramics will never displace what is coming out of Asian factories to suburban, and now increasingly urban, big-box stores. Instead, they look to be a complement for the foreseeable future, and if this means more people can contribute to the economy, rather than being excluded from it because the alternative is working low-wage jobs, all of us will benefit.

Image credit: Leon Kaye

Leon Kaye has lived in Abu Dhabi for the past year and is currently spending some time in Uruguay. Follow him on Instagram and Twitter. Other thoughts of his are on his site, greengopost.com.