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In the early morning of April 2nd, when Josh Silverman started his day at work, the Etsy CEO was amazed to see a sudden surge in traffic to the crafting e-commerce website on an ordinary Thursday.
One thing in particular was the increase in traffic: the search for "face masks" rose 100 times this morning within a few hours and reached nine search requests per second at one point.
While Etsy's vendors had been offering face masks for several weeks since the COVID-19 pandemic began, media reports surfaced this morning indicating that the U.S. government would change its stance and recommend that Americans wear face masks in public places wear to help curb the pandemic spread.
"It happened like an explosion. It was instant, ”says Silverman Fortune. Some sellers postponed orders for the entire previous month in just an hour. However, the increase in search queries was not without challenges.
For one thing, he wanted to be sure that sellers could complete these orders so that this would not result in a bad experience for someone new to the website and lose Etsy the chance to make a good first impression.
When Silverman entered "face masks" into the search engine, the results also revealed many Halloween masks and other irrelevant products. "At the moment, that's not someone who imagines face masks," he says.
At 8:30 a.m., he and his team triage the best 5,000 top results by hand, immediately correcting the algorithms. They placed vendors who actually sold fabric face masks first in the ranking and redirected buyers to the websites of sellers who confirmed that they could process the orders to redistribute the demand and thus retrain the search engine.
Over the next 48 hours, Etsy recruited more salespeople to make masks and helped them figure out how to get more cloth and set up their businesses quickly. "In a short time, we have built a medium-sized company within Etsy," says Silverman.
The contoured face mask from Infusion on Etsy is a bestseller made to order. Courtesy of infusion / Etsy
It was all a lot more work than Etsy would normally do. But the payout was undeniable: in April, Etsy sold 12 million masks worth $ 133 million, or one-sixth of its monthly amount, and Silverman says demand is holding up well.
In addition, sales of items other than masks on the Etsy website increased 79% in the past month, although the number of wedding gifts declined during the typically peak period of this category. Etsy was already doing well, if not quite as well: in the first quarter of 2020, sellers sold $ 1.35 billion worth of goods at their locations, up 32.2% year over year.
A wealth of new customers
There is an important long-term advantage for Etsy: In April alone, over 4 million new customers were won and 2.5 million others were won back who had not used the website for at least a year. (At the beginning of 2020, it had 46.4 million active buyers and 2.7 million sellers.)
Wall Street noticed it. Stocks hit a 52-week low on March 16, coincidentally when the blockade began in major cities like New York as investors worried about the impending economic downturn. Etsy shares have risen 157% in the two months since then, bringing the company to nearly $ 10 billion.
Silverman admits that he wasn't sure how people would behave when the locks started. However, he believes that people who support independent companies and want to buy unique items – or at least those that are not mass-produced – have a lot to do with Etsy's success.
And the influx of new buyers was a rare opportunity for Etsy to inspire new customers. "It was important that it was a good experience," says Silverman.
Initial data indicate that many are staying here: Around 32% of new customers who bought a mask in the past month bought another item within two weeks. According to Silverman, timely shipping statistics and call center volume indicate that the customer experience was good.
Wall Street analysts seem to agree with the thesis that Etsy will stick to its new customers as soon as the block ends and other retailers reopen. "Even for existing buyers, they may be exposed to the variety and choice of products available, which could lead them to come and buy the platform more than once a year," said Deutsche Bank analyst Kunal Madhukar, in a research note.
Since taking over the helm three years ago, Silverman has been trying to professionalize a location that often felt like a flea market. This includes a significant improvement in the search function – which, in his opinion, is difficult when you consider that Etsy is selling 60 million unique items at a certain point in time. And occasionally this meant friction with sellers, either because of higher fees or because they were urged to offer fast shipping.
At a time when eBay has stalled and the number of "re-commerce" sites is increasing, Etsy wants to take every opportunity to attract new customers who may not have thought much about it, especially since the shopping behavior is flowing is.
"For everything you need, the habit is for so many people Amazon, Amazon, Amazon," says Silverman. "If only I could get her to pause for a split second and think:" Where else could I get something similar? "Etsy will come to mind most of the time."
And millions of mask buyers are now at least more aware of Etsy.
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