As if Amazon wasn’t dominating much of the retail market already, their recent move to gain buyers and sellers in the “handmade” space came as a bit of shock. Handmade, after-all, is a complex word that essentially summarizes the craftsmanship of creative entrepreneurs. Keeping this in mind, it’s hard to grasp how an online marketplace like Amazon – known for it’s diverse assortment of inventory ranging from groceries to electronics to toys and more – can welcome this specialty market of “handmade” into their already crowded marketplace.
At 3 a.m. Eastern this past Thursday, 80,000 items from about 5,000 sellers in 60 different countries went live onHandmade at Amazon. Meanwhile, Etsy – a vibrant, handmade marketplace that recently celebrated ten yearsafter beginning in a small apartment in Brooklyn – continues on their path for creative entrepreneurs to pursue their passion by connecting buyers and sellers. In fact, over 1.4 million entrepreneurs have done just this – and while Etsy doesn’t sell as vast of inventory as Amazon does at large, what it does sell is a unique environment for this niche, creative, handmade market to connect.
I reached out to Etsy this past Thursday, and was pleased to connect with their CEO, Chad Dickerson, who had this to say:
We believe we are the best platform for creative entrepreneurs, empowering them to succeed on their own terms. Etsy has a decade of experience understanding the needs of artists and sellers and supporting them in ways that no other marketplace can. Our platform attracts 21+ million thoughtful consumers seeking to discover unique goods, and build relationships with the people who make and sell them,” stated Dickerson.
Etsy is a ten year veteran in the handmade marketspace, however Amazon is now aiming to compete in their space. Photo Credit: Etsy
Etsy is a ten year veteran in the handmade marketspace, however Amazon is now aiming to compete in their space with their addition of Handmade at Amazon, launched October 8, 2015. Photo Credit: Etsy
While there’s a lot you may try and read-through-the-lines here,the biggest takeaway I believe is that Etsy – unlike Amazon – is a niche marketplace that is uniquely designed for creative entrepreneurs and those buyers that aim to support them. Their goal is not to just sell items that fall under the handmade category, but also to connect those involved to help each other along the way. A great example of this is the Quiltsy Team TISI +%, a group that connected through Etsy’s “Etsy Teams” platform and created a month of charitable quilting called Quiltsy Cares. Each day in March 2015, this group donated quilts or knit items to various organizations they support with 24 total organizations receiving donations – including Quilts of Valor, which gives quilts to U.S. service members and veterans. With this serving as just one example of  many, it helps to show that Etsy goes far beyond being a marketplace for creative entrepreneurs, but it also serves as s destination for buyers and sellers alike to connect, gain a variety of resources to gain stronger selling success (such as their Seller Handbook, online seminars, and in-person trainings) and even help make some entrepreneurs scale larger than they could have done alone thanks to Etsy Wholesale – a fairly recent addition Etsy launched in July 2014 to create new opportunities for sellers to connect with qualified, independent boutiques and larger retailers likeNordstrom JWN +0.00% that are looking for unique, hard-to-find products to stock in their stores.
The Differences in Handmade: Etsy vs. Amazon 
If you were to ask nearly any consumer the difference between Amazon and Etsy, it’s likely the list would be long. With Amazon’s recent addition of Handmade at Amazon, however, Etsy and Amazon suddenly have a few things in common. This said, even with their new similarities – there are still many differences. To help you understand just what these differences are, review the following:

First and foremost, the definition of handmade varies between Etsy and Amazon. Etsy describes handmade as being complex and bases this off of ten years of working history. Over these years, their definition of handmade has evolved, with feedback from their community contributing greatly to their definition of handmade. In a nutshell, everything listed in their handmade category must be made or designed by the seller. The seller may hire employees to help run her business or outside help to assist in making her designs, but if a seller is using any outside help this must be approved through Etsy’s outside manufacturing review process. Whether crafted by an Etsy seller herself, with the assistance of her employees, or with an outside manufacturer in small batches, handmade goods spring from the imagination and creativity of an Etsy seller and embody the principles of authorship, responsibility and transparency.
Meanwhile, Amazon requires that all products be made entirely by hand, hand-altered, or hand assembled by companies with 20 or fewer employees or collectives with less than 100 people.
When it comes to pricing and fees associated with selling through Etsy and Amazon, there are some variations, as well.
From the outside looking in, Etsy appears to be the most accessible marketplaces for small businesses to sell on. They have a 3.5% transaction fee and $0.20 listing fee that means that nearly 96.5% of the revenue from a sale goes directly to our sellers. Etsy sellers also have the option to pay for seller services, including promoted listings, direct checkout and shipping labels.
On Amazon, a seller pays a transaction fee of 12% of the item price or $0.50, whichever is greater. This fee includes payment processing and sellers also have access to discounted shipping and Amazon’s Sponsored Products service. In addition, all Handmade at Amazon sellers will need to have a Professional Seller account and pay a monthly fee of $39.99. Noted in their online footnotes, this fee is waived through August 1, 2016, for Handmade at Amazon sellers. Finally, however, the fee waiver is not applicable for artisans who sell more than 40 items in categories on Amazon other than Handmade at Amazon categories in a month.
While sellers have their own decisions to make when it comes to selling on Etsy, Handmade at Amazon or both, the real question – as always – will be where consumers choose to shop.