Are you planning to start an eCommerce business selling handmade goods? If so, you might be surprised (even overwhelmed) by the number of available marketplace platforms.
Shopify and Etsy are two of the most popular eCommerce platforms today, so there’s a good chance that your choice will come down to those two.
While Shopify is a standalone eCommerce platform that allows businesses to create their own fully customizable online stores, Etsy is an online marketplace that focuses on handmade, vintage, and unique items.
Both platforms have their own advantages and disadvantages, which can make it a bit of a challenge for businesses to decide which one is the best fit for their needs.
In this Shopify vs Etsy shop comparison guide, we’ll be taking an in-depth look at Shopify and Etsy, comparing their features and functionalities, and providing insights into which platform may be the best fit for your business.
- A successful eCommerce store has many features, like secure payment methods, user-friendliness, or compatibility with third-party apps.
- Shopify is a website builder that lets you have your own domain name for your online store while Etsy is an online marketplace with a massive existing customer base.
- Shopify is the better option if you want more flexibility while Etsy is a great choice if you want to start selling with little to no fuss.
Essential eCommerce Tools and Features to Look Out For
Since you’re reading this article, you probably understand the importance of picking the right eCommerce platform for your online business.
A robust eCommerce platform enables you to conduct all your business functions from a single software solution. This includes managing your own website and marketing campaign and facilitating your online sales, operations, and discounts.
The question is, how do you know which eCommerce platform is right for you?
To help make your decision-making process easier, here are some of the things you’ll usually find in all successful online stores.
After this overview, we’ll compare Shopify against the Etsy platform to see how they stack up on a feature-by-feature basis.
Payment gateway and processing options
From when humans first started bartering to the emergence of online marketplaces, one thing remained true: keeping customers satisfied will either make or break your brand.
This applies today to small business owners as much as it does to large corporations.
How do you ensure that a first-time buyer would be happy enough to come back for more?
That’s where a seamless customer experience comes in, and a big part of it is the ability to pay using a preferred method.
Most people still see online transactions as risky. So if they manage to find one (or more) payment methods they are comfortable using, they tend to stick with it.
The problem is there have never been more payment methods available than there are today.
In the 2000s and early 2010s, you had debit card, credit card, or cash. Those were your options. And paying online obviously negated the cash option, so you really only had two choices.
Now, you’ve got consumers using nearly a dozen cashless payment methods, like:
- Apple Pay
- Google Pay
- Samsung Pay
- Square Cash
Many vendors are even enabling payment via cryptocurrency!
Thankfully, both Etsy and Shopify have a large selection of payment processing options and take care of all the payment processing fees and back-end technology for you.
As you’ll soon realize, cart abandonment is a massive issue in eCommerce, so anything you can do to make the checkout process more convenient will go a long way.
Plus, you’ll appear trustworthy because you have the resources to accommodate the needs of different types of customers and process whatever payment method your users are most comfortable with.
Ease of setup and customization
When searching for an eCommerce platform, it is important to find one that is easy to set up and enables you to start selling quickly and easily.
This means having a user-friendly interface with a lot of community support, an easy learning curve, and responsive customer support teams with multiple points of contact (chat, email, phone).
Additionally, it is important to consider the customization capabilities of the platform you choose.
This will allow you to add your own design elements, web pages, and custom widgets to your online store, helping you to stand out in the competitive eCommerce landscape and catch the attention of your target audience.
Storefront design and user experience
When it comes to choosing an eCommerce solution, storefront design and user experience are critical factors to consider.
Your storefront design is the first impression potential customers will have of your business, and it can significantly impact their decision to make a purchase.
Therefore, it is essential to look for an eCommerce solution that offers:
Customizable storefront templates
A good eCommerce platform should offer a wide range of customizable templates that allow you to create a visually appealing and unique storefront that aligns with your brand.
This helps your store to stand out and create a lasting impression on your customers.
It’s important to choose an eCommerce solution that provides a responsive storefront design that is optimized for all devices, including desktops, laptops, tablets, and smartphones.
A responsive storefront design ensures that your store looks great and is easy to navigate on any device, which is crucial for providing an excellent user experience.
Thankfully, responsive design is pretty much the standard these days, and you rarely have to worry about a theme or marketplace not supporting devices of all shapes and sizes.
The storefront design should be intuitive and user-friendly, allowing customers to find what they’re looking for quickly and easily.
This includes simple navigation menus, clear product categories, and an easy-to-use search function.
Ability to feature high-quality images and product descriptions
An eCommerce platform should provide the ability to showcase (many) high-quality product images and detailed product descriptions. This allows customers to get a clear idea of what they are purchasing and can improve the user experience.
In a marketing study from 2018, 87.6% of respondents said clear product images were the most important factor in making an online purchasing decision.
If there’s one lever you can pull to make your product/brand look more professional, it’s a series of high-quality product photos.
Ability to manage multiple products and categories
Anyone who runs an eCommerce business will tell you that meticulous tags, product types, and categories are the keys to accurate reporting and overall site organization.
Trust me, I’ve seen some eCommerce sites with hundreds of products without any sort of categorization, tagging, or search features.
Properly organizing your products into categories and using accurate tags and product types makes it easy for customers to find what they’re looking for on your site. It also allows you to track your inventory, sales, and revenue accurately and efficiently.
When searching for an eCommerce platform, it’s important to look for one that offers robust product management features, including the ability to easily manage and organize your products into categories, tags, and product types.
This will help you provide a seamless user experience for your customers and ensure that your business runs smoothly and efficiently.
Platform fees and pricing structure
When it comes to choosing an eCommerce platform, it’s important to carefully consider the platform fees and pricing structure.
Different eCommerce platforms have different fee structures, so it’s essential to compare the pricing plans of different platforms to ensure that you are getting the best value for your money.
Some eCommerce platforms charge a monthly or annual subscription fee, while others charge a transaction fee or take a percentage of each sale. Some platforms may also charge additional fees for features such as payment processing or shipping.
For small businesses or those just starting out, a platform with a low or no monthly fee may be the best option. However, for larger businesses, a platform with more advanced features and a higher fee may be necessary.
When comparing eCommerce platforms, be sure to look beyond the initial pricing structure and consider factors such as the level of support offered, the quality of the platform’s features, and the platform’s overall reputation.
Additionally, consider any potential hidden costs such as payment processing fees, shipping fees, and other charges that may impact your overall profitability.
Available marketing and promotional features
Before you start selling, you need to consider how you’re going to promote your products or services. It’s essential to have a solid marketing strategy in place if you want people to (a) know that your brand exists and (b) choose you over your competitors.
Note that online marketplaces (like the Etsy marketplace) and website builders (like Shopify) have fundamental differences when it comes to promotional features.
Marketplace-style platforms (like eBay, Amazon, and Etsy) allow sellers to tap into an existing audience without having to spend too much energy generating traffic.
You still have to find ways to make yourself stand out, but there are native and add-on tools that you can use for this purpose.
All-in-one eCommerce platforms (like Shopify or WooCommerce) give you total control over your marketing campaigns. You’ll have your own eCommerce website and can manage your content as you see fit.
You will have to build your audience base from scratch, but you’ll have total ownership over that audience.
Integration with other services
Integration with other services is an important feature to consider when choosing an eCommerce platform.
An eCommerce platform that can seamlessly integrate with other tools and services can help streamline your business processes, increase efficiency, and improve the customer experience.
Some common integrations to look for in an eCommerce platform include:
Payment gateway integration is essential for processing online payments. Look for a platform that integrates with popular payment gateways such as PayPal, Stripe, or Square.
Shipping carrier integration allows you to easily manage and track your shipments. Look for a platform that integrates with popular shipping carriers such as UPS, FedEx, or USPS.
Integration with accounting software such as QuickBooks or Xero can help streamline your financial processes and make it easier to manage your books.
Marketing automation tools
Integrations with marketing automation tools such as Mailchimp or Klaviyo can help you manage your email marketing campaigns and other marketing efforts more efficiently.
Customer relationship management (CRM) software
Integration with CRM software such as Salesforce or Hubspot can help you manage your customer data and interactions more effectively.
Inventory management software
Integration with inventory management software can help you track your inventory levels, manage purchase orders, and ensure that you always have the right amount of stock on hand.
This can help you optimize your inventory management processes, reduce stockouts, and ensure you always have the products your customers want in stock.
By the way, SkuVault integrates with all major eCommerce platforms (including Etsy and Shopify).
Support and customer service
When selecting an eCommerce platform, it’s important to consider the level of support and customer service offered by the platform provider. Running an online store can be complex, and having access to quality support can be crucial in ensuring the success of your business.
Look for a platform that you can reach round-the-clock via multiple communication channels. There are those that support live chat, voice calls, emails, and more. Some have a wealth of training materials or an extensive FAQ section that you can refer to.
Social media integration to promote your shop
Social media is not only a good place for people to connect with friends and family. It’s also a powerful marketing tool for small businesses and large organizations who know how to use it.
Consider this: Facebook alone has almost three billion monthly active users spread across the globe. Instagram is not far behind, with its community of over two billion monthly active users.
Imagine how many potential customers and clients you can reach just between the two of them.
On the flip side, if you don’t promote on social networks, you’ll miss out on a lot of opportunities to sell. Even worse, these opportunities will go to competitors who took the time and effort to do social media marketing.
So when choosing a platform for your online store, make sure that it offers social media integration. This way, you can reach more of your target audience.
Scalability and growth potential
Scalability and growth potential are essential factors to consider when choosing an eCommerce platform.
While you may not think that scalability will ever be a factor for your business, it’s one of those things that can be a huge headache if you haven’t prepared for it. There’s nothing worse than having to switch platforms because the one you chose can’t handle the growth of your business.
Both Shopify and Etsy allow for tiered plans which facilitate easy scaling. However, they also come at a price.
Each offers features that allow you to easily ramp up and scale your business as it grows. For example, Shopify Advanced (their highest plan, billed at $299 per month) offers more favorable transaction fees, steeper shipping discounts, and up to 15 seats for a growing team.
Even if you envision your company as a “mom-and-pop” style shop forever, it’s important to plan ahead and ask yourself questions like:
- If the business grew 2x year-over-year, could this platform sustain me?
- What would be the switching cost of moving to another platform?
- Can this platform support multiple SKUs or product categories, and am I happy to stay in this ecosystem for the foreseeable future?
What To Consider When Picking Between Shopify and Etsy
Now that we have discussed the essential features you should look for in an eCommerce platform, it’s time to move on to our Shopify vs Etsy comparison.
We’ll compare each platform through the lens of each aforementioned feature. Let’s dive in!
Ease of setup and use
When it comes to setting up your online store, both Shopify and Etsy are quite easy to use. You don’t need much experience or advanced coding skills; everything is highly intuitive.
Shopify, for instance, gives you access to amazing-looking themes and a user-friendly drag-and-drop builder. Even better, you can customize your Shopify store using one or more of the available plugins.
Basically, you can start selling craft supplies, vintage items, and virtually any other product, both physical and otherwise, from day one.
Unlike Shopify, Etsy does not let you build a website from scratch because the marketplace is already in place. Instead, you can use it to create an Etsy store.
This means the whole process of building a storefront is simpler and faster.
However, note that it’s not as flexible as a typical Shopify store when it comes to design and branding.
Both solutions are very easy to set up, but Etsy has a higher speed-to-market.
There are three pricing tiers you can choose from when setting up your Shopify store. First is Basic Shopify, which gives you access to unlimited product listings, 24/7 customer support, and different sales channels.
On top of this, you will also have a secure website with an SSL certificate, which is helpful in gaining the trust of potential customers.
Next is the Shopify tier (yes, that’s the actual name of the middle pricing tier), which is a bit more expensive. However, aside from the basic features mentioned above, it also provides five staff accounts, inventory locations, and standard reports capabilities. Plus, it gives you a discount on all your transaction fees, which Shopify charges.
Finally, Advanced Shopify offers 15 staff accounts and access to advanced reports. Also, a third party will calculate your shipping rates, which will allow you to save money.
As for Etsy, there are no costs involved when setting up your account. However, you’ll have to pay fees as you stock your Etsy store.
Etsy fees include a payment processing fee for each purchase, a transaction fee, and a listing fee for each product listed.
Since Etsy has very little upfront costs and comparable transaction fees to Shopify, we’ll also give this victory to Etsy.
Payment Processing Options
Shopify is among today’s biggest eCommerce platforms. As a result, it has a lot of influence over its users and partner companies alike, especially when it comes to payment gateways.
There was a time when the platform relied solely on third-party gateways, and they had a long list of compatible options. This includes Apple Pay, Amazon Pay, Google Pay, and PayPal. However, Shopify came up with its own processing solution in 2013 with Shopify Payments.
If you use Shopify Payments for your online store, you’ll have to pay for a monthly plan and standard credit card processing fees. That said, you won’t have to pay transaction fees for every sale.
This is a pretty big deal for stores that do high volumes of daily sales.
Thanks to Etsy Payments, Etsy sellers also have access to widely accepted payment options, such as bank transfers and credit or debit cards. However, Shopify offers more.
What’s more, Etsy Payments doesn’t waive the fees on any of the Etsy listings, unlike what the native payment option does for the payment processing fee of Shopify app store owners.
For that reason, the clear winner is Shopify.
One of the most important points of discussion in this Shopify vs Etsy comparison is their selling tools. In this regard, Shopify is a clear winner.
Shopify offers a treasure trove of eCommerce features, including Shopify POS or point-of-sale. Shopify POS also gives you the option to sell your products in person. Out of the box, you have the ability to sell in-person products or services. Pretty handy.
All plans come with discount codes and gift cards, even Basic Shopify. Of course, you also manage your own website on this platform, so you can create custom pages, integrate your choice of marketing tools, or implement store automation.
This also means the ability to do full-scale content marketing campaigns and optimize every aspect of your site for Google Search.
On the other hand, Etsy sellers don’t have access to as many tools. This is because Etsy users are simply joining a pre-existing (and very locked down) online marketplace.
Etsy does offer a solution called Etsy Pattern, a tool that provides Etsy users with their own website outside of the marketplace.
Still, Shopify is far and away the superior choice in this category.
Another essential part of this Shopify vs Etsy comparison is the marketing tools that they offer. Again, Shopify has the edge in this round.
Etsy users have to create their campaigns on their own as they don’t have access to built-in marketing tools. That said, they can get Etsy Plus to unlock more features, like customization tools and credit toward Etsy ads.
Unlike Etsy, Shopify comes with a number of marketing capabilities. You don’t even have to spend more money on Advanced Shopify to enjoy the benefits of email marketing and access to multiple sales channels.
Shopify also has a rich ecosystem of third-party Apps (think plugins for WordPress or WooCommerce) that open up all sorts of advanced functionality simply unattainable on the Etsy marketplace.
Shopify wins again.
The next item in this Shopify vs Etsy comparison is app integrations. Both eCommerce platforms have much to offer in this department, although Shopify does it a bit better.
To illustrate, the Shopify App Store has over 6,000 apps for you to choose from, so you will surely find one that can help you run your online shop with greater efficiency.
Etsy is also compatible with several third-party apps for marketing, reporting, and other applications. However, its selection is not as extensive as that of Shopify.
Shopify wins by a nose.
In this part of the Shopify vs Etsy debate, the two platforms are almost even.
Shopify has a responsive customer support team you can reach 24/7 via live chat or voice call. You could also get in touch with them through one of their social media accounts or their email.
If you want to try solving an issue yourself, you could refer to a wide range of informational materials that include Shopify community forums, video tutorials, and instructional articles.
Etsy’s customer support infrastructure is also quite robust. It offers 24/7 live chat too, which is very helpful. However, it does not have as many contact options.
We’ll call this category a draw.
Our Shopify vs Etsy comparison continues with the pricing plans. In this department, the ideal choice will largely depend on how many items you sell.
Shopify has a monthly subscription fee, but it lets you sell an unlimited number of products. Also, it doesn’t charge transaction fees for processing payments if you use Shopify Payments.
Etsy Payments doesn’t offer discounts on the transaction fee, unlike Shopify Payments.
Shopify is much more expensive up front, but you get what you pay for: a website builder, an ecosystem of third-party add-ons, and all the payment processing methods you could ever want.
It’s impossible to pick a winner for this category, as it completely depends upon your goals.
In the final stage of this Shopify vs Etsy discussion, we’ll discuss the variety of products you could sell in your online store.
Shopify allows its users to sell any item, whether physical or not. This includes your handmade goods, craft supplies, and other similar offerings.
On the other hand, Etsy specializes in items designed by the sellers themselves. It is restrictive in this regard, but it connects you to your niche market directly.
Which Is Right For Your Store?
Whether you should go with Shopify or Etsy would depend on your business, budget, goals, preference, and skillset. Nevertheless, in some areas, there’s a clear frontrunner.
For instance, if you’re looking for a platform with more payment options, Shopify is your best bet. The same is true if you want access to a wealth of marketing tools that can help you grow your business.
Setting up shop with Shopify also makes sense if you have unique technical needs that only third-party apps can meet. Not to mention the fact that you can build and customize every single facet of your website, create custom branding, and execute SEO best practices.
Etsy might be the better option if you sell handmade goods exclusively because its target audience is more specialized.
It’s also best for those who have no desire to build a personal brand or muck around with a back-end CMS or website builder.
However, there’s a catch: Etsy could get expensive quickly if you sell a lot of items from month to month.
Conclusion: The Bottom Line
Shopify gives you more control and more features at a higher price, including your own website, which can be a time-suck to maintain. You’ll also be building your audience from scratch, which can be a grind (and take a long time).
Etsy limits your control over design, branding, and third-party integration, but at the benefit of getting a guaranteed audience. It’s also got virtually zero startup fees and very fast go-to-market capabilities.
Both are excellent tools that will likely only continue to improve in the coming years. And frankly, there’s no reason why you can’t try both platforms for a few months, experiment with which you like better, and double down on the winner.
At the end of the day, you as a small business owner are the true winner. There’s never been a better, easier, or less expensive way to get your business off the ground and build the life you want as an eCommerce entrepreneur.
Thanks for reading, and good luck!
Frequently Asked Questions (FAQs) about Shopify vs. Etsy
What is Shopify?
Shopify is an eCommerce platform that allows you to build and manage your own website. You can use it as an online store from which you can sell any type of product.
What makes Shopify a favorite among business owners is that it has everything you would need to start selling, including marketing tools, payment methods, and handling of inventory.
What is Etsy?
Etsy is an online marketplace that caters to handmade products, craft supplies, and vintage items.
Unfortunately, it does not let you build your own website, but this is a better option for some people who don’t want to go through the trouble of designing the pages and coming up with shop policies.
What are the key differences between Shopify and Etsy?
The biggest difference between the two eCommerce platforms is that Shopify is a website builder, whereas Etsy is an online marketplace.
As a result, Shopify offers more flexibility in terms of customization, payment options, and other features.
What are the advantages of Shopify?
The biggest draw of selling on Shopify is that it gives you more control. You can tweak your website as you see fit or use one of the many compatible apps to unlock more functionalities.
What are the advantages of Etsy?
Etsy takes away the hassle of having to design your own shop. In addition, it already has an existing base of potential customers.
How much does Shopify cost?
Shopify has three pricing tiers that range between $29 and $299 a month. It has something for businesses of all sizes with different needs. In addition, it doesn’t charge transaction fees as long you use Shopify Payments.
How much does Etsy cost?
Etsy charges its sellers $0.20 for each product listing. On top of this, Etsy sellers must also pay a 5% transaction fee for every product sold.
Which platform should I choose?
At the end of the day, your choice depends on your business goals. If you want your very own custom website with control over every aspect of your online presence, then Shopify is a wise choice. On the other hand, if you want something that is virtually ready-made with an existing base of potential customers, go with Etsy.