Etsy’s Reign of Terror – Discrimination and Abuse

Most of the press we encounter about Etsy talks about how great and innovative of a company it is and how they give small artists and artisans a chance to sell their wares in a global market. But that is only a partial truth, no one is talking about what happens behind the scenes, about the corpses scattered all over and the lives left in ruins along the way.

Yes, darling Etsy has been abusing its power and victimizing sellers with a very flawed, discriminatory, arbitrary and ineffective Integrity Policy, in which many shops are shut down without any evidence of misdoing or any legitimate explanation. Many of these sellers are genuine craftsmen following all the rules and whose only income is derived from Etsy. Some of these sellers are people who have been building a business and reputation for years and are left with nothing as Etsy with the click of a button erases all, even their feedback history which is the core of someone’s commercial history online.

Etsy has a very discriminatory way of applying their so-called Integrity Policy, they react to reports of Etsy members, usually sellers, who can anonymously and freely flag any store without having to produce any evidence of violation, Etsy then make some of these flagged shops a target and overlook others, needless to say that some of the targeted shops belong to legitimate artisans and some of the overlooked ones are from resellers of mass-produced items.  Many of these targeted sellers are bullied and harassed, asked to proof themselves time and time again with poorly designed and inconclusive processes that are arduous and take many hours, some others are simply kicked out without having the opportunity to defend themselves or being offered a legitimate explanation or in many cases citing a violation that doesn’t exist anywhere in their TOU or one that has been interpreted at their whim. All this happens while many infractors are left totally undisturbed.

BUT IF ETSY NEGLECT THEIR DUTIES TOWARDS SHOPS THAT ARE BLATANTLY BREAKING THE RULES, AND THEY THEMSELVES VIOLATE THEIR OWN RULES SO OFTEN, WHAT KIND OF MORAL AUTHORITY CAN THEY CLAIM IN ORDER TO SHUT DOWN A SINGLE SHOP?

Being realistic, even if their Integrity procedures were efficient and transparent, in most cases is almost impossible to prove if an item was produced by the owner of the shop or someone else, or if certain vintage piece is older than 20 years. So the arbitrary and frenzied “cleaning” they are engaged on added to the incompetence of their Integrity Team, becomes more of a blind witch hunt inside their little Dictatorial Regime, that is hurting more innocents than culprits. Haven’t they realized their system doesn’t work and that this is not the middle ages nor are they an Independent Republic?

Their vague “DOs and DON’Ts” leave tons of room for unsavory characters to get in disguised as craftsmen/artists and also allows Etsy to accommodate and bent these policies according to their convenience, which they do without any hesitation.

But if you are among the many Etsy community members who is already aware of the situation, you also know that you are forced to keep your mouth shut, as criticizing them in any way, shape or form will get you expelled and “excommunicated” faster than you can say “oh!”, you won’t even be able to do shopping there ever again. No, this is not a joke! This is their idea of business in the 21^st century.

So if you are part of the 25 million members of the Etsy community who believe this kind of behavior doesn’t affect you or will never apply to you, because you have been there for years, always follow the rules, or are just a buyer not a seller, think again, this can happen to anyone and affects everyone.

Lets dissect the anatomy of the damage with the following case study in which we will focus on one shop that has been reported many times and for some reason Etsy allows it to keep running. Etsy knows who we’re talking about so here we will call it XYZ, not because we feel the need to protect its identity, but because there are many like it and then we will need to name all the cases we have identified.

XYZ has been in business for a little over 2 years, it sells “handmade” jewelry by a very talented girl, so much so, that up to today (when this article was published) she has sold over 15.000 items  (not cheap ones). Her sales triplicated in 2012 (to about $400,000-$450,000 in gross sales), the only problem is that about 80% of her sales come from items manufactured in India, specially gold vermeil bezel set gemstone rings, but bangles and earrings also. But she is talented alright, she has managed to fool thousands of buyers under Etsy’s watch. Here is the breakdown:

• XYZ buys her finished rings from India at about USD$8 or probably less as she buys them in the thousands.

• Because she claims these rings to be handmade directly by her or her “collective”, she is able to charge anywhere from $56 to $66 per ring (although the manufacturer charges her the same amount of money for all rings, as the different stones used are in the same low price range category).

• She is able to sell them at these ridiculously high prices because people are buying them under false pretenses. Exact same rings sell in ground-floor retail stores in Mid-town Manhattan for $25, although physical stores have to pay rent and overhead, XYZ doesn’t.

• BUYER HAS THEN BEEN MERCILESSLY RIPPED-OFF AND DECIVED.

• As XYZ sells anywhere from 15 to 50 rings per day (subject to time of year, discounts, etc.), is taking a lot of business from legitimate jewelry makers.

• Legitimate jewelry makers are also forced into unfair competition or not to compete at all since many of them can’t or won’t produce such big amounts of rings per day.

• Legitimate jewelry makers leave and the genuine artisan community shrinks.

• Other people see XYZ is getting away with it so easily, is an invitation for them to do the same.

• If Etsy’s very intelligent and sophisticated SCRAM system (Systems for Catching Resellers and Abusers of the Marketplace) hasn’t flag this store many times already, means it is totally useless.

• The only reason this is happening in the XYZ case is because Etsy is allowing it to happen.

Now multiply this by the hundreds or thousands of shops in the different categories that are reselling mass-produced stuff.

How is this happening under Etsy’s nose? It’s a great question, they have been notified of XYZ for more than a year, all the info regarding the Indian manufacturer has been offered to them to no avail. Corroborating this story was as simple as visiting the manufacturer’s showroom in mid-town Manhattan (short ride from their Brooklyn offices), it was not a coincidence for XYZ to be selling the exact same jewelry items with the exact same shapes, exact same stones and exact same craftsmanship quality.

A big number of us who make jewelry and buy our gemstones from Indian manufacturers will recognize their finished jewelry offerings on the spot, it is actually very easy and does not require much genius or expertise, but why is that Etsy’s Integrity team doesn’t have the expertise (Etsy have plenty net income to hire as many specialized, competent people as they wish), or do they and they just turn a blind eye on these sellers because they produced them a lot of money.

These sellers also get a free pass hiding behind Etsy’s “collective” concept, but a shop that sells 30-50 items a day (items that are not made in a few minutes) is not even a “collective” anymore, it is a Factory! Etsy refuses to draw lines wherever is not convenient for them.

As harsh as some of this may sound to some of you, especially those who have no clue this is going on, know that  it’s all true and verifiable!  We know many of you love Etsy and your first reaction will be denial, but remember that the portion of the Etsy community comprised by very talented artists and artisans that you love and who in some cases are so altruistic to even donate their time and work to the noblest of causes have nothing to do with Etsy Corp, which is the portion we are denouncing here. And please, stop assuming that all stores shut down did something to deserve it. There are many people suffering due to Etsy’s injustices and the inhumane, arbitrary and unprofessional ways of applying their policies.

We, the people writing this article, are among Etsy’s latest victims and had to speak up, because what they are doing is WRONG.  Etsy’s honest sellers and buyers deserve more clarity, more honesty and more equality, Etsy needs to stop the tyranny and the double standards!

Unfortunately, like many of you, small artisans and artists, we cannot afford to spend thousands of dollars going through JAMS Arbitration as specified on Etsy’s ToU or hiring a lawyer to right the wrong. The only thing we have that we can afford to use is our voices.

After this happened to us (our story here: http://wp.me/p3kXuD-V) we have spent many hours of many days researching in order to better understand the nature of the beast, we have read all the cases we have been able to find from people reporting the same or similar issues with Etsy (there are way more than expected, but these are just a few, unfortunately, most folks don’t report these cases publicly). But, in all we read, we found only one person claiming being successful in having her Vintage Shop reopened on Etsy and getting financial compensation from them, but she was lucky to have a cousin who is a lawyer and partner of a law firm to work her case. The rest of us will crash with the reality that no lawyer will take this type of cases, because the financial loses are not in the thousands of thousands and litigation costs will be higher than any gain.

CONCLUSIONS

If you are planning to open a s tore on Etsy, think first like a business person and ask yourself : “is the risk worth it?”. Or simply apply this mantra: “If the deal is not right, walk away”.  Remember that is your livelihood that is a stake.

If you are already a shop owner these are some things you can do to mitigate the damage if something like this were to happen to you:

–         Don’t make Etsy your only option, have other stores in different sites and if possible open you own website. Have plans B, C, D & E always ready.

–         Keep PayPal as your checkout method, that way if your shop gets shut down, you will be able to fulfill any pending orders and save some of your reputation.

–         Even if you can proof in 1000 ways you handmade your items yourself, you have 100% positive feedback and have been selling on Etsy for many years, don’t make the mistake of thinking you are safe and don’t put any faith on the fairness or good judgment of Etsy, because there is none. Once you are flagged by another seller or by SCRAM you are a target and if they decide to review your case, it’ll be done by a entry level agent with no real qualifications to analyze and judge your manufacturing methods/procedures, your materials, tools or any other document you present as proof.

–         Don’t stay quiet; REPORT, REPORT, REPORT “Injustice thrives when good men do nothing”.  Wait until the anger has subsided and report your case in as many places as you can, do it in a clear and concise way. You can do it anonymously, but let people know the items you were selling, this creates a record of which categories are being attacked.

If you are a buyer do your research before purchasing, you might find the exact same item cheaper and without any deception in a lot of other places.

This video depicts Etsy’s Integrity Team discriminatory and draconian practices.

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OTHER RESOURCES:

SITES TO BUY AND SELL HANDMADE OR HOST YOUR WEBSITE:

http://www.artfire.com/ – http://www.luulla.com/ – http://www.zibbet.com/ – http://www.storenvy.com/ – http://en.dawanda.com/ – http://trembu.com/ –  http://www.bonanza.com/   http://www.craftisart.com/ – http://www.shophandmade.com/ – https://handmadeartists.com/ – http://crafterstown.com/ – http://www.rubylane.com/ – http://madeitmyself.com/ – http://meylah.com/ – http://articents.com/ – http://www.silkfair.com/ – http://www.shopdelighted.com/  – http://www.craftshowcase.net/ – http://www.storemate.com/

–http://www.ecrater.com/ – http://bigcartel.com/ – http://www.bigcommerce.com/ – http://www.shopify.com/ – http://retailrapp.com/ 

LINKS TO A FEW OTHER VICTIMS’ COMPLAINTS:

http://wtfbyrne.tumblr.com/post/50655942027/my-letter-to-etsys-executives
http://www.justanswer.com/law/7qrzq-hi-i-own-ed-store-www-etsy-com-website.html
http://www.consumeraffairs.com/online/etsy.html
http://www.ebay.com/gds/why-etsy-is-unsafe-for-buyers-and-sellers/10000000013523439/g.html
http://www.handmadeology.com/etsy-shop-suspended-what-you-need-to-know/  read comments also, they are current!
http://www.yelp.com/biz/etsy-brooklyn#hrid:7HJ4pEIEQR6NM6dpyi5nCQ/src:self
http://amplicate.com/hate/etsy/5312988-unreasonable-suspension-etsy-is-fraud
http://amplicate.com/hate/etsy/5358236-unreasonable-suspension-not-acceptable/
http://www.why-girls-are-weird.com/2012/11/dear-etsy.html
http://tsilivithrini.blogspot.com/2011/12/etsy-shop-suspended.html
http://cinderssays.blogspot.com/2013/01/i-used-to-sell-on-etsy.html
http://www.auctioninsights.info/etsy-still-dropping-sellers.html
http://community.zibbet.com/forum/topics/etsy-suspended-my-shop
http://blogs.houstonpress.com/artattack/2012/01/etsy_closes_azreals_accomplice.php
http://artmakersworlds.com/etsysucks.html

AGENCIES AND SITES TO FILE A REPORT AND/OR COMPLAIN:

http://www.ag.ny.gov/internet-bureau-online-complaint-form
http://www.bbb.org/new-york-city/Business-Reviews/internet-shopping/etsy-inc-in-brooklyn-ny-104233/complaints
http://www.consumeraffairs.com/online/etsy.html
http://amplicate.com/hate/etsy
http://etsy-reviews.measuredup.com/3184
http://www.consumerabuse.org/
http://etsy.pissedconsumer.com/
http://www.complaintsboard.com/complaints/etsy-useless-trust-and-safety-team-admin-c610901.html
https://getsatisfaction.com/etsy/topics/_shop_suspended_message
http://www.ripoffreport.com/Search/etsy.aspx
PlanetFeedback.com
http://www.consumer-action.org/helpdesk/
http://www.sitejabber.com/reviews/www.etsy.com
http://www.viewpoints.com/Etsy–25479-reviews