Etsy is sending out 20% coupons to select buyers as holiday marketing ramps up.
Back in June, we let you know that we sent a select group of buyers an Etsy coupon for 20% off their next purchase to encourage them to come back and shop more on Etsy. This campaign was successful in bringing more buyers back to shop on Etsy, so we wanted to give you a heads up that we’re running another similar discount campaign next week.
A new group of buyers will receive an email with a 20% off coupon fully funded by Etsy that they can use towards their next purchase. The promo code will be unique to the buyer and will last for two days.
Etsy-funded discount strategies like these are one of the many ways we’re working to help bring you repeat buyers. Be on the lookout as we continue to build marketing opportunities and resources to help you grow your business.
As the announcement says, Etsy did the same thing back in June, offering a similar Etsy-funded 20% off coupon to a "targeted set of buyers" that was good for 2 days only.
I have to believe the timing of pumping out these discounts just days before the end of a quarter is likely not a coincidence and once again CEO Josh Silverman seems to be looking to his old employer, eBay, for inspiration.
Ex-eBay CEO Devin Wenig desperately threw eBay funded sitewide discount coupons out to buyers in 2018 at a rapid pace in what ended up being an expensive mis-step for the company.
Buyers became habituated to the couponing, so they actually bought less frequently as they sat around with items in their carts waiting for the next discount to drop and when they finally did buy, the discounts favored higher ticket items at lower return on investment (ROI) for eBay.
By Q1 2019, Wenig was forced to admit the massive discounting strategy didn't work and eBay reversed course. (emphasis mine)
As we mentioned last quarter, we entered the year with the intention to reduce low ROI marketing spend while maintaining the focus on driving positive buyer growth with new product experiences and targeted marketing. In Q1 that's exactly what we did. We removed the significant amount of promotional spend that tended to subsidize higher priced items at low ROI.
While the idea of having the marketplace fund coupons may seem attractive to sellers, there can be a downside to the practice as well, especially if done too often.
If you're an Etsy seller, what do you think of Etsy funded coupons for buyers? Would you rather see them direct that marketing spend toward ads or other strategies to bring more buyers to the site?
Let us know in the comments below!