Visiting Etsy, Amazon’s Next Prey

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Handmade at Amazon, which launched earlier this month, is surely hoping to encroach on Etsy’s stable of more than a million sellers. Handmade at Amazon, which launched earlier this month, is surely hoping to encroach on Etsy’s stable of more than a million sellers. Credit Illustration by Kristian Hammerstad

If you trust the press, Amazon is a capitalist leviathan, good for bargain-hunting consumers and bad for everyone else. The company’s founder, Jeff Bezos, intent on dominating the publishing industry, told his employees to “approach these small publishers the way a cheetah would pursue a sickly gazelle,” according to Brad Stone’s book “The Everything Store.” Last year, in this magazine, George Packer wrote about Amazon’s “shape-shifting, engulfing quality.” (Bezos once planned to call his company Relentless.com.) More recently, the Times ran a thorough piece that called Amazon’s work culture “harsh,” “punishing,” and “a world of frequent combat.” (Jay Carney, an Amazon executive, later fought this characterization in a blog post; Dean Baquet, the executive editor of the Times, pushed back against the pushback; and Carney responded to Baquet, all in the same day. Carney scored a few points, but it’s improbable that anyone was left with an impression of Amazon as a warm, fuzzy company.)

Earlier this month, a press release announced the launch of Handmade at Amazon, “a new store featuring genuinely handmade items crafted and sold directly from artisans.” Most of Amazon’s graphic design is minimalist, blocky, utilitarian; the Handmade logo, on the other hand, is written in a cute, wobbly serif. The dominant online marketplace for handmade crafts—for now, anyway—is Etsy.com, which was founded a decade ago. If you want a bird-shaped brooch or a crocheted tea cozy but have no idea where to find an artisan who makes such things, you might turn to Etsy. In exchange for connecting buyer and seller, the company takes a 3.5-per-cent cut of every sale. Amazon’s fee structure will be different—whether it will be better or worse for sellers is currently a matter of urgent debate on Etsy’s message boards—but it’s essentially the same business model. Artists can sell in both places, and Handmade at Amazon, which launched with just a few thousand sellers, is surely hoping to encroach on Etsy’s stable of more than a million. But Amazon has the clear advantage when it comes to active customers: Etsy has about twenty-two million; Amazon has more than ten times that number. The day the press release was issued, a dozen news sites referred to Handmade by Amazon as an “Etsy killer.”

“That kind of language doesn’t really fly here,” an Etsy employee told me last week. “It’s just so violent.” She walked me through the company’s headquarters, on a cobblestone street in Brooklyn, and introduced me to Chad Dickerson, the company’s C.E.O., who wore a Western-style shirt and jeans. “Military and sports metaphors fall pretty flat around here,” he agreed, smiling. “It’s just not our culture.” He led me into his office and sat in a leather armchair, cradling a mug of coffee. On a small table were a rough-hewn wooden clock and coasters in the shape of guitar picks, all purchased on Etsy. “We’re a pretty female-dominated community, both in terms of our employees and in terms of the sellers,” he said. “I’m not really the hard-charging alpha-male type. I do a lot of listening.” One employee told me that if Bill Clinton could be considered America’s first black President, Dickerson might be called Etsy’s first female C.E.O.

“We’re a public company, and we are interested in making money for our shareholders,” Dickerson continued. “And we also believe that a business can foster community, and be helpful to artists, and be responsible. Those two ideas can be confounding to people who like to think in polarized terms. ‘It’s all about profit!’ ‘It’s only about social good!’ Why can’t it be both?” He had another thought, but he stopped himself short. “I’m trying not to use binary language here,” he said. This might have been true, but he was also trying not to mention the elephant in the room: if Etsy, a certified B corporation, represents the altruistic side of the spectrum, surely Amazon is a paradigmatic example of the other side. (Amazon did not respond to specific questions, but did send me a statement that read, in part, “Customers on Amazon search for handmade items thousands of times a day. We are very pleased with the early sales.”)

I continued my office tour. It was a Tuesday, which meant that an internal initiative called Eatsy was providing lunch—ethically sourced food, prepared by local chefs, on the house. (Amazon, unlike other tech companies of comparable size, does not feed its employees.) Etsy’s headquarters, in DUMBO, look pretty much as one might expect: rich in plant life and tchotchkes, preciously graffitied. The front desk is a custom piece of art made from “local found objects”—i.e., Brooklyn street trash. There are many common areas, whose names are portmanteaux of musicians and food: Bon-Bon Jovi, Ace of Bouillabaisse, Pjörk. The air-conditioning ducts are wrapped in yarn.

I ate lunch with Heather Jassy and Stephanie Schacht in Depeche à la Mode. Jassy, the senior vice-president for members and community, said, “Etsy isn’t a growth-at-all-costs company. We want artists to succeed.” She seemed to be referring to a hypothesis I had read in the business press: that Amazon’s long-term strategy might be to gather sales data about its third-party sellers, then use that data to launch its own products, undercutting the sellers in the process. (It would not be the first time the company has been accused of such a thing.) Schacht, who holds a Ph.D. in sociology from Princeton, is in charge of “responsible seller growth.” She spent her first nine months at Etsy conducting surveys, and then integrating the data into “this huge manifesto that attempted to define what we mean when we call something handmade. The definition we settled on might not be perfect, but at least we are trying to be transparent.” At the end of the meal, I asked Jassy and Schacht what a world without Etsy would look like. It took a few moments for them to answer. Only when I looked up from my notebook did I realize that they were holding back tears.

In Dickerson’s office, he said, “The bottom line, for me, is: Does business have to be this zero-sum, gladiatorial thing?” He raised his eyebrows. “We’re explicitly not competing on price and convenience alone. We sometimes encourage our sellers to set higher prices, if that’s what their business needs. We believe that low prices are good, but so are other things—that artisans thrive, that they get paid a fair price, that they create good work. We’re making a big bet that consumers care about that stuff, too. Maybe we’re wrong. Maybe people really just want their goods made in huge factories and then delivered….” If he was about to say “by drone,” he stopped himself. “Look, we’re betting on humanity,” he said.

More specifically, Dickerson is betting that Etsy’s sellers will choose loyalty and community over capitalist efficiency. Recently, several Etsy message boards have been devoted to the question of whether to sell on Etsy, Amazon, or both. A jeweller named Lauren Teller, whose Etsy store is called The Old Mill Shoppe, wrote, “Amazon does not care about its sellers like Etsy does!” Bob and Sherry Truitt, artists in New Jersey, responded, “Etsy is run by investors same as ebay or Amazon. They don’t care about you.” Linda, a pillowcase designer in London, was more Solomonic, or at least more risk-averse. “What difference do the aesthetics make,” she wrote. “With 250 million buyers and if it gets sales I will gladly go with what requirements Amazon wants.”

*Amazon Studios is developing a New Yorker series in partnership with Condé Nast Entertainment.

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