Amazon and the Handmade Frontier

Today, Amazon launched a new marketplace called Handmade at Amazon, which takes competitor Etsy head on. This new arts-and-crafts bazaar hosts over 80,000 items from about 5,000 sellers in 60 countries, moves Amazon into new territory and positions it to take lead in the every growing, home-grown artisan market.

What’s in it for shoppers?

Amazon shoppers will already feel at home browsing around the 6 handmade categories—home, jewelry, artwork, stationery and party supplies, kitchen and dining, and baby—through a familiar interface and cart process. Each product’s detail page prominently displays the Handmade logo and features a picture of the artisan behind the work, with links for specific inquiries. So, they get to know the person a little more, and make a connection. While being able to request custom products, shoppers can also easily automate the made-to-order purchase process without directly contacting the seller through Amazon’s options.

Shoppers are also assured that these products are in fact, handmade (not just made to look handmade). Amazon has been vetting artisans since May for their marketplace, and has strict guidelines for what constitutes handmade:

All products available in your Handmade at Amazon store must be made entirely by hand, hand-altered, or hand assembled (not from a kit). Products must be handmade by you (the artisan), by one of your employees (if your company has 20 or fewer employees), or a member of your collective with less than 100 people. Mass-produced products or products handmade by a different artisan are not eligible to sell in Handmade.

While this may seem like a trivial distinction to make, it’s one that Etsy has skirted since changing it’s vendor rules, allowing for outside manufacturing. Etsy’s controversial decision has lead to an expansion of what vendors offer, but there has also been a rise in counterfeit items and a perception of moving away from their handmade roots.

Prime shoppers may also find free expedited shipping through Handmade at Amazon for select products.

What’s in it for vendors?

Well, Amazon has 285 million active account shopper base, so that’s a ton more eyeballs on your wares than Etsy’s 22 million active accounts. Amazon is also offering sellers logistical benefits as well, such as lot shipping through their fulfillment centers across the country, enabling Amazon to ship the goods as part of the Prime program. On the site, sellers can develop a profile page to introduce themselves and their passion for their product, and also promote their goods through Amazon’s Sponsored Products advertising program.

Greater traffic and exposure, along with shipping, are certainly beneficial, but at what cost. According the NY Times:

Most sellers are likely to give Amazon a bigger cut of their sales for that reach, however. Etsy charges a 20-cent fee for each item a seller lists on its site and takes a 3.5 percent cut of the sales. For now, Amazon will charge no listing fee but take 12 percent of sales, which it says covers all costs, including payment processing, marketing and fraud protection.

Given that most of the vendors behind handcrafted goods are small, independent outfits, some still hobby enterprises, the addition of Amazon as another avenue for selling may add a layer of complication for folks already selling on Etsy or EBay. However, with increased traffic could come more consistent sales and more stability, and they may be better off opting out of their former markets.

What’s in it for Amazon?

Moving into the handmade market place isn’t a huge stretch. Amazon already has a general marketplace open to vendors. But it’s clear, Amazon is spreading its capabilities and diversifying offerings. While it has done this for years through products, some with more success than others, the company is geared up to take on services like grocery delivery and home repairs. So why not get a stake in the ever-trending artisan market, in this day and age of pinspiration? Why not put a different face on what IS Amazon? Through the handmade marketplace, Amazon becomes a supporter of the little guy, the independent, not just a big company pushing mainstream products like it’s big box competitors. It’s another feather in the hat for Amazon, so let’s see how this goes.