Etsy continues to make refinements to its business model as it seeks a return to growth amid increasing competition. The company’s latest moves include selling off Reverb, a resale marketplace for musical instruments that it acquired in 2019, and a host of updates to its seller experience.
Etsy Offloads Reverb to Focus on its Core Businesses
Reverb has been purchased by a holding company that operates as a subsidiarity of a company jointly owned by Servco Pacific — a Hawaii-based corporation that operates in the automotive sector as well as distributing musical instruments and other commercial products — and tech investment company Creator Partners, according to a filing with the U.S. Securities and Exchange Commission.
Financial details of the deal were not disclosed, but Etsy did note in the filing that “the acquirors share Reverb’s experience in the music industry and focus on supporting musicians,” adding that the divestiture was intended to allow Etsy to focus on its core businesses — its namesake marketplace and the resale marketplace Depop that it acquired in 2021. The sale is expected to close within a few months.
“There are a number of similarities between the levers of growth for Etsy and Reverb, such as improving search and discovery, making selling and buying easier, and building a global brand and user community,” said Etsy CEO Josh Silverman at the time of the Reverb acquisition back in 2019. Interestingly, those are the same levers Etsy is pulling now as it looks to institute a turnaround in its core businesses, where growth has flagged in recent years. Business also appears to be flagging at Reverb, with gross merchandise sales on the platform declining to $917.9 million in 2024 from $942.1 million the previous year.
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Improved Etsy Seller Experience Aimed at Addressing Previous Complaints
Etsy’s challenges reached the mainstream media in 2023, when sellers began to vocally protest the platform’s payment practices and fees. Other retailers, including Amazon and Michaels, took advantage of the moment to promote or launch their own competitive offerings, and Etsy has been working to strengthen its position as the foremost marketplace for handmade goods ever since.
So it’s no surprise that following consumer-facing improvements like enhancements to the app experience, search experience and testing a new loyalty program, Etsy’s latest move now focuses on the seller experience. The updates are designed to “directly address some of the challenges sellers have flagged and demonstrate Etsy’s commitment to listening to feedback and providing sellers with the tools they need to thrive,” according to comments from an Etsy representative that were shared with Retail TouchPoints.
These updates include:
- Making it easier for sellers to list their products, with new capabilities including the ability to edit photos direction in the Etsy Seller App and a pilot of new technology that will give sellers real-time feedback on the quality of their listing to help them optimize visibility before publishing;
- Enhancing the Shop Manager platform to make it faster and more focused, with a streamlined dashboard that focuses on stats, orders and recent activity and simplified navigation;
- Expanded 24/7 live chat support in Shop Manager to help sellers resolve issues quickly and confidently; and
- Improved ad placements within Etsy search to enhance efficiency and ROI for sellers looking to reach new audiences with advertising.
