Where to Market & Sell your Handmade Products

If you put all your eggs in one marketing or selling basket, your business can take a big hit if a platform changes its algorithm, a craft show is cancelled, or a retailer carrying your goods closes.

You’ve likely heard of all the Etsy sellers who saw their sales drop in half overnight, due to changes Etsy made. 

But randomly adding new marketing and sales channels isn’t wise either. You have limited time, so you want to use channels that will give you the most bang for your buck and time.

You also must give it time. If you’re one of the sellers who’s experienced a drop in traffic and sales on Etsy, you can’t expect to hop on another online marketplace platform or start your website and see immediate traffic and sales.

 

WHAT IS A SALES CHANNEL

A sales channel is a platform you sell your handmade goods through. Sales channels may be direct (when you sell directly to a customer) or indirect (when someone else sells your products to customers).

Direct

Direct sales channels allow you to keep the majority of your profits with each sale.

Some of the direct sales channels that handmade businesses sell their products through are:

Website

Websites cost money to design and build, and have recurring fees when it comes to the domain, hosting, credit card transactions, etc. and can take months, sometimes even years, to build up traffic. But, you have full control over your website and don’t have to pay listing or commission fees.

 

Online marketplaces

Are cost effective to set up and typically charge a small fee to be a member each month, to list products or for each sale. You can take advantage of the traffic they bring to the website, however, they still require you to drive your own shoppers to your store to see significant growth.

 

Craft shows and events

Typically charge a fee for the space of a table or booth, however some events will charge a commission on sales or have additional fees for renting a table, wifi hookup, parking, etc. And of course, your time to maintain and sell through each channel must be accounted for when it comes to costs.

 

Indirect

Indirect sales channels will take a percentage of your profits so you must have good margins before you go down this path.

Some of the indirect sales channels that handmade businesses sell their products through are:

 

Affiliates

Affiliates get a percentage of each sale. You can decide on the percentage, but the juice must be worth the squeeze to attract enthusiastic affiliates who put effort into selling your products. Depending on your product and its profit margins, you may choose to share a bigger (e.g. 50%) or smaller (e.g. 15%) percentage, or have a fixed rate for each sale.

 

Retailers

Retailers will either purchase your products at wholesale prices or sell them through a consignment agreement (check out the pros and cons of each here). Wholesale prices are typically set at 50% of your retail price. Meaning if you sell a bag at a craft show for $100, a retailer would expect to buy the same bag from you for $50 so they can sell it in their store for $100 and make a profit.

Consignment agreements vary from store to store, with different commission fees and terms. The retail stores I sold my handmade products through on consignment typically took around 30 – 40% of a sale. It was nice to earn more money with each sale, but the downside was that I had to make stock for their store and wouldn’t get paid until it sold. I would also receive stock back if it hadn’t sold after several months, and then I was left with items that were shopworn or out of season.

 

Distributors

Distributors are the middleman between you and wholesale accounts. They reduce your profits even more, as they typically want an additional 20 – 30% off your wholesale prices. They’ll purchase your products and then sell them to retailers. The perk of using a distributor is that they have the connections to retail stores to grow the wholesale side of your business. You obviously need high profit margins for this option to work.

 

Sales Reps

Sales reps are similar to distributors, but instead of purchasing your products and selling them to retailers, they meet with retailers and market your products to them. They’ll take a commission of each wholesale order they get you.

One sales channel will likely be your main focus; however, the more channels you add, the more money you can make…to a certain extent.

Adding too many sales channels can be counterproductive if you don’t have a good handle on each. Before you can begin adding more to your plate, you must have a system for maintaining one sales channel and a plan for inventory management between channels.

The sales channels you choose will be dependent on your:

• Customers – where and how does your target market prefer to shop? Are they more likely to be online? And are they comfortable purchasing online and paying for shipping? Or do they prefer to shop in person?
• Products – are your products commonly purchased online or in-person? Do people prefer to touch or try on your types of products before purchasing? Selling at craft shows or retail shops may be ideal. If you sell a more specific, hard-to-find item, online may be better. Most people don’t shop for “soap” online. But the do shop for more specific types of soap (e.g. “charcoal and turmeric infused face cleanser).
• Your Business – how is your business set up and what can it handle? Are you able to spend weekends selling at craft fairs? If you need your work schedule to be more flexible, selling online may be better. But if you’re selling online, are you able to process orders and ship them out in a timely manner?

 

WHAT IS A MARKETING CHANNEL

A marketing channel is a platform or method used to drive shoppers to a sales channel.

People don’t just show up on your website, at your craft show table, or at a retail store; something must lead them there (even if it’s a “craft show here” sign on the street they happen to be driving down).

A few examples of marketing channels are:

• Social media sites (e.g. Facebook, Instagram, Pinterest)
• Media (e.g. newspapers, TV, magazines)
• Search engines (e.g. Google, Yahoo)
• Print marketing (e.g. business cards, postcards)
• Events (e.g. networking events, craft shows…yes, craft shows are both a sales channel and a marketing channel)
• Blogs (e.g. your website’s blog or someone else’s)
• Email

Marketing methods are the techniques you use on those marketing channels to gain attention.

For example:

• Social media – paid ads, posting photos or videos, sharing links to blog post
• Media – paid ads, press releases
• Search engines – paid ads, SEO

Many handmade businesses either have a lack of focus when it comes to marketing channels and methods, trying anything and everything, or they’re too focused on one marketing channel, putting more time, effort and money into one method when it’s not the right fit.

Marketing must be focused and dependent on:

• The shopper you want to reach – where are they hanging out and easy to reach?
• The sales channel you want to drive shoppers to – if you want to drive shoppers to your website, online marketing will be more effective than running ads in magazines.
• Your business – how do you prefer to market your business? If you can’t stand social media and don’t understand how a platform works, marketing through it won’t be very effective.

 

Before following someone else’s advice on the sales and marketing channels that are a “must” for small businesses, do your homework and be sure they’re a fit for your business.

There’s no magic bullet or foolproof formula for getting more traffic and sales. Unfortunately, every business must put in time and effort to find its unique path to them.