There is a market for homemade goods

An interview with the founder of Etsy at this year’s Davos made interesting viewing. In particular it’s encouraging to see that homemade products are doing well, in this instance sold online. For people who need to generate income, and who doesn’t really at the moment, this is good news.

Etsy is an online market for handmade goods, also called a P2P - read person to person - marketplace. Etsy’s turnover was just under $100 million during 2008. It took about three years to grow to this size which is a fairly rapid growth curve I would say.

Another interesting point is that 97% of their customers are women and the average purchase is for $15 and most customers buy two items at a time. That is a lovely bit of market assessment and research, for free!

Etsy posted record sales for the last three months of the year 2008. That’s the same period that main street, or high street as it is called in the UK, started complaining about the recession. One gets an idea that shoppers went elsewhere, rather than shutting down spending completely.

At this stage in the revival of interest in homemade products, it would seem to me that the long-tail principle would apply. With other words, provided you have access to a huge market, people selling special items will find enough people who want to buy in order to make it worthwhile.

Your homemade product by necessity needs to find an outlet that can reach out to a large customer base. Etsy of course does this. With $100m turnover and the average customer purchases $30 worth, that is a fair number of customers that bought. Never mind the many that just browsed.

It doesn’t necessarily have to be online though. You can get together with many other home manufacturers and start homemade product co-operatives that utilise physical spaces to market their products.  Once a week in a church hall, or once a month in a larger venue can be rewarding.

However you do this, and with whatever product, there is a marketplace for your homemade product. So don’t hesitate to start your knitting for babies, embroidered bed linen or handmade furniture business.

Local is going to be the new place to be with the global marketplace experiencing some major hick-ups at the moment. And social networking, whether online or in the real world, is the new way to communicate. Well it’s not really new is it. We’re just finding our way back to basic good principles.

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