Gumroad Vs Etsy: 9 Key Differences

As a handmade seller on Etsy, you must have experienced phases of low sales. The pandemic was one of the key factors in stopping the physical delivery of artwork.

Therefore, it has become crucial for every handmade business to sell digital products.

Etsy is the first choice for everyone. But if you look beyond Etsy, there is Gumroad. Gumroad is different from Etsy. But it is an alternative worth considering.

Both platforms require marketing for handmade products due to saturation and competition. So, it makes sense to consider the Gumroad vs Etsy differences. 

Gumroad Vs Etsy: 5 Key Differences

This post may contain affiliate links. That means if you purchase any of the products mentioned in this article through routing via the links in this post. Then, I may end up receiving a certain monetary percentage from the sale. Though the one who purchases through the link does not end up paying anything extra apart from the mentioned MRP on the product. Full disclosures on the Affiliate Page. 

1. Pricing

Pricing is an important deciding factor when you are starting a handmade business. That is why it tops the list of Gumroad vs Etsy differences.

It is a pleasure to realize that Gumroad costs nothing to showcase products. Yes, it costs zilch to start listing your products on Gumroad. 

However, they do charge a fee when you make a sale. They charge a flat 10% per transaction. 

The credit card fees and PayPal charges are over and above the transaction charges.

They also have a pay-as-you-feel-like feature. That means the buyers can pay as much as they deem fit for the product. 

Such pricing helps beginner crafters as they get to test the market for their creations.

There is a nice, but not necessary fee for the service of Gumroad Discover. This service when activated bumps the products in front of Gumroad users. There is an additional percentage charge for sales through Gumroad Discover. But there are no upfront fees for enrolling in Gumroad Discover.

On the other hand, Etsy costs have a multiverse of complications. Also, the pricing differs for different countries as well. For some countries, they charge an upfront fee to open a store.

Moreover, the basic platform has these components of pricing as below:

1.1 Listing Fees

This first set of fees is 0.20$ per listing. However, this small listing fee becomes zero when someone refers you to Etsy or if you refer someone.

There are a few more levels of complications with this fee. They are auto-renew sold, multi-quantity, and private listing fees.

1.2 Transaction Fees

How much I wish that this fee was a mere percentage of sales. But Etsy complicates it further by adding shipping and gift wrapping charges. That means the more services you offer to your customers, the more Etsy rips you apart. 

By the way, the transaction fee is a whopping 6.5%. 

If you are in the mood for some more adventure. Then, you can enjoy Etsy’s extra features like Ads and Shipping labels. There are charges for offsite ads as well.

If you are not yet overwhelmed with the various charges of Etsy. Then, you should have a look at their Pattern offering. It seems like their desperate attempt to prevent sellers from starting their websites. 

So, as you can guess, it is a website builder service to charge sellers an additional subscription fee.

That is not all. Etsy offers a subscription service Etsy Plus. This service has an expanded set of tools costing 10$ per month.

In short, you lose more when you sell more with Etsy.

2. Format

Both platforms facilitate solopreneurship. But both their interfaces are different from each other.

Both Gumroad and Etsy let users sell and buy. But there is a vast difference in their approach. 

Etsy works on a marketplace platform. However, Gumroad leans on a portfolio-based approach.

That means Etsy exposes a potential buyer to several search query options. That brings in huge competition as the buyer gets to see a lot of products.

The chances of a buyer arriving at any Gumroad shop are through prior lead generation. In all probability, it would be through the seller or the various affiliates of the seller.

If one takes numbers into account, then the differences make sense. 

Etsy has over 120 M items for sale making $13.49 B in annual gross merchandise sales in 2021.

Unlike Etsy, Gumroad is not public yet. That is why there is no constant pool of data. According to one of their blog post, about 46,000 creators earned $142 million in 2020.

3. Tiered Selling

This aspect makes a marked difference between both platforms.

Gumroad offers layers for the sellers to showcase their products to its buyers. For instance, as a seller, you can give variations to a product with its Versions feature. You can also upsell.

Upselling means offering a bigger and better version of the main product. Upselling is crucial to scale a handmade business.

Tiered selling from Gumroad lets sellers offer multiple formats for a single product. For example, as a soap seller, you can give different colors/ aromas of the primary offering. You need not offer individual listings/products for variations of a base product.

The above tiers apply to all 7 product types. They are as follows:

• Digital Files
• Course/ Tutorial
• E-book
• Newsletter
• Membership
• Podcast
• Audio Book
• Physical Products

In comparison, Etsy does not offer variations as a feature. But as a seller on their platform, you can make some on your own.

Etsy now allows variations of the main product. But still, it does not provide the upselling feature.

Moreover, the Etsy platform focuses on physical products. But you can also sell digital products with ease.  

The Etsy platform cannot sell recurring digital products. These include products like memberships, newsletters, and podcasts.

Also, the platform is not the first choice for selling courses and tutorials. As of the time of writing this article, all such products are beyond Etsy.

4. Marketing

Whoever tried selling knows how important marketing is. Selling handmade crafts online is no different. You have to get your message out to attract the buyers who end up paying.

Whether it is Gumroad or Etsy, marketing is necessary. The inbuilt marketing framework of each differs.

Etsy has an advertising function that you can avail to get a feature on the first row. Plus, Etsy also functions as per SEO principles. 

That means there is plenty of opportunity to use tags and descriptions to move closer to a sale. If you subscribe to Pattern by Etsy, then you can blog to market your shop.

With Gumroad, apart from the SEO features and blog, there is a Discover feature. It is like the platform itself suggesting products from its curated list to the audience. Discover platform sorts products under various heads. The range varies from audio to books, gaming, software, and a lot more.

However, Gumroad lacks paid advertising, the way Etsy provides. 

5. Control on Reviews

If as a handmade seller, you got a 1-star review on Etsy. Then, you know for sure how much that hurts.

Most of the time it is not about your failure as a seller. But it could be a glitch in the shipping service, or the buyer did not or misread your listing.

Those are the times when you lose your enthusiasm to make your small business a success.

It is unfortunate that on Etsy’s platform, the seller cannot contest the review that a buyer gives. The platform has a bias toward the buyers.

But with Gumroad, there is an option to not display the reviews on your shop. That means if you receive some bad reviews, you can decide if you wish to conceal them from the future audience.

That gives you leeway to earn back the positive reviews that you can display later.

6. Control on Piracy

Etsy as a platform has evolved over the years. These days it is common to find buyers listing fake handmade products. Many sellers sell from Chinese websites claiming to be their handmade work.

That is why the platform has become strict and vigilant with the sellers. Thus, in recent times, Etsy has shut down shops that break their rules.

With Gumroad, there is control over selling fake digital products. They stamp digital products with a unique license. That way, every download gets a verification. It works well with a software product. However, you can use it on PDF files as well. 

It cannot prevent a fake sale, but it lets you know the source from where the piracy started.

7. Newsletter Services

A direct line of contact with an audience increases the chances of recurring sales.

If a business has the consent from its audience to receive mail. Then, it is a powerful asset for the respective business unit to possess.

Etsy does not let you have the email details of your customers. Because of that, you cannot have direct contact with them.

That means you are at the mercy of the platform to get you sales. Some sellers use QR codes in their images to get customers’ data. But that could bring in issues if someday Etsy decides to change its rules.

But with Gumroad, you get to own a sale. That means you can contact the customer through their mail IDs. You can use their built-in newsletter broadcasting service. Or you can even import the contacts outside the platform to use as per your email marketing strategy. 

8. Location Limitations

Etsy does not allow sellers from a few countries. My country, India is no longer a valid one on the platform. Though erstwhile it was not the case. Since November 2023 India and a few other countries cannot accept Etsy payments.

That means no one from these countries can register on the platform as a Seller.

The existing sellers can continue if they have a regular and active GSTIN. GSTIN is a registered code for doing business in India.

This drastic step from Etsy hinders individual sellers from opening shops. Though established handicraft businesses that were already on the platform can continue with Etsy.

On the other hand, Gumroad has no such bizarre rules. Rather, they have no discrimination for the sellers and buyers.

Post these updates from Etsy, it makes sense to make a move to Etsy.

9. Abandoned Cart Notifications

This one feature marks a huge difference between both platforms. Gumroad came up with a notification service for abandoned carts under their workflows.

That means you create a workflow to nudge the users who added products to their cart but did not buy.

Etsy has yet to develop such a helpful feature for its users.

Gumroad Alternatives

1. Sellfy

It is a considerable alternative to Gumroad for selling digital/physical products. It has a free plan for beginners with an inventory of up to 10 products.

Gumroad integrates with print-on-demand apps like Printful. But Sellfy has its print-on-demand features. That means you can create and sell customized merchandise without owning any inventory.

Like Gumroad, they stamp digital products to prevent piracy.

2. Bigcartel

I love Bigcartel. I have owned a shop there for a decade. It is decent for a beginner crafter. 

Their starter pricing plan lets you put 5 products without paying them a penny. They have a lot of options to customize the shop.

Like Gumroad, they let you run promotions and discounts.

Bigcartel promotes itself as an easy online store maker for artists and makers.

3. Ecwid

Like Gumroad, opening a storefront with Ecwid is free. But unlike Gumroad, the free store has a limit of 10 products.

However the good part is that they do not charge a transaction fee. So, whatever you earn from your products goes straight to your bank account.

4. Payhip

Payhip seems like a close contender to Gumroad. They let you showcase digital downloads, courses, memberships, and even physical products. 

What makes them different from Gumroad is the transaction fee tiers. Their free plan has the highest transaction fees of 5%. While their most expensive plan has 0 transaction fees. Although each of their plans lets you showcase unlimited products.

5. Paypal

Paypal is and will remain the pioneer in making online transactions seamless. Before I started using Gumroad and Thrivecart, I used PayPal to sell my creations. The PayPal buttons help to ease selling.

Since PayPal is a payment processor, I still use it to route my earnings. My earnings from Gumroad and Thrivecart reach my bank account through PayPal.

6. Stripe

Stripe is the recent favorite for receiving and paying money online. You can consider it a direct competitor to PayPal. 

I was a little late in experiencing Stripe because it took years to come to my country. You can consider it as an alternative to Etsy. But you must consider its transaction fee that differs from country to country. 

Also, they require proof of the establishment of the business. That could be a roadblock

 if you have not turned your hobby into a business yet.

7. Zopping

This one is interesting because it works on pushing creators to make more sales. Yes, that is the reason they do not charge a single penny till you make a certain amount in sales revenue.

The amount will differ in your country. But it is about no charge up to $1000 sales. From there it starts at $20 and goes up to $100 for about $100,000 in sales revenue.

Transferring earnings to your bank account via a third-party app would be an extra cost.

8. Thinkific

This platform is famous for selling online courses. 

At 0 cost and 0 transaction fees, you can sell 1 digital product with Thinkific. So, you can use it to start testing your digital art business.

9. Teachable

Teachable is a popular name for online courses. Much like Thinkific, it also has a 0-cost monthly plan to sell 1 digital course/product. 

But it charges $1 + 10% transaction fees for every sale.

Conclusion

If you are looking for Etsy alternatives for digital downloads. Then, you can look forward to selling on Gumroad. 

Gumroad works for myriad products like art prints, courses, and memberships. But you can also sell physical artwork. However, the best part is that there are no listing fees to sell. That means you get to sell unlimited products without spending a single penny.

So, if you know someone who gets confused regarding Gumroad vs Etsy. Then, this is the article you need to share with them.

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