In 2022, Etsy generated over $2.5 billion in revenue, which indicates a growth increase of 10.1%. Millions of new people have signed up with the site since its inception, but with this level of growth comes a high level of competition. As a new seller, it can be challenging to stand out, and as an experienced seller, it can be hard to keep your products in the spotlight. That’s why Etsy advertisements are so helpful. If you run ads on the platform, you can increase your products’ overall visibility while attracting new shoppers.

What are Etsy Ads?

Etsy advertisements are a paid service that helps sellers to promote their listings. People who advertise on Etsy can narrow the general scope of their advertisement by using demographic filters, such as search phrases, gender, and location. Your listing will appear at the top of the search results as soon as a potential customer searches for a product that matches your criteria. This increases your product awareness while drawing more traffic to your store.

Etsy advertisements are essential if you want to succeed on the platform. Marketing boosts visibility and general product interest. They are also an excellent way to get your product in front of people who might have yet to come across it.

As an Etsy seller, you have numerous options when it comes to advertising. Some of these can be found below:

Etsy Promoted Listings

A promoted listing ad will appear at the top of the search result page for a fee. You can choose the products you want to promote, set your bid per click, and take advantage of more traffic. You will only pay if someone clicks your ad.

Offsite Etsy Ads

Offsite ads are yet another way for you to promote your products. Etsy will advertise your products on Google, and you will only pay if a sale is made.

Google Ads

Google shopping ads allow your product to be featured in Google search results.  You can choose a daily budget and still only pay for the clicks you get.

Social Media Ads

This is another way for you to advertise your products. You can promote them through sites such as Pinterest, Instagram and Facebook.

With Etsy-promoted listings, you don’t have to wait for your product to climb the search results naturally. You can get instant traffic to your page, translating to natural listing views as people become more accustomed to your offerings.

Etsy Ads stats

Source: Etsy

How do Etsy Ads Work?

With Etsy ads, you are charged when someone clicks your ad. The amount you pay will depend on how many people click on your advertisement and how valuable your placement is. Your cost-per-click may vary depending on your listing and each time it shows in the search results. Your cost-per-click will be summed up each day, and if you set a cap, you will always stay within this budget.

All sellers start with a budget of $25. This is calculated weekly for those who are signed up with Etsy payments. If you’re not signed up with Etsy payments, this will be calculated monthly.

Mechanics of Etsy Ads

The Etsy ads algorithm takes into account the buyer’s contextual input and how they are searching. Your listing’s title, tag, and attribute will also be considered. Lastly, the likelihood of purchasing influences your ad placement. Based on price and click-through rate, predicting how likely someone will buy after clicking on the listing is possible.

Certain keywords will command a higher price if there is a lot of competition. Etsy will enter a bid for an ad space on your behalf based on the budget you provide. Etsy uses a sealed bid, second-price auction system to determine ads’ placement and cost. Ad inventory will be sold off at varying prices, depending on the amount of competition there is. Keyword relevance, listing quality, and budget will influence your advertisement.

If you want to sell to a wider audience on Etsy, then Etsy ads are a great way to reach out to new customers who might have yet to see your advertisement.

do etsy ads work?

Source: Etsy

How to Set Up Etsy Ads?

If you want to set up an Etsy ad, then follow the steps outlined below:

  1. On, select Shop Manager.
  2. Go to ‘Marketing’ and select ‘Etsy Ads’ in your Etsy Seller Dashboard.
  3. Choose your shop goal: You can opt for increased visibility and awareness, short-term orders, promotion of specific items, boosted sales, and maximized exposure.
  4. Set your daily budget: Decide your budget for the campaign. Etsy will spend your budget to get you the most clicks within the daily limit.
  5. Enable Ad for your listing: Enable the ad for the listings for which you want to run the advertisement campaign.

How Much Does it Cost to Run Etsy Ads?

Etsy operates on a PPC model. As a seller, you will only be charged if someone clicks on your advertisement. There are a lot of factors that influence the cost of Etsy advertisements. This includes keyword competition, seller location, and ad quality.

The average cost of an Etsy click is around $0.5. While it is impossible to predict the average cost for a particular niche due to the constantly changing landscape of Etsy, the general return of an Etsy campaign is 75-100%. Your ad campaign will average a return of $1 for every $0.50 you spend.

In addition to your ROI, you will want to take into account your click-to-sale ratio so you can weed out the listings that are not performing as well.

etsy ads cost

Source: Etsy

Tips for Advertising on Etsy

If you want to run ads on Etsy, then you need to:

  • Use relevant keywords
  • Target specific audiences
  • Create high-quality advertisement copy

When you have done the above, you need to track your ad’s performance. As you make changes, you can tweak your advertisement to make adjustments.

Notable Sellers Who Use Etsy Ads

A lot of sellers have experienced success as a result of using Etsy ads, some of which can be found below.


Dana Muskat is the founder of Big Stuffed. She creates oversized plush sea creatures. Her attention to detail is one of the many reasons her store has done so well over the years.

She has worked with big fashion houses in the past but turned her sights to Etsy when she created a three-foot-long stuffed octopus, which she gifted to mark the birth of her niece. She used Etsy ads and began to make a sale each day. She turned her hobby into a thriving business by ramping up her marketing efforts and combining her Etsy ads with a solid social media campaign.


Alicia Bock, an avid photographer, quit her job so she could stay at home with her daughter.  She then started selling her photos on Etsy. She decided to go old-school with a Polaroid film camera.

The result is dreamy, fine-art prints that have appeared in several TV shows. This includes Grey’s Anatomy and the Sex and the City movies. As her store began to take off, she pushed organic searches by adopting strong keywords and utilized Etsy ads to drive instant traffic. The result? A boom in business led to her being one of the most celebrated sellers on the site.

Do Etsy Ads Work? Are they Worth It?

So, do Etsy ads work and are they worth it? Ultimately, if you are in a highly competitive niche, Etsy ads are a surefire way to get ahead of the competition. If you work in a relatively unique niche, then Etsy ads are still a worthwhile investment, but for different reasons. In this instance, Etsy ads can push your unique product to people who might not know it exists, which can be helpful.

Some of the benefits of Etsy ads include:

  • Increased traffic
  • Boosted sales
  • Higher conversion rate

With that in mind, there are some drawbacks to using Etsy ads. If you are a new seller, even getting a lot of traffic, this might not translate to sales until you build enough trust authority. You will also need to take into account the cost of advertising when you’re not actively making sales. Ongoing campaign management can also take time away from your business.

So, although Etsy ads can be a worthwhile investment, there are some considerations. Running an ad without keyword research or time investment is a huge mistake, but if you are willing to do the work, the benefits speak for themselves. It helps to evaluate your goals and marketing strategies before you go ahead and invest because only then will you make the most out of your marketing campaign.

Learn more about Etsy and how to earn more from a multichannel e-commerce Etsy and Shopify synced business.

How to grow your e-commerce business with a synced Etsy and Shopify store?