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Amazon takes aim at Etsy (AMZN)
BI Intelligence
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Amazon plans to launch a new wedding gifts store within its Handmade at Amazon craft goods marketplace, taking direct aim at competitor Etsy, TechCrunch reports.
The new wedding store will offer handcrafted gifts including jewelry, home goods, and accessories, as well as personalized wedding invitations and décor — goods that online shoppers are likely to seek out on Etsy.
The focus on weddings could make Handmade at Amazon a more significant threat to Etsy because consumers spend high amounts on wedding gifts and related items. For example, one study found that bridesmaids dresses were 1.8x more expensive than similar styles not marked for bridesmaids. US consumers spend $55 billion per year on goods and services related to weddings, according to IBISWorld.
The announcement comes at a time when Etsy itself faces decelerating growth and pressure from investors to consider operational and strategic changes. Etsy recently changed CEOs and laid off 8% of its workforce after announcing another quarter of decelerating sales growth in Q1 2017. Meanwhile, black-and-white Capital LP, an Etsy investor, released letters to the company’s board of directors detailing several issues with Etsy’s site and user experience. As Amazon continues to build out the Handmade at Amazon marketplace with more products and specialized stores, it could convince Etsy sellers to join up and leave Etsy. If Etsy doesn’t find ways to kickstart growth soon, its sellers may feel that they have little choice but to turn to Amazon.
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