So it’s those kinds of capabilities and muscles we keep building that I think is getting us to be a better and better full funnel marketer. Another thing I’ll just say about marketing and we’re above the funnel that can help a lot is Etsy is now a brand many people are familiar with. If you walk around in the United States or U.K. and say, have you heard of Etsy? Most people will say, yes. If you ask the next question, what do you think of Etsy, almost everyone you talk to is going to say the same three things. It’s the same three words, I love Etsy. Great. But they think they know us already and they have a set of opinions that we need to disrupt, for example, it must cost more because it’s made just for me. And in this very highly promotional environment, when a lot of people are looking for deals, they don’t necessarily associate Etsy with deals.
Now Etsy is never going to be a blue light special bargain basement place. That’s not our brand. But with 120 million things for sale, we do have millions of items that our sellers want to put on sale at really attractive prices. And so disrupting people’s understanding of Etsy by saying actually not only is a beautiful product, but you can afford it, and it’s priced well is disruptive. I’m really excited about arrives on time or your money back. That isn’t a totally novel claim. But it’s novel for Etsy. People don’t realize how reliable Etsy sellers are at delivering on time. And I think that kind of thing is actually disruptive to, oh, I didn’t realize that Etsy could do that. And so those kinds of disruptive claims is how we’re thinking a lot about how we’re messaging above the line right now.
Debra Wasser: Okay. Great. Thanks, Josh. We have several questions about promotions, so I’m going to combine them. One is from Eddie Yruma at Piper Sandler, and one is from Nathan Feather at Morgan Stanley, but it’s basically getting at how do we think our Q3 promotions went the Etsy funded promotions? And how do we think about those more as a go-forward marketing strategy? I think we could start with Josh on that one.
Josh Silverman: Great. So the Q3 promotion was just $5 off of spend $25 or more and you get $5 off were great. We saw a nice little bump in GMS and buyers really like that sellers loved it and it was ROI-positive. It was a relatively small investment, and it worked terrific. Then in October, we ran $10 off 40 didn’t work as well. It was not ROI positive. It pulled forward sales as much as it increased sales, didn’t drive as much incremental lift. I could go a lot deeper into how did it work in one market versus another in one category versus another with new buyers for laps buyers. But the point is we’re learning. And this is a tool we’ll have in our toolkit. I would expect we’ll do more in the fourth quarter as we continue to test and learn with an eye towards testing and learning.
The investments are something we put an ROI threshold on like anything else we do. But the vast majority of promotions on Etsy are seller funded. It’s when sellers put things on sale. And the new deals tab in our app, for example, I’m really excited about. It just launched. It’s very early days, but buyers seem excited that there is a deals tab. One place I can go to find deals just for me. and maybe something they didn’t think of an associate with Etsy. So I think we have a lot of sellers who want to put things on sale. We can do a better job and we really are focused right now in giving them insights on how, when and for how much should they put things on sale. And then us highlighting those things. That’s going to be most of how promotions continue to work.
But if Etsy can be the icing on the cake with some Etsy funded things and make that a good investment, we’re going to keep testing, and I’m optimistic that, that’s going to be a lever in our toolkit.
Debra Wasser: Great. I like the icing on the cake. That’s great. Rick — next question comes from Rick Patel at Raymond James, Rachel. I’m going to give this one to you. Can you expand on new buyer ads? How much is coming from the U.S. versus international? And anything around categories and how people are spending when the new buyers come in?
Rachel Glaser: Sure. So first of all, we love our growth internationally, and we said up 7%. And so we’re seeing that we’re opening up new markets, which is fantastic. We’ve certainly seen a lot of new buyer growth coming from international, but we’ve also seen a material amount of growth coming from — for new buyers coming from the U.S. So really in both places that we haven’t disclosed the breakdown of new buyers by geography. So that’s as much as I can say there. And no, we don’t really see any category differences by geographic market. It’s sort of a universal appetite for all of our major categories along tail of categories across all of the geographies.
Debra Wasser: Great. There are two questions about sort of areas of interest that we have for investment. One is from Ashley Owens at Key and the other one is from Nick Jones at JMP, and I’ll basically read a version of the combined question, which is for Josh. As you look out over the next couple of years, what are your priorities in terms of investments in mark-for-the-market place for buyers and sellers in search in other tools? And how do you see those types of investments inflecting frequency over time. I think that’s really the net result of the question.
Josh Silverman: Great. So thank you for the questions. We think we are in the early days of unpacking Etsy’s opportunity. We think that we can gain a lot of share in our categories and versus e-commerce and through both adding new buyers and frequency. And there’s four things we’re really focused on right now. It’s quality, value, reliability and consideration. Starting with quality, value and reliability. We’ve made a ton of progress on relevance. So whatever you enter in the search engine, we do a pretty good job of understanding what you meant in finding a set of results that are relevant to what you meant, maybe not what you said. But giving you a diverse set of ideas, what are the five or 10 best ideas for that provided it’s a relatively generic thing like gift for mom or whatnot.
Giving you a really good, compelling diverse set of ideas and then picking the few best examples within each of those ideas is a big focus. I think we have a ton of opportunity to do better. So we don’t just match you with the product you’re likely to buy. It’s a product you’re going to love. And in the process, we show you the breadth of the kinds of things that Etsy can do for you. I think there’s a ton of opportunity. And as we do that, we will get a lot more frequency. In terms of value, people assume that if it’s mass produced somewhere and lots of hundred thousand, it’s going to be cheap and it is. But it turns out that if somebody makes it just for you and there aren’t three markups along the way, that also can be affordable and can be special.
And so highlighting the fact that you’re getting great value on Etsy is something that is a big focus, helping our sellers price well, use promotions well. That’s a big focus. And then on reliability, we’ve made so much progress on making sure items arrive on time. making sure there’s clear return policies, making sure it’s easy to fix things on the rare occasion that something goes wrong. We now need buyers to understand all the progress we’ve made, and we can continue to do better, make delivery windows shorter without losing the special nature of Etsy. So a lot we think we can continue to do on reliability. As we do better on quality, value and reliability we then need consumers to understand that we need to disrupt their consideration of Etsy so that we’re in their consideration set a lot more of the time.
