A View from the Top: Linda Kozlowski, Etsy chief operating officer, on how entrepreneurs can sell more online

Since Etsy was founded in 2005, it has benefited from putting people and community first

Linda Kozlowski has been chief operating officer of Etsy since May 2016

Linda Kozlowski, the chief operating officer of online goods marketplace Etsy, has just had lunch with some British sellers. “It’s a great opportunity to meet up with people and learn about their challenges, but somewhat bad for my wallet!” she laughs.

Among today’s purchases: a leather necklace, two wallets – one for herself, one for a friend – and a rubber stamp for her Christmas cards.

Ms Kozlowski, who works out of Etsy’s head office in New York, is visiting the UK to talk to sellers about some new initiatives intended to make their lives easier, including gift-wrapping options and improved transparency about deliveries.

The 44-year old has been in charge of operations at Etsy since May 2016. She joined from Evernote, a note-taking app, where she managed global operations, which followed a four-year stint in Hong Kong working for e-retail giant Alibaba, where she was in charge of global marketing and business development. She is also a recovering journalist.

“I’ve always been attracted to platforms that support entrepreneurship,” she says. “Alibaba was so big, it was on a different scale. Evernote was a place to support creatives, but Etsy is the ultimate for me: when you have the creative entrepreneur and the businesses side coming together.”

Since Etsy was founded in 2005, it has benefited from putting people and community first, in opposition to the more jumble-sale approach of the likes of eBay and Amazon. Etsy gained a reputation for supporting female entrepreneurs after it was revealed that 86 per cent of its sellers are female.

The site also became known for its wacky but lovable products, ranging from beautiful hand-illustrated Christmas cards to chicken ponchos and a clock made out of a used cheese grater.

As sales grew, Etsy broadened its horizons by introducing a wholesale business for bulk sales in 2014 and, in February of this year, a studio that sells craft supplies.

But expansion came at the expense of key areas of the business. Other online retailers have become more sophisticated, offering curated search results and personalised products. And competition also picked up when Amazon launched its own Handmade marketplace in 2015, going head-to-head with Etsy.

After a slowdown in transactions and an unexpected loss in the first quarter of 2017, Etsy needed a shakeup. It got one in May with new chief executive Josh Silverman, a board member at restaurant chain Shake Shack and ScriptEd, a coding course for schools.

Mr Silverman immediately cut 140 jobs, bringing the total jobs lost to 230 since the beginning of the year. He also brought the focus back to what Etsy calls its “core business”: helping homegrown entrepreneurs sell their goods more quickly.

Ms Kozlowski says Josh Silverman has been responsible for two changes. “Focus, which Josh has talked a lot about: narrowing down and making sure we’re doing the best things for our community, which includes a focus on how we grow sales for our sellers. The second offshoot of that is being fast with how we test ways to do it.”

Results for the third quarter of 2017 were much improved. Sales grew 13 per cent while revenue was $106.4m (£80m), beating the average analyst estimate of $104.9m.

The company is now testing ways to improve its search function. Etsy users sometimes complain of items showing up more than once during a search, while commercially produced goods have infiltrated results. Ms Kozlowski says the acquisition of a company called Blackbird Technologies in 2016 has helped the group employ artificial intelligence to personalise search results, so buyers see the items most relevant to them.

They are also experimenting with eBay-like functions that allow buyers to see how many of an item are left and how many people have so far looked at it, to gauge how popular it is.

Etsy is trialling new ways to make delivery more transparent, such as tracking numbers to give buyers and sellers an update on the shipping process. For the Christmas season – typically Etsy’s busiest time of year – it has added an gift-wrap option and a packing slip.

The company is also experimenting with a social media tool that posts across Facebook, Instagram, Twitter and Pinterest from within the Etsy app, to save sellers time. The tool allows sellers to create promotional posts if they are running a sale, or turn posts into paid-for Facebook adverts.

This focus extends to Etsy’s geographical reach. Etsy is looking to expand its base of 150,000 sellers in Britain. The UK is one of the company’s top six markets, but Ms Kozlowski is tight-lipped when I ask her which countries make up the other five: “We’re going to focus on our six core markets and not necessarily expand into other markets, even though we have buyers and sellers all over the world.”

Ms Kozlowski’s interest in craft stems from her mother, who sold homemade crafts as a side project during her daughter’s childhood in North Carolina. Ms Kozlowski’s mother started making and painting aluminium flowers as a hobby, but when she when she ran out of places to keep them she started selling them to people she knew.

“There is only so much you can keep in your own home, so it’s a great way to create what you love and share that with people in the world,” she says. “We have some sellers who are doing exactly that, making something on the side, but then we have a lot of sellers who started doing this as a hobby and discovered it could be a business.”

Ms Kozlowski sees her job as making the Etsy experience consistent from the seller to the buyer, so that buyers get what she calls a “a spark of joy” from buying something handmade and being in touch with its creator.

This year, the company has increased the number of pop-up Christmas markets taking place across the country under the name Made Local. The idea is an extension of Etsy itself: “Everything we’re doing is to make it even easier to get that spark of joy by focusing on bringing sales to our sellers and making their jobs easier.”

“There are few places where you can interact with the human who has made what you are buying,” she says. “We feel confident that Etsy gives you the best experience when you are buying special goods, whether it's for you or someone else.”

Or, as with those wallets from a UK seller, one for Linda Kozlowski, and one as a gift.