Q&A with Helen Souness of Etsy Australia
Helen Souness is the managing director of Etsy in Australia and Asia. She was also recently named to the board of Sendle, a shipping startup aimed at small and medium businesses. Internet Retailing spoke to her about investment in artificial intelligence, growth in Asia and empowering female entrepreneurs around the world.
Heather McIlvaine: What can we expect to see from Etsy in Australia?
Helen Souness: Australia is a top five market for Etsy, and we’ve really increased the number of Australian makers on the last platform in the last few years. But there is some exciting new news as well. Etsy Studio [a new marketplace for craft supplies] is going to launch this year with eight million suppliers’ items already listed. It’s going to be a really exciting home of creativity not just for our makers but for everyone.
HM: Etsy recently acquired an artificial intelligence (AI) company called Blackbird in the US. How will the technology be integrated into Etsy’s offering?
HS: Blackbird have joined our international tech team in San Francisco, though the bulk of our engineering team sits in New York. They’re already implementing some of their intelligence into the search and there’s a whole road map of how they’ll integrate their work into the core search engine of Etsy.
HM: Can you give some examples of what that will look like?
HS: Generally speaking, AI creates increasing levels of context around a search. For example, if you searched for ‘red bolt’ on the internet, Google wouldn’t know if you were talking about a bolt for putting two sheets of paper together, or a bolt of fabric. It’s got no context at all to your search. But once you’re on an e-commerce site and you have increasing levels of usage, you start to get really good information about the context of that search. So if you search ‘red bolt’ on Etsy Studio for example, you will get a bolt of fabric. We have tens of millions of searches every month, and over time that really increases conversions, because the results are more relevant.
HM: Improving search functions is one thing, but how does Etsy help customers discover products that they don’t even know exist?
HS: We have more than 40 million items on Etsy, so it’s a constant challenge. Obviously the technology side and the design of the site play a big role in discovery. But on the marketing side, I would highlight the fact that we work not just with the lifestyle press but also with digital influencers. We’re working with people who are experts at curating items and looks and trends, and supporting them to uncover Etsy products.
HM: With the upcoming arrival of Amazon in Australia, more and more online retailers are looking at the customer experience as a differentiating factor. But Etsy may have less to worry about than most pureplay e-commerce companies, thanks to its focus on handmade products. How do you see your ability to compete?
HS: Amazon launched a handmade marketplace more than a year ago, but our CEO has publicly stated that we have not seen the impact of that. That’s a great start. The fact that we keep our commission considerably lower – it’s 3.5 per cent – also helps. We strongly believe that being seller-focused is the right way to ensure everyone grows in our business. We have 12 years’ experience policing and enforcing a hand-made policy. I’m always completely paranoid about competitors, and Amazon is a great company, but we haven’t seen the impact of that in the handmade marketplace.
HM: Etsy is also looking to ramp up its business in Asia, with you at the helm of that. What can you tell us about Etsy’s business there so far?
HS: The incredible thing about launching in 200 countries 12 years ago is that we’ve seen patterns of demand and supply evolve over time, and we really understand the phases of market development. This helps us decide when to put people on the ground and really accelerate that growth. What we tend to see in early markets is a seller-focused market that is more about exporting. Then we see buyers start to import. Only in the later phases is there an enormous amount of domestic trading, which creates a very balanced, self-sustaining market. This very much where Australia and the UK are now. Some markets have more potential than others to leave those early stages. But as e-commerce grows around the world, we see every market becoming a domestic market, it’s just a matter of time.
HM: What most excites you about growing the business in Asia?
HS: It’s always been a very inspiring part of the Etsy business that we’re empowering female entrepreneurs. Across the world more than 80 per cent of our sellers are women. In Australia it’s more than 94 per cent. It’s really extraordinary to be moving that into the Asian market and bringing the Etsy model of direct selling into a market, where a lot of makers are still working through a middleman, and having really low barriers. You can open a shop for free, it’s 20 cents per listing, which – even in some of the Asian countries I’ve visited – is a low price. It’s really exciting to think about what that can do for the economies and individuals.
HM: You have also recently joined the board Sendle. How did that come about?
HS: I met James in the course of speaking for the B Corp movement in Australia. Etsy is a certified B Corp and Sendle was the first technology company to become a B Corp. I was really impressed with the Sendle business model and the team there. We ended up doing a marketing partnership with them last year, and then the Sendle team asked me to join their board.
This interview has been lightly edited.