Etsy Direct Checkout - Is anyone using this and do you like it?

[Former_Member]

I have read some good things and some bad things about this. Seems most sellers don't really like it. I think the fees are too high. 0.08% more than Paypal plus another $0.25. I'm worried I would have to raise my prices to cover that. Seems unfair to my customers. I have heard some people say that it is good for the customers, which makes me want to use it. I am a little torn over if I want to do this or not. Is anyone else using this? Do you like it? :)

[Former_Member]

Luci, I have just come the forums (again) reading about the pros and cons - there are always threads about it. I too am torn and have been sitting of the go ahead for a few weeks now.

I thought about just turning it on for a couple weeks to see how it goes and then disabling it if I don't like it. I like having all the transactions in one place....but if it gives customers more options I am all for that.

One thing I read about over and over, and that I really don't like, is that Etsy seems to "corral" people toward their direct checkout with it being set as the default with the credit card logos. This can potentially confuse customers...not realizing they can still choose PayPal or even credit cards through PayPal. Feels dishonest to me and another way to sneakily get more money.

I'm glad you started this thread - I have been meaning to ask if anyone else here is using it....would love to hear more opinions & experiences!!

[Former_Member]

I saw a lot on the forums also, which is why I had to go to my teamies for some insights. I'm still on the fence on this also. It makes perfect sense to me that it would default to the direct checkout. If I were Etsy I would have set it up the same way. I was a corporate accountant. I am familiar with these arrangements between companies and so I understand that. I hope we get some more opinions on this too! Would love to know what people who have tried this think and what is holding others, like me, back...

[stitchuation]

I was thinking I would try it, then read some long threads on the topic and decided against it for now.

Still open to it once the kinks get worked out!

[Former_Member]

So, here is how it's been working for my two etsy stores and do note that I do not have a LOT of sales data... but so far, these have been my observations.

Direct Checkout to Paypal ration in this store is 1:1 and on my other etsy store is 4:4, and It is going to be about 3 to 4 weeks since I had set it up.

- straight up, I see no difference in what customers choose to use. It's pretty even.
- the difference is who is buying.
- Etsy regulars, i.e. shop owners and frequent buyers still use paypal.
- one time buyers use Direct Checkout

I guess for me, at present I am still keeping both options open for buyers. I know it's a bit more expensive to use Direct Checkout, but I still haven't raised prices yet. I am hoping the more sales I get, the costs would eventually even out!

[Former_Member]

Thanks for the input, Marbha! Have you noticed any increase in sales like some people have reported? (Some actually claim a decline, but hard to tell if there is any correlation).

[Former_Member]

Good question Marcy! I am curious about that myself.

Marbha, I thought it was interesting that you notice in your shops that it is mostly the one time buyers using the direct checkout, while Etsy regulars and shop owners seem to be sticking with Paypal. I don't know what it says about the direct checkout option, if anything, but it is an interesting observation...

[Twistedcopperforest]

I believe paypal charges a fee for using their service? with direct checkout shouldn't that even it out? where does .08% come from? I thought Etsy charges me .03 for a sale plus .20 for listing , paypal i think is .03 also but dont mark my words on it. I'm going to try it for a couple of weeks ( or months depending on sales) It has to be easy for people that don't have a paypal account. Setting up a paypal just to buy could discourage people from buying your item.

[Former_Member]

The fees for processing through Paypal are 2.2%. The direct checkout fees are 3% plus an extra $0.25 cents each transaction. The 0.08% is just the difference between the percent they are charging as a processing fee is all.

These are different from what they charge for the sale and this listing. This is on top of that. You pay Etsy (rightfully so) 3.5% for each sale plus $0.20 cents for each listing. This other 3% is on top of that for processing the payment and has nothing to do with the listing cost or percent they take from each sale. And yes they should charge for processing payments, but it is a little higher than what I am used to paying is all. Maybe it's the accountant in me, but all of those percentages and pennies know how to add up. I've seen it. :)

Maybe I will just turn it on for a couple of weeks and see what happens...

[Former_Member]

@ M.Basile - I will be frank here, I really don't think there has been any change in the sales. But then again, I am a person whose sales numbers are pretty low. So, for me, any sale, be it via Direct Checkout or Paypal is always a celebration!!!

[Twistedcopperforest]

Amen to that!!! my sales are not great either:)
Thank you Luci ! I appreciate the info on charges. I honestly did not know exactly what all the charges were.
One way or the other we all pay :(
You all have a great day and good luck on sales!!!

[Former_Member]

Thanks, Marbha!....I concur, any sale is cause for celebration!

[Former_Member]

Sales are always good, but you should always know what your bottom line is. A sale is great, but not so good if you don't make any money on it after paying fees and shipping and taxes and all that good stuff. It is so easy to get excited about the sale and then lose track of what that sale cost you. Yes, we all pay, but paying more still isn't a good option. Paying more means you made less on that sale. I signed up for it and we will see what happens. If it raises my costs too much I will have to raise my prices or discontinue using direct checkout, depending on what if any affect it has on sales. It's kind of an experiment right now for me. :)

[brizelsupplies]

I'm not going for it at all. Did not like what i read about it from the onset and personally I think its nuts that Etsy has created a 'new' payment system for its own market place with fees that are higher than Paypal. rotfl. There's LOTS not to like about Direct check out (like having to ship the item b4 getting paid and waiting another 3 days after that to get the money in one's account) but the higher fees takes the winning ticket.

Oh well- after 10 yrs of selling online- I'll happily stick with Paypal and money orders, thank you very much :)

[Former_Member]

Those were my exact problems with it Nicole. The higher fees is a killer. So far all my sales are still through Paypal so it hasn't been an issue yet, but this is very much a test run. I am not opposed to shutting it off if I need to. I'm waiting to see how this develops. If Etsy was smart, and I think they are, they will use their payment method as a way to shop multiple shops and only have to pay once. If they do that we are all stuck with it. My guess is they are building it into the back end right now, but I could happily be wrong about that. However, after spending years working in tech world I am almost positive that is where this is going. We will see. :)

[brizelsupplies]

Ya...
As I recall Ebay phased out personal checks and money orders- leaving only Paypal but by then folks didnt have to have a Paypal account to pay so that 'worked out' okay.
My personal belief is that fewer choices is always the mistaken path to take... there are several words to describe that but none of them are 'nice' so i will reserve my judgement and hope this will not come to pass.
Let's hope we get to keep our freedom !

[Former_Member]

Great thread. I had reservations about it too. Read the same forums. Know some shops that are excited about it and think they have an increase. Hate the idea of having some money going into the bank acct and some into paypal though. I finally set it up but it is deactivated. I wanted the option should I be working with a customer who doesn't have paypal, but I didn't want to make it available all the time right now.

[Former_Member]

They don't need to have a Paypal account to pay through Paypal. Paypal processes credit card payments. So far the 3 sales I have had since have all paid through Paypal. Of course that is only 3 so it isn't exactly a substantial number, but I am happy to see that Paypal seems to still be the payment of choice at the moment. :)

We'll see how it works out for me. Bee is so right about having money depositing through 2 different accounts. It is definitely going to be more work on the accounting side. Not looking forward to setting that up, but I guess I should so I am ready for it when I receive payments through there. Blah... haha

[Former_Member]

I went back and forth about this too..but then my hubby (crazy numbers guy) worked out all the stats between fees on paypal versus this new payment option and concluded that it is actually cheaper to use the direct payment on orders over $100 because of fee changes for larger purchases. (I think it was $100..or something super close to $100..haha clearly I am so NOT a numbers person). He then went to my shop and looked at the proportion of items that are over $100 and what is selling.

For me, I sell quite a bit that is over $100, so you would think that the new payment would be worth it (which was my conclusion) but alas, he decided it wouldn't be. And the reason is the 25 cents on much smaller items. It is actually still cheaper to use paypal, even with the crazy fees on larger purchases because all the smaller purchases, $5, $10, $12 etc. are decimated with the listing fee, Etsy fee, a renewal fee if need be, and then the payment fee. Adding any additional fee even if just 25 cents is totally not worth it.

To me, when it comes to personally shopping, if I really want something, I will do what it takes to purchase it. Whether that means I have to be re-directed to paypal or whatever. I think a valuable customer will do the same. I can't see that paying the additional price will bring in enough new buyers to make it worth the fees, and there is no way to know whether these new buyers are ONLY buying because they don't have to use Paypal.

I suppose if everything you sell, or most of what you sell is above $100, it is worth it. For me? And I assume most of Etsy sellers? Not so much.

[Former_Member]

Good point Morgan. I also saw that it would be cheaper on larger orders, which we seem to have at the holidays with our framing and all.

Luci, I have had customers get confused with checking out with paypal and not having a paypal account, so I thought Direct Check might aid in that.

I had it up for about a week, and all orders that came in were thru paypal still. I turned it off until I can figure out a better accounting system. I am in the process of changing it right now and adding direct's use of the bank account would be a big headache until I get everything worked out.

On the shopping side of things. I visited my fav soap shop to purchase some stuff and they had their direct checkout turned on. It confused me for a minute since I hadn't seen it and then I saw how Etsy defaults to direct checkout instead of paypal. That is what really made me turn it off for now.

I have a lot of customers (probably 40%) that come to Etsy just to purchase from me. They created an account that day and use paypal for their order. If they are willing to do all without a compliant why bother with direct?

Anyways, it's (direct chkout) there on my shop with the waiting period ended and ready to go should I change my mind.

Thanks for everyone thoughts. It is helpful reasoning for sure.
Bee

[Former_Member]

Wow! Reading all of this is quite interesting. I think for my shop, I'll just stick with Paypal. I use it personally when shopping and love it and in my opinion it's super easy. And I think a lot of shoppers already have a Paypal account. And like someone mentioned, if somebody's really interested in something in my shop, so much that they intend to buy it, I don't think being diverted to Paypal will deter them. Sometimes too many options is just that; too many. :)

Oh, I also saw someone mention that Paypal fees are 2.2%... They're actually 2.9% + $.30. They raised them at the beginning of the year. Not sure if everyone's aware of that!

[Former_Member]

Thanks @AuburnArtisan. I did know that. Just wasn't doing the math I guess. @Morgan, I wonder if that is still true about your $100 fees equation?
I also know that you should sign up to paypal as merchant because your fees will be lower if you exceed ceratin sale levels. At Christmas our fees are 2.5 + .30
Thanks, Bee

[Former_Member]

Oh yeah. I forgot about Paypal raising their rates. I even looked on their website before putting that up and they still had 2.2% listed. Someone forgot to update something. haha But I even checked my statement and it is 2.9%+0.30 so that is totally right.

[Former_Member]

Oh I didn't know they lowered fees for certain sales amounts! Of course, my sales are quite low, so I'm not sure that'd ever happen for me! ;)

@Luci - I just thought about it at the beginning of the year and thought I'd check and sure enough - they raised them! Kind of a bummer! :(

[Former_Member]

It is a bummer Auburn, but I guess not really unexpected. I'm going to spend the weekend analyzing my profit margine and see how hard this is really hitting me. I've just started out so I don't have reliable data yet. Now I think I will be able to get a pretty clear picture. I guess everyone has to have their cut. :)