How urn startup Oaktree Memorials uses Etsy for customer acquisition

Oaktree launched an Etsy store in mid-2021. Typically, Oaktree’s Etsy store only accounts for about 15% of the company’s revenue in any given month. According to the company’s co-founder, Max Lemper-Tabatsky, Etsy customers have a higher average order value. On its DTC website, Oaktree’s AOV is around $250. On Etsy, it is around $500 because customers often opt for more customization, as well as higher-priced products.

Oaktree’s marketplace strategy is unusual among DTC brands. There are some unique restrictions to selling through Etsy, such as limitations around how much sellers can spend on advertising in a day and how much first-party data they can collect. Still, it underscores how Etsy can be used to reach customers who are interested in niche, handmade or personalized products.

“For us, Etsy started as another marketplace to test,” Lemper-Tabatsky told Modern Retail. Oaktree’s website advertises one-of-a-kind, handcrafted urns designed to blend more seamlessly into a person’s home. In addition to its presence on Etsy, Oaktree also launched an Amazon store in 2022. On Etsy, Lemper-Tabatsky said, there’s a “specific customer that’s unlike Amazon or Walmart,” he said. “Someone who browses Etsy is usually looking for something unique and doesn’t mind longer fulfillment time.”

On its DTC website, many of Oaktree’s customers are placing last-minute orders. Meanwhile, on its Etsy shop, “some of them are buying to upgrade to a new urn,” he said.

Oaktree’s urns range from $45 to $995 on its website, not including the cost of adding on engraving. On Etsy, the company has found success testing its higher-end line, with some going for as much as $1,200. A large percentage of Etsy customers also opt to engrave their urns or cremation jewelry, which brings in added revenue.

With Etsy’s marketplace being global, Lemper-Tabatsky said it has “made it easier to reach customers abroad without having to pay extra.” The platform has fewer cross-border restrictions than Amazon or Google, he added, allowing a seller to cross-promote in several countries at once.

It’s also simple to create an Etsy shop, Lemper-Tabatsky said, compared to setting up an Amazon store. “That’s allowed us to experiment with different storefronts, he said. “For example, we tested a pets-only store to get feedback on specific products.” 

A limit to scaling 

“There is a limit to how much you can advertise — as a store, you can only spend up to $500 a day,” Lemper-Tabatsky explained. “But it only charges you if a customer is clicking on your ad, so we haven’t been able to scale them past $50-100 a day.” 

Still, he added that the ROI on these ads is 10X on Etsy compared to the 3X return on ads Oaktree generates on its DTC store. “It’s also the only platform that’s not constantly asking to put in money,” he said since the campaigns are mostly contained to the platform and not outside traffic from search and social media.

Moreover, as with many marketplaces, the brand does not collect customers’ first-party data directly. There are other ways to retain an Etsy shopper, Lemper-Tabatsky said, like including package inserts with the company’s website and social media accounts in the first order.

Lemper-Tabatsky said that because Etsy is designed for individual sellers, there currently are limitations to how much a brand can scale on the marketplace. “But that’s understandable since [Etsy] is meant to be easy for anyone to set up a shop,” Lemper-Tabatsky said.

There are examples of brands that began as Etsy shops and then transitioned to a DTC model, such as P.F. Candle Co. and Brooklyn Candle Studio. However, there are fewer examples of brands, like Oaktree, that launched an Etsy store after launching a DTC site.

Erin Kristyniak, the vice president of global partnerships at e-commerce marketing platform Partnerize, said testing Etsy is an example of how willing DTC startups have gotten to invest in secondary channels. For a long time, she said, direct-to-consumer brands avoided third-party marketplaces like Amazon to protect margins and maintain control over the customer relationship. “But over time, they’ve realized it’s important to reach different customer segments and diversify their presence,” she said.

“Brands now know the consumer in each of these is remarkably different, whether it’s Amazon, Walmart, or Etsy,” Kristyniak said. “The Etsy shopper is not looking to get the item in two days, which allows for a more personalized customer experience.”

Currently, Etsy is also going through a transition, in which it is trying to become more of a full-fledged marketplace with robust advertising capabilities. This has generated critique from small sellers who allege that dropshippers selling commoditized products increasingly plague the platform. However, Etsy is still trying to maintain its reputation as a home for high-quality, handmade product listings. 

With the tools Etsy is adding to accommodate sellers, Kristyniak expects more existing brands to experiment with it. That’s not to say that every brand’s assortment will make sense for the Etsy audience. “There are certain categories and products that can fit those for certain platforms that others may not fit,” she said. For instance, Kristyniak noted that artisan brands that make personalized jewelry and accessories would fare better on Etsy than beauty and wellness products.

As a DTC brand trying to tackle marketplaces and wholesale in a sensitive product category, Lemper-Tabatsky said investment in an Etsy store is worthwhile. The hope, he said, is for Etsy to add more advertising tools that DTC brands can use to reach and convert a wider Etsy audience. 

“The core of our brand is to create handmade, premium products, so we’ve always had Etsy on our radar due to its ethos,” Lemper-Tabatsky said. “So it’s a good fit, at least for our category.”