How One Woman Makes Almost $1 Million A Year On Etsy - Fast Company Gets Etsy Tips from Three Bird Nest

Knitting socks, scarves, and headbands doesn’t have much in common with performing orthopedic surgery or governing a country. But this crafty hobby earns mother-of-three Alicia Shaffer’s business $80,000 a month, in part via her Etsy shop—which adds up to an annual revenue of $960,000, she claims. That’s about as much as top orthopedic surgeons make, and more than twice as much as the United States president makes.

Shaffer, based in Livermore, California, sells her knitted wares on Etsy in the online craft marketplace’s second most successful handmade goods shop. (The first most successful shop sells "buttons like the ones they wear at TGI Fridays," Shaffer says.) Called ThreeBirdNest, it's named after Shaffer’s bird's nest tattoo, honoring her three kids.

Through its independent website and Etsy shop, ThreeBirdNest receives an average of 150 orders per day, with most orders consisting of three items. Around the holidays, that number goes up to 700 to 1,200 orders per day. This January, the business raked in a total of $128,000 in sales. In the three years since its launch, it has made 100,000 sales on Etsy alone, Shaffer says.

The shop’s 58 designs—including socks, leg warmers, boho scarves and lace headbands, as well as T-shirts that read "Feed Me And Tell Me I’m Pretty"—look like they might appeal to a certain type of kombucha-brewing earth mama, but they don’t scream million-dollar business. Prices range from $4 for a fabric cuff bracelet to $38 for a floral circle scarf. Many Etsy shop owners feel lucky to sell 10 pieces a month, and65% of Etsy sellers make less than $100 from their shops in a year. Crafters usually need day jobs to support their hobbies. What accounts for ThreeBirdNest’s success? Is the shop secretly sewing methamphetamine into the seams of those lacy legwarmers?

Shaffer attributes her success to deep-seated motivation. She launched ThreeBirdNest in 2011, when she made a few headbands for the small women’s clothing boutique she ran in Livermore. They were so popular she decided to start selling them online. "I opened an Etsy shop, figuring I'd help pay for my kids’ soccer and dance lessons to supplement the boutique's sales," Shaffer tells Co. Design. "I was recovering from the failure of a business I'd run selling baby products—handmade slings, carriers, and blankets." After that business tanked in the recession, "I’d lost a little bit of confidence in my ability to be an entrepreneur."

In the first few weeks after its December launch, ThreeBirdNest made 90 sales. Shaffer credits much of the traffic to Pinterest—she pinned her items. Still, "It was absolutely mindboggling. I thought it was a complete fluke, that it would stop after the holidays were over." But when February rolled around, Shaffer found she couldn’t fill all the orders herself. She hired a friend to help with shipping.

Now, Shaffer has a team of 15 sewers—"all moms," Shaffer says—working full-time, as well as a professional photographer. Shaffer’s husband was able to retire early from his job as a fire chief. Not all the items are entirely handmade by Shaffer’s team—many, like the knitted legwarmers, socks, and gloves, are sourced wholesale from India. "We finish them here, adding lace trimmings and buttons," Shaffer says. The profit margin from such imported items is 65%.

"After I lost my last business, I said, ‘I don’t want that to be on my gravestone,’" Shaffer says. Shaffer’s been a relentless businesswoman since high school, when she went door-to-door selling engraved nameplates and license plate frames printed with slogans ("Like, ‘Don’t bother me, I’m off to Bingo,’" she says.) She took her cues from her mother, who made extra cash selling handmade items at craft fairs and owned a nameplate-engraving machine.

But her shop’s success isn’t just thanks to a Tracy Flick-ish desire to succeed—it’s also about aggressively helpful customer service, attention to detail, and knowledge of how e-commerce on Etsy, which has 30 million registered users, works. Here, some of Shaffer's business tips for killing it on Etsy.

Think Like A Shopper
"Etsy has a ton of articles and videos on secrets to shop success. I took advantage of all of those," Shaffer says. "I always ask other Etsy shop owners, ‘Would you click on your item?’" Shaffer says. "If you search ‘lace headband,’ 24 headbands show up. Which do you click? You want to make sure you’re looking at your shop from the shopper’s perspective."

Photography And Styling Matter
It all comes down to photography and the way you style your items, Shaffer says. ThreeBirdNest’s items are among the top hits for an Etsy search of "lace headband," and the images are among the only ones that are well-lit, featuring a professional-looking model (Shaffer’s younger sister), instead of just some headbands lying on a table.

Follow Etsy's Advice Religiously
Another basic piece of advice Shaffer has is to consistently dot the i’s and cross the t’s on all of Etsy’s online paperwork: "Do you have all tags completed? Have you written a full description of the shop? Do you tell your story in the 'about us' page?" All of these seemingly negligible details affect how shoppers perceive your digital storefront.

Don't Give Your Products Stupid Names
Making sure items show up in Etsy’s searches is also crucial: "A huge mistake I see is lots of shop owners list products by the name they’ve given it, like ‘Juicy Frutti Tutti Garland.’ No one’s going to search for that." Instead, Shaffer usually opts for something more general, like "floral garland," or "tassle birthday party decoration."

Kill Customers With Kindness
Without an advertising budget, ThreeBirdNest promotes instead through social media and word-of-mouth. "We reach out to customers, asking them what they want. We add inserts into each order with coupon codes, giving them $5 off their next purchase. We ask our customers with blogs to tell their friends about ThreeBirdNest." Shaffer’s customer service ethic is strong: "Pre-make your items whenever you can so you can ship them to customers before the one- to two-week lead time. Respond to their emails immediately. Make sure they come back."

Despite the hype about her business’s astounding revenue, Shaffer insists she pours most of it back into ThreeBirdNest in hopes of expanding. Shaffer herself takes a salary of $55,000 a year. This year, she’s adding a children’s line, called FeatherWeight, to the shop. "I want ThreeBirdNest to become a household name," she says, something no Etsy shop has done so far. She envisions it as a more affordable Free People.

"People say, ‘look at all this money,’ but I’m not on a cruise," Shaffer says. "I’m working my butt off for it. I’m not just sitting here pointing my finger at people and telling them to get to work. I get home, put my kids to bed, and keep working. It’s a 24/7 operation."