Inside Etsy’s product, growth, and marketplace evolution | Tim Holley (VP of Product)

1. Rally Around a Northstar KPI

Establish a single, clear Northstar KPI (like Gross Merchandise Sales for Etsy) and make it the consistent drumbeat in every meeting and the measuring stick for all launches. This provides clarity, aligns teams, and helps prioritize efforts by articulating how work contributes to the main goal.

2. Cultivate a Clear Narrative

As a leader, consistently articulate a clear narrative about the company’s direction and goals. Repeat it often (more than three times) so people internalize it, marrying clarity on goals with clarity on why, which is an incredibly powerful combination for driving change.

3. Bring an Outside-In Perspective

Benchmark your business against competitors and the broader competitive set, even if you’re a unique marketplace. This helps ground discussions in the overall dynamics of what customers are doing and where they’re spending their money, leading to better decisions over time.

4. Prioritize Minimizing Waste

Adopt a product development principle of minimizing waste by asking if the work is adding value to the customer and business. Be willing to stop projects that aren’t working out, as being diligent about resource investment is crucial for small teams to be successful.

5. Deeply Understand Your Customers

Immerse yourself in understanding your customers (e.g., sellers) by doing studio visits, going to their workshops, and involving them in product development. This deep understanding helps identify their unique needs and how to best support them, especially during times of rapid change.

6. Evolve Team Communication

Continuously adapt team communication methods based on their needs and context, especially during stressful times. For instance, if daily coffee chats become repetitive and add to video call fatigue, evolve to different formats or frequencies to keep a pulse on what the team truly needs.

7. Expand Experimentation Horizons

While A/B testing is valuable for immediate impacts, expand your approach to include different validation methods for metrics like retention or SEO, which necessitate longer time horizons. This forces teams out of their comfort zone to understand and measure change over longer periods.

8. Leverage Buyer Review Photos/Videos

Encourage buyers to submit photos and videos with their reviews, especially for unique items. This helps future purchasers gain confidence by seeing what the item looks like in a real-world context (e.g., in a buyer’s hand or home), addressing concerns about size, color, and fit.

9. Employ Behavioral Economic Nudges

Use signals and nudges (behavioral economic tactics) to help buyers make decisions by elevating small, glanceable snippets of information. Highlighting details like ‘only one of these’ can fit into a buyer’s decision-making process and drive conversion.

10. Test Small Copy Changes

Don’t underestimate the impact of small, one-line text changes in key areas like the cart experience. Unexpectedly, these can resonate deeply with buyers and lead to significant conversion uplift, sometimes by communicating core business values.

11. Don’t A/B Test All Changes

Recognize that not all changes are suitable for A/B testing, especially when honoring direct inputs from users (e.g., a seller offering an item on sale). In such cases, use pre/post analyses or other data interpretation methods to understand impact, even if confidence in causality is slightly different.

12. Acquire Sellers Through Community

Acquire initial supply by engaging directly with sellers at relevant events (e.g., craft fairs) and leveraging word-of-mouth through seller communities. Sellers often know others with similar inclinations, creating a natural growth loop.

13. Drive Buyer Acquisition via Long-Tail SEO

Leverage a vast, unique inventory to drive buyer acquisition through SEO and Google Shopping. This strategy effectively meets niche and specific needs, showing not just single items but also related options, attracting buyers looking for something very particular.

14. Implement Seller Referral Programs

Consider seller referral programs using a low-barrier currency, such as listing credits instead of cash. This encourages existing sellers to bring in new ones by making it easier for them to start or list more items, while also mitigating fraud risks often associated with monetary incentives.

15. Close the Habit Loop for Retention

Design features that close the habit loop for retention, using user actions (like ‘favoriting’ an item) as triggers for notifications. Inform users when a favorited item goes on sale or is low in stock, making the interaction valuable and encouraging return visits.

16. Maintain Marketplace Integrity with Clear Policies

Invest continuously in enforcing clear policies about what is allowed on the platform to maintain brand integrity and differentiate from competitors. This ensures only relevant and high-quality items are available, which is crucial at scale and for unique marketplaces.

17. Support Seller Scaling with Production Assistance

Evolve policies to support sellers in scaling their production (e.g., through ‘production assistance’) while maintaining item provenance. This allows designers to bring ideas to life or existing sellers to meet higher demand, provided they understand and have a relationship with their production partners.

18. Structure Teams with Five-Legged Stool

Consider a ‘five-legged stool’ approach for product team collaboration, including Product, Engineering, Design, Insights (Research & Analytics), and Marketing. While challenging, this incorporates diverse viewpoints and constraints, leading to better product decisions and features.

19. Empower PMs for Decisive Accountability

Clarify that the Product Manager is ultimately accountable for making decisions and owning the consequences, especially when data isn’t perfectly clear. This empowers PMs to choose the best ideas and learn from outcomes, rather than getting stuck in consensus-driven debates.

20. Hire for Collaboration, Decisiveness, Curiosity

When hiring Product Managers, prioritize candidates who demonstrate a real excitement for collaboration, decisiveness in ambiguous situations, and a strong sense of curiosity or a growth mindset. These traits are crucial for navigating change and learning in dynamic, relatively small organizations.

21. Implement Weekly Focus Exercise

Encourage a simple ‘weekly focus’ exercise where team members articulate their priorities for the week and reflect on last week’s progress. This low-fi practice fosters accountability, helps identify patterns in time management, and keeps focus on priorities rather than just tasks.