Etsy plans to test its first-ever loyalty program as it aims to boost sales

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Etsy says it will begin testing its first-ever loyalty program in September

Etsy said Wednesday it will begin testing its first-ever loyalty program in September, a move designed to boost the e-commerce site's sluggish sales and draw in occasional shoppers.

The New York-based company said select buyers will receive an invitation for the program, which will offer free shipping across the U.S. and access to discounts.

“We want people to start their shopping journey on Etsy rather than come to Etsy when they’re just looking for something very specific,” Raina Moskowitz, the company’s chief operating and marketing officer, said in an interview.

Etsy is launching the program — called Etsy Insider — with the aim of reversing a decline in its gross merchandise sales, a measure of the amount of goods sold over a certain period.

Etsy did not disclose how much customers must pay for the new loyalty program. But Moskowitz said the monthly fee will be close to the cost of a latte. She also said the company will decide on whether or not to do a nationwide rollout of the program after seeing what resonates with consumers.

The company with roots as an online crafts marketplace experienced a boom in its business during the COVID-19 pandemic, when homebound consumers turned to it for items such as artistic face masks. But it's been facing more challenges since the worst of the pandemic eased and consumers, who typically go on its site to buy discretionary items, began to feel more pressure from inflation. Like Amazon, it is also facing more competition from Temu, the online retailer owned by the Chinese e-commerce company PDD Holdings.

During the first three months of this year, Etsy reported merchandise sales on its marketplace