Hey hustlers, big shifts are happening!
Etsy just lost 1.4 million sellers, raising questions about its future. Meanwhile, GenAI is reshaping retail traffic, doubling visits every two months.
Consumers are cutting back on dining out, but online shopping is thriving.
In payments, Klarna just locked in an exclusive BNPL deal with Walmart, and AI is taking product descriptions to the next level.
Let’s break it all down! 🚀
ECOMMERCE TRENDS
Etsy Loses 1.4 Million Sellers as Growth Reverses
Etsy’s seller count is shrinking fast. In just a year, 1.4 million active sellers have left the platform, with the number dropping from 7 million to 5.6 million. Most concerning is the 600,000 sellers lost in Q4 alone, marking Etsy’s third straight quarter of decline.
📉 The Bigger Picture:
Active buyers also dropped, from 92M to 89.6M.
Gross Merchandise Sales (GMS) declined, indicating broader struggles.
New seller signups have plummeted—from over 300,000 per month in 2021 to under 20,000 per month in 2024.
⚖️ How Etsy Compares:
Amazon adds ~1M new sellers per year, maintaining strong marketplace growth.
Walmart’s marketplace is expanding, recently surpassing 150,000 active sellers.
Etsy’s CEO Josh Silverman insists the platform is staying true to its handmade roots, but seller churn suggests mounting pressure.
💭 Is Etsy Right-Sizing or in Trouble?
Some attrition may be intentional, with Etsy cracking down on counterfeits and low-quality sellers. But a 1.4% decline in net income and slowing demand for discretionary goods hint at deeper challenges.
Is Etsy’s slowdown a correction after pandemic-fueled growth—or a sign of long-term trouble? Let us know what you think!
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ECOMMERCE AI
GenAI Traffic to Retail Sites Doubles Every Two Months
Retail websites are seeing a massive surge in traffic from generative AI (GenAI) chat interfaces, according to Adobe Analytics. While still smaller than channels like paid search or email, GenAI-driven visits have doubled every two months since September 2024.
📈 Traffic Growth by Industry (July 2024 – February 2025):
Retail: +1,200%
Travel & Hospitality: +1,700%
Banking: +1,200%
GenAI visitors spend 8% more time on retail sites and browse 12% more pages, but they are 9% less likely to make a purchase. However, this “conversion gap” is narrowing—down from 43% in July 2024—indicating that shoppers are becoming more comfortable completing transactions after AI-assisted searches.
Retailers are already adapting to this shift. AI-powered chat tools like ChatGPT are streamlining product discovery, price comparisons, and deal-hunting, making them a key player in modern eCommerce.
What’s next? As AI’s role in shopping grows, expect more businesses to optimize for GenAI-driven traffic and conversions.
ECOMMERCE TRENDS
Retail Sales Show eCommerce Growth as Consumers Cut Back on Dining
Shoppers are making careful spending choices as economic uncertainty and inflation loom, leading to a decline in discretionary spending and a rise in eCommerce activity.
📊 Retail Sales Trends (February 2025):
Overall retail sales: +0.2% (below 0.6% expected)
eCommerce sales: +2.4% (biggest jump in 14 months)
Dining out: -1.5% (third straight month of declines)
Grocery sales: +0.4% (shift toward eating at home)
Consumers Are Cautious with Credit
Credit access is tightening, with rejection rates rising across all major credit products. In February, 33.5% of auto loan applications were denied, the highest rate recorded. Younger consumers face the most difficulty, with 15.4% of applicants under 40 rejected.
Why it matters:
eCommerce is benefiting as shoppers hunt for deals online.
Discretionary spending is slowing, impacting electronics, apparel, and dining.
Credit concerns may lead to further pullbacks in nonessential purchases.
Looking ahead: With inflation expectations rising and credit tightening, retailers may see continued shifts toward online shopping and essentials.
DIGITAL PAYMENTS
Klarna Becomes Walmart’s Exclusive BNPL Partner for OnePay
Klarna is expanding its footprint in the U.S. by becoming the exclusive Buy Now, Pay Later (BNPL) partner for Walmart’s OnePay platform. This strategic partnership will roll out in 2025, allowing Walmart shoppers to finance purchases with Klarna-powered installment loans.
💳 Key Details:
Klarna will power OnePay installment loans with repayment terms of 3 to 36 months.
The partnership is integrated across Walmart’s online and in-store checkout.
Klarna’s move comes ahead of its anticipated IPO, signaling confidence in its growth strategy.
Walmart will continue its partnership with Affirm, but Klarna secures exclusivity for OnePay.
Why It Matters:
BNPL adoption is growing as consumers seek flexible payment options.
Klarna gains massive U.S. exposure, competing directly with Affirm.
Walmart strengthens OnePay’s financial services offerings.
Looking Ahead: As Klarna’s IPO looms, this partnership could further boost its valuation and market presence in the U.S. BNPL space.
ECOMMERCE PRODUCT DESCRIPTIONS
AI-Powered Product Descriptions: Crafting Copy That Sells
Writing compelling product descriptions has always been a challenge, but AI is changing the game. By leveraging generative AI and prompt engineering, eCommerce sellers can now generate engaging, conversion-optimized descriptions at scale.
A Proven AI Prompt Formula:
1️⃣ Task – Tell AI what to do (e.g., “Create a product description focusing on a key feature.”)
2️⃣ Context – Define the audience, benefits, and brand voice.
3️⃣ References – Provide example descriptions for AI to mimic.
4️⃣ Evaluate – Review AI-generated copy and refine it.
5️⃣ Iterate – Adjust prompts to improve output.
Example:
Instead of a bland description, AI can generate engaging copy like this:
“Tired of chasing soup around your bowl with a tiny spoon? Meet the soup spoon designed for real soup lovers—deep enough to scoop hearty stews and creamy bisques in one satisfying bite!”
Why It Matters:
AI-driven descriptions boost engagement and SEO.
eCommerce brands save time while maintaining quality.
Well-crafted prompts produce better AI-generated content.
Want to improve your product listings? Start by refining your AI prompt strategy!
Signing off,
The Merchant @CartHustle