Etsy is doubling down on its marketing campaign as the online store looks to retain the customers it gained during the pandemic.
CEO Josh Silverman told CNBC’s Jim Cramer on Thursday he is pleased with the returns he’s seen from its marketing spending in recent years and that the company is dialed in to continue the strategic investments.
“We’re going to keep being super disciplined about our investment,” he said in a “Mad Money” interview. “This is a moment when Etsy is really top of mind for millions of consumers and it’s the perfect moment for Etsy to be leaning in and really investing in marketing.”
The comments came one day after the online platform, which specializes in selling handmade and personalized items, topped Wall Streets’ estimates in its third-quarter report. Despite bringing in $451 million in revenue, more than double from the year-ago quarter, the stock sold off 5% in Thursday’s session.
Etsy tallied $127 million in marketing expenses in the July-to-September quarter, which made up a large part of its roughly 86% year-over-year increase in operating expenses, and the e-retailer plans to continue spending big on its strategy in the current quarter. The company is expecting a lower return on investment, however, and says it will impact margins.
Etsy has focused on television, digital and performance marketing, the company said.
Silverman pointed out that Etsy, which was added to the S&P 500 in September, is now mentioned alongside other big players in the e-commerce space like Amazon, Walmart and Target. At $132.42 per share at Thursday’s close, the market values the company at $15.8 billion.
“We’re suddenly in the same breath as brands that are 50 or 100 times bigger than Etsy, and we have the potential to be so much bigger than we are today,” he said. “It’s just being about top of mind.”
Etsy’s gross merchandise value, which retailers use to measure growth, was up 119% to $2.6 billion in the third quarter, the company said. The company grew revenue by 128% during the period to $451 million and produced 70 cents in earnings per share, beating estimates by 10 cents per share.
The stock is up nearly 200% year to date.
