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Unit 1.case

Case Study: Nepali Handicrafts on Etsy – From Local Stalls to Global Carts

IT 204: E-Commerce

Learning Objectives

By the end of this case study, you will be able to:

  • ✅ Analyze how e-commerce features solve traditional business problems.
  • ✅ Differentiate between a marketplace model and a standalone website.
  • ✅ Identify key operational strategies for launching a small-scale global e-commerce venture.
  • ✅ Connect this real-world example to the core concepts of Unit 1.

The Context: A Pre-Digital Business Model

The Situation

  • A Patan-based artisan collective.
  • Specialized in wood and metal crafts.
  • Primary Revenue:
    • Tourist footfall in local stalls.
    • Sales via export middlemen.

The Catalyst for Change ⚡

  • COVID-19 pandemic hits.
  • Tourism collapses, eliminating in-person demand.
  • Supply chains for middlemen are disrupted.
  • Result: A critical need to pivot or perish.

The Pivot: Marketplace vs. Standalone Site

The first major decision: Where to sell online? The collective chose Etsy, a global marketplace for handmade goods.

Marketplace (Etsy)

  • ✅ Built-in audience & discovery
  • ✅ Integrated payments & trust systems
  • ✅ Lower initial technical lift
  • ❌ Platform fees & competition

Standalone Site (e.g., Shopify)

  • ✅ Full brand control & ownership
  • ✅ Direct customer relationship
  • ❌ Must generate all own traffic
  • ❌ Higher setup & marketing costs

Decision Rationale: For a rapid launch with minimal upfront cost, leveraging Etsy's existing infrastructure was the optimal strategy.

Key Strategy 1: Crafting the Digital Shelf

In e-commerce, your product page is your salesperson, packaging, and storefront all in one.

  • SEO-Friendly Listings: Optimized titles, tags, and attributes to appear in search results for terms like "Nepali wall art" or "handmade singing bowl".
  • Storytelling Photography: High-quality images showing the product, its scale, its use, and details of the craftsmanship.

Example: Product Title Optimization

Poor SEO: "Wooden Mask"

Good SEO: "Hand-carved Mahakala Mask, Himalayan Wood Art, Nepali Wall Decor for Meditation Room"

Key Strategy 2: Solving Global Logistics

Getting a product from a workshop in Patan to a customer in Portland requires a robust logistics plan.

  • Cross-Border Shipping: Used marketplace tools to generate prepaid international shipping labels (e.g., via DHL, FedEx).
  • Customs Compliance: Correctly used Harmonized System (HS) codes on customs forms to ensure smooth clearance.
  • Standardization: Adopted standard SKUs and developed protective, branded packaging to reduce damages and elevate the customer experience.

HS Codes: A global standard for classifying traded products. Getting this right prevents customs delays and unexpected fees for the customer.

Key Strategy 3: Omnichannel Presence

The collective didn't just rely on Etsy's traffic. They created a customer journey starting on social media.

Instagram Post/Story
(Discovery & Social Proof)

⬇️

Direct Message (DM)
(Answering Questions, Building Rapport)

⬇️

Link to Etsy Listing
(Secure Checkout)

This approach leveraged Instagram for visual storytelling and community building, funneling qualified buyers to the Etsy platform for a trusted transaction.

The Outcomes: A Business Transformed 📊

Revenue & Demand

  • 60% revenue recovery within 3 months.
  • Diversified demand beyond tourism.

Profitability

  • Higher margins vs. export middlemen.
  • Improved cashflow via direct platform payments.

Data & Growth

  • Direct customer data enabled repeat marketing.
  • Feedback informed product iteration and new designs.

Unit 1 Lens: E-Commerce Features in Action 🔍

This case perfectly illustrates the unique features of e-commerce technology from Chapter 1.2:

  • Global Reach: The business transcended local boundaries, reaching customers worldwide without physical expansion.
  • Universal Standards: Etsy provided a common payment and communication platform, understood globally.
  • Information Density: Product pages conveyed far more information (origin, materials, artist story) than a simple price tag in a physical shop.
  • Social Technology: Customer reviews on Etsy and engagement on Instagram built trust and social proof, replacing face-to-face interaction.

Unit 1 Lens: Types of E-Commerce

Where does this model fit within the types of e-commerce from Chapter 1.3?

This case represents a hybrid model.

  • It operates on a C2C (Peer-to-Peer) platform, where individual artisans (consumers/producers) sell to other consumers.
  • However, for international buyers, the collective functions as a small business, giving the transaction B2C (Business-to-Consumer) characteristics.

Challenges & Key Lessons

Challenges Faced ⚡

  • Navigating cross-border compliance (customs, taxes, returns).
  • Managing production capacity and lead times for handmade items.
  • Risk of counterfeit goods from competitors on a large marketplace.

Key Lessons Learned 🎯

  • Marketplaces dramatically compress go-to-market time for small producers.
  • Product page quality (copy + photos) is the single highest ROI activity.
  • The "product" is the entire experience: packaging, shipping, and policies matter immensely.

Summary: Key Takeaways

  • E-commerce provides powerful tools for resilience, allowing traditional businesses to pivot against physical-world disruptions.
  • Marketplaces like Etsy lower the barrier to entry for global trade, handling complex functions like payments and discovery.
  • Success in e-commerce requires mastering digital merchandising—the art and science of the product page.
  • The online "product" is the entire customer journey, from the first Instagram post to the final unboxing.

Thank You

This case study demonstrates the transformative power of applying e-commerce principles to a traditional craft-based business.

Next Up: Chapter 2 - E-commerce Business Models and Concepts

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