Sex sellers face trouble after Etsy bans sex products

The ban also applies to media created by pornographic publishers such as Playboy magazines, nudity on models including “female nipples,” and material containing sexual language referring to familial relationships such as “daddy” or “mommy,” according to the announcement.

Stevenson expects to take a significant financial hit because of the policy change. Although the company has its own website where customers can purchase products, Stevenson said about 90% of its total sales come from Etsy. Stevenson’s company has made nearly 57,000 sales on Etsy since it launched in 2018. The business employs a team of four. The company also signed a new office lease in April, with rent set at $1,500 per month.

“If those same Etsy shoppers can’t find us on our site or elsewhere, it’s going to be a disaster,” Stevenson said. “How can we afford to pay our wages if we lose most of our revenue within 30 days?”

In a post on Etsy’s forum, head of trust and safety Alice Wu Paulus said the policy change was the company’s attempt to “continue to keep our users safe.” The company declined to comment for this story, but an Etsy spokesperson said most of the feedback the company has received from sellers about the change has been positive.

The change comes at a critical time in Etsy’s history. After a pandemic-fueled boom that saw shoppers forced to shop online while stuck at home during lockdowns, the e-commerce platform has since struggled to maintain sales volume amid inflation and increased competition. In its latest results, Etsy reported first-quarter profits of $63 million, down more than $11 million from a year earlier, due to weak consumer demand.

Etsy has implemented a series of cost-cutting measures, including layoffs. Earlier this year, activist investor Elliott Management, which has led efforts to turn around tech companies like Pinterest, built a significant stake in Etsy, becoming the company’s largest shareholder, according to CNBC. Interestingly, Elliott’s Marc Steinberg also joined Etsy’s audit committee, in addition to the board.

At the same time, Etsy is fending off growing competition from ultra-cheap Chinese retailers including Temu and Shein. Non-homemade items continue to flood the site, despite Etsy’s efforts to clamp down on such goods, Modern Retail previously reported.

For Stevenson, the shock came partly from the fact that he said he didn’t get enough notice from Etsy itself about the ban. Stevenson learned about it through social media posts on X (formerly Twitter). Wu Paulus’ post said the company would reach out to sellers who might need to update their listings in the coming weeks.

“To this day, a week later, they haven’t notified sellers like us with any kind of notification on the platform, like a dashboard or email — nothing,” Stevenson said. “Technically, they gave us 30 days notice, but if you’re not on social media or you didn’t see the announcement in the right place, I’m sure there are sellers who still don’t know this is happening.”

Stevenson isn’t alone. Michael Mickey, president and owner of Mr. Hankey’s Toys, also learned of the policy update on social media. Mickey is less concerned about how the ban will affect his own brand, since most of its sales come from its website and wholesale. Still, smaller businesses that started on Etsy will bear the brunt of the fallout, he said.

As Mickey said, “This is going to hurt a lot of small businesses.”

“Slippery slope”

Etsy’s partial ban on adult content has been long overdue, according to sellers who spoke with Modern Retail. About a year ago, Stevenson noticed that Etsy was labeling or removing more products, often with little or unclear explanation. For example, some products were removed, apparently because of animal references, including keywords like “tentacles.” That had a disproportionate impact on sellers like Stevenson who specialize in fantasy-themed products, leading many of them to leave the platform long before the recent policy change, he said.

All in all, running an Etsy store has become more difficult even before the platform made this new change, Stevenson said. He added that his sales have dropped by half over the past year due to various issues that have cropped up on Etsy.

“I honestly don’t think I slept a night in a year and a half,” Stevenson said. “We were on the edge of our seats, waiting for that worst-case scenario that had been on our radar for a while.”

Etsy sellers are now scrambling to find a new online address before their items are removed from sale.

Alexandra Houston, founder of London-based e-commerce platform Charmskool, which specializes in fetish clothing and accessories, said that since Etsy announced the ban, she has seen a “significant influx” of interest from affected sellers. The online marketplace already has about 100 sellers. Houston is currently in the process of adding about 20 more sellers. Another 20 sellers have inquired about joining the platform but have not officially applied.

Houston, who also sells vintage clothing on Etsy, said the new stance on adult content is another sign that Etsy is no longer the company it was when it was founded in 2005 as an alternative to companies selling mass-produced goods.

“It seems like Etsy is moving toward more standardized content. The site is flooded with mass-produced items,” Houston said. “This attempt at sex positivity feels very slippery.”

More harm than good

Etsy’s policy change adds to a growing wave of online platforms that have restricted or banned adult content altogether. In 2018, Tumblr banned pornography from its platform after Apple removed its app from the App Store, ultimately leading to Tumblr’s demise. OnlyFans repeatedly banned adult content creators in 2021 — then quickly reversed the policy after a backlash — saying it faced pressure from its banking providers. A number of age-verification bills — laws that require sites with a certain amount of adult content to verify that users are over 18 — have gained traction in the past few years, which critics say could do more harm than good.

Industry experts, including sex workers and First Amendment lawyers, typically attribute such crackdowns to the Fight Online Sex Trafficking Act and the Stop Online Sex Trafficking Act, also known as FOSTA-SESTA, which Congress passed in 2018. By making platforms responsible for what their users say and do in an alleged attempt to curb sex trafficking, experts told Bloomberg that the legislation has had a chilling effect across the internet as websites clamp down on adult content through blanket bans to avoid any risk to their operations.

“Over the past few years, we’ve seen increasing censorship of resources and products related to sex and sexuality,” said Mike Stabile, director of public policy at the Free Speech Coalition, an adult industry trade group. “Too often, platforms simply ban anything that might be controversial, including LGBTQ+ resources, sex education, or references to consensual adult sexuality. Unfortunately, as a few platforms increasingly have a larger share of the market, that means many outlets and communities are effectively shut out of the market.”

In December, Forbes found that AI-generated pornographic photos of celebrities were common on the website Etsy.

Etsy did not provide any additional reasons for changing its policy beyond what Wu Paulus wrote in her forum post, but Stevenson said he believed concerns about adult content being traded could have been addressed by using content filtering and moderation tools rather than leaving independent sellers to their own devices.

“I don’t know why they couldn’t just launch Etsy Plus or something like that, where it’s just adult content,” Stevenson said. “Most sellers, within reason, want to follow the rules because we understand that it’s important that the right people see your stuff and the wrong people don’t. Etsy just has a habit of making rules without warning and then punishing people before they can comply.”