This month I welcome Roberto Milk, the co-founder of NOVICA and Handmade.com to the Marketplace report. NOVICA has a long history of supporting artisans through their fair trade marketplace. And now they are sharing the launch of their new marketplace Handmade.com. Read on to learn more about how they are taking their experiences from NOVICA, and building upon it with a new marketplace open for many more artisans.Â
Here is the interview on our YouTube channel:
Can you share the origin story behind the marketplace?
We are a mission-driven company to the core. We started over 20 years ago with the dream to make the world a better place for artisans. I’m half Peruvian. My grandmother on my Peruvian side was one of our very first artisans. She was one of the inspirations behind the whole thing in many ways.
We wanted to reinvent the way that import-export worked for artisans. So many of the artisans we worked with didn’t have a way to reach the world market. And in the NOVICA context, we’re mostly talking about village artisans from around the world.
There were many, many middlemen. There were tons of markups in the process. And so the artisan usually got about 10% of the final retail price in the US. So the system needed to change and needed to be improved. Our whole idea was, how do we create a better way for artisans to to sell their goods?Â
For our first marketplace, we originally partnered with National Geographic. This was important for us as we wanted to share the stories of the artisans. We’ve also worked with a variety of groups such as US Aid, the United Nations, and the World bank to open 10 economic hubs around the world.Â
So that’s the NOVICA story. But for years we have had inbound requests to sell from us from artisans outside of our core fair trade mission. Many coming from US artists that we would love to work with. And our systems weren’t really designed to work with the market in this way. Which is what led us to the creation of Handmade.com. Handmade.com is our new marketplace allowing us to serve a broader market of sellers.Â
What countries/locations/categories are eligible to be sold on your marketplace?
NOVICA is well established with its economic hubs. Â
Handmade.com will work for all the 10 economic hubs we already support plus will work for sellers from the US to start. While we have global ambitions, right now we are working on the practical reality of ensuring all the shipping integrations are working. You’ll recognize who the shipper is if you work in the US market.
Canada is also high up on our list, hopefully for next year. We are going to be doing quarterly rollouts starting next year.
Are you focused on specific niches or is it a general marketplace?
Both of our marketplaces are a general marketplace that focuses on Handmade items. We try to have a transparent process around our Handmade standards.
NOVICA has been around longer, and has the more established standards. We have a Village council, kind of United Nations style, that reviews our Handmade standards. We have representatives from different countries and institutions that support NOVICA involved in this process. We have these biannual meetings where we’ll do a full review of the handmade standards per category. That way we can make adjustments to the standards over time.
For the new Handmade.com marketplace, we are just getting up and running. If you don’t see things in the category you make- that is okay. You can still apply as we are just getting this started.
Can you share more of how the marketplace worked when it first launched, and how it has been evolving?
When NOVICA originally launched, we had intended it to be more like a marketplace where artisans listed everything themselves. However, we quickly learned around the world that wasn’t going to work. That is what led to the creation of the economic hubs.Â
How do your fee structures work?
For NOVICA, The artist names their price, and we add a markup on top of it. But the artist always prices and can move their prices up or down. They don’t have to worry about how their products are listed on different marketplaces, as we are typically the only ones they work with.
However, that doesn’t work for Handmade.com because we are in the US market. In the US, sellers also have to be aware of what is happening in the retail price environment and map out their prices accordingly. So for this one we are adopting more of a standard marketplace model.Â
Figuring out how to set the fees is tricky. We did a lot of research between Etsy and Amazon to gather data points for fees. We have set our initial pricing that you can find on our website. But here is where we are different. We’ve made a commitment that we will only decrease fees over time.
Right now we have sold $135 million worth of product through NOVICA. When we get to a combined $1 billion we are going to have a celebration and decrease our fees.
Our fees are set at their current levels, because marketing is expensive! We have to continually get in front of buyers, and you can’t do this without charging enough in fees. It’s just the reality of how this works.
What do you do to attract both sellers and buyers to your marketplace?
Here is where I think we are a little different in our ability to develop the buyer base. Because of our history with NOVICA, we’ve learned to develop a lot of business partnerships. For example, we’ve got a great relationship with Kiva. This is a business relationship we have built.Â
We love Kiva and Kiva loans. We were one of the first non-bank, non-traditional microfinance institution on Kiva. And so Kiva borrowers or Kiva lenders, they could they could lend money to NOVICA artists through the Kiva platform. It’s so cool. And so and then we um ended up also running the Kiva store. So any of the artisans on NOVICA that borrowed from Kiva, then they were also accepted into selling on the Kiva store. So it’s a place for you know where someone from a Kiva lender can also, they can purchase their holiday gifts you know and support Kiva and and also support the artists that are borrowing money from Kiva. So it’s super cool. so And there’s many, many, many of those opportunities available. Â
Of course you will also see us do more traditional advertising like on Google and Meta platforms.Â
In terms of attracting sellers, for Handmade.com this all started from an inbound set of requests from sellers. So we have started with that initial list.Â
From your perspective, what makes a good product listing for your site?
First and foremost, think about what it is that makes your product unique? Have you spoken to the design, the beauty, the quality and the level of craftsmanship that goes into your product? All of these are important building blocks to crafting the story of your product. That story is so important!
All of us supporting handmade are on the same side, right? We are just trying to get them to not buy Wal-mart and Target, but to support handmade. We want them to replace some of their factory purchased goods with those that are handmade.
Then you also have to think about how the customer is searching for it- what they might ask to find the products they are looking for. Remember the buyer is making that purchase because they want to beautify their life in some way.
What advice would you give artisans when looking at a marketplace to know if it might be right for them?
For each artisan this is going to be a different decision. I would suggest artisans consider spreading around and using several platforms. That way if something happens on one of them, they can move on to others. This will help you manage your platform risk and help you figure out what platforms you like.
How do people get started on Handmade.com ?
Head on over to our website to apply (link below). You’ll see several options there to learn more about selling on our site and how to apply.
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