Probably too late as going back would likely reduce revenues. Handcrafted goods are expensive and slow and hard to police the sellers.
Its a shame, because it was such a good idea to have a marketplace for people to sell stuff without the pain of setting up an online website/shop. Though some independents are now are using the squarespace/shoppify....etc.
Here's a contrarian point of view: What if they do embrace China imports, get acquired by Alibaba and become from a front of artistic goods made in China.
Etsy is based on selling handmade/artisan stuff. They can get away selling mass market stuff because of the reputation they earned with actual artisans at the beginning.
Your strategy would be to get full steam becoming a front for Alibaba, fooling your users for long enough so that eventually Alibaba buys you.
Problem is why would Alibaba do that ? By that stage you have a toxic brand: at any time, if a enough ripped off users make some noise, you are done forever.
The best move for Alibaba, assuming they are interesting in building a Chinese artisan store, is to simply destroy Etsy with "Cut out the middle man, buy Etsy chinese mass market stuff cheap directly at the source on Alibaba. Or if you are interested in the genuine chinese art, check out our new dedicated store. Click on the following link to see all the process and check we put in place to make sure it is genuine handmade, not found in a super market good."
Amazon's "lock on all of that" has pretty much ruined their brand from a retail seller standpoint. They're catalogue is overrun with garbage and counterfeits. It's quickly becoming eBay. I used to look at stuff in brick and mortar stores and then buy from Amazon. Now I look on Amazon for research and buy from brick and mortar stores so I know I'm not buying Chinese counterfeit garbage.
I mean, Isn't that what they are doing? Shrinking workforce in theory "refocusing" which is code for "we don't need all these people if we are targeting a smaller market"?
Its a shame, because it was such a good idea to have a marketplace for people to sell stuff without the pain of setting up an online website/shop. Though some independents are now are using the squarespace/shoppify....etc.