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Shop Talk: What Can Etsy Do For Me?

I'm been thinking about a new topic to continue our earlier discussions relating to small business, from shop owners to the independent artists trying to promote their work in stores and on the web. (If you'd like to read some of our past discussions on small business topics, click here.) I decided that today, I'd like to talk about Etsy.

Daniel Sroka recently caught my eye by a comment he'd left here on decor8, and I've been following his blog ever since. He wrote in with some excellent questions in regards to Etsy, and with so many of you being experienced shop owners there, I hope you'll chime in to not only help Daniel, but also to assist all the others out there that may have similar questions. Here's his letter below:

"I am an artist, a photographer, and have been evaluating the different markets for selling art, and how to approach them. On one end of the spectrum you have the traditional gallery-oriented market: art selling for high prices, in small editions, to small groups of people. Because of the price, this is art that needs to be *sold*,
usually in person. On the other end you have sites like Etsy, selling art at prices that are low enough to encourage people to take a chance at buying art online, but high enough that it still has the feel of quality. I don't think it is a good idea to rely on only one market for your income, so it seems that the best place to be is somewhere in the middle: selling some exclusive work for higher prices, but complementing that with smaller, more inexpensive pieces on Etsy. But I'm curious if anyone has had success selling their work in both of these markets. Do you find that there is a relationship, either good or bad, between them? For example, do your sales on Etsy help market your more expensive work? Or conversely, have you found that being on Etsy makes potential galleries/collectors discount your more expensive work? If you are selling work on both, what percentage of your sales comes from each market?" - Daniel Sroka.

Since this isn't an area that I have experience in (selling on Etsy), I'm handing this topic over to readers to assist you. Thanks Daniel for writing in!

(screenshot of etsy homepage from 6/29)