Based solely on the headlines, e-commerce is dead in the water.
It makes sense: Amazon (AMZN), the industry's juggernaut, just laid off 18,000 workers. According to the Wall Street Journal, that's the largest layoff by a major tech firm to date.
But this is a time when it pays to defy conventional wisdom and look beyond the headlines. You see, there's a niche part of this sector that doesn't draw much attention from the "pros" on Wall Street...
I'm referring to the market for handmade goods. Before you scoff, consider this: This market has a global value of $718 billion. And I've uncovered a leader in this market that's set to double its earnings in just three years.
Online Still Rules the Roost
Despite Amazon's recent bad news, I believe the future of retail still hinges on the online world.
But don't just take my word for it. Consider these statistics from researchers at eMarket:
Prior to March 2020, e-commerce had a global value of $25 trillion. This includes business-to-business transactions, as well as those made by consumers.
That made online sales roughly the same size as the U.S. gross domestic product ("GDP"), an amazing fact considering America's economy is the world's largest.
And though the physical retail economy continues to rebound in the aftermath of Covid, e-commerce is still expected to keep growing, too. Research firm Oberlo forecasts the global e-commerce market to increase by more than 10% this year. At that rate, it's doubling every seven years.
The Demand for Handmade Goods
That bodes well for a savvy e-commerce leader that focuses on the niche sector I mentioned earlier: unique, handmade goods.
Conventional wisdom previously maintained that it's not easy to sell handmade items online. The experts believed that collectors had to see original art and handmade objects in person to get emotionally invested enough to buy them.
But Covid changed that. With galleries closed all over the world, collectors turned to the World Wide Web for their next acquisitions. In July 2020, for example, a painting by artist Roy Lichtenstein sold at a live-streaming auction for $46.2 million, beating forecasts by 54%.
The online event drew 80,000 people from around the world, a whopping 13,000% increase from the number of folks who usually attend.
One month earlier, a piece by painter Matthew Wong sold for $1.8 million during a live-stream auction, a price more than 2,100% higher than officials at fine arts company Sotheby's thought it would command.
We don't have data for 2022 online art and related sales quite yet. But 2021 was a banner year for the field. Sales reached $13.3 billion, a far cry from the mere $3.1 billion figure in 2013.
The fact is that six-figure art is just the tip of the iceberg when it comes to handmade, one-of-a-kind goods. With millions of us redecorating our homes during and after the pandemic, interest in these goods is running strong.
And one marketplace is the go-to source for acquiring these items.
Get Your Handmade Goods Here!
You might be familiar with Etsy (Nasdaq: ETSY). Founded in 2005 as a way for individual "arts-and-crafters" to sell things, Etsy is built around the notion that the item you're buying is unique – the exact opposite of mass goods offered through Amazon.
At Etsy, the ability to ask for personalization is built in through dedicated contact with the item's maker. Today, the website has listings for all kinds of art pieces – everything from traditional paintings to unique photos to patterned blankets and sheets. Many items are only made once, so you know they're true collectibles.
Today, most of Etsy's sales come from its homewares and home furnishings divisions. Whether it's personalized pet furniture or pillowcases with unique messages or prints, Etsy is selling billions of it...
And I do mean billions. In 2022's third quarter, Etsy handled $3 billion worth of merchandise sales. I know Amazon probably does that much in a single day, but Etsy's profits are running circles around the "king of e-commerce."
Etsy even offers an augmented reality ("AR") function on its mobile app. This lets users see what a piece of art would look like on their wall before they buy it.
Double Your Money?
The increased demand for customization and uniqueness isn't going away. I'm projecting earnings growth of an average of 24% for Etsy, which means earnings could double in just about three years.
This investment play could lead you to 100% returns over the long haul. And if you're a "Pro" subscriber, I'll reveal how you could potentially double your money even sooner.
