Payhip vs Etsy: Which One’s Better for Selling Digital Products?

I figured, “Everyone’s buying on Etsy, right? This’ll be easy.” But wow… I did not expect the fees, the algorithm stress, and the feeling of being buried under thousands of similar products.

Fast forward a few months, I switched to Payhip and things got way easier. No, I didn’t get the same built-in traffic Etsy offers, but I finally felt like I was running a real business, not renting shelf space in someone else’s crowded store.

If you’re stuck trying to choose between Payhip and Etsy for selling digital products — templates, planners, art prints, anything downloadable — here’s everything I learned (the hard way) about both platforms.

Selling on Etsy: Great for Exposure, Not So Great for Control

I’ll give Etsy credit: it has an audience. The day I listed my digital planner, it got 5 views almost instantly. No ads. No social media. Just pure marketplace juice.

But here’s what no one talks about:

• Etsy fees stack up fast. You’ve got listing fees, transaction fees, processing fees, and even advertising fees if you opt into their “Offsite Ads” (which they do automatically once you hit $10k in sales).

• It’s a search engine game. Your success depends heavily on keywords, tags, and constant tweaking. I felt like an SEO analyst more than a creator some weeks.

• You don’t own your audience. I had buyers, but I couldn’t email them directly or retarget them later. They’re Etsy’s customers — not really mine.

And when Etsy changed their algorithm or pushed me lower in search rankings? My sales tanked overnight. That kind of dependency stressed me out.

Switching to Payhip: Owning My Storefront

Payhip was a breath of fresh air. It’s not a marketplace — it’s a hosted storefront just for me. That might sound scary at first (no built-in traffic!), but hear me out.

• It’s free to start. You can launch a product today without paying a dime. Their free plan charges a small 5% per transaction, and the paid plans drop that to 0%.

• Built-in marketing tools. I’m talking email marketing, coupon codes, affiliate programs, even upsells — all included. No extra apps or plugins needed.

• You control the branding. I customized my storefront to match my style, added a blog page, and set up a lead magnet to grow my email list. It feels like mine, not just a profile on someone else’s site.

• Instant delivery + PDF stamping. When someone buys, Payhip handles the delivery automatically. I can even stamp buyer info on the PDF to prevent piracy.

And the best part? I own the customer relationship. I can email them, tag them by product, upsell them later, and track what’s working — without being locked into a third-party platform.

Head-to-Head Comparison: What Matters Most?

Here’s the honest breakdown from someone who’s been on both sides:

Who Should Use Etsy?

If you’re brand new, don’t have an audience, and want quick visibility, Etsy’s not a bad place to start. You’ll get traffic. You’ll make some sales. You’ll learn fast.

But you’ll also be stuck in a race — one where you have to keep optimizing, advertising, and hoping Etsy’s algorithm doesn’t randomly hide your shop.

Who Should Use Payhip?

If you want to build something sustainable — a real business, not just a side hustle — Payhip gives you the tools. Especially if you already have an audience (even a tiny one), or you’re willing to market through email, content, or social media.

Payhip is ideal for:

• Digital product creators

• Course sellers

• Coaches or consultants

• Anyone tired of marketplace fees and limitations

Final Thoughts

If I could go back, I’d use Etsy to validate my product idea, but I’d set up Payhip at the same time. Use Etsy to get early momentum — but use Payhip to build your brand.

Eventually, Etsy might bring you traffic, but Payhip will bring you freedom.

And trust me, nothing beats waking up to a sale notification on your own platform — where you keep the customer, the profit, and the control.