Etsy is adjusting its seller policies to make it easier to detect AI

Etsy, the online marketplace known for selling handmade and vintage items from independent sellers, has introduced significant changes to its seller policies amid rising concerns about the influx of generic and AI-generated products.

The new rules aim to maintain transparency and authenticity, to ensure shoppers know exactly what they are buying and the degree of human involvement in the creation of those goods.

The context

First established in 2005, Etsy is known for unique products made by independent artists. The company also provides tools and support for small businesses to manage their stores and reach a global audience.

The Etsy NYC headquarters building is seen on December 13, 2023 in New York City.

Michael M. Santiago/Getty Images Entertainment/GC Images

Etsy has faced criticism for the increasing presence of AI-generated products on its platform, raising ethical concerns among traditional artists and buyers.

What we know

Etsy revised its seller policies on Tuesday, implementing new “creativity standards” that require sellers to clearly label their products based on the level of human engagement.

The move marks Etsy’s first direct engagement with artificial intelligence in its seller guidelines, according to TechCrunch.

The “Handmade” label applies to products that are physically made by the seller or using tools like 3D printers, TechCrunch reported.

However, the “Designed” label is a new category introduced to address AI-generated items. Sellers who use AI tools to create their designs must label those products as “Designed by,” indicating that AI or other digital tools were involved in their creation. This ensures that buyers are aware that the products may not be completely handmade, according to the outlet.

Despite the backlash against AI-generated art, Etsy has embraced the technology under certain conditions. Sellers can use AI tools to create but must disclose as much in the product description. However, selling AI prompts, such as “10,000 Midjourney prompts”, is strictly prohibited, and these listings will be removed from the platform.

In a statement to NewsweekAn Etsy spokesperson said the changes to its seller policies are intended to keep the platform “special.”

“Through e-commerce, there has been an increase in mass-produced and generic goods from reseller websites,” the statement said. “Also, we’ve heard from both buyers and sellers that we could provide a more transparent shopping experience, where the role a seller plays in creating their merchandise is crystal clear.”

During Etsy’s first-quarter earnings call, CEO Josh Silverman emphasized the company’s commitment to keeping “commerce human.”

He said Etsy removed four times the number of listings that violate its handmade policy compared to the previous year.

What comes next?

These changes are expected to improve transparency and confidence among buyers, enabling them to make more informed purchasing decisions. As the debate surrounding AI-generated art and products continues, Etsy’s new guidelines could set a precedent for other online marketplaces grappling with similar issues.

Update 6/10/24 5:00 PM ET: The title of this story has been changed to better reflect Etsy’s new policy changes, and comment from Etsy was added.

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