Etsy Introduces New AI-Generated Item Guidelines in Seller Policy

Etsy has made significant changes to its seller policies in response to a surge of AI-generated products and generic items flooding the platform. On Tuesday, Etsy revised its guidelines, introducing a new set of labels that indicate whether a seller made, designed, sourced, or handpicked an item. This is the first time Etsy’s policy has directly addressed artificial intelligence, establishing clear guidelines for what is and isn’t allowed on the platform.

Etsy's New "Creativity Standards" and Seller Labels

To maintain transparency with buyers, Etsy has implemented Creativity Standards requiring sellers to label the over 100 million items listed on the platform. These new labels, located in the “Item Details” section of product descriptions, reflect the level of human involvement in creating the products.

Key Labels for Sellers Include:

• Handpicked: This label applies to vintage items or items that have been curated by the seller.

• Sourced: Craft and party supplies fall under this category, indicating that the seller didn’t make the items but sourced them.

• Handmade: Refers to physical products that the seller personally made or created with tools like 3D printers or Cricut machines.

The introduction of these labels marks a significant step in clarifying product origins and helping buyers make informed purchasing decisions.

Addressing the Rise of AI-Generated Items

A new label, Designed, has been introduced to address the growing presence of AI-generated products on Etsy. The platform has faced backlash from traditional artists due to the rise of AI art, which can mimic human artists' styles. Despite these concerns, Etsy is embracing AI technology while establishing rules around its use.

According to Etsy’s Seller Handbook, sellers can use their original prompts in combination with AI tools to create designs. These products must be labeled as Designed by, indicating that AI played a role in the design process.

Examples of AI-Generated Items:

• A fantasy scene created based on a seller’s original input and produced by an AI generator.

• A custom portrait of a buyer’s pet, generated using AI tools.

Sellers are required to disclose in their listing descriptions whether AI was used to create the product.

New Rules for AI-Prompted Listings

While Etsy allows sellers to design products using AI tools, it has implemented a new rule prohibiting the sale of AI-generated prompts. This addresses a growing trend of listings such as “10,000 Midjourney Prompts” or “Ultimate ChatGPT Prompts Pack.” A spokesperson from Etsy informed TechCrunch that these listings would be flagged and removed, starting immediately.

Etsy’s Commitment to "Keeping Commerce Human"

Etsy’s CEO, Josh Silverman, emphasized the company’s commitment to keeping commerce human during a first-quarter earnings call. Silverman assured investors and sellers that Etsy is actively removing listings that violate its Handmade policy, with four times the number of violations removed compared to the previous year.