How To Make Passive Income On Etsy In 2023

If you are passionate about making passive income on Etsy this year, you are lucky! The opportunity is wide open and is waiting for you.

Or, if you have a passion project idea that can be translated to generating passive income on Etsy, get ready. This year is gonna be your year of making a passive buck from Etsy.

Let’s dig right in


Disclosure: This page contains affiliate links. I’ll receive a commission if you purchase through my links at no cost to you.

What is passive income?

Passive income is the income that is acquired automatically with minimal labor to earn or maintain.

In simpler terms, you don’t have to be actively doing work at that time to get the money.*

(* You still have to do the work upfront, before you reap the benefit passively)

Usually the passive income terms are used in terms of investment, where you get the annual dividend from the funds that you purchase. That is completely passive

But who are we fooling right now, we don’t have bucks, let alone to buy the funds with annual dividends.

Let’s be real.

So the passive income that I refer to is Creating a digital product.

It’s not entirely PASSIVE, because you need to pour on your hard work first. But once you have created your digital product, it’s entirely passive.

Just imagine, you are creating a one-time product, and the possibilities of it getting purchased are endless and totally passive.

If you are itching to join to create a side hustle, but you are busy with your 9-5, this business design is for you.

It doesn’t matter if you are a school teacher, college student, nurse, or anyone, you can do this.

Is it easy to make passive income on Etsy?


And it’s not entirely PASSIVE. You have to do the hard work and put in the sweats and hours on it.

I will not sugarcoat and say that it is easy.

However, with the right steps and approach you will make the passive income on Etsy in no time

Think about it, any business required effort, and it is not going to be easy at first. But once you get the hang of it, it’ll become easier

But generating passive income on Etsy is relatively easier compared to the rest of the business model:

  • You don’t have a large amount of capital to start the business
  • Just create the product ONCE
  • Don’t have to store the product and worry about shipping
  • You can start anytime, anywhere, and just need a laptop (or Ipad) 

Tips: Once you start making money passively on Etsy, you can create a youtube channel or social media platform such as Tik Tok or Instagram and teach people your way of doing it.

Why? Because you can make your next passive income through Affiliate marketing. 

So get this, not only do you get PAID for your digital products, you double the chances of getting passive income by affiliate marketing.


Trust me it’s not easy (at first) but it will be worth it

How to make passive income on Etsy?

It is by selling digital products / digital downloads or printables.

What I mean by digital products is something that you have created ONLINE such as a digital planner, digital sticker, or party invitation that the customer can download and print on their own.

Your task is just to create the product

You create the product one time, put it on the listing, and once your customer purchases the item, you will send them the link to the file. And it’s done!

See, it’s NOT entirely passive as you still need to do it once. But once done, it’s purely automatic.

You can find out how to create the best digital product in my previous article. But, in brief, there are a few simple steps

1. Begin with the end in mind

Imagine your potential product with your potential customer design specifically for them

2. Do proper market research: 

This is extremely important so that you don’t create similar products in similar niches. The competition will be too high. Consider investing in keyword search tools to help you with the process.


EverBee is one of the best and most popular keyword tools used for Etsy. You can do product research on trending or high-demand products on Etsy. You also can see other listings’ revenue performance to see what type of products will give you high revenue.

The free version will only allow 10 searches per month. The paid version will give 30 to unlimited searches per month depending on the plan.

Sign up EverBee here to search for the best keyword for your Etsy store.

EverBee also has a chrome extension that you can download below:

EverBee Chrome Extension

Mangools or KWFinder

One of the best SEO tools with a lot of features that you can use to help improve your Etsy shop performance. Aside from keyword analysis, you also can do research on your competitors which will show you what is your competitors’ best keywords that they rank for. Mangool or KWfinder keywords tool also allows you to search location-specific-longtail-keywords if you would like to market and focus on a specific location.

You can try to use their keyword tool below:

Pricing starts from USD 29.90 up to USD 89.90 per month depending on the plans and features.

Sign up Mangools / KWFinder here to search for the best keyword for your Etsy store.

Tips: If you don’t have any budget (yet) to purchase the keyword search tool, you can use the Keyword Everywhere chrome extension and use the free version.

Another tip, you can use the Etsy search bar and start typing your desired product. The autosuggestion will give you an idea of what actually people are searching for. 

Try to create a product that is wanted by your potential customer. Study a few competitive stores within your niche and find out what has not been created yet.

That’s the opportunity

In this super helpful video, Brenon Dopp explains how well digital products are doing and how well your competitor is doing.

You can ease your research process by getting the Everbee like what he did in the video. It’s a small investment to your passive income Etsy business.

3. Create the digital product

Once you are done with the research process, now it’s time to actually create the product.

Based on your current skills, pick on apps or software you can use to create a digital product to make your passive income on Etsy.

Tip: Sketch your design in your journal or notebook first. This is to avoid getting paralyzed with the endless option of design once you start creating.

By keeping it in your journal, you can document what works and what doesn’t for your reference in the future.

This can help you become more focused and not get distracted once you begin your creation

If you are really new to this, I suggest using the Canva platform, as it is easy to navigate and user-friendly.

You can use the Free version and mix and match the different elements to get the desired. The PRO Canva is also available to get unlimited design. 

Sign up Canva here and start creating your design now.

But bear in mind, for digital download, it’s BETTER to use the FREE version to make sure it’s available for your customer who doesn’t have a PRO account. If not, they will end up with a design with a watermark on the background of the design.

Other than Canva you can use

  • Picmonkey
  • Procreate
  • Apple keynote

Tip: You can hire people on Fiver or Upwork if you have the budget and idea but lack of time. It’s a win-win situation, You can start your passive income on Etsy, and they can get paid for their services.

4. Create your listing

This is another important step to make sure your product is visible and reachable within the thousand of Etsy listings available

Create an eye-catching mock-up to make sure your product stands out from the rest.

5. Promote your listing

Promote on your social media. Don’t just upload and wait for people to come to your Etsy store. Invite them.

Give them an offer they can’t resist.

How much money I can make from Etsy passively?

Well, of course, it will depend on the price of your product, how many listings you have, and how many products you sold.

The range can be: $0-$70,000

As a beginner, selling 3-4 products in the first month can be considered a WIN. I know you might think,

Only 3-4 products? But I want to sell more

In the beginning, your shop is not getting much exposure yet. But once you get the traction, Etsy will notice your store, So just keep updating the listing with new, quality digital product

Dina Lu, share her experience of creating a digital product in a brand new Etsy store which makes 24 sales in the first month!

Bear in mind, you have to pay for the listing. So list the product that you think you will purchase as a customer. Don’t just upload the listing for the sake of it.

Another example of a more experienced Etsy seller is Brandon Timothy who makes $18,000 selling digital prints on Etsy.

Again, if you are just about to begin, DON’T COMPARE. Focus on creating your masterpiece and do diligent research.

In a highly competitive niches like selling digital products on Etsy, research is key