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E-commerce marketplace Etsy is cracking down on AI use in product listings. Etsy now mandates that most listings include at least one unedited photo of the product against a real background, according to a company blog post Thursday outlining its updated policies. Functional guides — such as patterns, recipes and instructions — can no longer be AI-generated and must showcase real results made by using the guide. Buyers who open cases with Etsy because the product is materially different than the listing may receive a refund from sellers if the listing didn’t meet Etsy’s updated image requirements. Bot-generated listings aren’t allowed and such listings will be removed. The company has “always been a marketplace that stands for creativity and craftsmanship,” Etsy’s Vice President of Customer Operations James Ossman said in the company post. “These changes are our starting point, not the finish line. We know there’s more to address as AI evolves, along with how you use it and what buyers expect. We’ll keep making improvements across Etsy for sellers and buyers, evaluating our policies, expanding proactive enforcement, and building tools that help you demonstrate your authorship as we listen and learn what our community needs.” In addition to the updated listing requirements, Etsy also added a guidance feature to the listing form sellers use that flags images Etsy detects may use AI. The marketplace is investing more into AI detection and listing removal tools, with plans in the upcoming months to “explore more ways to give buyers helpful context about when AI has been used in content they see on Etsy.” The move comes as Etsy itself has invested more into using AI across the business. The company has been spending more money on AI and compute, CFO Lanny Baker told analysts during an earnings call in August. Despite its new limitations on AI use in sellers’ listings, CEO Kruti Patel Goyal told analysts that the biggest opportunity for AI is on Etsy itself. “It's really about using AI to make Etsy much, much better at connecting the right buyers with the right sellers,” Goyal said. “So we're applying AI across all of these areas that I just talked about, discovery, matching and personalization to really better understand what buyers are looking for, to better understand our buyers, to better understand our inventory so that we can surface the most relevant inventory from the full breadth of our marketplace.”
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