Etsy Has Integrated AI to Build Customer Profiles

The e-commerce platform developed new AI-driven profiles for over 70 percent of its active shopping user base.

Updated on Sept. 29, 2026 in Artificial Intelligence

Isometric editorial illustration of arranged wooden cubic and cylindrical shapes representing retail data structure. — Etsy has integrated artificial intelligence to analyze shopping habits and purchase histories, aiming to boost platform personalization and reverse recent sales slowdowns. AI Illustration. Upload story photo >

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Etsy has launched a new initiative using artificial intelligence to track shopping habits, purchase histories, and preferences for its millions of users. The company is leveraging these profiles to improve search results, recommendations, and advertising effectiveness.

Why it matters

The shift aims to address a recent slowdown in sales by enhancing the personalization of the shopping experience across the platform. By optimizing its advertising and search tools with AI, Etsy seeks to retain its market share amidst competitive pressures.

Etsy currently manages more than 100 million listings across its global platform. The company has successfully built AI-generated profiles for over 70 percent of its 90 million total shoppers.

The players

Etsy

This e-commerce company provides a global marketplace for unique and creative goods.

Lanny Baker

He serves as the Chief Financial Officer at Etsy and oversees the company's financial operations and strategic AI initiatives.

eBay

This multinational e-commerce corporation facilitates consumer-to-consumer and business-to-consumer sales.

ChatGPT

This artificial intelligence platform is being utilized by companies to enhance customer engagement and advertising tools.

The details

Etsy is collaborating with ChatGPT and other AI platforms to refine its checkout options and targeted advertising capabilities. This data-driven approach is designed to help the marketplace navigate recent economic trends, including instances where customers have absorbed price hikes over the past year.

In July 2026, Etsy finalized the sale of the Depop platform to eBay.
In August 2026, the company announced plans to reduce its total workforce by 12 percent.
In September 2026, CFO Lanny Baker provided detailed insights into the company's long-term AI strategy.

The Tech Race

Etsy's adoption of AI follows the industry trend of transitioning from static search tools to hyper-personalized recommendation engines. This strategy places the company in direct competition with larger e-commerce rivals that have already integrated similar predictive shopping models.

Shoppers can expect to see more relevant product recommendations and search results as the AI profiles become more refined. These technical improvements aim to streamline the checkout process and customize the advertisements users encounter while browsing the site.

The takeaway

Etsy is banking on machine learning to improve user engagement and restore growth after a period of sales stagnation. Users should prepare for a more personalized experience, though the company continues to restructure its workforce in response to broader market challenges.