This creator made Beyoncé’s viral disco hat — then came the knockoffs. Etsy’s become a hotbed for them.

PHILADELPHIA — Abby Misbin spends 12 to 15 hours a day inside what she dubs the “hat bunker” — the basement of her parent’s home, where she makes bedazzled and fringed cowboy hats.

Her time is often spent hand-laying more than 15,000 reflective glass tiles onto a hat, creating wearable disco balls. Misbin’s fingers are covered in tiny cuts.

Misbin has been selling custom, campy cowboy hats for $65 to $350 on her Etsy store Trending by Abby since 2020. But Misbin’s business started to boom after Beyoncé wore one of her mirrorball creations in February to promote the Renaissance tour.

Misbin has the rare problem of being too successful. After halting mirrorball hat orders to catch up with demand, she developed a 6,000-person waiting list.

Now, Misbin’s popularity has unveiled another augur of late-stage capitalism: the dropshipper, a type of merchant flooding maker markets like Etsy with mass-produced goods that knock off designs from artists already on the platform.

Dropshippers operate online storefronts advertising niche products at below-market costs — only they don’t hold any stock. Instead, they ship the product directly to buyers from overseas wholesale giants like Alibaba, Aliexpress, and Temu.

Dropshipping isn’t illegal so much as it is unethical. Suppliers keep their costs low by relying on sweatshop and child labor, and the trend cycle’s ever-increasing speed is terrible for the environment. Dropshippers also operate like much of the fashion industry does: by copying designs from smaller businesses that lack resources to sue.

Dropshippers — like the ones ripping off Misbin’s cowboy hats — are hitting the creative economy with indiscriminate abandon. They target major fashion companies and small business owners, turning platforms designed to elevate bespoke work into a brigade of Amazons. Why spend hours gluing rhinestones on a hat when someone can do it cheaper, and most consumers won’t know the difference?

“It’s difficult for legitimately handmade sellers to compete with somebody who says they’re handmade, but in reality, is just sourcing things from overseas factories,” said Mattie Boyd, an artist and organizer with the Indie Sellers Guild, a fledgling union for small business owners on Etsy and other e-commerce platforms. “It’s also unfair for buyers who are often being tricked into buying something that’s presented as handmade.”

Misbin said dropshippers haven’t decreased the volume of business, but have changed how her customers view the way she does business. Prospective buyers are constantly reminding her that they can get the same hat elsewhere, for less time and money.

“Even just searching my name makes me too upset because these shops keep popping up,” Misbin said. “I just take issue with people who don’t value the amount of work I’m putting in.”

Is Etsy the next Amazon?

Misbin said she noticed dropshippers using her product images to sell knockoffs long before Beyoncé posed in her metallic hat.

But now, the threat is pervasive, Misbin told the Washington Post.

Misbin told The Inquirer she used to manually report each fraudulent or knockoff listing to Etsy, which would remove the items or the storefronts about half the time. Recently, she said, that likelihood has plummeted.

Etsy is governed by something called the Handmade Policy that bans mass-produced goods from being sold on the website. That hasn’t prevented Etsy from becoming a hotbed for dropshippers. Etsy says it has committed $100 million to trust and safety initiatives since 2022, which include “strengthening … automated detection systems and expanding the team that manually reviews potential [copyright and handmade policy] violations.”

Intellectual property and Handmade Policy violations were the most common on Etsy in 2022, according to the company’s recent Transparency Report. It removed four times more mass-produced item listings than in 2021, and took down 1.1 million listings for alleged copyright infringement.

Still, Misbin said one solution Etsy recommended was to confront the storefronts misusing her photos directly, something she regrets. “When I started messaging the sellers directly, they were beyond rude,” Misbin said. “Some even accused me of being a dropshipper, too.”

Etsy declined to provide statistics regarding handmade policy violations for 2023 or say whether advising confrontation among sellers is standard practice.

‘It’s like whack-a-mole’

One solution proffered by Etsy is for sellers to register a copyright for their product photos with the U.S. Copyright Office, a relatively inexpensive and painless process, though wait times can get lengthy.

But Misbin (or any artist) shouldn’t have to do that to protect their work, according to Gabrielle Sellei, an entertainment and intellectual property lawyer who works with Philadelphia Volunteer Lawyers for the Arts.

“A copyright springs into existence the minute you create something in tangible form,” like a photograph, said Sellei. “Someone is infringing on her copyright, whether it is registered or not.”

Sellei said Etsy likely encouraged Misbin to register her copyright to help them verify her ownership, but concedes the singular action “is not going to stop the counterfeiting of goods.”

In 2022, the platform launched the Etsy Reporting Portal, a hub for sellers to submit and track intellectual property violation reports. Etsy’s AI detection software also proactively removed about 468,000 listings for potential counterfeiting in 2022.

Boyd, the guild organizer, flagged the AI as a problem in and of itself, saying it often makes mistakes and suspends “rule-abiding” sellers.

Sellei said the best way for small business owners like Misbin to protect their work is to trademark their logos and brand names. But even then, she would not recommend taking dropshippers to court.

“It’s like whack-a-mole. You’re going to put one away and five more will spring up,” said Sellei. “Your chances of finding them are hard, your chances of beating them are hard.”

Sellei and Boyd believe the only way to stem the proliferation of dropshippers is through collective action, like pressuring Etsy to look for the tells of a dropshipping business — high sales volume or overly long shipping times — more readily.

For now, the guild has two workarounds: experienced Etsy retailers who serve as guides on handling copyright infringement, and the union’s membership directory, which has become a database of verified handmade, vintage, or otherwise unique storefronts.

Misbin isn’t a member of the guild. She often feels overwhelmed by the rush of professional advice: register copyrights, spend hours filing takedown requests, find the time to scale up her operations and compete with manufacturers.

“I’m not interested in the business side of things,” said Misbin. “I just like making hats and being a hermit in my basement.”