The API that strengthens an already vibrant e-commerce community by letting artists embrace their inner developer
The dedicated buyer and seller communities on Etsy, from the active discussion boards to the Community Council to the "hearting" of products, are behind the site's explosive growth. Nearly 250,000 new members are joining monthly. Now the developer community is joining the mix, taking advantage of the Etsy API to build new applications on Etsy's platform.
Perusing the featured developers who are part of the project Etsy dubs "Handmade Code", it's interesting to note that most all of them are also sellers themselves and their applications (with the exception of the iPhone app) are all free. I doubt that most other sites that provide APIs see their own users morph into developers.
The photographer Red Row Studio who sells prints "mainly inspired by outdoor life in and around Lothian, Scotland where I live", for example, developed one of the coolest Etsy app that I've seen. His Craft Weasel's Tag Finder helps sellers choose the most effective tags for their listings. As tags are how items are both initially categorized (Etsy uses a very detailed categorization scheme) and how they are searched, choosing effective tags is paramount for a seller looking to highlight his product among the 1,931,988 that were listed in October 2009 alone.
As a knitter, you can tag your products in a variety of ways, such as "wool" and "scarf", but taking a look at Tag Finder's tag cloud can help you choose to add, say "organic" to gain more page views and also maybe sell it at a higher price.
Another favorite app of mine is ColorMatch by 26 Olive Street, a shop "obsessed with anything vintage". ColorMatch is "designed to allow anyone to easily upload an inspiration jpeg and have the hues analyzed into a paint palette used for searching items on Etsy by color." So if you just bought a beautiful organic creme wool scarf, you can easily find a matching set of legwarmers.
The Etsy API is yet another way that the p2p community site continues to shake up the e-commerce model.
Etsy, p2p e-commerce 
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