Shares of (NASDAQ: ETSY) are trading slightly higher over the past year but still more than 70% off their all-time high. It's been an unusual three-year pattern for e-commerce. During 2020, consumers had no choice but to shop online, which drove incredible growth for Etsy. The company was seeing gross merchandise sales more than double during the pandemic, but the last two years saw a reversal of those trends as the return of brick-and-mortar shopping and inflationary headwinds pressured sales.

While Etsy could see a return to the high-growth days before the pandemic, there are some weaknesses the company needs to work on to realize its full potential.

On the surface, Etsy's focus on providing small businesses and artisans a platform to reach consumers separates itself from other retailers. Its unique merchandise is a key differentiator from other online retailers like Amazon or eBay.

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Source Fool.com