Obviously I am new to Etsy and don't have it all together yet. I am still learning. However, I have been asked how I photograph my little felt robots. I will be honest. I have some pretty decent equipment, but you can get similar results with a lot cheaper stuff.
I use a Nikon D80 DSLR and this lens
. I use two Alien Bee lights, one with a softbox up close for the main lighting and one with a white umbrella further back for fill lighting. And, if none of that made sense to you, that's okay. I'll give you some tips. I have this equipment because I used to photograph people which is very different than handmade items to sell on Etsy, but I do have some basic knowledge I hope I can share:
Light is the most important factor. If you don't have enough light your image will be dark and/or blurry. No one wants to buy a product they can't see and you certainly won't be featured in treasuries either. Light doesn't have to be expensive or complicated. Photographing outdoors on a cloudy day is the best. You get beautiful diffused light. The second best bet is to photograph in the shade. Why not the sun? because it causes harsh shadows. If you need to photograph indoors try using light from a window and use a piece of white poster board to bounce light on to the side that isn't getting the window light for a more uniform brightness and less shadows. If you want to go with a lamp, flash or even studio lights try bouncing it off a white wall or a piece of large white poster board to light the whole item and minimize shadows.
Take a look in a catalog or magazine. Most products are photographed in front of very simple backgrounds. White is the most popular. Looking at Etsy's front page you will see that most all the featured items usually have white backgrounds. It's nice and clean and puts all the focus on what you are trying to sell. With that being said, I do like to mix it up and do fun (but simple) backgrounds for my robots sometimes, especially with my steampunk robots. Guess what! My backgrounds are just 12x12 scrapbook papers. I don't buy anything special. I just use some from my stash. Everyone has a stash of scrapbook paper right? I mean, they must, I do and I don't even scrapbook. Of course if you are photographing something bigger than my robots you will need something else. Try fabric pulled tight or even wrapping paper, but whatever you choose - keep it clean and simple.
3. Angle and Detail Shots
Shoot your item from a few different angles. You want to be sure you show a good representation of your item. Take a shot from eye level, one from slightly above and from the side. Of course it will depend on what you are selling, but take a few shots. The nice thing about Etsy is that you can show five images! It doesn't cost anything extra to use all five images. If your item has any special details get in close and photograph them. Some lenses won't focus properly if you get too close. In that case get as close as you can and then crop your image so it will show up bigger so your customers can see the detail.
You can edit in any software program. It doesn't have to be Photoshop. If you are new to photo editing software I would recommend Photoshop Elements to get you started. It's cheaper and more simple to use. It doesn't have all the features, but you probably won't need them for Etsy selling anyway.
WARNING: Do not be tempted to use Photoshop to make your item look different or better than it is. That is dishonest. Use for correcting exposure, cropping, sharpening and color correction only.
Try and get your pictures the best they can be in camera so you don't have to spend a lot of time on the computer. However, I find most my images really benefit from being brightened a little. I also usually crop to a square format, but that depends on your item. Remember square or horizontal images look best on Etsy.
5. Learn Your Camera
Alright, this should have been number one. However, it's not really a tip I can help with since cameras are all different. I would suggest using Aperture Priority mode and let your camera pick the shutter speed. I like using a wide open aperture so I get that blurring in the back and foreground, but that's personal preference. Hence why I use this lens :)
Don't get hung up on settings that other photographers use. Your lighting situation will be different as well as distance from the item, etc. So don't ask me what I use :) I won't tell you because it won't help you. If you get frustrated just put your camera on Auto. Very very smart people have made cameras with very smart automatic settings that get it right almost always. Don't feel bad putting their hard work to use for you. If you aren't a camera expert that's okay, you are an expert at what you make to sell on Etsy. Play to your strengths and let your camera help you out.
Last of all I should mention to practice. Take lots of pictures and try to get better each time. I am still learning and hopefully I will get better too.