This is actually a blog post from 2007, but I figured it was worth an update, since I know many of you are using your Etsy address for your business cards. But - there are many advantages to having your own domain.
1) Leaving your options open
First of all, do not put all your eggs in one basket. What happens if Etsy does something to really p. you off tomorrow, and you close your store? Then you have a whole set of cards that you can just throw away.
Instead, you can buy a domain and either put up a simple site with your Etsy Mini, or just forward the domain to Etsy.
2) Protecting your business name
Ideally, you have a business name where the .com domain is not yet taken. Imagine having a successful Etsy store, and then finding someone else using that name on their own website, possibly taking away business from your shop. They will be found on Google along with your store - you can prevent that by registering a domain.
3) Professional appearance
It just looks much more professional to have www.myshop.com on your business cards instead of www.myshop.etsy.com. And it's easier to remember, too!
4) Choosing a domain
Personally, I would not settle for a .net or .org domain if your .com domain is already taken. Each domain ending communicates a certain image. .org is meant for (non-profit) organizations, .info for info sites, and .net is only second-best.
For anyone outside of the States, I would suggest registering a .com domain along with the address in your country's domain ending. That is one weakness of my current set-up – my business name I only have as .de, which is okay since I do lots of local business; I do also own a different brand name on .com, though, so those two names will eventually be interlaced.
5) Thinking of alternative URLs
So what do you do if your domain is already gone? Go to NameBoy and let them come up with combinations - for example adding "design" or something similar to your business name.
When registering a domain, you don't necessarily need hosting - you can find more info on websites and providers here.