I don't think it's the prices either. Things to thinks about:
-Who is shopping and buying on Etsy?
You need to know who your customer is. You need to do some research and think about who is shopping for crocheted items on Etsy. Set up your shop to get their attention and hold on to it long enough to consider parting with their cash for your items. One way of doing this is to add more items, so if someone does stop by your online shop they may spend more time browsing. More time spent browsing increases the likely hood of getting a sale. Consider making a header for your store. If you don't know how to make computer graphics, I know there is someone in the Misc for Sale section on this website that offers logo design services for a REALLY good price. Try providing more details for the items for sale. What are the dimensions? Grandma wants to know if those baby booties will fit her growing granddaughter! The people shopping on Etsy can't handle your items, so you need to create a description that makes the items tangible for them. Provide as many details as possible about your shipping policies, return policy, payments accepted, environment in which the items are created . . . Things things help people feel safe giving you their money. When I browse Etsy I scan pictures of items and a sale is made or lost right there for me. Which brings me to my next point.
-A picture is worth a thousand words
You can take really good pictures with a basic digital camera if you set up a light box. Google that term and you will find more than one tutorial for you to set one up cheaply and quickly. A good picture highlights the item for sale. The fact that I can see portions of your carpet, counter top, and couch in the background looses my attention very quickly. Here are some links to other sellers on Etsy offering crochet items.
http://www.etsy.com/shop/CreationsbyKara?ref=seller_info
http://www.etsy.com/shop/beautifulycreated?ref=seller_info
That picture is what is going to sell your item. It's importance can not be underestimated. A HUGE portion of selling in today's handmade market is MARKETING. You can put some cheap lotion in a bottle, but as long as you add an AMAZING scent and slap on a label with beautiful graphics you will sell something. People want their senses to be dazzled. For example, maybe put the baby booties on a baby then set the baby in good light on some green grass or a white sheet. A good background will focus you attention on the product, not take your attention away . . .Take many pictures of just the baby's feet and pick the one image that captures the detail of your item and it's quality. Change angles, think about how the light is affecting how your item looks. It takes practice to get a sense of it, but you'll know it when you've got it! You can post more than one pic, so have an overall shot that captures the whole item and at least one detail shot.
For success on Etsy, a unique product and good presentation is key.
