Keep your avatar eye catching and simple! Remember certain things:
Your avatar is seen:
In your shop
In the Forums
In all of these places, your shop name is RIGHT NEXT TO IT. It's not really necessary for it to be on your avatar. It just makes it more cluttered.
I am a huge fan of product placement. I like to think of the avatar as the window to your shop. When people are the forums, they are essentially window shopping and clicking on avatars that catch their eye.
MAKE SURE it is something that is actually for sale in your shop! SO many times I click on an avatar only to NOT be able to find it inside. Once it is something in your shop, make sure that it is easily accessible IF you have a lot of items in your shop. I like to make it one of the featured items if I haven't renewed it to the front page.
I just recently starting putting text into my avatar, just because I am running a Sale, it's simple, clean and eye catching. In the recent Rate My Avatar thread in the forums, I scored a 4.5 out of 5 on average! If you are wondering about yours, check out any of the threads on Etsy!