Selling on Amazon VS eBay
Whenever there’s huge Amazon TOS (Terms of Service) changes, sellers panic and even threaten to leave Amazon for eBay. This is especially true in regards to the major change almost a year ago which sent Amazon sellers into chaos. The main goal of this post isn’t to make an airplanes to airplanes comparison of Amazon to eBay, but to show you the major differences between these two marketplaces, and what you can expect from each one. In the end, you will figure out a strategy to sell products in either one – or both marketplaces. Let’s go!
1. Marketplace Comparison
Like most companies, Amazon claims to put the customer first. In their very first annual report in 1997 (the year Amazon went public), Amazon netted $164 million in sales from 1.5 million customers in 150 countries. Today, Amazon is one of the world’s biggest retailers, reporting $37.96 billion in sales in Q2 2017.
In the beginning, eBay was AuctionWeb–which describes the mission “The world’s largest person-to-person online trading community”. In 1998 (the year eBay went public), eBay reached $19.5 million in sales. In Q2 2017, eBay netted $21.5 billion in sales–about 43% lower than Amazon.
The verdict? In terms of revenue and growth potential, Amazon completely blows eBay out of the water. However, when you examine other defining elements of both marketplaces, you’ll see that eBay has some influences and there’s substantial opportunity for sellers to grow on both marketplaces, depending on their purpose and goals.
2. Countries Available
Amazon is available in 11 global marketplaces across North America, Europe, and Asia allowing sellers to grow their businesses internationally. Amazon operates in marketplaces shown below:
eBay however can be considered more global-friendly than Amazon, with 25 dedicated international sites compared to Amazon’s 11.
The verdict? eBay clearly wins in the international category with the sheer number of international sites available for sellers.
3. Amount of Sellers
There are 120,000 new sellers joining all Amazon’s marketplace in a month. Increasingly, Amazon has their own private label brands (Amazon Elements, Amazon Basics, etc) making it harder than ever for retail arbitrageurs to succeed on the platform. However, there’s plenty of room for private label brands to build their businesses, and Amazon now offers EBC and Storefront to give private label sellers better branding opportunities.
eBay claimed to have 25 million sellers as of September 2015. One of the biggest challenges for eBay sellers is changing the perception of customers that equates eBay with “used products” or “garage sale”. This is part of the reason why many eBay sellers have a strong multichannel marketing strategy in place.
The verdict? Amazon favors bigger brands and professional private labels. Meanwhile, eBay is still the best place for sellers of collectibles and niche items. Sellers who have products that fit into both of these marketplaces should take advantage and consider selling across both marketplaces.
4. Fulfillment Options
There are two ways for sellers to ship products on Amazon, one is Fulfillment by Merchant and the other is Fulfillment by Amazon. Sellers can choose either one of the fulfillment methods or both. For those who doesn’t know how fulfillment by Amazon works, below is a graphic for better understanding.
eBay sellers are solely responsible for product fulfilment and while eBay may not be attempting to compete with Amazon’s fast shipping, there are incentives for sellers who offer faster free shipping. Sellers offering free shipping on a product and delivery in under 4 business days (within the US) are eligible for a “Fast ‘N Free shipping” badge on their product. That badge can actually increase the chance of a sale by 11%.
The verdict? Fulfillment by Amazon is an amazing service provided by Amazon for sellers to take advantage of … combine that with Amazon Prime and sellers are able to grow their businesses exponentially. eBay sellers who want to succeed should also offer top-notch customer service. However, eBay customers don’t necessarily expect anything extraordinary other than what’s directly stated on a listing.
5. Account Types And Selling Fees
Amazon sellers can choose to sell either with an Individual or a Professional account. Here’s the breakdown:
For more information about fees for Amazon sellers, you can refer the Fees and Pricing. For detailed explanations of Professional selling plan features, refer the Volume Selling.
eBay only has one selling plan and there are only 4-Steps to start selling:
- Set up your seller account
- Create a listing
- Manage your listing
- Wrap up the sale with your buyer
Below’s a simple breakdown of eBay’s fees from their site,
- Insertion fee
- Final value fee
- Advanced listing upgrade fee (optional)
- Supplemental service fees (optional)
For detailed explanation of eBay’s fees, refer Standard Selling Fees.
The verdict? eBay’s selling process is simple with a 4-step get started process compared to Amazon where sellers have to decide how they sell and how they fulfill.
6. Payment Methods
Amazon sellers must use Amazon Payments to accept payment, as simple as that. Amazon collects the payment, and deposits it into sellers’ bank account twice per month.
eBay sellers can accept PayPal, and credit cards if they have their own merchant account.
The verdict? Amazon sellers do not have to send invoices, payment reminders, or track unpaid items. However, eBay sellers get paid faster through PayPal.
At the end of the day, both Amazon and eBay are two separate beasts and appeal to different customers. There is no question eBay is best for some items, while Amazon is best for others thus there isn’t a perfect marketplace to sell in. In life, when given the option A and B, why not choose option C? Which is both!
AmazonBasic Portable Photo Studio For Professional Images
One of the vital components of a fully optimized product listing is having images that are of high quality. Amazon has released their own portable photo studio for sellers wanting to have high quality photos without needing to burn a hole in the pocket hiring professional photographers and purchasing expensive cameras.
Basically, the portable photo studio is collapsible with high output built-in LED lights for handheld photography with a camera or smartphone. The portable studio has optimized lighting within the box for multiple imaging options.
The portable photo studio is designed to be convenient and can be collapsed into a thin (2.5 inch) easy-to-store portfolio carrying case using the shoulder strap or handle. The entire structure and surrounding fabric is designed for excellent protection and most importantly, long life. In a nutshell, the AmazonBasics Portable Photo Studio has high durability and robust for daily use.
Where can I get my hands on this? You can purchase this amazing tool on Amazon of course!
Amazon Multi-Channel Fulfillment Rates Changing August 30, 2017
Amazon Professional Sellers, if you haven’t read about the upcoming change for fulfillment rates then listen up! We want you to be aware of changes to Multi-Channel Fulfillment fees (MCF is the service where Amazon fills orders from your other sales channels using the same logistical technology that powers Amazon Prime and your FBA business) taking effect on August 30, 2017.
According to Amazon, Multi-Channel Fulfillment (MCF) fees in the U.S. will be adjusted to reflect the changing costs of fulfillment and to better align with Fulfillment by Amazon’s fee structure. Updates include:
- Consolidation of Fulfillment Fees,
- New Product Size Tiers,
- Discounted Fees for Multi-Unit Orders, and
- Changes to Unit and Dimensional Weight.
You can find detailed MCF fee changes HERE.
Eugene is an Amazon business coach, consultant, and blockchain enthusiast. He helps aspiring and established entrepreneurs build a highly profitable Amazon FBA business so they can unlock their true potential. Learn more about him at wiseintro.co/FreedomProfitsBlueprint