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Selling through Amazon and eBay in 2014

Author's avatar By Expert commentator 03 Dec, 2013
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The one New Years Resolution you should be making right now

If I said that you could have access to 3,000 Wembley stadiums full of buyers that have the ability to purchase your product and the ability to pay immediately, you'd probably think I'm lying or a looney. But I'm not, this is the reach of the marketplaces like eBay and Amazon, right now, today.

In this article I aim to quash a few misconceptions and open your eyes to the obscene power of the marketplaces. And at the end of this article I have one question for you, but for now let's dive in.

A Car boot sale and books?

ebay_amazon_mythsIf you think eBay is a great big car boot sale and Amazon is just for books, then you're wrong, so very wrong.

The marketplaces have evolved, they're gaining pace every single day and it's not just the smaller unheard of businesses that are using these marketplaces, over the past 3 years more and more household names have woken up to the potential of the marketplaces.

Argos, SuperDry, Littlewoods, Boohoo, French Connection, Schuh, Sony, Sharp, Philips and Office Shoes are just some of the brand names you'll instantly recognise.

Oh and we missed one, Tesco the second largest retailer in the world also uses eBay UK as a sales channel.

Auctions, What Auctions?

This is a great myth about eBay and while auctions are still a great marketing tool they now account for a fraction of the overall sales on eBay and over 70% of all items purchased are now instant using 'Buy it Now' listings and on Amazon UK 100% of purchases are also instant.

Did you know that over 70% of sales are now instant on eBay? If you didn't click here to share this on Twitter.

Delivering what customers want

We know what customers are like and they want everything. They want:

  • Confidence
  • Selection
  • Safety
  • Convenience
  • Ease of use
  • To buy anything, anywhere at anytime.

Buyers want convenience and that's what they're getting from the marketplaces. They can browse using any device and checkout within a few clicks or finger pushes.

Credit Card Warriors

Dr Dave Chaffey might string-me-up for this, but I refer to marketplace buyers as 'Credit Card Warriors'. These customers are not pseudo Twitter or Facebook users, when a customer goes to a marketplace they're in buying mode.

This is what these marketplaces are specifically designed for. Customers have the ability to pay immediately with linked payment accounts and make no mistake they are using this new-found ability in the millions.

So What is a Marketplace anyway?

A marketplace can be defined as 'An open place where people meet and trade'.

All that has happened over the past decade or more is that the traditional marketplaces have moved online, specifically to eBay and Amazon. And the thing is customers have not just gone there in their thousands, they're there right now in their millions.

eBay reported 108M active users in Q3 2012, Amazon 200M in Q4 2012. eBay helped businesses sell $75.3 billion in merchandise in 2012 and Amazon sold over 1B items (yes that is a Billion) for the first time in Q4 of last year. That was 126 items sold per second. 7,548 items sold a minute, 452,899 an hour or 10.8 million items sold a day.

And the cool thing about this is... 39% of units sold on Amazon in Q4 of 2012 were by 3rd party merchants, not Amazon.

Did you know that? If you didn't, use this link to share this as a tweet.

What's the difference between eBay and Amazon?

There is a very clear line between eBay and Amazon, not only in the way that each of these marketplaces work, but also how customers see each marketplace.

  • eBay is purely a marketplace, they help businesses facilitate transactions between buyers and sellers.

'When a customer buys from eBay, they buy from a business on eBay'

  • Amazon on the other hand, sell directly on their site that's probably what you know them for however they also allow businesses to sell alongside themselves and this is one of the key reasons why the range of products available on Amazon is so diverse.

'When a customer buys from Amazon, they buy from Amazon'

When it comes to payment for a transaction, you are very likely to have a PayPal account. This is standard payment method for eBay and as Paypal is also owned by eBay, the integration between the two businesses is seamless, especially now as they have linked eBay and PayPal accounts together, it's a case of buy, click, click done.

For Amazon, they have their famous 'one click' checkout, it's fantastic, click and if it's a book for the kindle, it's on the Kindle in seconds. The reason why they're able to do this that when you register for an Amazon account you are driven through a process that requires you to add a credit or debit card.

Openness and Clarity

People think they might get ripped off-online but the reality is that it's the other way around.

Both marketplaces have highly transparent feedback systems, if a seller misbehaves then it's updated in almost realtime and the days of 'bad buyers' is numbered and eBay put successful processes into place to cull them.

Pay-Per-Sale not Pay-Per-Click

Unlike other forms of marketing where you can pay upfront for an action that 'may' lead to a sale. With the marketplaces you pay the vast majority of fees when you actually make a sale.

When it comes to actually listing your products on the marketplaces, eBay and Amazon vary from category to category.

As a rough guide, eBay varies from Free to 20p per listing depending on the account type, Amazon is £25 a month + VAT. Then when your business makes a sale, commissions on eBay varies from 5% to 12% of the total sale value, plus a Paypal fee and Amazon UK ranges from 7% to 35% with most products falling in the 15% range.

Say Hello to the Marketplaces

We've got Black Friday and Cyber Monday coming up and over the next few weeks, look out for the latest stats for the marketplaces for the Christmas period of 2013.

If you take only one thing away from reading this article, don't underestimate the marketplaces, buyers aren't, they're there in the millions and with the credit cards waiting.

So for that question I had for you at the beginning: Will you be taking the marketplaces more seriously in 2014?

Let us know in the comments box below.

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