Thursday, October 27, 2011

Top eBay Alternatives 2011 - eBay vs. Amazon

By Ethan Pepper  |  October 27, 2011 No comments




It's no wonder amazon is one of the biggest companies on the web. They offer a huge selection of items integrating third party items with new merchandise. Amazon is not an auction site (they tried it for a while but it didn't last) but they are a great alternative to eBay. Some of the things they offer:
  • Amazon has a huge and loyal user base insuring high sales.
  • Amazon uses a catalog based approach making listing much less time consuming than on eBay.
  • No need to take pictures of every item, simply write a brief description.
  • Upload large amounts of inventory with spreadsheets or CSV files.
  • Once an item is listed it never has to be re-listed.
However, Amazon.com has it's fair share of complaints as well most are similar to those aimed at eBay.
  • Amazon fees are very high and include a $1 fee on each item sold which can be eliminated by upgrading to a premium account for $40 a month. This is on top of a FVF that can be as high as 15%
  • It is very easy to get banned as an amazon.com seller. Try as you might you will not get reinstated.
  • You don't get paid for your orders until you enter the Delivery Confirmation number.
  • The feedback and refund system greatly favors the buyer.  


For twenty dollars more a month than the regular Amazon.com subscription amazon.com will help you set up a customizable Webstore that is not in direct competition with other third party sellers.






  • You can use their extensive catalog of items to quickly list items.
  • You can list unlimited items without any extra fees you pay only 7% when an item sells.
  • You can accept Amazon Payments which will make it familiar to buyers who have used amazon.
  • Also, when you don't have an item a buyer wants you can refer them to amazon.com and get an associates commission.


    One drawback is that you have to have your own hosted domain and likely you'll want to know a little HTML to really make your site unique. Also you may have problems listing items that are not in amazon's catalog. A good way to promote a webstore by Amazon is to advertise your items on Amazon by using Product Ads By Amazon. A PPC advertising program that allows you to advertise directly on Amazon. This gives your products and store instant credibility. Plus, people who click the ads are more likely to be ready to buy since they have already visited Amazon. This option is probably good alternative for big sellers on eBay who already have built a brand for themselves and would like to save on fees.



    Ebay Vs. Amazon

    Head to Head








    Auction Fees Listing Fees Final Value Fees Payments Accepted Monthly Fees Alexa Site Ranking* Promotional Tools
    eBay
    First 50 Free Monthly
    $0.99=$0.10
    $9.99=$0.25
    $24.99$0.50
    $49.99=$0.75
    $199.99=$1.00
     $200+= $2.00  
    Buy It Now
    $0.50
    Media
    $0.05
     9% Of Total Payment Includes Shipping
    PayPal**
    Merchant Accounts
    None  21 eBay Site Traffic
    eBay BasicSame as above
     
    BIN 
    $0.20
    Media
    $0.05
     7.5% Auction Style

    BIN
    7%-13%
     Same as above$14.95  21
    Custom Logos
    E-mail Marketing
    Cross Promotions 
    eBay Premium Same as above
      
     BIN
    $0.05
    Media
    $0.05
    Same as above Same as above $49.95  21 Same as above
    eBay Anchor Same as above
     
     BIN
    $0.03
    Media
    $0.03
    Same as above Same as above $299.95  21 Same as above
    Amazon None     None     Up to  15%plus $1 Amazon Payments $39.99 Eliminates $1 Fee 13  Amazon Site Traffic
    Webstore by AmazonNone     None     7% 
     Amazon Payments
    Merchant Accounts 
    $59.99  Varies by Webstore
    Amazon Product Ads
    SEO Marketing


    *Alexa ranks sites by popularity #1 being the most popular site on the web. Currently Google has the top spot.

    **PayPal charges a 2.9% fee for eBay Transactions.


    So let's do a hypothetical comparison. Let's say you list 300 Video Games a month on eBay with a a 60% sell through rate (which is pretty good) at about $20 a piece. And let's say you have the basic store subscription package. Now let's say you do the same on Amazon. Which will be cheaper? For eBay you'd have the following fees:
    1. 14.95 Basic Store Subscription
    2. 300 * $0.05 = $15 in listing fees
    3. 13% * (180 * 20) =$468
    4. PayPal Fees of 2.9% * 3600 = 104.4
    This assumes that you are listing in the most common categories. So let's add it all up. Out of the 3600 dollars in sales you end paying eBay about $572. That's a percentage of about 16%. Now let's try our example with Amazon.com

    1. 39.99 Pro Merchant Account
    2. 15% (180 * 20) = $540

    Amazon is simpler but in the end cost the same amount as eBay.  Fees making up about 16% percent of profit. Of course some items actually sell better on amazon and others sell much better on eBay. Plus there are some advantages to listing on amazon as it is less time consuming. It never hurts to diversify your inventory.

    Author: Ethan Pepper

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