All online marketplaces may seem the same at first glance. You sign up, you load your products, your listings appear, and you sell. Once you start selling on one of these marketplaces, however, you will begin to learn the different aspects involved. Some of these will make you smile while others will disappoint. Sellers will tend to gravitate towards popular platforms such as Amazon and eBay.
Check out our take on Amazon vs Walmart here.
Although they are both globally recognized multi-billion dollar companies, both Amazon and eBay have their failings. Sellers on these online marketplaces will therefore also often experience the Amazon Vs eBay grass is greener syndrome when they come across certain issues. When you realize that Amazon will not offer you a certain perk or eBay changes their Terms of Service, you might consider making a switch. Before you do, you need to know that there are a few basic differences between the two platforms that you should understand to help you make your decision.
Choosing Amazon Vs eBay
Amazon is now recognized as the most valuable retailer in the United States. Walmart held this position for years, but the online giant has grown rapidly and steadily to finally take the lead. Amazon just has so many product options and such a strong focus on customer satisfaction that online shoppers love them. Amazon’s dedication to putting customers first has many times been unpopular with sellers, but Amazon stands firm on their promise. Professional sellers will do well on Amazon, but this is no longer a good place for rookies and garage sales.
eBay is an ecommerce pioneer like Amazon, but debuted as an online trading community. eBay still offers the live auction format on top of fixed-price sales. eBay boasts 25 million sellers in 36 countries and continues to welcome new and part-time sellers with open arms. eBay sold about half of what Amazon did in the last quarter of 2016. Part of the problem is the misconception that eBay sells mostly used items, which tends to discourage shoppers.
Easily more than one million sellers are added to the Amazon community every year. In recent years, many well-known brand names have been among these new additions. Amazon has also introduced their own private labels. These big sellers are making life hard for the smaller sellers to build good businesses. For instance, hefty fees are levied on those who want to sell brands that have become restricted over the past few years. Sellers who can build their own private labels have a chance on the platform if they have a good product, and Amazon offers certain tools to help them build their brands.
eBay is not so concerned with luring the top brands into the fold but still hosts a number of known brands. Many of these established brands reap the benefits of having greater visibility on eBay than they would on Amazon. eBay’s reputation for selling used items has kept the platform down, but eBay sellers who have a multi-channel setup are faring well. Sellers who have found their niche markets can excel on eBay. It is also interesting to note that Amazon has gotten so big that niche items may have become the only way for new sellers to succeed there.
Amazon currently has 38 categories of products from almost 700,000 different brands. Amazon excels in the sale of electronics, home items, sporting goods and clothing and accessories. Half of these categories are only accessible to sellers who pay and have approval from Amazon. The rules are there to ensure the legitimacy of products.
eBay has more than 20,000 categories and over a billion listings under them. This platform also does splendidly in electronics and clothing and accessories, and also in fragrances, toys and collectibles. eBay is not as strict as Amazon when it comes to listing products. Just as eBay is a haven for small sellers, it can be a difficult place for large volume sellers. eBay shoppers tend to expect that their sellers have intimate knowledge of their products, which is an advantage for small sellers on this platform. Big brands can use automated systems to make listing easier, however, and provide the information that customers demand. Ultimately, shoppers are going to have better luck finding unique items on eBay and the basic essentials on Amazon.
As we got into a little bit above, Amazon shoppers and eBay shoppers have different expectations regarding product types and seller experience. Amazon customers are basically looking for the best deals. 300 million users take advantage of the sophisticated Amazon search feature to find products that they like, but don’t necessarily buy what they find on Amazon. Almost half of the United States enjoys Amazon Prime, however, which shows us that the value that this platform adds in terms of fast shipping, and customer service on top of cheap pricing has impressed many Americans. Amazon is also now available in over 180 other countries as part of its 11 global marketplaces, or websites, in the original North America, and recently in Europe and Asia. About a third of Amazon sales come from these two latter marketplaces.
Like its sales, eBay has only about half the number of users as Amazon – 167 million. This indicates upfront that sales volume per capita on eBay is not much different than on Amazon. What can be puzzling is the fact that eBay has a much wider reach than Amazon. eBay has 25 websites around the world, and almost two-thirds of their sales come in from outside of the United States. Similar to Amazon, eBay customers also like a good deal, and tend to think that they can get products cheaper on auction. Quality is also very important to eBay shoppers. They look for good items and good service. Amazon focuses on customer service, but eBay sellers must provide the best service to be able to remain competitive. While competitive pricing is still vital, sellers on eBay who have built good relationships with customers can expect increased conversions whereas Amazon customers will tend to always go for the lowest price. The Amazon brand is a top priority, but eBay is more concerned that sellers maintain their reputations.
Although Amazon has a sophisticated feedback system, eBay feedback tends to carry a lot more weight with buyers. This may be due to the Amazon A-Z Guarantee, which sets buyers at ease. Buyers can leave negative feedback on sellers on both platforms, and sellers can leave their positive impressions on buyer transactions. One plus for Amazon here is that sellers do not lose visibility when seller feedback ratings fall. Of course, falling below the Amazon standard score can result in account suspension.
Both Amazon and eBay have shown great ability to retain shoppers’ attention with bounce rates under 25%. The average page view is 32 seconds on Amazon, where shoppers browse deals and sales, and over 13 minutes on eBay, where shoppers spend more time monitoring auctions.
Amazon offers sellers the option to sell less than 40 items on a basic individual account but requires a professional one for more than 40 items. Individual accounts charge $0.99 per sale plus fixed category-based selling fees while a professional account requires a monthly payment of $39.99 on top of the fixed selling fees. Amazon also deducts a referral fee and a closing fee, and fees vary depending on the items sold and the categories they are listed under. Professional sellers do get access to Amazon Sponsored Products Ads and the benefits they provide, however, which can boost conversions. Commissions and FBA fees are quite a bit higher than on eBay, so selling a larger volume is needed to make up the difference.
eBay gets a bad rap for the fees that they charge, but the costs are actually lower than on Amazon. eBay does not charge a closing fee, and even though they do charge PayPal fees, sellers keep 5% more over Amazon sellers on a free account. Fees are also much easier to manage on eBay since there is no subscription differentiation. eBay sellers have the option to create advanced listings, but all sellers pay the same standard listing fee, final value fee, and fees for any optional features or services they choose to sign up for.
Stability and Performance
Both Amazon and eBay are considered stable selling platforms. Amazon sellers often groan about TOS changes and threaten to leave the retailer, but there have been relatively few major changes over the past few years. Amazon is consistent, and generally enforces their rules evenly and thoroughly. eBay, on the other hand, has rolled out big changes almost yearly, which has caused some grief when costly adjustments have to be made.
Both Amazon and eBay offer premium tools that sellers can use to boost conversions. Amazon focuses more on providing advertising, however, while eBay take a more seller-based approach. eBay sellers can subscribe to shop analytics, access seller success tips, and opt for social media integration, among others. Amazon has yet to offer any of these types of tools since it has continued to focus on the customer experience and because Amazon itself is also selling.
The only option for branding on Amazon and eBay is private labeling. eBay used to allow sellers to network with and market to buyers, but has restricted all lead generation activities on the site.
Sellers can choose to go the Merchant Fulfilled way and ship their items themselves, or use the FBA service to have Amazon take care of shipping and customer service to boot. Merchant Fulfilled grants sellers a fixed shipping credit that is usually enough to cover shipping costs. It is important to note that Amazon shoppers have been spoiled and tend to be more demanding, even expecting more than what is stated on a listing. Making them unhappy can result in penalties from Amazon, even if a seller has done everything promised. FBA is a simpler process, but the requirements can be tricky. FBA also gives sellers better Buy Box visibility.
eBay shipping can also be a hassle. There is no option on eBay to have the company take care of shipping. This full control also tends to push shipping costs way up, which is a disadvantage compared to Amazon’s standard shipping rates. To be fair, eBay has set limits on shipping fees for items under the books, DVDs and video game categories. The Amazon fulfillment system is a work of art, but eBay sellers who are able to offer fast and free shipping have an 11% better chance of making a sale, according to the eBay Seller Center pages. The Fast ‘N Free mark also gains sellers the privilege of having poor reviews upgraded to five-star ratings. eBay customers aren’t so picky, and are usually perfectly satisfied when sellers deliver what they see on the listing.
So… Amazon or eBay?
There really is no way to give a firm answer one way the another on the Amazon Vs eBay question. Amazon and eBay may have had similar beginnings, but they have gone different ways since then. The key takeaway here is for sellers to know their customers, know their limits and their goals, and choose the platform that best fits these criteria. For many, selling on both platforms has been remarkably rewarding. It’s apples and oranges here, but if you have them both, then you can take great strides with your business by taking advantage of diversifying your sales channels to optimize sales for different sets of customers and products.