More profitable Marketplace- Amazon or eBay?
When anyone thinks to sell online the first word comes to their mind is either Amazon or eBay, as both are the millionaire companies plus they are more popular than the other online marketplaces as Walmart, Shopify etc. This creates more confusion among the sellers to pick the right marketplace to flourish their online business. In the United States, Amazon and eBay are the top competitors of each other and we bet they are making the competition worldwide. Though everywhere giant Amazon is booming but eBay too holds an important place in the online shopping. Every marketplace has its strong points and flaws. If you too are making your mind to sell online and would have been stuck whether to sell on Amazon or eBay then on seeing their pros and cons you can select the right marketplace you are searching for being an online seller.
Let's dive into deep -
To understand the difference between Amazon and eBay, we will compare both, on various factors one by one, so that you can calculate your profit margin and can select the right selling platform for you.
Which is more popular?
Both Amazon and eBay are popular among the customers and both work for millions of customers. A statistics report has revealed that every month Amazon deals with 184 million while eBay being the nearest competitor deals with 164 million users yet the figures keep on increasing day by day. This is only monthly figures from which you can imagine how many customers would have joined every year. Both are driving more traffic day by day. Needn’t say- more customers= more sales= more ROI.
As Amazon provides many services to its sellers to create a good selling experience to its Sellers, but as the saying is “ there is such thing as free lunch, it incurs charges to them for everything. It starts from the account setup to FBA. It charges its sellers for putting their inventory into its warehouse and also has its charges for professional selling plan and individual selling plan. The sellers have to pay Amazon for prime membership, SWA, Dropshipping and also the commission (15% or more depending on the product category) for selling on Amazon.
While eBay takes lesser charges for account setup. It also charges its sellers a lesser commission rate than Amazon to sell on eBay.
The design of the page of any marketplace matters a lot. Both marketplaces have good page design. The way in which they differ in designing is Amazon allows consistent listing design page while on eBay you would not know what would be the color, design, fonts, etc. be like. The eBay customers cannot make up their mind to see the constant page design while on Amazon uniformity is always maintained. This also builds the trust factor for the customers. The uniformity and consistency create good customer experience while non-uniformity makes the trust shattering. This doesn’t mean that the page design of eBay is not good or worth looking for. After all, beauty lies in the eye of the beholder. If you like consistency you can select Amazon else for the varying experience you can choose eBay.
Amazon and eBay both have their guidelines for product listing. Within the specific format, the Amazon and eBay sellers need to fill the information about the products. The difference is that Amazon allows the single listing for the same products despite different sellers which makes it easier for customers to search for products while eBay allows different listing for the same products. These different listings might create confusion and frustration among the customers to see the same products differently, this can repel them.
Amazon and eBay serve differently in listing the products. On one hand, Amazon with its easy listing process has no charge for listing the products on it while eBay incurs charges to its sellers for listings. Although eBay allows few free listings for the sellers but posts certain sale limit it charges and also for renewal of listing (eBay does not allow long term listing) on the eBay page to make it live for the specific interval of time. Also, the listing fees differ per product and per-category on eBay.
On the contrary, listing on Amazon lasts until and unless either seller deletes it or the product goes out of stock. In the more worse cases, if Amazon blocks or deactivates the product, then only listing on Amazon disappears else the Amazon sellers can have their listings as long as they are selling on Amazon and that too without any charge.
The prime difference between Amazon and eBay is “Amazon Prime”, the service that offers quick delivery. The customers love faster delivery and Amazon makes it possible on the same day (if the destination is in the same city) or two-day for the customers who have opted for Prime membership. The eBay lacks in the quick delivery. This gives Amazon the chance to become more popular among its customers. For a seller, you would definitely be loved by your customers if you are selling on Amazon rather on eBay.
Inventory Management and FBA:
If you sell on Amazon then you don’t need to get worried about a warehouse. Amazon has its warehouse and allows its sellers to keep their inventory(incurs charges to them). Through its FBA service, Amazon fulfills and ships all your orders for the products that you have kept in its inventory. While you are sleeping or busy in other works, Amazon’s FBA is there for you. On the contrary, eBay does not cooperate with its sellers at all in managing inventory and shipping. If you opt bay for selling, then you either have to manage your inventory own or need to take the help of third-party service providers.
For any business to retain, it is must to have a good customer-buyer relationship. Both eBay and Amazon have millions of customers. But the statistics reveal that Amazon has more satisfied customers than eBay has. Why is it so? When we explored for finding out the reason we have found that eBay has a complex process for ordering (fixed or auction-based) and payment while Amazon has made it simple. On eBay when customers click to buy it gets redirected to PayPal for payment. This makes the customers confused about whether it is secure or not as it is redirecting from eBay to another website. Amazon at this place makes it simplest as the customers click “Buy”, they can easily pay with the convenient payment method they choose.
Also, the returns and refunds are easy on Amazon as compared to eBay. On eBay customers do not know whom to deal with- PayPal or eBay for return and refund while on Amazon, it is totally responsible for dealing with customers and above all, it makes all things crystal clear. Amazon again builds trust in the customers.
Picking the marketplace depends on the type of business and the products you are selling. Then comes the above-mentioned factors to compare which marketplace is suitable and would turn into a profitable deal. Since both Amazon and eBay have some flaws then it is up to you how do you utilize the available marketplace at its best. We can’t deny the fact that Amazon has more customers than eBay and we already know that more customers mean more sales but we can’t neglect the potential of eBay to reach customers as it is making a tough competition for Amazon sellers with its millions of active customers.
As in online business, omnichannel selling is always profitable but if you are an amateur and putting your first step into the eCommerce platform then selling on a single platform is suggested. Once you make up your mind for selling on one platform and start earning then you can also reap the benefits from selling on both the platforms and then move ahead with omnichannel selling.
If you are stuck in managing the marketplace (single or multiple) you can select the third-party service provider to assist your eCommerce store.