When it comes to buying or selling products online, two of the biggest names that come to the mind are eBay and Amazon.
These two titans dominate the eCommerce market space.
Often, when you are a new entrepreneur trying to find a platform to sell your products on it's natural to be confused about whether to use eBay as your selling platform or whether to opt for Amazon.
These two powerhouse marketplaces are good in their own ways. But as a seller, you need to be able to weigh the pros and cons and check which one would best suit your selling needs.
In this article, we shall compare and discuss the various aspects of the two marketplaces based on certain common elements for both of them. In this post, we will discuss the following factors to help you in your decision making process:
Credibility & Competitivity
The market is a free market, and as such, both of these online selling platforms are highly competitive and credible in their own way. When we compare both these big players of the eCommerce market, we realize that Amazon competes directly with many third-party sellers and online platforms.
Amazon uses many small sellers to source the most popular products as a means to attract buyers and prospective customers to the their platform. Essentially this means that Amazon unapologetically competes with its own sellers as well.
Amazon also creates a competitive environment among its sellers. This competitive nature ultimately leads to the products that end-users and buyers receive being the best they can be, as sellers attempt to be the best on the platform and gain more sales.
In recent years though, Amazon's share in the overall sales volumes have declined drastically as compared to their third party retailers who are selling on their platforms.
According to Statista.com Amazon's direct selling volume has come down drastically from selling 74 percent of items directly in 2007, to almost half of that in 2019. But even if Amazon's sales volumes are declining, their products are still the best rated and highly competitive.
The fact that all the other sellers are competing with Amazon's product standards, Amazon is at a highly desirable market place.
Amazon being the platform, as well as the seller, it the unique decision making ability to sell what works and to eliminate what does not.
So, it is like this - Amazon will use the small retailers and sellers to understand the market trends. Once they find a product that sells well, they will start selling a similar product directly and, in no time, undercut and exceed the sell volumes of their third-party sellers.
Also see: Our Jungle Scout Review to find out what products sell well for you!
Amazon is an excellent marketplace that sells and markets new products. The trends from which can benefit its bigger brands such as Solimo, Pinzon, and Rivet.
So, Amazon is more into selling new products, whether it is its own or third-party sellers.
Amazon is a fiercely competitive marketplace for new items and sellers, providing the best quality items and excellent customer service.
eBay, however, has a reputation for being a platform that mostly sells used and collectible items. It is like an online garage sale. However, contrary to popular opinion and perception, according to an article published by prnewswire around 80% of the products sold on eBay are brand new.
eBay is just an online selling platform and does not have a brand or a line of products of its own. This means that they won't use smaller sellers or third-party retailers as guinea pigs to understand trends to increase their own sales volume.
eBay is purely an eCommerce website that serves as an online marketplace for all sellers, big and small. Moreover, eBay is a better marketplace in terms of providing sellers the help they need to build their brand.
So the bottom line - Amazon is a better and far more competitive marketplace for individual sellers and third party retailers with sellers competing with Amazon's products and brands. eBay, on the other hand, is a platform that enables the sellers the ability to build a brand identity. While most of the items on eBay are new, it does also create a niche for collectible and used items.
International Outreach & Presence
In terms of a global presence, both online eCommerce platforms have a fair amount of international presence.
If you are a budding entrepreneur or a new seller looking to expand your business and increase your sales volumes, you will undoubtedly need a platform with global outreach and presence to sell and market your products to a global market.
There are products and items which sell better and are more popular in certain parts of the world. When you have an eCommerce platform to sell your products in all regions seamlessly, you can simply list your products on these regionally based websites and domains.
As such, having your products listed like this means you get a varied customer base across the globe, which is a distinct advantage for your business.
So what is the difference in the international presence of the two? Let us list the same for both of them.
- Amazon has 17 websites across the world, spanning three geographical areas such as North America, Australia, and Asia-Pacific.
- Amazon has its consumers across all these sub-continents, which amounts up to over 180 countries worldwide.
- Sales Volumes are huge, yet the majority of sales come from within the United States. International sales only accounted for 28.3% of amazon's total sales in 2018.
Amazon's websites are more or less built with the same look and feel across geographical boundaries, and users find it extremely easy to use.
Amazon has been able to penetrate deep and well into the lives of the average consumer. It is now a household name in many developing and developed nations.
Amazon provides the suppliers and sellers with the same kind of facilities across all locations, and once you are on Amazon, making your brand a truly global brand gets easy.
Now let us look at the domain and outreach details for eBay:
- eBay has around 49 websites and domains worldwide in geographical locations such as North America, South America, Asia, Europe, New Zealand, and Australia.
- In the year 2018, more than 60 percent of the eBay sales occurred outside of the United States.
As such, it is evident that eBay is better in terms of global outreach and market penetration and covers almost all subcontinents other than Africa.
We already established that eBay is a pure marketplace. Since eBay has no interest in creating its own products or brands, sellers and retailers can make the most out of their Unique Selling Propositions on eBay across all geographical locations.
eBay is also a better marketplace for selling used and collectibles items. If you are a dealer dealing in used items, antiques, or collectibles, you can list and sell these products on eBay, and you will undoubtedly find a buyer within one of these geographical areas.
So, the bottom line - eBay has a better international outreach and scope for the sellers than Amazon. If you are looking forward to expanding your business worldwide with a vast and diverse customer base, eBay could be your best bet.
If, however, you need a more significant customer base inside the United States, you stand a better chance with Amazon.
Before selling any products, it's a good idea to understand your customer base and who they are. It is also good to know the demographics and shopper habits to understand and analyze which segments are buying more than the others.
For these reasons understanding your customer base is essential. Let us compare the differences between the customer base with Amazon as well as eBay.
- Amazon is known to have a total of 310 million active users buying from the platform worldwide (Statista, 2016).
- 67 percent of Amazon Shoppers prefer to shop using their desktop computer or laptop (Cpcstrategy, 2018 Pg15).
- About a whopping 82% of consumers check prices on Amazon before making a purchase! (Feedvisor, 2019 Pg15)
- Amazon is a household name in the US, and an estimated 105 Million users are Amazon Prime members. (Statista, 2019)
From the figures and the statistics above, it is evident that Amazon has a better and bigger consumer base and is more popular in US households. The Amazon app is also a hot favorite and that is evident from the users who use the mobile app.
- eBay gets a total of 182 million users visiting the website monthly.(eBay, 2019 Pg9)
- eBay has an auction model, and hence the best bid and the lowest listed prices make it on the site. Which simply means that the consumers get the lowest prices.
- eBay has a product quality scoring system, and consumers on eBay can use to know for sure that a product is of good quality. (Ebay, 2016)
So the bottom line - Amazon has a bigger and better customer base than eBay, which is almost double than that of eBay. While eBay buyers are more focused on getting the best quality at the best prices, Amazon buyers are okay in shelling out more money with Amazon Prime to get their products shipped quickly and for some exclusive discounts.
Selling Platform and Experience
Another thing that can be compared between the two is the Selling Platform, the ease of use, and the seller experience. The comparisons can be drawn out based on the number of sellers on these platforms.
Per a recent report, there are close to 2.9 million active sellers on the Amazon platform. This number continues to increase every year (Marketplace Pulse, 2019).
This increase can be attributed to the various selling resources that are available to sellers so that they can make more money. Amazon provides a service known as FBA - (Fulfillment by Amazon). Using this feature, almost anybody can become a seller without any hassles. Simply sign up as a seller using the FBA option, and you can become a seller with Amazon.
eBay has approximately 25 million active sellers, with more than a billion products listed on their website.
eBay does not have a fulfillment method such as FBA and hence is dependent on a lot of factors that the sellers have to control themselves.
So the bottom line - Amazon is a better choice and is a more mainstream option for sellers. Whereas eBay is a bit more unusual selling option with the sellers. As such, Amazon is a preferred selling platform than eBay.
When it comes to fees, eBay charges 10 percent of the costs, whereas Amazon charges 15 percent. eBay charges PayPal fees as well, but Amazon does not.
The PayPal fee is 2.9 percent of the sale price plus a flat $0.30. Simply put, eBay is better in terms of the fees, and on average, sellers on eBay get to keep up to 5.5 percent more profit than if they were selling on Amazon.
So, selling on eBay vs. Amazon? Which is better?
Having weighed the pros and cons of selling your products on each platform, both have their advantages and disadvantages.
If you wish to expand and enhance your business, the best policy is to use both platforms as part of your selling strategy. Use the platform that is best for the products you are selling. If you need a varied customer base across the world, you know which one has a better outreach Amazon, and if you wish to deal with old products and collectibles, you know where to go.
Use our comprehensive guide and make a decision that best suits your business needs.
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