Comparison of eBay and Amazon
eBay and Amazon are two largest Internet platforms in terms of turnover of goods and money, where people from all over the world make purchases every day, and sellers use these resources to promote their products, increase the number of customers, and, as a result, increase number of sales. These two companies are the biggest competitors, although the methods of selling goods through eBay and Amazon and their methods of activities differ in many ways. Let’s figure out the difference between these two giants of online trading.
eBay is an online auction that was created to sell goods between people, that is, “from hand to hand”. But with the growth of popularity and number of customers, this platform also began to attract manufacturers of goods and online stores, for which eBay has become, if not the main, then a very important and profitable sales channel. eBay can be compared to a large international market on which both companies and ordinary people offer their products to the whole world.
In its turn, Amazon is a large marketplace, where goods are sold not only from sellers, but also from Amazon itself. Thanks to the general terms and conditions, it resembles a large shopping center on the Internet, where there are many shops that sell their products and are divided into categories. Amazon takes responsibility for logistics to the buyer and warehousing of the goods, as well as it controls the quality of goods sold. If a seller of cheesy goods appears, Amazon immediately removes it from its platform.
As you can see, the business models of these two platforms are slightly different, although they are a part of e-commerce. eBay is more focused on C2C (consumer-to-consumer) sales, both at fixed prices and through the auction system. While Amazon is more targeted at B2C (business-to-consumer) sales, where goods are sold at fixed prices.
Both platforms have their pros and cons, which make them so different from each other.
- High traffic. Amazon.com. ranks fifth in the list of the most visited websites in the US, so you can only imagine what opportunities in online trading it can offer. A huge number of sellers inspires you to look for the ways to stand out from their list.
- Platform reliability. Thanks to the Amazon system, which not only prevents possible fraud on the part of customers, but also guarantees the safety of their purchases, most people have an elevated level of trust and are willing to use a more reliable Amazon in comparison with competitors. The company guarantees a high quality of goods and their well-timed delivery, because all sellers undergo a strict inspection and control.
- Transparency of the cost system. By selling through your own online store, you can unexpectedly increase your marketing expenses, which will adversely affect the estimation and calculation of future profits. On the other hand, Amazon charges a fee for each unit of goods sold, which is usually a fixed percentage of the price.
- A very high conversion percentage –– 13%.
- Big competition. Amazon has a huge number of sellers, which significantly increases the level of competition.
- The time lag between the sale of goods and payment. For new sellers, there are some restrictions that do not allow you to withdraw money immediately after the sale of goods. It may cause some difficulties for small sellers in their business.
- Rare second chance. Numerous cases can be found when Amazon closes a seller’s shop for no obvious reason. Just a few negative reviews from dissatisfied customers can cause big problems, even if they are small percentages of all your customers. Therefore, it is very important to satisfy a request of each client, which is a very difficult task.
- Many potential customers. eBay.com is the seventh most visited website in the US, and many of the visitors can become your customers if you use the right sales tactic and offer a competitive product.
- Auction system. Auction system may be the best solution for the sale of rare or unique products, and selling price can exceed an expected income. If your product is mass-produced, it’s better to sell it at a fixed price.
- Increased trust. Like Amazon, the eBay shopping system is fairly secure, protecting both sides of a trade deal.
- Simplicity of registration and lot listing. eBay serves as an auction and it is focused on the fact that everyone can sell there what he wants (if it is not a prohibited item).
- There is no alternative to PayPal. Most operations of buying and selling of goods are carried out through the PayPal payment system, which is owned by eBay. Although this increases the security of both parties, it also causes some problems, such as withholding your funds, blocking an account, or the inability to accept money in some countries.
- Counterfeit products. When selling products that are easily counterfeited, it is very easy to meet unexpected competitors who sell the same product at lower prices. This fact to some extent affects the rating of the auction, so it is very important to offer a high-quality product.
By contacting Partner Trade consultants, you can get expert advices on the correct and safe trading strategy on eBay and Amazon. Our goal is to make your business successful!