As an ECommerce seller (www.laughingbear.co.uk) I've spent the past 5-6 years selling on-line and currently sell both on my own website, on EBay and for the past 2 years on Amazon so have been able to get some real world experience of how each channel works for us.
Firstly EBay.
EBay is still the huge elephant in the jungle of ECommerce. Until recently its been populated largely by small business sellers (like us) and private sellers clearing their attics but now with the Outlets moving in it has become a place where big names like Tesco are selling.
EBay has always had a feeling of a bit of a car boot sale with plenty of tat and dodgy 'back of the lorry' stuff but an increasing number of small businesses do use it as a 'proper' sales channel. As a channel it has a lot of pros and cons....
Pros
- It has huge footfall. The number of people using the site is frankly enormous much larger than all but the Amazons of this world could hope for. It is likely that a lot of potential buyers of your products will eventually wander through the EBay portal.
- Its possible to offer a very limited range of products. If you're starting out and only have 1/2 product lines then a dedicated site would be a) expensive and b) look rather empty. On EBay people will largely be looking for a particular product and provided they find yours they won't care if its the only thing you have in stock.
- You need virtually no skills and no upfront investment as EBay take care of all of that for you
Cons
- The huge number of sellers means your products (and prices) will be on show on the same page as your competitors' products. This results in vicious price wars. There will always be some idiot who thinks making 10p profit on a £20 sale is worth doing which of course either trashes your margin or means you make no sales.
- In many categories there are either more crooked sellers than genuine ones or more dodgy buyers than real ones (more on dodgy buyers later). These sellers will either have fake goods or no goods at all and will be trying to rip off as many customers as possible before they get caught. If you're not intending to actually send out any stuff its no skin off your nose to 'sell' at less than cost price meaning these guys can soon swamp parts of EBay and rely on the seemingly endless stream of buyers who think they can get something for nothing. On EBay it seems there are usually 100 born every minute to be victims of these con artist sellers.
- These fake sellers of course then result in all other sellers being tarred with the same brush. The adage that if you're happy you'll tell one person if you're unhappy you'll tell 20 people holds true and the number of stories of buyers being conned into buying concert tickets, mobile phones, cheap laptops etc etc abound.
- Its not only sellers that can be crooks on EBay. Many multi-channel sellers report that parcels to EBay buyers get lost 5-10 times more frequently than parcels from web sites or Amazon. Assuming Royal Mail don't actually identify EBay parcels and just chuck them in a skip its fair to say that there is a small but significant number of buyers who will happily buy stuff on EBay, get the goods then put in an "Item Not Received" (INR) claim with EBay/Paypal and get their money back. The temptation to get free stuff from EBay seems to be high (and in the current climate getting higher)
- EBay tend to create rules for sellers virtually on a whim. This wouldn't be so bad if the rules were consistent and followed a logical train of thought. Many seem to do exactly the opposite of what you would imagine would be sensible. For example there is a lot of fraud on EBay around selling non-existent concert tickets. Previously a seller could sell tickets that he did not have in his hands up to 30 days before he was due to receive them. This resulted in a a lot of cons with the sale of non-existent tickets. However because you can make a paypal claim up to 45 days after the purchase buyers had some chance of getting their money back. Now EBay has increased the time in advance of ownership a seller can sell a ticket to 90 days therefore making it much easier to con a buyer and much harder for them to claim the money back!
- EBay seems to be caught at a crossroads. When it first started it was an on-line carboot sale with mainly private individuals selling to and buying from each other. It now seems to want to be both a car-boot sale (free listings for private sellers) and to attract large sellers (like Tescos). It is finding it hard to be a venue for all the different types of seller and it would appear that at least two different groups inside EBay are trying to develop its seller profile in two different directions at the same time. Confusion for both buyers and sellers!
Sellers trying to sell high end, high street items often find they are swamped by either the outlets or by sellers offering cheap copies.
It would appear from the way EBay is going that it will become the bargain basement of the Internet ECommerce market. Which is fine as long as you know what you're getting into.
In Part 2 Amazon
