After choosing an item for your online business, you may be wondering…
“Okay, now that I’ve got my product, where should I sell it?”
The first two names that come to mind are Amazon and eBay.
Both of these are current top marketplaces to sell your products. However, if you’re looking to start an online business then you have to choose between these two, and since they’re both massively successful, the decision can be confusing.
So, Amazon or eBay? Which is the better option? Which one will make you more successful?
In this post, we have tried to answer all your relevant questions.
So, let’s get started.
In order to determine the best option, you will have to go through each contributing factor one by one.
That is why we have created a 10-factor, step-by-step comparison between Amazon and eBay to save you the dirty work!
Let’s get started:
Before we compare the two sites, let’s first understand that Amazon, in addition to being an e-commerce site, is also a seller itself. So, selling on Amazon means competing not only against other sellers, but also against Amazon itself.
This number for Amazon used to be about 74% back in 2007, but has decreased since then and still continues to fall. Nonetheless, this factor plays a significant role in boosting competition on Amazon.
Moreover, when it comes to comparing Amazon vs. eBay, the former has far more sellers than the latter. This of course, indicates higher competition as well.
So, what’s happening over at eBay?
Well, number of sellers is definitely lesser. Unlike Amazon, eBay does not sell anything itself and only serves as an e-commerce website.
The competition, conclusively, is less on eBay than that on Amazon.
eBay is a clear winner here.
Amazon can sometimes prove to be too competitive for individual sellers.
Being purely an e-commerce platform, the only thing a seller on eBay has to worry about is other 3rd party sellers. The lesser number of sellers on eBay is also a plus!
Amazon’s Fulfilled by Amazon or FBA program is a major game changer when it comes to comparing shipping services of eBay vs. Amazon. In fact, it may perhaps be the biggest difference between these two e-commerce giants.
Customers hate having to pay for shipping and delayed shipments as well. With Amazon’s FBA, you handover the responsibility of shipping and handling customer service entirely to Amazon (and who better for the job than Amazon itself?)
From here, Amazon makes free delivery just within 2 days! This earns you, the seller, a good name and lets the buyer enjoy his/her product on time (certainly a win-win situation).
Moreover, if a shipment is returned by the customer then Amazon makes sure that it is in the right condition to be re-sold before sending it back to the seller.
So, all you have to do is to send your product to Amazon and they will handle the rest. Here’s how it all works:
eBay does not offer any sort of shipping services other than making some shipping recommendations to sellers.
For example, with FBA, if you have a 1000 hats to deliver to different customers then you can just pack them up in a box and ship them off to Amazon.
With eBay, however, you would have to pack each hat in a separate box and deliver it to its individual buyer.
FBA may prove to be a bit impractical in some cases when you have to ship your products to Amazon warehouses thousands of miles away. This is why the option of drop shipping is also available (especially for new or small-scale sellers).
Amazon is a well-deserving winner here.
There’s a reason why FBA is so popular amongst sellers on Amazon. The system just takes care of everything for you, while you have all the time and energy in the world to focus solely on your sales.
Yes, you may not want to pursue FBA but it doesn’t hurt to know that you’ve got the option. eBay, however, does not offer any such options to sellers.
Amazon charges 15% in commission while eBay charges only 10%. eBay does, however, charge an additional payment processing fee - or Paypal fee - of 2.9% of sales price.
But, when compared with Amazon, eBay proves to be the cheaper option in spite of this additional fee. Let’s make a simple comparison:
As you can see, there is no closing fee on eBay.
So, it is quite obvious here that Amazon actually does cost more. However, you should also realize that they offer many services to sellers in return of this fee. eBay, on the other hand, leaves you entirely on your own in terms of:
Storage Packaging Shipping Distribution
Moreover, there are some categories that are cheaper to sell on Amazon than they are on eBay. These include:
Personal Computers Unlocked Cell Phones, Consumer Electronics, Video Game Consoles Base Equipment Power Tools
You can sell these items on Amazon for the same listing fee i.e. $0.99, but with a far lower FVF (6-10%).
Well, it all comes down to price vs. value.
If all you’re looking for is lower fee, then eBay is a clear winner (unless, of course, your product lies in the above mentioned 3 categories).
However, many sellers decide to pay the additional fee on Amazon just to take advantage of their seller services which are not offered on eBay.
Also, if you decide to pay optional fees on eBay like Advanced Listing Upgrade Fees or Supplemental Service fee, you may actually find yourself paying the same amount (or even more) as that on Amazon.
Amazon’s product management system is hands-down the easiest one.
To understand why this is so, let’s first look into eBay’s management system.
eBay has always received scrutiny when it comes to management. Its decentralized product management system can be extremely confusing as there may be hundreds of different listings for an identical item (mostly when it comes to auctioned items):
On the other hand, you will never find multiple listings for the same product on Amazon. Why?
Because Amazon only allows one listing per unique UPC (barcodes seen on products).
Moreover, eBay also allows HTML/CSS usage in its listings so sellers are always competing against each other in trying to create a more impressive listing with unique design.
On the contrary, Amazon only permits photos and plain text descriptions, making listings much easier.
Amazon is the obvious winner here.
Amazon loves to keep it simple and so do most of the sellers. You don’t have to worry about using HTML/CSS here to create a more appealing listing, nor do you have to deal with multiple listings!
This is probably the most important factor of all because every seller wants greater sale opportunities.
Here’s how both sites compare:
Amazon’s total revenue last year came to be a whopping $282 billion while eBay only made $10.75 billion in comparison.
The main reason for this huge difference is simple: the size of eBay’s marketplace is only a fraction of that of Amazon’s.
In fact, Amazon’s massive clientele can ensure you 10 times more sales than eBay!
Amazon’s revenue has been impressively multiplying for the past 5 years while that of eBay has been almost constant throughout this time.
Check out how Amazon’s been booming since 2004:
The e-commerce giant is already way ahead of eBay when it comes to size. Moreover, while eBay seems to be stuck around the same size, Amazon continues to grow every year (at impressive rates!).
This is also an important factor in a world where everything has a brand image, from sale items to websites to nations, literally everything. Amazon and eBay are no exception.
There was a time when eBay used to sell only used, second-hand items. Today, more than 80% of items on eBay are brand new. Despite this fact, however, the brand image associated with eBay being a second-hand items’ seller still persists.
But why does this matter?
Well, if everyone thinks that you mostly sell used items then that’s not particularly good for business.
On the contrary, Amazon is a widely trusted e-commerce site with no reputation of selling used goods. It is also popular among shoppers for its effective customer service.
Amazon’s customers are not only more than double in number as compared to eBay’s, but they are also quite loyal.
44% of American households have Amazon Primesimply because they trust Amazon enough to invest in a Prime membership that ensures fast shipping and cheaper prices on Amazon.
Check this out:
Amazon is a clear winner here.
According to a research, 44% of online shoppers go straight to Amazon first before looking at any other e-commerce site. This shows just how reliable people consider Amazon to be.
Although eBay’s perception among customers is not accurate, it still plays a role in pushing at least some traffic away.
To become a seller on Amazon, you have to start by signing up on their sales account website, SellerCentral:
After this, you can submit information about the products you plan on selling. You would also have to set up a two-step verification on your Amazon account if you haven’t already.
On the other hand, you don’t have to do almost any of this on eBay.
All you need is your regular, basic eBay account. You can register for it here if you haven’t already. Or, you can also set up an account for business on the same page:
If you’re only looking to sell some unwanted stuff, we recommend simply using your personal account.
eBay definitely has a simpler sign-up procedure than Amazon.
Unlike Amazon, eBay does not put you through the hassle of signing up for a sales account. You can just get yourself registered for a basic eBay account and start selling right away.
8. Selling Options - Selling on Amazon vs. eBay Let’s talk about what you can and cannot sell both on Amazon and eBay.
Some people argue that eBay allows far more number of categories to sell in than Amazon. However, if you actually look into all these categories, you’ll look at most of them and wonder “but who even sells these things?”.
Well, some people do. But that’s the thing, the number of allowed categories on eBay is sure greater but most of these categories are so unusual that they only appeal to some sellers.
Amazon, on the other hand, caters to almost all categories of everyday or usual use. It is still dominant in nearly all departments that have a constant customer-demand and also in products which are not found through discovery or bought on impulse.
You can check out the complete list and their details here:
Note: Visit Amazon for the complete list
Amazon wins here for being the better retailer of commonly bought items.
eBay started off as a site where people would come to sell off their used items. In fact, it is still more welcoming towards used products than Amazon.
But, unless all you’re selling are used items or collectibles, Amazon is the proven best option.
Like any other e-commerce site, both Amazon and eBay are buyer-centric.
In such a system, websites can sometimes be quite strict with their sellers. This is the case with Amazon too.
Unlike eBay, Amazon can sometimes end up giving too much of a hard time to sellers. For instance, it has a reputation for suspending buyers over trivial matters with little or no warning.
This is what Amazon’s sales account health dashboard looks like:
Notably, when an Amazon account is suspended, the funds in it are immediately frozen too.
eBay, on the other hand, is not that merciless towards its sellers. Its main priority is also customer satisfaction but it is still less strict with sellers when compared with Amazon.
eBay obviously wins here. Amazon’s strict and ruthless policies sometimes even push sellers away or end up discouraging them.
While eBay also isn’t perfectly fair to sellers, it is still better than Amazon in this regard.
Everyone would tell you that eBay is far more lenient towards sellers than Amazon is, and provides ample branding opportunities as well.
What they won’t tell you is that Amazon also provides branding opportunities, just not to scam artists or those looking for some quick money. Which, by the way, is a great thing for both sellers as well as customers.
When it comes to branding, a major difference between Amazon and eBay is that the former hides customer’s details (especially their email address) from the seller, while the latter does not.
This matters a great deal. Why?
Having your customer’s email address puts you in direct contact with him, giving you the freedom to brand your items however you want.
You cannot do this with Amazon because they own the customer in every way. However, what you can do is avail Amazon’s services for branding opportunities. Here’s what they offer:
*Enhanced Brand Content (EBC)
* Amazon A+ Content
All three tools are free of cost and have the potential to reduce product returns, negative reviews, immediate bounce offs and increase the ROIs of paid product Ads (in addition to sending a brand value and assurance).
Well, eBay may give you the freedom to brand your products directly to the customers but it also allows several scam artists to participate in this practice as well.
This confuses customers and also sparks unfair competition for authentic sellers.
Amazon, on the other hand, protects customer information while still providing sellers with efficient tools for branding opportunities.
If you check the comparison above, you’ll notice that Amazon wins 6 out of 10 categories while eBay wins only 4:
The number of sellers on Amazon grow every year due to the very reason that it wins all these important categories. (It gained 1,029,528 sellers just this year!)
Also, as discussed, Amazon is again better than eBay when it comes to management, easy shipping, number of shoppers, brand image, branding opportunities as well as allowed selling categories.
eBay, on the other hand, is more seller-friendly, cheaper, less competitive and also provides an easier sign-up process.
Let’s be realistic, as far as the sign-up process is concerned, no one would prefer eBay only because the sign-up process is shorter. Same goes for being seller-friendly. Honestly, if you’re not doing anything fishy, you won’t get into trouble.
Lastly, It comes down to eBay being less competitive and cheaper. To overcome the competition on Amazon, honestly all you’ve got to do is put some effort in choosing the right product (check out this post to find out how).
In the end, it all comes down to your preferences.
If you are someone who does not plan on using extra services and is only looking to make a few extra bucks, then eBay is for you.
On the other hand, if you’re looking to build an online business and would accept any service that makes you stand out, then Amazon is definitely the right way to go.
Think we missed something out? Let us know below in the comments!
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