PLUS: What do your eBay buyers really want?
Like many eBay sellers, I know auction is sometimes the best and often the only way to make sure you’re getting the highest price possible from some product listings.
This is why:
- Auction is the best way possible to get the optimum price for an item whose value is uncertain, or for which pricing guidelines are not available elsewhere. A good example is autographed items and signed letters from famous people no longer living. By their very nature, many such items will have already been snapped up by collectors and the chance of new ones coming onto the market is far less than for similar items appearing from living celebrities!
Auction is also the best way to determine the value of unique as well as very rare items that have not appeared on the market for several years, meaning there’s no price trend to work from. Performing an advanced search on eBay won’t help either. So the item gets listed at auction and bidders decide how much it’s worth.
Products most likely to reach their optimum prices at auction include: original art, autographs, information products offered with full copyright, products with double buyer interest (such as a collectable photograph with autograph that generates a bidding war between people collecting photographs and others interested in autographs), and virtually any unique or rare item.
- Now imagine there’s a multiple-product lot available at a liquidation auction, or a job lot available from a shop about to close down or from a manufacturer selling end-of-line goods in bulk: you obviously don’t want to purchase hundreds or even thousands of items together, only to find they don’t sell in smaller bundles or individually to end users.
So you ask for one unit of product from the auction company or other seller and you offer that item at auction. Choose your auction durations depending on time remaining between your auction ending and the big-bundle lot going under the hammer.
When your auction ends, you’ll know how many people would purchase your item and what the lowest buying price would be (it’s the price at which the first person drops out of your list of bidders). So, for example, you might find your product attracted ten people offering £10 or more, where £10 is the price that put you in profit.
You might do more test-run auctions to make sure your product is likely to sell over the indefinite future.
Now with all your bid prices and bidder numbers on a spreadsheet, you determine how many bidders offered enough to cover your buying and selling costs and leave a decent profit for you.
If all bids fell below your target unit profit margin, you obviously don’t buy the big-bundle product lot. But you might consider buying it where results provide decent profit margins and bidder numbers suggest your product might be an ongoing high-profit seller.
- The technique just mentioned can be used to test demand for a mass-market products, without the seller having to buy wholesale quantities and subsequently discovering their product doesn’t sell at a profit and has to be sold at a loss.
As for the last suggestion, you buy just one unit of product, on the high street if you have to, and then you take images and upload the item at auction.
If bids are good and several bidders emerge, you do second chance offers to non-winning bidders and then buy sufficient product to fulfil orders. This might involve buying in wholesale quantities offering decent profit margins, or you may have to run several auctions to dispose of bulk-purchase stock.
When your wholesale stock runs out, you determine whether profits make it worthwhile restocking the product.
What do your eBay buyers really want?
One way to grow your profits on eBay is by communicating more closely with buyers and enquirers.
That might sound obvious, but you’d be surprised how few sellers actually ask their buyers for advice about products, customer service or other people who might also be interested in their products.
These ideas will help you turn buyers and enquirers into a research tool for your business:
- When someone orders from you on eBay, send a quick message asking if there’s anything else they’d like to buy at the same time. Tell them they’ll save money on delivery and sweeten the deal by offering a discount on additional items purchased before their current order is processed. Say something like: ‘Thank you for buying one of our widgets. As a valued customer I’d like to offer you 10% off any additional purchase made before your widget is shipped on [specific date].’
- Ask for customer recommendations. Offer some useful gift to buyers for getting their friends and relatives to buy from you. Say something like: ‘Thank you so much for your order. If you like our product we’d appreciate you telling your friends about us, and if they buy from us, ask them to mention your name and we’ll send you a lovely [describe gift or bonus].’
- Ask buyers and enquirers if they’d like to receive regular communications about your range of products, with lots of useful tips to help them enjoy their product or learn more about their special interest. Say something like this: ‘Thank you for buying one of our dog kennels. We are dog lovers too and we’d love you to join our mailing list for lots of doggy news; you’ll even get a free ebook about dog care and ways to keep your four-legged friend safe and happy for life. It normally costs £4.99 but it’s free if you join our list today at [www.joinushere.com].’
- Ask your buyers if there’s anything they’d like you to sell on their behalf. Either pay for products up front, or sell them at auction or from a fixed-price listings and share the proceeds with their original owners.