How choosing your venue carefully, and pricing your products accordingly, can make a huge difference to your online profits
You’ll often hear me talking about selling on ‘multiple venues’, ‘expanding your business’ and ‘never putting all your eggs in one basket’ – in other words not relying on just one sales venue. The reasons are a plenty but the bottom line is that the more mediums your products are available through, the more sales you will have the opportunity of making and ultimately this means more profit for you. So, it’s very important that if you want to sell seriously online you always consider this.
In last weeks blog post I talked about the ‘best venue’ and so this week I want to follow on from this because with different or multiple venues comes a small dilemma, and that is one of pricing issues. I often receive emails from people asking how they should set their prices – should they sell their goods for the same price on eBay and on Amazon or should pricing and postage charges differ according to where they are selling?
Amazon do actually have a little known rule (and to my knowledge, it’s one that no seller ever adheres to!) and that is that if a seller lists the same product on eBay and Amazon, the selling price should be exactly the same on both sites.
BUT, over on Amazon, prices are often higher per item compared to eBay – even when sold by the same seller.
I was reminded of this last month when I researched and sourced a product exclusively for members of The Source Report. As I was doing my research, it quickly became clear that it would be far more profitable if the item were sold on Amazon, rather than eBay.
As a rule, I calculate the full NET profit calculations if the product were to be sold on eBay or Amazon for every hot product report I create, and this was the first time in a very long time that in my honest opinion, even though the product was in demand, it simply wasn’t worth listing at that time on eBay, only Amazon.
Why? Because the asking price on Amazon was around £5.00 more than the same product was listed for on eBay!
So, let’s think about this for a minute. If you are selling on eBay then it’s very likely that your prices are somewhat driven by your competition. Undercutting and loss leading strategies are in evidence all the time – in fact I talked about ‘loss leading’ in one of my June eletters – and it’s very tempting to ‘price match’ or undercut just to get a look in.
On Amazon though it often appears that things are a little more civilized. Of course undercutting goes on – mostly because on Amazon there aren’t the same opportunities to really sell your product within your description like you can on eBay, as the description allowance is in a different format and much shorter.
But the thing is, my attitude is and has always been to make as much profit as possible from a product, and surely this is the same for everyone – that’s the whole idea of business – so, wherever you are selling, why sell cheap?
Instead, if you’ve found an in demand product but you can only make pennies by selling it on eBay compared to pounds on Amazon, look at listing your item on Amazon instead as prices can be considerably higher.
And don’t think that because prices are higher people won’t buy – they will! Of course, there are plenty of buyers out there who will always rather purchase from a website than eBay or Amazon – they just feel safer.
And on the other side of the coin there are buyers out there who always think they will get the best bargain on eBay – but this isn’t always true because you also get Amazon loyal customers… who won’t stray from their site of choice – even to compare prices. Even if it means the chance to purchase for less elsewhere!
So, my suggestion is to always consider alternative venues if the figures aren’t stacking up for your first choice.
If you’re a dedicated eBay seller, don’t be afraid to mix and match with Amazon as well and vary your products and venues. They don’t have to be listed on both sites. Go where the profit is. As long as you’re utilizing multiple venues across your inventory then that’s absolutely fine.
Always check selling prices on eBay and Amazon when calculating your profits – you may be surprised at the difference!
As always I wish you the best of success,