For years, eBay was the most recognized e-Commerce platform thanks to its versatility. It not only allowed people to sell second-hand products, but also it was the perfect starting point for small businesses who wanted to launch quickly, with minimal start-up costs and an accessible audience. Eventually, Amazon started selling more than books and CDs and began diversifying further until the present day. They now stock products from A to Z as their logo suggests!
Taking all of this into consideration, there’s no doubt it’s hard to choose between one or the other. In this article, we’ll try to cover some of the factors that matter the most when considering selling on Amazon vs. eBay in 2021.
By the Numbers: Amazon vs. eBay
The size of eBay’s marketplaces is a small fraction of what Amazon’s is. While these statistics won’t be directly relevant to you as an online business owner, it is worth noting the context here. Both will most likely give you what you want, both cater to different preferences, but one simply dwarfs the other in total market share.
Shopper popularity
Amazon is the winner again. Prime subscriptions are growing every year. But remember, more popularity means more people flocking to sell on the platform. At the end of the day, this may only cause more competition for you, depending on your product niche.
When it comes to choosing between Amazon or eBay, it’s important to take into consideration shopper popularity, however, these big numbers don’t mean a thing unless we have a peek into customer motivation.
Understanding which features shoppers value most may help sway your decision regarding the platform you choose to sell on and your eventual fulfillment method.
If you are looking to create your own brand, sell in bulk, and scale quickly, Amazon was built for you.
If you’re selling niche products, collectibles, hard-to-find, or offbeat merchandise, you were born and bred for the eBay shopping audience.
Fulfillment methods
Amazon Fulfillment Options
There are two main fulfillment methods you may choose from if you want to sell on the Amazon marketplace: FBA (Fulfillment by Amazon) y FBM (Fulfillment by Merchant).
FBA is as simple as it sounds: sellers sell, Amazon ships. With FBA, sellers only need to focus on handling sales and making sure Amazon stays stocked, the rest is done by Amazon. It comes with a huge advantage: your product gets the coveted “Prime” badge (the biggest incentive for people to make a purchase).
FBA is easy, but it isn’t free. You will have to budget in Amazon FBA fees if you want to take advantage of these services.
FBM means you’ll have to take responsibility of the whole fulfillment process. You’re responsible for receiving shipments from your supplier, storing them until sold, packing, and shipping them to your customers. Depending on the size of your product and physical workspace, Amazon FBM could prove to be a massive headache or money-saving machine.
There’s also the option to work with a 3rd Party Logistics Company. At MetsCube, we take care of your products to ensure that they are prepped and sent safely to their destination, while we assure that our clients understand exactly what benefits and limitations we offer with regard to the care and custody of their valuable goods. To understand more about our insurance policy, contact MetsCube today.
eBay Fulfillment
Currently, the only way to fulfill your orders for eBay customers is the old-fashioned way… doing it yourself (the equivalent of what we talked about with Amazon FBM).
While this makes sense for sellers with storage space and manageable inventories, if you are new to online selling, this level of involvement may be more than you bargained for.
Seller competitiveness
Amazon is crowded. There are 6.2 million sellers currently selling on the platform. In 2019, they revealed they had 200,000 sellers with revenue over $50,000 and 50,000 sellers with revenue over $500,000.
While more competition isn’t always a bad thing (your success on Amazon will most likely hinge more on savvy product selection), it does mean there is a much steeper challenge in ranking on page one of Amazon search results.
eBay, on the other hand, is centered around promoting different versions of the same product rather than pushing shoppers to one unique product listing and promoting the best version of each product towards the top of the list.
eBay says there were 6.7 million sellers in 2017 but the VAST majority of these are very low-volume sellers. eBay almost certainly has far fewer sellers than Amazon, and competition for advertising is also significantly less on eBay, so it’s cheaper.
Amazon vs. eBay fees
eBay charges a flat 10% in commissions but does not include payment processing fees in that calculation. Payment processing fees are typically an additional 2.9% from PayPal. Amazon typically charges a 15% commission which includes payment processing fees.
However, Amazon will charge you inbound shipping fees if you use their FBA program and outbound shipping fees as well.
Amazon seller fees
When selling on Amazon, there are two primary fees to be aware of: the referral fee and fulfillment fee.
- Referral fee: Every time you sell a product on Amazon, you pay Amazon a portion of the total price or a minimum amount, whichever is more.
- Fulfillment fees: This selling fee will entirely depend on which fulfillment method you are using (FBA or FBM) and how big/heavy your product is.
You may still encounter additional fees like inventory fees, premium account services, and advertising costs.
eBay seller fees
eBay also has two main types of sellers fees: insertion fees and final value fees.
- The insertion fee is charged after you create a new listing on eBay. eBay gives sellers their first 250 listings free per month, then begins charging $0.35 per listing.
- The final value fee is paid to eBay after you make a sale and is represented by a percentage of that sale plus $0.30 per order.
Which one is better overall?
As you can see, the question of Amazon vs eBay is not as simple as choosing one and discarding the other. There are so many factors that go into success in e-commerce. Product niche, keyword research, listing optimization, advertising efforts… the list goes on and on.
The reality is that Amazon is almost always the better platform for sellers to start selling on. Amazon will give you the most stability, deepest library of resources, and the biggest opportunity for growth.
eBay does have a place in e-commerce and many sellers will find value on it. It just shouldn’t be the first thing you focus on. But since you don’t have to pick one, you should consider eBay as a smaller selling pond to nab sales Amazon sellers are too preoccupied to compete with.
