eCommerce sellers nowadays have a plethora of options for where they can sell their products online. However, Amazon and eBay are the two marketplaces that have been around a few decades. You might consider selling on Amazon vs eBay as they are the oldest and biggest online sales channels.
But how do you know which one will be more profitable to you?
There are compelling arguments for both, so we’re going over the differences between the two giants to help you choose Amazon or eBay to sell your products.
What is Amazon?
Amazon is a global eCommerce corporation that specializes in online retail, computer services, consumer electronics, digital content, and other local services including daily specials and groceries.
According to the latest industry data, Amazon is the biggest e-retailer in the United States with net sales of close to 386 billion dollars in 2020. E-retail sales of electronics and other products comprise the majority of the company’s revenue, followed by third-party seller revenues, subscription services, and AWS activities. Amazon is now one of the most valuable brands in the world due to its global breadth and reach.
Pros & Cons of Selling on Amazon
- Lower fees
- Buyer trust
- More branding opportunities
- Fulfillment services
- More restricted categories
- Extra FBA fees
- More difficulties to list products
- More competition
What is eBay?
Founded in 1995, eBay is a worldwide eCommerce company that provides C2C online sales services. eBay mainly focuses on its auction platform and shopping website. It allows people and businesses all over the world to buy and sell a wide range of products and services. “Buy it now” shopping services, online classified adverts, and online event ticket trading are all part of the eBay business.
eBay marketplace earned roughly $10.3 billion in net revenue in 2020, the majority of which came from transaction fees.
Pros & Cons of Selling on eBay
- Less competition
- Customer loyalty
- Fewer category restrictions
- Easier to list
- Smaller audiences
- Less buyer trust
- No fulfillment service
- Higher fees
Amazon vs eBay: Which one should I sell on?
Who should sell on Amazon?
The Amazon business model is efficient, and a seller can start selling things in a matter of minutes. Logistics are made easier with the FBA (Fulfilled by Amazon) option. The products are displayed to a larger audience in a short period of time, and this is something that is difficult to comprehend.
Aside from that, selling things at a higher price and in large quantities is rather simple on Amazon. If meeting tough requirements isn’t a major concern as long as a seller continues to make good sales, Amazon is a better option than eBay.
Who should sell on eBay?
One of eBay’s most valuable features is that it gives sellers better flexibility. A seller has complete control over the creation of product listings, shipping rates, and return policies. Furthermore, the fee is lower, allowing products to be sold at more competitive costs.
If a seller wants complete control over how his or her products are listed and the ability to define his or her own product restrictions, eBay is the best option.
Have you ever thought about selling on Amazon and eBay at the same time? If yes, you are taking steps to work out a multi-channel selling solution. Whenever you want to sell on multiple sales channels to make your business thrive, Amazon Integration and eBay Integration can be your best choice. LitCommerce is a SaaS system that allows e-sellers to list and sell products on the largest online marketplaces and allow data on these channels to be centrally managed in one place.
Is it better to sell on eBay or Amazon?
1. Customer Trust
In the comparison of selling on Amazon vs eBay, both sales channels are well-known, having been active since the mid-1990s. However, when it comes to customer trust, Amazon tends to outperform its competitors. In fact, Amazon places such a premium on obtaining and keeping customers’ trust which is one of their vision, mission and values.
And now, it appears that the focus is paying off. According to a recent Jungle Scout survey, 73% of Americans believe that Amazon is a good company for buyers.
The ease with the return policy is another reason Amazon is typically seen as the go-to option for internet buyers. Their A-Z Guarantee promises that customers will get a complete refund if they are unhappy with their product or the time it takes to arrive.
Meanwhile, when it comes to returning items and getting full refunds, eBay’s process is even more convoluted. Furthermore, sellers can check the “No returns” box on eBay, leaving buyers with no recourse if they are dissatisfied with the product. As a seller, you could believe this is a positive thing, but, in reality, this can be incredibly harmful to your company.
When you set your listing to “No returns”, you’re telling potential customers that they shouldn’t trust what you’re offering. And, as a customer, what sorts of businesses would you like to purchase from? Those who happily support you once you’ve made a transaction? Or those who take your money and run?
>>> Verdict: By offering post-purchase support, Amazon builds brand loyalty and gives purchasers the confidence they need to take a chance on a product they might not otherwise buy. When it comes to Amazon vs eBay selling, you benefit from that Amazon trust.
2. Market size
When comparing eBay vs Amazon, which sales channel gives you the most chance of selling your products? Which one is larger, giving each product the raw power of more possible eyes?
According to Statista, the number of people who shop on Amazon is staggering. In 2019, it made up 13.7% of the worldwide eCommerce retail market on its own. This corresponds to a massive 52.4% market share in the United States. In terms of raw traffic, Amazon received 2,7 billion worldwide visits from both desktop and mobile devices in June 2021.
It’s also worth mentioning that 44% of US households have signed up for Amazon Prime, the company’s premium program. Given Amazon’s ubiquity in the United States, it’s understandable that customers are willing to pay more for faster shipping and lower individual item costs.
eBay market share, on the other hand, is around 4.3% in the US eCommerce market, Walmart has knocked them down to third position, with roughly 7.1% of the market share.
Many people might rise a question “Is eBay still popular?”, however, the truth is around 1.7 billion people use eBay on a monthly basis. These people are especially picky, preferring to buy only from sellers who have the best feedback ratings. As a result, protecting your eBay reputation is critical to your business.
Because eBay began as an auction platform, its purchasing culture centered around pricing. Customers on eBay are more concerned about price and security than with the niceties that come with premium subscription services.
The comparison here is a little bit skewed. When comparing the raw market size of Amazon vs eBay, Amazon comes out on top. However, it isn’t all doom and gloom for eBay. They’re still a major global player in eCommerce, with tens of millions of buyers from outside the US accounting for more than half of their annual sales revenue.
>>> Verdict: eBay might be perfect for you if you have a specialized product and a very specific target audience. However, Amazon’s market share can’t be matched in the vast majority of circumstances.
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With billions of products for sale, you may find a wide range of new and used items on both Amazon and eBay, but the sites have distinct regulations about what you can buy and who can sell it.
Amazon has over 119 million products listed on its site, and about 4000 of which are sold every minute. Therefore, it appears that you can find almost everything these days on Amazon. Third-party sellers can offer products in almost every category, from apparel and accessories to toys and games, without requiring clearance.
Some Amazon items, however, fall inside the gated categories which are often costly, sensitive in nature, safety-related, uncommon, or collectible. These products include items like fine art, industrial and scientific equipment, as well as food and supplies, etc.
There are also restricted items, which may require you to furnish Amazon with additional information or confirmation to match certain criteria. Magazine subscriptions, lock-picking gadgets, and cigarettes, for example, are not allowed to be on Amazon at all.
While most things listed on Amazon are new, third-party sellers also sell used and refurbished items. But, there are some limits in particular product categories.
Electronics are the most popular product category on Amazon, with 44% of U.S. buyers having purchased them, followed by clothing, shoes, and jewelry (43%), and home & kitchen products (39%).
Similar to Amazon, eBay features a large number of items that you can sell. This eCommerce platform, on the other hand, is distinct in that it focuses on the sale of rare and collectible things.
Ebay does not require sellers to obtain special permission to sell within certain categories, such as coins, and jewels, due to its focus on these specialized products. However, it does keep a comprehensive list of prohibited items, including food, alcohol, and event tickets.
The top-selling product categories on eBay are quite similar to those on Amazon. To be more specific, electronics and accessories account for 16.4%, and clothes and accessories 13.8%. However, eBay stands out with its third most popular product, automotive which accounts for 10.5% of all sales. Everyday, 360 cars and trucks are purchased via mobile devices on eBay.
Despite its reputation as the Internet’s garage sale, eBay’s 1.1 billion listings contain 81% brand-new items.
>>> Verdict: While thinking of which product category to sell on Amazon vs eBay, both marketplaces are generally not good for customized products like engraved products. While both provide some amount of customized support for customized products, neither provides the kind of customization support that your own website can.
Because of the hyper-competitive nature of eCommerce, the shopper is in charge. For the most part, sellers must compete on price or face extinction. It’s tough when selling against another, but what about the sales channels like Amazon and eBay?
Amazon operates on the basis of a product catalog, with the purpose of giving a single clear listing for each unique product. So, regardless of how many sellers are offering a product, a buyer searching for it will be sent to the best result.
Moreover, more potential sellers will appear only once you click through to the product page. However, by that time, the winner of the Amazon Buy Box will have earned the trust (and money) of the majority of customers.
Though Amazon doesn’t explicitly state the factors its algorithm considers when assigning the Buy Box to sellers, there are considerations for them to follow. As a result, sellers may be competing with hundreds of other sellers for that one prime spot in the Buy Box.
eBay allows shoppers to compare several listings for the same item, matching its origins as an auction platform. Some will be new, some will be used, some will be in decent condition than others, and the majority will have different delivery alternatives.
Furthermore, because of eBay’s auction capability, continuing item listings will compete with those that are available to buy right now for a fixed price. All of this adds up to an eBay purchasing experience that is significantly more thoughtful and sophisticated.
This is wonderful news for retailers. You have more options for customizing your listing to appeal to various audiences. Products are also more visible, allowing buyers to dig through the inventory for the best offer.
>>> Verdict: When it comes to competitiveness between Amazon vs eBay, this appears to favor eBay at least for sellers. Amazon is fiercely competitive, with a slew of retailers vying for a single position in the Buy Box. On the bright side, this could work in your favor. If you actually offer the greatest products in your niches with the best price, you’ll have a good chance of winning the Buy Box and making a lot of money. In most circumstances, eBay offers sellers a more satisfying experience though.
5. Amazon Fees vs eBay Fees
Actually, you’ll have to pay the selling fees to list products on eBay or Amazon, and the different prices on each site might mount up quickly. Some users have dubbed eBay “feeBay” because of its high fees. However, Amazon has its own set of seller fees depending on what you’re selling. The decision of selling on Amazon vs eBay may result in you keeping more money in your pocket.
There are 2 Amazon selling plans available which are Individual and Professional. The one you choose will depend on the amount of sales you want to make.
If you’re new to eCommerce and don’t know how much you’ll sell, the Individual plan is a terrific place to start. This plan allows you to sell up to 40 items per month for no monthly fee, and costs only 99 cents per item sold. If you expect to sell more than 40 items each month, the Professional plan is the way to go. It costs you $39.99 per month and allows limitless sales.
There are also referral fees that are paid on every item you sell, in addition to the costs you pay for the plan. The percentage you pay varies by product category and ranges from 8% to 15% of the purchase price.
Finally, if you want to enroll in Amazon’s Fulfillment by Amazon (FBA), you’ll have to pay a number of additional fees. FBA allows sellers to keep their products in Amazon warehouses while Amazon handles the packing and shipping. Please visit our detailed article about Amazon fees for more information.
On eBay, there are two types of selling fees. First, there are insertion costs which apply when you list a product. Then, there are final value fees which apply when you sell a product. You’ll very certainly be charged a PayPal processing fee, which isn’t paid to eBay but is still a part of the transaction.
eBay charges $0.35 per listing and category for insertion fees. Setting up an eBay Store entitles you to a monthly listing allowance. Basic Store is $28 per month and includes 250 free listings, with packages ranging from $28 per month to $350 per month for Anchor Store. Unfortunately, if your item doesn’t sell, you still can’t receive the return fees. And you will pay again the insertion fee each time you re-list your item.
Final value fees are a percentage of the item’s purchase price plus shipping and handling costs. The amount of money you pay will depend on the eBay account’s type you’re currently having. To be clearer, sellers with a regular eBay account will pay a 10% final value fee on most items. Luckily, depending on their subscription model, sellers can have a chance to pay lesser final value fees.
>>> Verdict: Which is cheaper to sell on eBay or Amazon? When PayPal processing fees are put in, eBay is just around 2% cheaper than Amazon. This is a blow, Amazon vs eBay selling fees will depend on the type and number of products you offer.
6. Shipping and Fulfillment
Obviously, a large market and a simple transaction are just the beginning. It’s also the physical delivery of products to the customer’s front door that ensures repeat customers and positive reviews. Both marketplaces offer different shipping and fulfillment options for sellers. So, here’s what you should know about shipping and fulfillment on Amazon vs eBay.
Fortunately, the ability to participate in FBA (Fulfillment by Amazon) is one of the most appealing features for third-party sellers. Fulfillment by Amazon is a service that allows you to store your products at an Amazon warehouse near you. When a sale is made, Amazon will pick, pack and ship on your behalf.
By this, sellers can allow Amazon to store and fulfill orders which is way more convenient. Furthermore, FBA also gives customer service and marketing benefits for stores, such as eligibility for Super Saver Shipping and Amazon Prime. Free two-day shipping is available to Amazon Prime members which can entice shoppers to click “Buy”.
Overall, Amazon companies have seen a 30% to 50% increase in sales thanks to FBA’s benefits. However, there’s no need to participate in FBA. When things sell, third-party sellers have the option of packing and shipping orders to buyers.
While eBay does not have a program similar to FBA, it has finally launched Managed Delivery in 2020. This plan allows sellers who sell a lot of inventory to fulfill orders more conveniently and swiftly. Plus, eBay has a Global Shipping Program which lets sellers ship purchased items to eBay’s global shipping hub in Kentucky. Then, it will be in charge of taking care of any custom formalities and shipping the items to buyers all over the world. Because of that, this marketplace will be accountable for any delays in delivery.
However, you’ll be responsible for choosing, packing and shipping your own orders if you’re selling on eBay to people in your own country. Don’t worry much about it, there are plenty of service providers who will do it for you if you’re willing to accept a blow on your profit margins.
On eBay, this could be especially difficult for new sellers to overcome. It’s obvious that having to build up shipping and fulfillment from scratch without the platform support is very expensive.
While eBay does not have a service similar to Amazon Prime, it’s worth noting that free, fast shipping might increase the appeal of your listings. Online buyers have grown to expect simple and cost-effective shipping alternatives as a result of Prime’s success. In fact, free shipping is given on 71% of eBay sales.
>>> Verdict: In a nutshell, Amazon offers more shipping options to merchants than eBay does, this is a no-brainer. Even if eBay launched such a service tomorrow, it would be competing with the world’s most advanced delivery service from the ground up. It’s possible that eBay businesses should attempt to undercut FBA on pricing, opening up new markets. But until it does, Amazon is the clear winner.
7. Advertisement Fee
It’s always a good idea to get an edge over your competitors, so it’s worth the investment. In the Amazon vs eBay comparison, both offer additional services that can help you push your product ahead.
Amazon Sponsored Products is a program that helps your products appear at the top of search results for specific keywords. You can highlight the target keywords you want to rank or let Amazon do it for you automatically.
This is a pay-per-click (PPC) program in which you pay each time your customers click through an ads link. Due to this, it’s critical to keep track of how much money you’ve spent for ad campaigns. Nonetheless, Amazon Sponsored Products is an advanced service with plenty of apps and extra tools to help control your marketing campaigns more precisely.
Keep in mind that there are still many other services that aim to promote brands and affiliates, and Amazon Sponsored Product is just an option.
eBay offers Promoted Listings, which boost the visibility of your products in search results. You ‘bid’ an amount to be paid on top of your final value fee, usually around 5-10%, and your product is boosted alongside the products of other sellers, each with their own bid.
eBay Promoted Listings are simple and straightforward; you only pay when an item sells. It’s not a particularly complicated program, but it gets the job done in terms of attracting attention and increasing sales.
When it comes to selling on Amazon vs eBay in terms of promoting products, the comparison is closer than it appears. eBay offers a straightforward service, but the platform is inherently less competitive. A slight push at a reasonable cost may be all that is required. Amazon Sponsored Products are light years ahead of Promote Listings, but they are more difficult to master and charge a fee even if you do not make a sale.
>>> Verdict: Overall, Amazon takes the win by giving sellers more options and control over how they promote their products.
Frequently Asked Questions (FAQs)
1. Amazon vs eBay which is safer?
An eCommerce can be a risky industry, but Amazon may have more safeguards in place because you don’t have to engage with your customers. The payments to the seller are completely handled by Amazon. Having that said, Amazon and eBay have numerous measures in place to protect both their buyers and sellers.
2. Is eBay still popular on 2022?
3. What is other alternatives for Amazon and eBay?
Final words: Amazon or eBay?
Is eBay better than Amazon? There is no right or wrong answer, it depends on your business size and demand. However, just because Amazon is a better fit for you or your products, doesn’t mean you can’t sell on eBay as well.
Many sellers list their products on multiple marketplaces, including Amazon, eBay, Etsy, to name a few. In fact, 80% of Amazon sellers also sell on other platforms, and LitCommerce’s multi-channel selling solution makes it simple to sell on various marketplaces while managing your inventory from a single central catalog.
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