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If you want to sell online, you can choose between many different options. You can start an online store or sell through online marketplaces like Amazon or eBay.
If you're a beginner, it might be better to start your ecommerce business on a marketplace.
Building an online store will take you a long time to generate traffic and make reasonable sales per month.
It's easier to sell on online marketplaces like Amazon or eBay because they already have much traffic.
But which one should you choose?
If you want to know whether eBay or Amazon is better to start an ecommerce business, you've come to the right place.
Let's dive right in.
Amazon is ranked as the world's most popular online marketplace.
1 in 5 millennials "always" head to Amazon first when they want to purchase something online. (Inviqa)
Also, Amazon has more web traffic than eBay. There are twelve marketplaces in total (Amazon.com, Amazon.de, Amazon.fr, Amazon.uk, etc.).
Amazon and eBay are both well-established marketplaces with a strong customer base. However, when it comes to customer satisfaction and trust, Amazon comes out on top.
On their About Page, Amazon states that they are the world's most customer-centric company.
A big reason for Amazon's high customer satisfaction is the simplicity of returning products.
Thanks to Amazon's A–Z Guarantee, online shoppers can return a product if they are not satisfied with its quality or delivery time and get a full refund.
Compared to that, eBay sellers can tick eBay's "No Return" Box to make sure that eBay customers won't return a product.
Amazon sellers can use tools like Helium 10 to do product research, keyword research, listing optimization, and more.
These tools help sellers build their Amazon business, maximize profits, and automate business processes.
Although there are also some tools for eBay sellers, there are significantly more Amazon Seller Tools on the market.
You can learn more about Amazon Seller Tools here.
Amazon is experiencing stronger growth than eBay. This is probably one of the most important reasons for new sellers.
While people's interest in eBay has been decreasing since 2004, the interest in Amazon is enormously increasing.
If you want to sell on eBay, you only have one choice when it comes to fulfillment: you have to store, pack, and ship products on your own.
This will cost you a lot of time and, above all, a lot of opportunity costs.
Compared to that, Amazon offers their third-party sellers two options: FBM and FBA.
FBM means Fulfillment by Merchant. With this option, you have to store, pack, and ship products on your own.
FBA means Fulfillment by Amazon. Amazon takes care of all logistics with this option, including storage, packaging, shipping, and customer support.
You only have to send your products to an Amazon warehouse, and Amazon handles the rest for you.
The main benefit of Amazon FBA is that sellers have more time to market their own brand and grow their businesses.
However, FBA sellers have to pay more Amazon fees than FBM sellers.
Amazon charges FBM sellers the following fees:
In addition to that, FBA sellers have to pay the following fees:
Both FBA and FBM sellers have to pay additional fees, e.g., when a refund occurs. Check out our article about Amazon fees to learn more.
If you use eBay's auction model, you cannot control the selling price of your product.
Consequently, you won't be able to control your profit margin and scale your business.
On Amazon, you can set fixed prices. Thus, you can control your profit margin, making it easier for you to scale your business.
Of course, you can also publish fixed-price product listings on eBay, but they are harder to sell since people are looking for something cheap on eBay.
Compared to eBay, most customers prefer to buy new products on Amazon.
According to a study by Feedvisor, 66% of respondents typically start their search for new products on Amazon.
Since you need to sell new products if you really want to build a sustainable business, Amazon might be the better marketplace for you.
Another thing that sets Amazon apart from eBay is Amazon Prime. It's also one of the main reasons why Amazon has such a large customer base and customer satisfaction.
Prime members pay a monthly fee in exchange for free two-day shipping, free same-day shipping for selected items, and many other cool perks.
The benefit for Amazon sellers is that Prime members spend an average of $1,400 per year on Amazon, while non-Prime members spend only about $600.
Considering that there are 112 million Prime members in the U.S. alone, this is a massive benefit for sellers on Amazon.
You can expand your business to other Amazon marketplaces. For example, if you started selling on Amazon.uk, you expand your business to Amazon.com.
Here's an overview of all Amazon marketplaces:
While you can only sell ordinary products on eBay, you can sell almost anything on Amazon.
Amazon offers lots of opportunities to make money.
Here's what you can sell on Amazon:
We created a detailed article about how to make money on Amazon.
If you want to sell used products, Amazon is not the best marketplace.
eBay is the most popular online marketplace to buy second-hand products.
So, if you want to sell second-hand products, I highly recommend selling them on eBay.
The only exception is when you want to sell used books online.
Amazon is the better place to sell used books in most cases – obviously – because it started as an online bookstore.
To compare Amazon's and eBay's selling fees, one must ignore the FBA fees.
As an Amazon FBM seller, you have to pay the following fees:
The Premium Seller Account gives you 100,000 free listings and even more if you make sales regularly.
As an eBay seller, you have to pay the following fees:
You have to pay the insertion fees when publishing a listing on eBay and final value fees when making a sale.
If you set up an eBay store, you can publish a certain number of monthly listings for free. The Basic Store package costs $28 per month and gives you 250 free listings. The most expensive package is the Anchor Store for $350 per month.
In the past, eBay sellers had to pay PayPal fees, which were 2.9% plus $0.30. However, since the introduction of eBay managed payments, one no longer has to consider these fees. However, eBay increased the final value fees from ~10% to ~12,5%.
Comparing Amazon fees to eBay fees, there's very little difference between the two. However, eBay might be a little cheaper sometimes.
Amazon has 6.4 million sellers worldwide, and 1.5 million are actively selling on the marketplace. 2021 alone, 543,000 new sellers joined the marketplace. (Marketplace Pulse, 2021)
The competition on Amazon is huge, especially when it comes to the Buy Box. Although there are so many sellers, a tiny fraction of sellers generates a significant portion of total sales.
Fewer than one in ten active Amazon sellers made more than $100,000 in sales per year, and just one percent made $1 million in sales or more.
Although there are 25 million sellers on eBay, most are low-volume sellers.
There are so many people who once wanted to get rid of some old stuff and sold it on eBay.
In general, one can say that there's less competition on eBay than on Amazon.
You can sell with Amazon on 18 marketplaces, but you need a separate account for each marketplace.
The exceptions are Europe with its five marketplaces and North America with the US, Canada, and Mexico.
Since you use a separate account for each marketplace, your feedback is also separated, making it difficult for sellers to create a local brand.
In comparison, you only need one eBay account to sell on 23 sites in over 100 countries. It's very effortless to sell internationally with eBay.
In addition, eBay offers a global shipping program. All you need to do is ship your products to an eBay warehouse, and eBay will ship your products to the customer.
And here's the best thing: eBay's Global Shipping Program is free.
Finally, it depends on your business model, goals, and preferences which platform you should choose.
We hope that this article helps you to make your final decision.
Here are the reasons why Amazon might be the better solution for you:
And here are the reasons why eBay might be the better solution for you:
If you want to take advantage of both ecommerce marketplaces, you should also sell your products on both marketplaces – Amazon and eBay.