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eBay versus Amazon and the Future of Online Selling
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By Rich Karpinski

Millions of small biz retailers count on eBay as either a prime or complementary source of income. Amazon's aStore's, by comparison, are the upstart.

But could the balance of power be shifting? It's a trend worth noting for small business sellers.

Leading up to the holiday season, eBay cut its listing fee by 33%, it's largest one-time price cut ever. "We want to see what happens when we take a price decrease of this magnitude," according to eBay CEO Meg Whitman.

This comes as Amazon reports record earnings -- driven at least in part by great success among its third-party store strategy.

Reports the NY Times:


...investors and analysts have also been encouraged by more enduring trends, like the migration of smaller retailers onto Amazon’s network.

“Amazon’s third-party business is on fire,” said Scot Wingo, chief executive of Channel Advisor, which helps smaller retailers sell their wares on the Amazon.com site. “People that dipped their toes in the water with Amazon a year or two ago have really expanded their selection.”

Unlike eBay, Amazon does not charge a listing fee for each item sold on the site. Instead it charges only a commission, taking an average 10 to 15 percent cut of each sale, depending on the category of product. That allows sellers to experiment with all their merchandise on Amazon and pay only when an item is sold.

Amazon has also moved to make products from third parties more prominent on its site, since it does not have to store or ship those items and therefore enjoys better profit margins on their sales.


Is the balance of Web commerce balance shifting? If so, there's no secret sauce here: lower prices and strong partner promotion have Amazon gaining sellers. Small businesses will go where they can make the most money.

How about you? Have your online selling channels changed of late? Have you taken a closer look at Amazon? Let us know.

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