Every day, thousands of people make money on Amazon and E-Bay. People with different background are selling items from different locations. E-Bay popularized the auction format listings and Amazon concentrate on fixed-price listings. These are simply among the top largest market place in the world, but they both have pros and cons. E-bay charges a listing fee, regardless of whether the item is sold or not. E-Bay also charges a final value fee based on the selling price when the item is sold. PayPal is an E-Bay partner for processing credit cards and it also charges a commission based on the selling price. Amazon allows seller to list an item for free, but Amazon charges a higher percentage of commission when an item is sold. E-Bay’s commission is much lower than Amazon’s 15% on item under $25 compared to 8%. Amazon also charges more commission fee to use their service. E-Bay also offers a fixed listing feature, it is cheaper to use fixed listing feature, only 35 cents to list an item as a fixed listing, no matter how much it costs. For auction style listings, E-Bay allows sellers to list an item that is less than $9.99 for only 35 cents. E-Bay is excellent for small home-based businesses and for those who don’t want to spend a lot of money on commissions. Amazon, however, is definitely the best way to sell expensive items.
Amazon has set shipping prices but it doesn’t cover commission fee that Amazon charges, however E-Bay allows seller to set their own shipping prices and that is a benefit for sellers.
According to Internet retail market, Amazon experiences a growth in sales last year, while E-Bay showed a decline in sales and traffic compared to the year before. E-Bay made a lot of changes last year to their listing policies, and that drove a lot of sellers away. Amazon and E-Bay alternative to other its depend on the type of thing you sell, clothing and textile won’t fit good on Amazon but if you reselling a book or electronic Amazon is better than E-Bay. Amazon is extremely user friendly, and their policies are very straight forward. E-Bay allows both buyers and sellers to leave a feedback for each other but buyers have an advantage on E-Bay, sellers can only leave a positive feedback for the buyers, but buyers can leave a positive, neutral, or negative feedback for the seller. On Amazon, only buyers can leave a feedback for sellers.
There is one thing in particular that I don’t like about e bay, and it is the auction. There are some software available that allow users to bid one second before the auction ends, a small percentage of E-Bay users use those software to always win the auction. For example, Sniperware is a program that place a last second bid on your behalf.

I like the fact that Amazon does not allow auctions, and that allows users to hunt for bargain and purchase an item right away, without the fear of losing the auction. Amazon also has a feature super shipping. If you purchase an item that is more 25$ directly from Amazon (instead of a seller on Amazon), shipping is free.
Often there is problem with E-Bay credit acceptance if the billing address does not match the shipping address. This also happened to me once when my billing address did not match the shipping address, and E-Bay did not accept my card, just because of the fact that I moved to a different location.
E-Bay also has a website E-Bay Motors that is dedicated to the sellers who sell vehicles online but Amazon does not allow listing vehicles. E bay motors local classified is designed to connect car buyer and seller within 100 miles radius of their local market. Through an initial promotion period ending 15th July 2009, seller can list up to six vehicles for seven-day period with no insertion and successful listing fee. E-Bay motor is constantly ranked number one auto selling site with 12 million monthly unique visitors.
On E-Bay, seller does not have to ship an item by a specific time period, but Amazon gives its seller a time period and seller has to ship the item within that time period. Some sellers on E-Bay offer overnight shipping, and Amazon also has a feature that allows buyers to get the item as soon as in 1 business day. E-Bay also has a site dedicated to booksellers, called Half.com. Half.com is getting very popular amongst college students who want to save money on books. Half.com does not charge any listing fees, but it does charge a small commission when we sell a book. Half.com acts as a third party that accepts credit card from the buyer, and then deposits the money later into the seller’s bank account. Half.com also provides a shipping reimbursement to the seller. Half.com is gaining a lot of popularity and a lot of users prefer Half.com over Amazon.
Both E-Bay and Amazon have their pros and cons that need to be considered while making a decision. Some good bargain hunters’ use both E-Bay and Amazon to make a comparison on a certain item that they want to purchase, and they go with the site that allows a cheaper deal

eBay

Introduction

eBay is basically an online auction website founded as auction Web in San Jose California, 1995 by computer programmer Pierre Omidyar. eBay actually began when Omidyar was trying to sell his girl friend’s unwanted stuff for that he created a website to sell it online. She is now his wife. The very first item sold on eBay was broken laser printer for $ 14.83. Omidyar became astonished and contacted the bidding winner to make sure that the buyer knew that the laser printer is broken. Omidyar got buyer response in explanation “I am the collector of broken laser printer.” The company officially changed the name of its service from auction Web to eBay in 1997. While working in Silicon Valley mobile communication company as software engineer Omidyar developed Auction Web, an online auction platform. He was interested in the potential for an auction format to create a fair and open market place, where the market truly sets an item value. In an auction, anyone can bid until the price reaches the highest amount someone’s willing to pay. The market price changes from day to day, depending on demand and who’s bidding.

Strategy and success

eBay has been vigilant about its pay pal buyer and seller protection against fraud. One of their core marketing strategies today is that they refund full amount to merchandize who sell and buy on ebay using pay pal, the e bay online payment service.



eBay’s success so far

eBay began as a small site for individuals to trade, but now they continue to grow; and have expanded to 32 countries, selling millions of items in thousands of categories. Two of eBay’s fastest-growing categories are car and real state. The company acquired Pay Pal in 2002. E bay revenue was $8.46 billion and net income was $348 billion in 2008.



Positive and negative aspects

E-bay has been facing an issue that they should treated all its buyer and seller equally. It is believed that E bay is offering discount just to its biggest sellers. According to e bay’s new strategy only the mass sellers are allowed to negotiate low fees. 5 to 15 percent discounts are offered mass sellers, known as Power Sellers. Another widely criticized tactic of e bay has been that of, through feedback system sellers leaving negative comments about buyer are banned. This strategy has affected sellers worldwide. Sellers believe that this would leave them rather unprotected. In February 1996 founder of e bay Pierre Omidyar said that “by creating an open market that encourages honest dealings, I hope to make it easier to conduct business with strangers over the net…” Concerns have been voiced by critics regarding eBay no longer allowing buyer’s negative feedback by taking away sellers right to complain about a problem buyer will have very little recourse for actions when a sale goes wrong. BBC NEWS, Tuesday, 5th February 2008, 17:20 GMT
E bay claims that it will personally handle complaints from seller about problem related to buyers which appears to be a massive undertaking for the company.

Amazon

Amazon Introduction/History

Amazon.com is the world’s largest online retailer with nearly $15 billion in annual sales in 2007, stands today as one of the ionic online seller of the modern era. Jeffery P. Bezos, a former financial analyst for the New York hedge fund D.E. SHAW & COMPANY, founded it in 1994. He was on a drive form Texas to Seattle with his wife, writing an ambitious business plan for an online bookstore along the way. Amazon was initially launched as an online bookstore, but soon Amazon expanded from one product category to another: CDs, movies, and toys, furniture in short, and eventually ranged to everything from toys to kitchen supply. Amazon’s overall reputation for good price, broad selection and convenience has grown trust in e-commerce throughout the globe.

Strategy and Success

Amazon strategy was quite unusual. They didn’t expect any profit for the first five years. This is because they believed in achieving their non-monetary goals. Their internal target was stakeholders and their external target was customers and investors.

The most important thing in their strategic planning has been that of identifying company goals and maintaining balance between their skills and resources. Some of the underlying objectives of Amazon are:

Growth – As just mentioned Amazon started out, as an online bookstore only but very soon became an A to Z store, and is still growing by selling their web space to other smaller companies. They receive a 10 percent bonus for items sold by those companies through Amazon.com web page. According to CEO Jeff Bezos the company doesn’t want to expand to physical stores.

Competitive position – Amazon has positioned itself as the unquestionable leader of online retailing business. The company is marked by attractive availability and prices. This ideal combination made Amazon the busiest online store in USA so far.

Geographic scope – Amazon has branches in Canada, UK, Germany, Japan, France and China. Much less than eBay, but still considered a very global firm; most of the items can be ordered internationally, from the closest branch. For example an individual in Poland will order from Germany without any problems. 45 percent of sales occur outside North America.

Other objectives – Amazon likes developing partnerships like the one mentioned earlier which earns them revenues from fees and sales commission. They also have e-commerce partnerships with Target and Macy’s.

Amazon’s success so far

Amazon recently introduced “Giants Kindle Online Bookstore” and released free application use for iPhone and iPod touch users to read electronic book purchase. Amazon’s $359 Kindle 2 reading devise was released last month, including book marking, noting, highlighting and adjusting font size. According to Matea Gold, on Feb 10, 2009 “Amazon. Com Inc has unveiled its second-generation electronic reader, a slimmer and faster version of the Kindle devise it introduced 14 months ago with promises to revolutionize the way people read book”. Another article says, publishers and authors now have the power to silence the Kindle 2 e-book reader. Amazon.com Inc reversed course Friday on the device’s controversial text-to-speech features, which reads digital books aloud in a robotic voice” Alana Samuels, Feb 28th 2009. This illustrates Amazon’s development and success.



Amazon retail ranking is third overall. It has separate website for Canada, England, Germany, France, China, and Japan. Amazon’s web service development is worth noting as well. Its distinguishing capabilities include those of load balancing and to implement and configure technology in the Amazon web services. Load balancing an application helps taxes advantage of Amazon EC2’s elastic scaling, how to deploy a load-balancing solution inside the Amazon EC2 environment using round robin DNS or HA Proxy.

Positive and negative aspects:

Globally and historically Amazon has played a crucial role in providing digital access to learning through generations. An article from Amazon by Peggy M. Tomme “Affective teaching: psych-social aspects of physical education” is one of the examples of Amazon’s contribution to the moral development of young people. Research has demonstrated the value of cooperative sporting activities in encouraging honesty and respect of other people.”

About author

I, Zehra perusing a degree in Business Administration with majors in Finance from NM Highland University. This piece of work is part of my E-marketing coursework that I am carrying out under the guidance of Heath Anderson. The project involves creating a blog about internet marketing. I am not a big fan of internet shopping myself and have hardly ever bought anything online apart from my text books, but after carrying out this project the facts and figures that came to my knowledge, have got me attracted significantly to this modern version of shopping. Now I find myself really looking forward to carry out a considerable part of my shopping online through e bay and Amazon to help myself save both time and money. All in all this project has been a wonderful and enjoyable learning experience.