Amazon and eBay were launched just a year apart and have become two of the biggest e-commerce players. But as a business owner, which platform should you focus more of your energy on?
- Which Has More Customers: eBay or Amazon?
- Which Has Less Seller Competition: eBay or Amazon?
- Which Is Easier to Ship Items with: eBay or Amazon?
- Which Is Easier to Manage: eBay or Amazon?
- Which Has Lower Selling Fees: eBay or Amazon?
- Which Pays You Quicker: eBay or Amazon?
- Which has Lower Advertising Fees: eBay or Amazon?
- Which Is Better for Product Branding: eBay or Amazon?
- Which Is More Fair to Sellers: eBay or Amazon?
- Which Has More Good Product Categories to Sell in: eBay or Amazon?
- Summary: Pros and Cons of Selling on eBay and Amazon
- Other Channels Outside of Amazon and eBay
- Conclusion- Which Is Better Overall: eBay or Amazon?
Which Is Bigger: eBay or Amazon?
The size of eBay’s marketplaces is a small fraction of what Amazon’s is. In 2021, eBay has 182 million users worldwide, while Amazon has over 200 million Prime members alone.
Unsurprisingly, Amazon has a much bigger overall revenue compared to eBay. For example, in the third quarter of 2021, Amazon fell short of the expected revenue while eBay did better than expected. However, Amazon’s revenue that period is $110.8 billion while eBay’s GMV is $19.5 billion.
eBay’s total revenue per year has been essentially flat for nearly five years since 2014 while Amazon’s has nearly tripled in this time. So all things equal, you should expect Amazon to bring in 10x more sales than eBay.
When I started my boating brand, eBay was over 50% of our revenues. But when I sold the brand in 2016, eBay was well below 30% of our revenue. Two years later, in 2018, eBay was well under 10% of my new brand’s total revenues.
Back in 2019, eBay was doing better overall compared to other sites like Walmart. However, after the e-commerce boom during the pandemic, Walmart stepped up its game and has overtaken eBay in the second spot.
Find more statistics at Statista
Amazon Wins. There’s no competition here. Amazon is at least 10x bigger than eBay and is growing quicker.
Related Listening: Episode 156: Diversifying Your Brand Beyond Amazon U.S.
Which Has Less Seller Competition: eBay or Amazon?
Both eBay and Amazon are selective with what data they reveal about their sellers.
Amazon in 2019 revealed they had 200,000 sellers with revenue over $50,000 and 50,000 sellers with revenue over $500,000. In 2021, the company reported that 27,000 sellers in the US alone passed the $500 million revenue mark, while those who surpassed $1 million in sales grew by nearly 15%.
Compared to eBay, Amazon has more serious and bigger sellers, so it’s more competitive. More importantly, as we’ll get to shortly, competition for advertising is also significantly less on eBay so it’s cheaper.
eBay is less Competitive than Amazon: There are certainly fewer eBay sellers than Amazon and more importantly, advertising costs are cheaper.
Which Is Easier to Ship Items with, eBay or Amazon?
Perhaps the biggest difference between eBay and Amazon is the fact that Amazon has its Fulfilled by Amazon program, more commonly known as FBA.
With Amazon FBA, sellers ship their items to Amazon and Amazon handles all fulfillment and shipping. This saves a lot of work.
Sellers are responsible for both inbound and outbound shipping. Sometimes, a Seattle seller will be sending their inventory all the way to Florida. If this sounds impractical and expensive, sometimes it is. Overall though, most sellers pay less for shipping because of Amazon’s significantly discounted rates.
With Amazon FBA, you will also be responsible for storage fees which are also expensive (up to $200 per month to store a pallet from October to December). These fees are increasing every year, alternating between significant and minimal changes.
One major downside to Amazon FBA is that it potentially creates sales tax nexus for sellers in dozens of states meaning they have to collect and remit sales tax in those states.
Amazon is easier than eBay to fulfill and ship items with. Amazon FBA is a huge boon for most sellers as it removes the hassle of shipping. However, it means expensive storage fees and is not a good option for people wanting to fulfill items from a garage or basement. It may also create sales tax issues.
Which Is Easier to Manage: eBay or Amazon?
In terms of management, eBay is a victim of its past success when it used to rule the world of used products.
eBay has a terribly confusing decentralized product management system. There can be thousands of different listings for the same exact Instapot.
eBay allows HTML/CSS in its listings, which means sellers are constantly trying to edge one another in the sophistication and design of their listings.
Contrary to eBay, Amazon has an extremely easy-to-use product management system. There is only one listing per unique UPC (the bar codes you see on products). Amazon essentially only allows photos and plain text product descriptions making listings much easier.
Amazon by a long shot is easier to manage than eBay.This one isn’t even close. Amazon is as close to a “set it and forget it” marketplace as you can get.
eBay’s Shopify Integration
eBay and Shopify have partnered to allow all sellers to connect their eBay accounts to their Shopify accounts.
You can connect eBay with your online store by choosing an eCommerce platform with a strong integration that includes the ability to import your eBay items into your online store.
Some advantages of connecting eBay with your Shopify account are the following:
- From the product catalogue of your online store, you can create eBay ads directly.
- In your online store and eBay, the available quantities of the products will be automatically synchronized.
- When a sale is made on eBay, orders will be created in your online store.
- The payment system will be PayPal and buyers will be able to buy your products through this payment gateway.
Which Has Lower Selling Fees: eBay or Amazon?
Before you can list something on Amazon, you have to choose one of two seller plans: Individual (charges $0.99 per unit sold) and Professional ($39.99 per month regardless of the number of units sold).
With eBay, on the other hand, you’re given 250 free listings per month and are charged $0.35 per additional listing. It also has the following Store Subscription options:
In addition to the subscription fees, you should know that there are other 3 main costs to consider when selling on eBay: insertion (listing) fees, final value fees, and PayPal transaction fees (if using it).
Some other optional extra fees such as fees for advanced listing upgrades, auction listing fees and classified advertising.
For most categories, eBay will charge 12.55% on the total amount of the sale up to $7,500 calculated per item and 2.35% on the portion of the sale over $7,500. 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.
We used an example of a package selling for $49.99 and measuring 15″x12″x4″. The cost on eBay was $15.96 compared to $13.25 on Amazon. Amazon fees were 20% cheaper than eBay.
|Shipping Fees from Amazon FBA (2-Day)||$9.52||$5.85|
|Advertising Fees||–||Approximately 0-25%+ of Sales|
|Monthly Fees||$0/$24.95 Basic eBay Store||$39.99 (Professional Selling Plan)|
Amazon has cheaper fees than eBay. When comparing two packages that are exactly the same, Amazon is roughly 20% cheaper, including shipping costs.
Which Pays You Quicker: eBay or Amazon?
Once you start selling products, you want to actually get paid for them!
In terms of payment time, this is one area where eBay is much better than Amazon. For eBay, you get paid the second a buyer purchases your item.
For Amazon, however, you do not get paid until after the buyer has purchased the item and Amazon has shipped the item to the buyer. Further, there’s a holding period of approximately two weeks on your funds.
eBay pays you Quicker Than Amazon If you want your money quickly, eBay is the clear winner.
Which Has Lower Advertising Fees: eBay or Amazon?
Both Amazon and eBay are increasingly becoming pay-to-play marketplaces. This means that often you need to pay to have your listings appear at the top of search results.
However, Amazon sellers rely on advertising far more than eBay sellers.
In 2018, we surveyed five high-volume sellers and found that these sellers had advertising account for 26.7%-60.6% of their sales.
Advertising costs on Amazon have significantly increased over the years, however, and it’s becoming one of the biggest threats to your Amazon business. A 2021 report by the Institute for Local Self-Reliance (ILSR) reveals that Amazon is actually using sellers to fund its alleged monopoly, taking about two-thirds of seller’s revenues, a big part of which is spend on ads.
On the other hand, eBay has expanded what it calls promoted listings but most sellers use no advertising at all.
If you’re a typical seller on Amazon, with 25% of sales coming from advertising and pay approximately 30% for your Average Cost of Sale (ACoS), then this adds an extra 7.5% to your selling fees. Ouch.
eBay knocks out Amazon with lower advertising costs. This one isn’t even close. Most Amazon sellers pay a ridiculous amount of money on advertising while most eBay sellers pay none.
Which Is Better for Branding: eBay or Amazon?
The biggest disadvantage of Amazon though is the fact that Amazon owns the customer in every regard.
Amazon hides everything about the customer in great detail, most importantly their email address. They also severely limit how much branding of your products you can use by severely limiting HTML/CSS use.
While eBay does not want you directing customers off of eBay, you do have a lot more flexibility, including getting access to their email address and being able to somewhat brand your store and listings.
Previously, we used Mailchimp’s eBay integration to email customers after purchase if they’d like to signup for an extremely relevant ebook. Each month we would generate 100+ emails from this strategy. Our email list for this segment converted at around 1% with an average transaction value of $200. It was very valuable.
eBay offers far more branding opportunities than Amazon. Neither channel likes you steering customers away from their platform but eBay offers, at the very least, more flexibility for the branding of your items.
Which Is More Friendly Towards Sellers: eBay or Amazon?
Both eBay and Amazon are buyer-centric. However, Amazon tends to be more ruthless. After all, customers are at the heart of its Flywheel Strategy.
Amazon has a terrible reputation for suspending buyers, often with little cause or warning. In fact, an entire cottage industry of account suspension “specialists” has popped up to help sellers get unsuspended. When an Amazon account suspension occurs they immediately freeze your funds and give you little feedback.
Related Reading: The Reason Behind the Mass Suspension of Chinese Amazon Sellers
eBay is fairer to sellers than Amazon. Let’s be clear—both eBay and Amazon have reputations for poor service for sellers, but Amazon is the hands-down winner for the level of poorness.
Which Has More Good Product Categories to Sell in: eBay or Amazon?
Amazon is dominant in nearly all product categories where there is existing customer demand and the products are not found through discovery and/or purchased on impulse.
eBay is still competitive with eBay motors (automotive/boating/etc.) and electronics, specifically electronics parts and accessories. Also, it still dominates used items, collectibles, and other unique items.
eBay and Amazon are generally not good for customized products such as engraved products. While both do offer some level of customized support for customized products, none have the level of support for customization that your own website can provide.
Amazon excels in most product categories but eBay still dominates others. Generally, if you’re selling a new, commodity item, Amazon is your place to be. If it’s used, then look to eBay.
Summary: Pros and Cons of Selling on eBay and Amazon
Overall, eBay allows you the opportunity to brand your products and store more and with more forgiveness for mistakes and/or poor-quality products. The cost is a significantly smaller audience and no in-house fulfillment.
Selling on Amazon Pros
- Much larger audience than eBay (10x+)
- Amazon FBA means Amazon handles all shipping and most customer service
- Easier to manage
- Can use paid advertising to have your items instantly rank for keywords
Selling on Amazon Cons
- Amazon “owns” the customer entirely
- Much more competition than eBay
- Paid advertising is critical and drives up selling costs
- Ruthless suspensions and bad seller support
- Higher return rates
The biggest advantage of Amazon is the sheer size of the marketplace. The Amazon FBA program is a close second. The cost is that Amazon is a cutthroat marketplace where you will have constant schizophrenia in fear of other sellers sabotaging you and/or Amazon suspending you.
Other Channels Outside of eBay & Amazon
There are other channels to sell your products on. You can see our full summary of other sales channels here. The best channels to consider are:
Once you’ve maxed out eBay and Amazon’s potential, the next logical channel is to start selling on your own website (and most people will do this through Shopify). In fact, your own website will support your sales on eBay and Amazon so it’s best to launch your website concurrently with selling on eBay and Amazon.
If you’re selling any home-related products, Houzz can be an amazing channel. It’s not uncommon for a seller in a niche like home decor to get 25 to 50% of their sales through Houzz. If you’re not selling a home-related product though, Houzz will be of little use to you. Etsy is similar to Houzz if you’re selling anything homemade or craft-related.
Finally, Walmart has been improving its e-commerce strategies over the past years. It has even started allowing non-US sellers into its platform. It definitely has a stronger online presence now and with millions of dollars invested in improving its logistics, it may even become a bigger threat to Amazon than eBay is.
Conclusion- Which is Better Overall: eBay or Amazon?
On paper, it would appear as though Amazon vs eBay is a close race. The reality is that Amazon is almost always the better platform for sellers to start selling on.
eBay does have a place in e-commerce and many sellers will find value in it. It just shouldn’t be the first thing you focus on.
While Amazon does have higher selling fees, especially if you consider advertising fees, it makes up for this by having a much larger customer base, easier fulfillment, and being easier to manage. If you’re just getting started selling on Amazon and looking for more information, check out our article How to Get Started Selling on Amazon.
Do you think Amazon is the best sales channel for sellers? Let me know your thoughts in the comments below.