on Overstock.com; you must exceed the ‘‘minimum required
rating,’’ a rating that Overstock.com does not disclose.
In other words, you can’t apply to be a Trusted Merchant when you’re just startingout on Overstock. You need to have a track record. And even if you had the buySAFEseal of approval or were a PowerSeller on eBay, buySAFE evaluates your sales perfor-mance on Overstock.com, so your status doesn’t carry over to the new venue.
‘‘It’s your success on eBay that will help you gain entry to this highly featuredTrusted Merchant program,’’ comments David Yaskulka of Blueberry Boutique, a suc-cessful business on both eBay and Overstock. ‘‘On Overstock, as on eBay, it’s a goodidea to buy a dozen or so auction items to build your initial feedback before you beginselling.’’
Once you are approved as a Trusted Merchant, you are charged a 1 percent transac-tion fee for each of your sales. What do you get in exchange for this fee and all of thescrutiny? First, buySAFE assures you that you get higher bids, as well as more bids.Second, you get a Trusted Merchant and a Bonded Seller icon that appears beside yourlistings on Overstock.com. And your customers have the knowledge that your sales arebonded up to $25,000. That means if you cannot or do not fulﬁll a transaction,buySAFE will compensate the buyer for the loss.
Securing Volume Discounts
Sellers on eBay struggle to put fifty, one hundred, or even a thousand items up forsale each week. They do so in the hope of building up sales volume: the more youput up for sale, the more you tend to sell, as long as your merchandise is desirable toenough people. These volume sellers don’t expect to get a discount simply for puttingitems up for sale: the more items they put online, the higher the fees eBay collectsfrom them. Because eBay hasn’t led them to think they’re going to get a discount,they don’t expect one.
Overstock.com gives volume sellers a break: the more listings you have on thesite at any one time, the more of a discount you get. The discounts are applied toboth listing fees and closing fees. The discounts work as follows:
• Once you have 100 active auction listings on Overstock, a 2 percent discount
is applied to the fees on active auctions 101 to 200.
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• Once you have 200 active auctions on Overstock, a 3 percent discount is
applied to the fees on active auctions 201 to 500.
• Once you have 500 active auctions on Overstock, a 5 percent discount is
applied to the fees on active auctions 501 to 1000.
• Once you have 1,000 active auctions on Overstock, a 7 percent discount is
applied to the fees on active auctions 1001 and higher.
This isn’t an earth-shattering discount unless you sell a lot of items at a highprice. Suppose you manage to put two hundred items online at one time on Over-stock.com, each with a starting price of $9.99. (For a retail or wholesale business witha team of employees available to handle the work, this is not out of the question.) Forthe first one hundred items, you’ll pay the usual listing fee of $.23 for each item aswell as the transaction closing fees shown in Table 13-1. For items 101 to 200, you’llsave only $.46 in total listing fees. But the real savings come in the transaction closingfee. If you sell all of items 101 to 200 for $9.99, you’ll pay not the usual 3.25 percentclosing fee on each item ($.32) but a 1.25 percent closing fee ($.12). Your totalsavings in transaction closing fees would be $20. Your total savings overall would be$20.46.
Understanding How Overstock Outdoes eBay’s Feedback SystemThere is a simple feedback system on eBay. People leave positive, negative, or neutralcomments for members with whom they conduct transactions. Overstock has a feed-back system as well, but it’s supplemented by many other ways in which buyers andsellers are rated:
• Business Ratings. This rating is the sum of each comment you have receivedfrom an Overstock member with whom you have been involved in a transaction. Youcan give the other member a rating ranging from (cid:6)2 to(cid:5)2.
•
Personal Ratings. Personal ratings don’t have a direct connection to yourtransactions on Overstock. They are given to you by your ‘‘friends’’ on Overstock;you can receive a star rating of zero to five stars.
•
Positive Ratings Percentage. This figure is the result of a complicated calcula-
tion: the ratio of your average positive rating to your average negative rating.
• Repeat Ratings. Overstock also reports on the number of repeat customers aseller has had—something else eBay ignores. The information is presented in thisformat: 145/125/20. This indicates that the seller has sold 145 items to 125 custom-ers, 20 of whom are repeat customers.
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Repeat customers are a sign that a business is well-established and highly trusted.Overstock also recognizes this with a red LL icon next to the user’s feedback rating:the LL stands for ‘‘Loyalty Leader.’’
(cid:3)
Overstock Customers Afﬂuent, Yet Value-Conscious, Seller Finds
A successful seller on Overstock.com who also happens to be one of the largest sellerson eBay was happy to comment on the differences between the two sites but preferredto remain anonymous.
Q. Did you have any problems making the transition from eBay to Overstock.com
and building a reputation at the new venue?
A. It was a lot faster for us to gain a foothold in the Overstock marketplace. The
folks at Overstock gave us a lot of support as well [as] a jumpstart.
Q. What advantages does Overstock provide for you as a merchant?A. Overstock provides an alternate channel that reaches out to a different clien-tele base than eBay. Most of Overstock’s customers are a little more afﬂuentyet still trying to ﬁnd a good deal.
Q. Do you still sell on eBay?A. We will continue our operation at eBay without a doubt. Overstock is simply
another venue that will complement the overall selling strategy.
Q. What kinds of merchandise do you sell on Overstock that you don’t sell elsewhere?A. We sell value-added combinations of items that are speciﬁcally catered toOverstock’s clientele base. These combos may not be the lowest priced items.However, it usually offers the best value on the Web. The name, Overstock,itself simply implies a bargain place. We wanted to offer the best value to ourcustomer.
Q. Overstock doesn’t have a built-in payment system. Is that a problem?A. So far, it’s working out just ﬁne as we are offering all payment methods suchas PayPal, merchant services, and paper payments. The good side that Over-stock doesn’t associate with any particular payment processor is that we canmake the best decision on offering the most preferred payment method to ourcustomer.
Q. How do most of your Overstock buyers pay for what they purchase?A. Paypal and credit cards via independent merchant services.
Q. What do you do, if anything, to market to a predominantly female clientele?A. It’s true that Overstock has more of a female-oriented client base. We makeour product description template a bit more user friendly for browsing as wellas our payment instructions.
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If you’re looking for a place to expand your sales beyond eBay while saving onselling fees, Overstock.com is a viable option. Don’t use the site as a dump for itemsthat won’t sell elsewhere, however; you’ll be better off if you choose merchandise andsettle on prices that represent a good value for your customers. Just as with eBay, themore items you put up for sale, the more difficult and time consuming it becomes tomanage your auctions—and by extension, your business—on your own. Overstock.comcounts third-party auction management providers like ChannelAdvisor and Market-Works among its solution providers. Overstock members get special deals when try-ing out or using their software. You’ll find out more about these and other auctionservice providers in Chapter 14.
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C H A P T E R (cid:3)14
Finding the Right OperationalPartner
When I attended a convention of eBay PowerSellers in early 2005, those in atten-dance seemed to be divided into two camps. First, there were the PowerSellers whoactually belonged to the group that was conducting the meeting. Second, there wereeager visitors who wanted to sell something to those PowerSellers, write about them,or do business with them. It was hard to tell which group was larger than the other.The bottom line was clear: As a successful eBay seller, you are a highly sought-aftercommodity. And there are many companies that offer you useful resources and areready and willing to provide you with assistance.
For example, there is a wealth of options available when it comes to serviceproviders. In fact, you may think that you need a scorecard to tell the players apart.There are auction service providers who focus on utilities designed to make auctionbuying and selling more effective. They are different from marketplace managers whoenable you to set up e-commerce storefronts that can supplement your auction sales.You’ll learn about both kinds of providers in this chapter. You’ll also learn thepros and cons of each so that you can decide which will best meet your needs. Ideally,the service provider you choose will function more like an operational partner—aresource that will provide you with software tools as well as support and advice tohelp you make a smooth transition to the world beyond eBay.
Reasons for Turning to an Auction Service Provider
Anyone who tries to sell seventy-five to a hundred or more items per week knowswhat happens—suddenly, you have something to do every minute of the day and longinto the night. You have to field questions from prospective buyers; you have to keeptrack of checks and money orders received from current buyers; you have to gather
157
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new items, write text, and take photographs to create more sales listings; you have toleave feedback. The amount of work can quickly become overwhelming. Auctionmanagement software can automate many of the steps involved. You do, however,use some of your hard-earned profits to pay subscription fees to the auction serviceprovider you choose to make your work go easier. What can you expect to get inreturn for your investment? Some of the goals you should be shooting for are men-tioned next.
Essential Features to Look ForAll of the many auction service providers differ in the details. One might offer moreimage storage space than another. One might have a slightly different monthly fee.However, there is a set of must-have features that every auction seller needs, includingthe following:
•
Formatting Descriptions. Make sure the software you use streamlines the pro-cess of adding colors to your descriptions, choosing typefaces, and arranging photosand text in a user-friendly way.
•
Providing E-mail Management. It is a very impressive touch to send automatice-mails to customers telling them their items have shipped, or thanking them when apurchase is completed. However, it is a drain on time and energy to compose a newmessage each time off the top of your head. Look for an auction service provider thatcan automate the process for you.
• Hosting Images. For your subscription fee, you should get space on a serverwhere you can post images of the items you have for sale. That will eliminate theneed to pay eBay’s hosting fees.
• Helping with Feedback. Feedback is an essential part of every transaction, butit can be difficult to remember to leave it when so many other duties are pressing. Aservice provider should be able to leave standard comments automatically. Althoughnot as personal, it is better than leaving feedback that is poorly written or not leavingany feedback at all.
• Uploading Multiple Descriptions. A service provider’s auction tool should letyou create and list multiple items, as well as let you schedule them so they start atthe same time.
Ideally, an auction service provider will help by providing reports that track yourincome, expenses, and profits. You should be able to track sales for a longer periodthan the sixty-day limit on My eBay, for instance.
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Tip: Go on the discussion boards run by various auction sites de-scribed in this book, such as AuctionBytes (http://www.auctionbytes.com/forum/phpBB/index.php), to ask for opinions on thereliability of a service provider before you sign on the dotted line.
Boost Your ProductivityWhen you have identified a sales niche as well as a supplier of merchandise, thechallenge is simple: You need to get as many sales online as you can, and completeas many transactions as you can to ensure a profit.
Any auction sales tool you use should increase your productivity. I once inter-viewed an eBay PowerSeller who told me he counted thirty-six separate steps involvedin creating a sales description and completing a transaction on eBay. He also saidthat, after a great deal of effort in collaboration with a software developer, he createda software program that reduced the number of steps to fewer than ten.
Sell Smarter Through Better ResearchYour sell-through rate depends in large measure on the quality of the research you dobeforehand. Doing extra work to look up brand names and original retail prices canmean the difference between a sale and a zero in the bids column. Although thisbook focuses on marketplaces other than eBay, the millions of sales records on eBaymake it by far the best place to do research. Looking up completed auctions on eBayis useful up to a point—up to about two weeks, which is when the sales records stop.You can get a more complete picture of the completed transactions for an item thatis similar to the one you want to sell when you subscribe to some services that providemore extensive background information than you can get on eBay.
(cid:3)
Terapeak
Terapeak (http://www.terapeak.com) is an auction service provider with a specialty.It focuses on mining eBay’s rich database of sales information and presenting the datain different ways. As you might expect, Terapeak lets you search eBay’s completedauctions for a long time—the previous three months’ worth of sales. You can studywhen the best times are to start a sale, and what the best starting bids are, based onthe ﬁnal sales price. An example of a search result is shown in Figure 14-1.
You can also mine eBay’s information in other ways. Consider the single mostpopular question asked by prospective sellers: What is the best thing to sell on eBay—
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and, by extension, on other websites? Well, Terapeak has an answer in the form of itsWhat’s Hot lists. These lists go beyond eBay’s simple listings of ‘‘Hot,’’ ‘‘Very Hot,’’and ‘‘Super Hot.’’ They provide percentages indicating how many of the items offeredfor sale actually sold (see Figure 14-2). The ﬁgures are available for a single day or aweek. You can then do a search for one of the items on the list, clicking on it to getthe particulars about sale prices, starting bids, and especially popular models withina particular brand.
Figure 14-1. Terapeak search results present up to thirty days’ worth of eBay completed auctionresults.
(cid:2) Terapeak Marketing Research.
Auction Service Providers
Auction Service Providers are primarily concerned with helping you to format salesdescriptions and complete transactions more quickly. You have the usual choice be-
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Figure 14-2. Terapeak’s service reports on sales categories on eBay that have been ‘‘hot’’ in therecent past.
(cid:2) Terapeak Marketing Research.
tween downloading and installing desktop-based software that runs on only one com-puter or subscribing to a service that you can access from any computer that isconnected to the Internet.
Some of the best-known auction service providers are listed in Table 14-1.With so many choices, it can be difficult to pick the right service. Most of theaforementioned service providers allow customers to try out their software for athirty-day trial period. It’s also a good idea to look around the Web to see whatsoftware tools are used by the sellers you know or whose listings you admire. Mypersonal impression is that many PowerSellers choose Vendio or Zoovy to be theirprovider.
In any case, be sure to take into consideration the uptime of the provider. Becauseservice providers aren’t always forthcoming about reporting service outages on their
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Table 14-1. Auction service providers.
Service URL
AAA Seller(http://www.aaaseller.com)
Monthly Fees
$8.95 to $44.95.
Andale (http://www.andale.com)
AuctionHawk(http://www.auctionhawk.com)
Auction Tamer(http://www.auctiontamer.com)
Research tools $7.95;Image hosting $3 to $55;Customer Manager $5.95per month.
Charges a flat monthlyfee rather than a com-mission on sales. For 110listings per month, youpay $12.99 per month,250 listings for $21.99per month, and so on.
Version for sellers costs$12.95 per month or$99.95 per year.
Auction Wizard 2000(http://www.auctionwizard2000.com)
License costs $75 for thefirst year, $50 for eachyear thereafter.
Features
Fifteen to more than athousand listings permonth; unlimited imagehosting; compatibilitywith eBay Motors.
Counters, listing tools,automated e-mails.
Customers can use a sim-ple one-page listingform, can add a scrollingshowcase of images totheir listings, automati-cally send invoices ande-mail messages to win-ners, and bulk relisting.
Has tools for buying andwatching sales as well asselling. Enables sellers tosell not only on eBayU.S. but on many ofeBay’s internationalsites, Yahoo!, Amazon.com, uBid, Bidville, andothers.
Includes a completee-mail system with an un-limited number of e-mailaccounts. Provides tem-plates for e-mail ad-dresses; sorts e-mailautomatically. Workswith eBay, eBay Stores,Overstock.com auctions,Yahoo! Auctions, andPlayer Auctions.
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Vendio (http://www.vendio.com)
Zoovy (http://www.zoovy.com)
Several plans are avail-able for Sales Manager:annual listing for $250per year and $.06 perlisting; pay as you go for$.10 per listing; $12.95per month, $.05 per list-ing and 1 percent finalvalue fee to flat rate of$39.95 per month and$.10 per listing.
Its Sales Manager Mer-chandising Edition workswith Amazon.com, eBay,and Froogle. It includesfree image hosting, list-ing templates, an HTMLeditor, reports that dis-play your revenue, costs,profit, and sales. Has itsown marketplace, VendioStores.
Auction Seller package:$49.95 per month,$399.95 setup fee. Otheradd-ons such as cus-tomer relations manage-ment package range from label and packing slip$9.95 to $35.00 permonth.
Zoovy Auction includesautomatic relisting, andinstant checkout; inte-gration with PayPal; up-selling and cross-selling;
printing.
own websites, this can be difficult to track. It is also important that the softwareprovided is updated on a regular basis. Zoovy, for instance, includes its own userforum where you can discuss Zoovy’s offerings with other customers.
Marketplace Managers
A marketplace management provider offers all the functionality of the auction serviceproviders listed in the previous section: they give their customers image-hostingspace, help with automating e-mails, have a selection of tools for designing salesdescriptions, and so forth. But they go beyond auction sales to help businesses ex-pand into other locations as well. They provide software for tracking inventory, creat-ing marketing, providing customer support, and hosting online storefronts andwebsites—in short, all the things that longtime auction sellers do on a piecemeal basisare consolidated in a single location by a marketplace manager. Look for the follow-ing essential features that go beyond the standard set supplied by auction serviceproviders:
•
Sales Tax. The tool should keep track of the sales tax you have collected frombuyers who live in your home state, which will be a big help when it comes time tofile your taxes.
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•
Tracking Inventory. The marketplace manager should let you keep track ofinventory so you can provide a replenishment before you run out of a particularmodel or item.
•
Shipping. The manager should streamline the process of printing mailing la-
bels and packing invoices.
• Branding. Some managers, like Marketworks, help you create unique logos
that you can use on your Web pages and your printed materials.
• Overseas Business. Some managers will provide translation services and help
you fulfill tax and customs requirements, which can often be confusing.
The two big players in the field of auction management (and online businessmanagement) are ChannelAdvisor (http://www.channeladvisor.com) and Market-works (http://www.marketworks.com). They offer expensive and complex packagesdesigned for large businesses, but they also provide entry-level packages to individualsellers. Some of the best-known marketplace managers are listed in Table 14-2.
As stated previously, there is considerable overlap between the services I amdescribing as auction service providers and those that are marketplace managers.ChannelAdvisor deserves a special mention: the company was founded by an eBayPowerSeller named Scott Wingo. Vendio, in particular, can be described as a market-place manager, while AuctionHelper has plenty of auction service tools. Don’t bereluctant to investigate companies listed in both categories when you’re looking foryour own provider.
Amazon.com Selling Tools
Amazon.com offers its own bulk listing tool, Bulk Loader, but it is only an Excelspreadsheet, and cannot help with tasks such as quickly capturing order and descrip-tion data, inventory information, or shipping procedures. It’s not well known to out-siders, but individuals and companies that sell in volume on Amazon.com know thatthey can take advantage of a variety of third-party software that helps them managesales on Amazon.com and even do research to find books and other products thatwill fetch particularly strong prices.
AManOne of the Amazon.com sellers described in Chapter 12, Tom Hawksley, uses AManto manage his Amazon.com sales descriptions. AMan, by Spaceware, keeps track oforders you have received on Amazon and maintains a list of which items have been
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Table 14-2. Auction service providers.
Service
Monthly Fee
Features
AuctionHelper(http://www.auctionhelper.com)
ChannelAdvisor(http://www.channeladvisor.com)
After fourteen-day freetrial, you pay 1.95% ofsales price with a mini-mum fee of $.15 andmaximum fee of $1.25,plus $.02 eBay API feefor each item (eBay’s Ap-plication ProgrammingInterface or API allowsservice providers to con-nect to its database).
The least expensive op-tion, ChannelAdviser Pro,starts at $29.95 permonth or $270 per year.
Infopia(http://www.infopia.com)
N/A; You have to consultwith an Infopia sales-person.
InkFrog(http://www.inkfrog.com)
Each software packagehas its own monthlycharge; or you can pur-chase all four for $17.90per month.
Inventory management:you can enter your in-ventory into Auction-Helper’s database; theservice tracks your sales,inventory numbers, in-voices, and sales his-tory.
ChannelAdvisor Proworks with eBay, eBayStores, Overstock Auc-tions, Amazon.com,Yahoo! Auctions. Cus-tomers get customer careadvice, discussionboards, newsletters, andmore.
Separate software mod-ules are available formanaging inventory,keeping in touch withcustomers, online brand-ing, and more.
i-Images is an image-hosting plan; i-Lister letsyou list and scheduleauctions; i-Showcase letsyou display a preview ofall your items for sale ineach listing; i-Checkouthandles the e-mails andtracks payment at theend of the transaction.
(continues)
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Table 14-2. Continued.
Service
Marketworks(http://www.marketworks.com)
Monthly Fee
Features
Image Hosting rangesfrom $29.99 for 100MBand up.
Marketworks charges aminimum $29.95 imagehosting fee (three otherplans ranging up to$119.95 are available),plus 2% of the final priceof a successful transac-tion with a $.20 mini-mum and a maximum of$3 per auction sale. Noinsertion fees arecharged. (Source: Auc-tionBytes)
Auction managementservice gives you 50MBof storage space, a list-ing designer, automatedfeedback, reports of yoursales history, and more.
SpareDollar(http://www.sparedollar.com/corp)
No listing fees, insertionfees or final value fees;$8.95 per month lets youuse all the company’sservices.
shipped and which remain to be sent out—data that become important if you selldozens or even hundreds of separate items at a time.
Seller ratings are especially important on Amazon, especially when you mighthave a half a dozen or more individuals selling the same used or ‘‘collectible’’ bookin the marketplace. You’ll stand out from the others if you have a better seller rating.As you know from your eBay selling, the best way to improve your seller rating is toship quickly. AMan helps you with shipping by letting you print out shipping labelsand packing slips that can bear your business name or user ID. AMan also generatesU.S. Postal Service bar codes so you can print out your own postage and avoidwaiting in line at the post office.
Monsoon
Monsoon (http://www.amazon.com/gp/browse.html/102-8416412-8597724?_encoding(cid:4)UTF8&node(cid:4)3472421&no(cid:4)3435361&me(cid:4)A36L942TSJ2AJA) is a bulklisting tool for Amazon. It enables you to ‘‘grab’’ the sales information for a group ofitems and prepare multiple sales listings. You can schedule your sales so they all startat the same time if you wish.
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SellerEngineSellerEngine (http://www.sellerengine.com/) is software that enables you to searchAmazon in a way that the site itself doesn’t permit—by the names of individual sellers.You can search through all the items sellers currently have for sale. That way, youcan adjust your own prices to make sure they are competitive. SellerEngine, likeMonsoon, also lets you upload sales listings in bulk.
ScoutPalScoutPal (http://www.scoutpal.com) is an amazing hardware device lets you scan thebar code of an item you see in a secondhand store, a flea market, or a resale shop.ScoutPal records the ISBN (for books) or other number of the product and automati-cally looks up the price of the item in the Amazon.com marketplace. It is a great wayto do on-the-spot research to see how likely you are to be able to resell the item for aprofit on Amazon.
● ● ●
One of the most important service providers you can choose is, of course, theservice that provides you with the ability to process payments sent to you by yourbuyers. If you use a service like Amazon.com, which processes payments itself, youdon’t have to worry about this. However, if you create your own website to supportyour sales in various marketplaces, you’ll need to sign up with a payment processoryou can trust, as described in Chapter 14.
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