Practical Ecommerce

The Dreaded Bedroom seller and how to beat them

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With the rise and rise of Ebay and Amazon, comes the “bedroom” seller. It may be more accurate to call them hobby sellers. All Ecommerce retailers know them. They are the sellers who undercut you and sell at cost or less. They appear, hang around for a few months, and then vanish. In the old days, you simply outlived them. Hobby sellers are cheap mainly because they have forgotten a cost or two. Forgotten to pay themselves a living wage, forgotten that boxes cost money, forgotten that stamps also cost. A successful business has to make a profit. All too many new sellers think that they have succeeded because they make so many sales, completely forgetting that each sale has lost them a cent or two. I am being a little harsh here. Some very large and successful businesses have started out as bedroom businesses, but these are not the ones that are currently causing the problems.

The problem is that these days for every hobby seller who disappears two more spring up. It seems that with the hard economic climate, more and more people are looking to earn an extra income by selling on the internet. Amazon and Ebay both provide a very easy platform from which to sell. So the cheap, undercutting hobby seller is never going to go away.

So to stay in business you have to beat them. There is little point in competing on price. You have to choose a different battlefield.

First and foremost is customer service. Send out orders as soon as possible (90% of our orders get despatched within 12 hours). Have great communication (100% of our e-mail queries get replies within 24 hours). Send out the goods well packaged so the goods arrive in good condition.

If you can do it right first time, customers are more likely to give you repeat business. Hobby sellers may miss one or more of these.

Then you need to do your research and tailor what you do depending on the sales platform.

Amazon

With Amazon it is mainly about the Buy Now box. In theory for each item there is a single catalogue entry on Amazon and all the sellers list their offerings against this single item. Amazon selects one of these offerings and put it in the blue Buy Now box. Most customers on Amazon buy from this box without looking at the other offerings. So getting the Buy Now box dramatically improves your sales.

In practice, many items on Amazon have duplicate entries. Whilst it is absolutely forbidden to create a duplicate entry, and I would strongly recommend that you do not, they do exist. It is always a good idea to put your offering on every duplicate listing. I have one item where there are 4 separate catalogue entries on Amazon. I list on all 4. On two of these there is stiff price competition and I rarely sell. On the other 2, the other sellers have largely ignored, and I have a continuous sales stream, at typically 20% higher price than on the busier duplicate entries.

Likewise there may be opportunities to create valid different catalogue entries. For example sets, or 5 x packs, etc. If what you are selling could be part of a set, then why not offer the set?

Ebay

Again research is essential. Unlike Amazon, where you share the listings with other sellers, you create your own listing. Here you have a real chance to distinguish yourself from a hobby seller. Offer a good return policy, have a professionally designed template, use your expert knowledge to write a good description, use good photos. Then once you have created the perfect listing, place it carefully. Make sure it is in the right category, make sure that it is easy for potential customers to find.

You don’t have to be cheapest to win the sale on Ebay. You just have to be found easier than the cheapest. Then if your offer looks acceptable, you get the sale.

These are just some of the ways to beat the cheap horde. Some may work better than others based on what you sell.

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Comments ( 4 )

  1. Elizabeth Ball March 11, 2013 Reply

    Hi Richard, great article! What’s your take on Etsy sellers?

  2. Richard Stubbings March 14, 2013 Reply

    I have never looked at Etsy before, so I have no real comment. EXCEPT in a very brief look I found a "robot baby costume" that will get the maker in lots and lots of trouble because it is a R2D2 copy costume. Lucas and Disney are not noted for their tolerance of IP breaches.

    It is not a sales platform I have looked at because it does not market to my target customer.

  3. Derek Bacharach March 21, 2013 Reply

    I’m surprised you didn’t mention the top seller badge feature for serious sellers on Ebay. It separates the bedroom sellers and the businesses – and appears on the listing in search and separates those who (in the last 3 months) have a good return policy on all listings, great feedback, and ships out orders at least 90% of the time within 24 hours.

  4. Richard Stubbings March 22, 2013 Reply

    I do not use Ebay as much as I perhaps should. As such I am not fully aware of all the badges, signs, and features. Whilst I am sure you are right, it would be right to mention such features, I wonder how much effect they actually have, since not all buyers are as expert on these features and perhaps just choose on price.