E-Bay is not just for one type of buyer or one type of seller. For the benefit of its 90 million shoppers, eBay is now trying to woo large retailers to its vibrant marketplace. In the current state of economy, retailers of all sizes are now looking for new marketplaces to promote sales and diversify their business. Without a doubt, the presence of larger, more established retailers is going to change the very nature and character of eBay—but ultimately, this will be beneficial to all parties.
Traditionally, eBay is an auction site, and larger retailers often do not use the auction model as a primary method of distribution. Nonetheless, eBay can be a wise choice for a larger retailer in providing a channel for surplus goods, or for testing the market for new products.
E-Bay has recently announced many policy changes to attract large sellers in its market. By reducing the fee structure now, the listing cost has gone down and the sellers can list large numbers of items with a very low start-up cost structure. Rather than focusing on a large up-front listing fee for thousands of items, the focus is instead on paying a commission on completed sales—a strategy that makes it very easy to experiment with large numbers of items.
Large Merchant Services
eBay has launched Large Merchant Services (LMS), which is specifically geared towards serving the special needs of larger retailers. In addition to a lower listing price grid, the plan gives retailers the option of negotiating prices directly with eBay if the volume is large enough. If you’re a Diamond or Platinum Power Seller, you’re in luck, and eBay now has different pricing schemes for you—and you can make your large eBay business even larger.
In addition to retailers that have grown up organically from eBay, large retailers that exist outside of eBay now have a greater incentive to open up an eBay channel.
Can small retailers co-exist with large sellers?
The fact that eBay is courting larger retailers has caused some concern among smaller sellers, and that’s only natural. Does this mean that eBay is going “corporate”? Not at all. eBay built its reputation by providing a sales venue for the smallest retailers, many of whom have traditionally been part-time, work-at-home operators. That has historically been part of the attraction of eBay, both on the part of sellers and buyers, and that will not go away.
Will the presence of large retailers pose a competitive threat to the smaller ones? To be sure, larger retailers with an established brand will take some business—but at the same time, their presence will drive more traffic to eBay in general, which benefits everyone. Think of it as locating your small shop in a shopping mall with a large “anchor” store. In a brick-and-mortar mall, the “anchor” store is the lifeblood of its existence, and without it, the smaller stores wither and die. The same is true with eBay—and the presence of anchor stores will ultimately be a benefit to the small retailers as well.