Common Mistakes Made By Marketplace Sellers

Expert Voices Feb 2014

Learning from your own selling mistakes is incredibly effective, but it can be an expensive form of education.

It’s nearly as good to learn from other sellers’ mistakes – you can feel their pain, but don’t have to share it. So I asked a dozen experienced sellers, consultants and suppliers what they often see online marketplace sellers doing wrongly, and what tips they could share so others could avoid the same pitfalls.

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Get Back to Basics

New sellers on eBay and Amazon – both individuals and businesses – often expect online marketplace selling to be simple. It’s certainly easy to get started, because the barriers to entry are very low. But that doesn’t mean it’s easy to be successful.

Ofir Amsalem

There is a huge difference between selling a few items on eBay and generating a reasonable income. New sellers think that selling on eBay is easy, but listing, communicating with buyers, pick, pack, ship and building a reputation is a whole lot of hassle. If you want to build a solid eBay business, get familiar with eBay’s policies. In the worst case your account will be banned if you break them.
Ofir Amsalem, Head of Ecommerce, AVH Diamonds

Once sellers get comfortable with their processes, they naturally want to sell more. But increasing sales volume is not just down to doing more of everything.

Jane Bell

One of the big mistakes is thinking that quantity will bring you sales. At the end of the day it’s quality of listing over quantity. Get right back to the basics, and make sure the substance of your listings is good for Best Match and Cassini. It isn’t just about price. Content and a reputation as a good seller with good customer service and easy returns policy is key.
Jane Bell, eBay Specialist Consultant, eBay Anorak

Best Match and Cassini were covered in more detail in the previous Expert Voices, What eBay Business Sellers Need to Know Now, and also Marketplace Repricing: The Ultimate Guide.

Marketplace selling is complex, and sellers can put in a lot of time and effort but miss some of the basics entirely.

Danna Crawford

People come to me saying eBay’s not working out for them, and when I look at their listings they have hardly any words in their titles, or they’re not using common words. Think like a shopper and follow success. Learn from items that have sold, even if they are not the same as yours.
Danna Crawford, Founder & CEO, PowerSellingMom.com

I think we’ve all seen web pages that go on and on, giving a hard-sell on training courses or software packages. There are a number of them pushing the idea that it’s easy to make a fortune selling online.

You may scoff at get-rich-quick websites, but for some they can be very persuasive.

Matthew Ogborne

Never buy from sites with long sales pages showing off their sports car and saying you’ll earn a thousand pounds a week. Never buy a suppliers list or distribution list. Google is your best friend. All the answers are there, you’ve just not found them yet.
Matthew Ogborne, Co-founder, UnderstandingE.com

When in doubt, if something seems too good to be true then it probably is.

Know Your Numbers

Few people get into online marketplace selling because they love bookkeeping. For many, it feels like their business is doing well because they are busy making sales and fulfilling orders. But being busy and being successful are not the same thing.

Tayyab Akhlaq

Focus on profit, not turnover. Marketplaces are inundated with people who aren’t making any money, and after twelve months they disappear because their cash has run out. People are so desperate for turnover that they don’t consider if they are making losses. Sellers get sucked in. Focus on what actually makes you money.
Tayyab Akhlaq, Managing Director, My1stWish and Genie and the Geek

Other sellers appreciate the need for profit, but miscalculate how much they are making. In online retail profit margins can be thin, so even a small mistake can turn a profit into a loss. If that mistake is amplified by high order volumes, the financial situation can deteriorate quickly.

Jack Phillips

Pricing! Often I see prices where it is obvious the seller has not considered all the expenses. You often see sellers who have not included their overhead expenses, like storage rentals, inventory taxes, software, bank fees, financing – the list is long! What about paying yourself for your time? What about the cost of shipping materials? Forget these things and you will bleed your business dry – and not realize it until it is too late to do something about it.
Jack Phillips, President, Jax Music Supply

Get Automated

Marketplaces like eBay and Amazon don’t know how much stock you really have, only what you tell them. Without a robust inventory management process (using specialised software or not) it’s easy to get the quantities out of sync.

Elizabeth Hitchins

Overselling is one of the first things that goes wrong. That affects your feedback, and it spirals from there. A lot of sellers manage their inventory through eBay, but need to keep a tight eye on their stock. Sellers can go through the holidays then realise they have a massive load of stock they haven’t listed on eBay. Automate your back-office processes and inventory management.
Elizabeth Hitchins, Freelance Consultant, KidsonTalks

Listing is another area where automation really makes a difference. Particularly for eBay, where listings can be completely customised, or for products not in Amazon’s catalogue, listing is a labour-intensive exercise.

Trevor Ginn

We used to create listings one by one, but you can save a lot of time if you start using spreadsheets. It’s really important to have a tool to help you with your sales – some sellers do it all on a marketplace by marketplace basis, it must nearly kill them!
Trevor Ginn, Managing Director, Hello Baby

Keep Working At It

Being successful selling online isn’t something you can set up then leave to run. New threats and opportunities appear all the time: competitors up their game, marketplace rules change, and buyers’ needs evolve.

What works today probably won’t work forever, so sellers need to stay on top of their business, react to change and take advantage of new opportunities.

John Lawson

The number one mistake is that sellers don’t take their website seriously enough. You can’t always depend on marketplaces – you have to start thinking and taking it seriously. Every day eBay lower the barrier to entry to get more people on their platform. As they do that they are increasing you and I’s competition. If you could master your own webstore, you reduce all the competition because the barrier to entry is so much higher.
John Lawson, CEO, 3rd Power Outlet and ColderICE Media

eBay and Amazon both changed their image policy last year, but there are still sellers who have not updated their photos, and risk having their listings pulled.

Even those who are in compliance with the new rules may not have realised that improving their photos can be an opportunity to boost sales.

Carlo Silva

Sellers still want to put borders on their images, and want to use manufacturer’s images. I highly recommend they take their own pictures – it separates you from all the other sellers. Use a white background, and size them up to 1,600 pixels – it will zoom into the image if you hover over it. It’s a good investment to have quality images, it increases the sell-through rate.
Carlo Silva, CEO, 2nd Office

Cross-border trade is huge on eBay (as indicated in The World’s Top eBay Sellers). But it’s a complex area and not as easy to master as the online marketplaces sometimes say.

Dan Burnham

Sellers try to dip their toe into cross-border trade and start with, say, 50 SKUs [product lines]. The temptation is try it on the cheap, but the 50 SKUs that you choose may be entirely the wrong ones. Generally what you’ll see is a 80:20 type spread, and it’s typically the case that the more you list, the more you sell. Starting small you may entirely miss and draw the wrong conclusion.
Dan Burnham, Head of Account Management, eSellerPro

Don’t Get Comfortable

Suzanne A Wells

Seasoned sellers can get too comfortable. They’re not shipping on time, they’re not shipping fast enough, they’re getting lax in their descriptions and maybe not giving the customer service eBay wants to see. eBay warns you before they suspend your account – you get several warnings – but they’re not checking their dashboard and keeping up with their metrics.
Suzanne A Wells, Freelance Consultant

The marketplaces on eBay, Amazon and elsewhere have changed quickly over the last few years, and are likely to continue doing so. Some sellers have done business the same way throughout and remained successful, but they’re the ones lucky enough to have the changes work in their favour.

Others have seen their business decline dramatically. Should they have seen it coming?

Dan Wilson

My heart sinks when a marketplace seller says something like “I’ve been profitable for three years and my sales have dropped off.” They swiftly blame eBay or Amazon, but failure to change, adapt and evolve on the seller’s part is usually the problem. Ongoing monitoring, planning ahead constantly optimising processes and listings are vital when building a viable business for the long-term.
Dan Wilson, Editor, Tamebay.com

In Closing

Everybody makes mistakes. The important thing is not to avoid mistakes – if you have never made a mistake, you’ve probably never tried anything new (to paraphrase Albert Einstein). The important thing is to learn from your mistakes, and if you can, the mistakes of others.

Hopefully this article has helped you to do that!

Have you made any of these mistakes, or seen others make them? Do you have any advice of your own? It would be great to hear from you in the comments below!

3 comments on “Common Mistakes Made By Marketplace Sellers

  1. Dan Wilson’s comment is so true. I see a lot of complaints about the changes eBay has been making and the effect on their business. The world changes and as a business person you have to adapt to these changes. eBay (and other marketplaces) exist to make money for their shareholders, not to make life easy for you, the seller.

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