This post is by Lahav Gan, CEO at CampaignGo.
It’s no secret that buyers LOVE sales. They are drawn to good bargains and are always looking to pay the lowest price they can get.
For sellers though, creating markdowns and sales promotions can be a difficult and time-consuming process. It’s challenging to select which items to put on sale, set up the discounts for each, and track the results to know if it even paid off. Unfortunately that means many sellers don’t even try to reach the full potential of using promotions to boost their eBay store revenue.
At CampaignGO, we have been eBay Sellers for the past decade, having two successful eBay stores, with over 10,000 listed items, 15,000 positive feedbacks and thousands of satisfied customers. So we know what works!
By reading this guide you will learn how to create markdowns with ease and in less time. We will explain why markdowns are beneficial to your eBay business, present various markdown options and strategies, and provide helpful rules and tips for markdown creation in the easiest and fastest way possible.
Why Are Markdowns Important?
Drive Traffic and Boost Sales – Discounts help draw potential buyers’ attention to your eBay store. Often, after being lured in by an item on sale, buyers will continue browsing through your store, and discover more of your products. Markdowns serve as a gateway and lead to sales growth.
Rank Higher on eBay’s Search– Creating a markdown is actually one of the parameters that helps eBay’s search engine Cassini rank you higher and get noticed. Remember: ranking well on search is all about benefiting buyers, so the more value you provide – the higher you rank!
Attract Repeated Buyers – Launching different markdowns on a regular basis helps lure returning buyers back. Also – providing them with special offers will help enhance their loyalty towards your store.
Get Rid of Old Items – Markdowns help you clear your inventory of items that have been occupying valuable space and not selling for ages. Turnover is extremely important and the discount will help you move those items easier and more quickly.
Meet Sales Objectives – Every business has long and short-term sales objectives. Launching markdowns can help you achieve the monthly, quarterly and yearly targets you have set for your eBay store. It also helps improve your store’s turnover, because listings start selling more quickly.
Helps you find the item’s optimal price – Unfortunately, pricing isn’t always an exact science and may change over time, especially when it comes to second hand items. A markdown can help you experiment and determine the optimal price for items that aren’t selling.
Trigger Best Offers – Providing a discount in addition to the Best Offer option (a feature which allows sellers and buyers to negotiate price) indicates to the potential buyers that you are open to negotiation. It gives them an idea of your price range and helps them make an accurate estimate which leads to a reasonable offer that is worth accepting.
So as you can see Markdowns are beneficial to YOU and your BUYERS!
What Kind of Markdowns Should I Create?
There are numerous options for creating markdowns with a range of discounts, combined with a whole range of products to choose from. So, what should you do? How do you choose the right items to put on sale at the right discount?
Your starting point is planning ahead – As we’ve said, the options for creating markdowns are endless. That’s why you first must identify the need or objective for a markdown, and only then specify the right markdown to meet that objective.
There are different kinds of Markdowns which may serve different purposes:
Small, Regular Reductions – Give small price reductions on a regular basis for different items to increases exposure and help promote new arrivals.
Larger price reductions – Best suited for Clearance Sales, getting rid of old items, and/or large stocks.
Special Occasions – Launch markdowns on special occasions, such as Black Friday, Halloween or Back to School, to trigger holiday and seasonal shopping.
Create a Markdown Calendar
Write down the kind of markdowns you’d like to create and determine strategic dates with a Markdown Calendar. These can include:
New Arrival Markdowns
Objective: Promote new listings.
Duration: 3 day sale starting the first weekend of every month.
Objective: Getting rid of old stock.
Duration: 5-7 day sale at the end of every quarter.
Back to School/Black Friday/Thanksgiving etc.
Objective: Trigger Holiday/Seasonal Sales.
Duration: 3-5 days before the holiday and/or on the day of the holiday itself.
Discount: May vary up to 70%.
Sort Your Inventory
After “planning ahead”, the second step should be sorting out your items for the different markdowns. This is the most complex part: How do I locate the items for markdown and connect them to the right discount?
Here are six helpful tactics to locate items for a markdown by different parameters common to all sellers; each may fit different sale objectives.
By Listing Date – You can choose old items for one markdown (items that are listed for over one year for instance), and new listings in another markdown which will give them a boost. Keep in mind, the discount percentage should vary between markdowns.
By Inventory Level – Use this tactic to put products with a big quantity on sale (for instance: quantity of more than 5/10/50/500 items in stock) or one-of-a-kind collectibles (less than two items). You can also choose items that are almost completely sold-out, and give them a final boost (for instance: quantity of more than 5 and less than 10).
By Number Sold – You can choose slower selling items or items that have never sold before. By selling them at a discount, you may find out their optimal price and prevent marking down best-selling items or items that don’t need a sales boost.
By Date Last Sold – This tactic is extremely effective for items that you haven’t sold for a long time by simply choosing a date range. Even a moderate discount can be the trigger for selling those!
By Number of Watchers – Watchers are an asset to your store, even if you don’t always acknowledge it. When potential buyers take an interest in your listings but don’t intend to buy immediately, they might add the items to their Watch List. It may indicate that they are waiting for the item’s price to go down, that they are still researching the market or that it’s just not the right time for them. Either way, once you put the item on sale, all watchers will be informed via eBay. The price reduction followed by eBay’s notification is usually the push that they need to close the deal. That’s why items with many watchers are a classic choice for a successful markdown.
By Free Shipping – Free shipping is a great technique to attract buyers and rank higher in eBay’s search. BUT listing an item with free shipping may sometimes mean it isn’t worth reducing the price if you haven’t built shipping into the cost of the item. The solution is to divide and conquer: Give a moderate discount on items listed for free shipping, and a more substantial discount on items that you charge for their postage.
Finally, don’t be afraid to be creative. Personalize your markdowns by mixing different tactics together, and find the markdown combinations that work best for your business. You can also compare different markdowns and learn which strategies are the most effective in BOOSTING your eBay Store
How Often Should You Create Markdowns?
There is a misconception that sales and markdowns need to be created around special events only. Actually, markdowns can be done on a regular basis without any special occasion needed: Once a week for three days, a weekend sale or even a single day sale twice a week. Just make sure that you use a variety of items, so that you don’t “exhaust” the same items and lower their value by putting them on sale over and over again.
You can create Markdowns whenever sales are slow, when older items aren’t moving, when you want to stimulate activity or just when you like to drive more interest and traffic to your store. Markdowns serve different objectives.
Regardless of your Markdown objectives, the more the better. Just remember not to “exhaust” the same items and to choose the appropriate discount.
How Should I Prepare for Markdowns?
There are no two eBay stores or sellers exactly alike; each business holds its own set of challenges. Sometimes these are unique and sometimes they are similar to others. That’s why it’s CRUCIAL for you to get to know your own eBay store, learn about it and figure out what strategies and tactics work best for you.
Understanding your inventory is the KEY to successful markdowns. Find out what your stock consists of: Which type of items do you have? How are they selling? How long have they been in your stock? How many items have a large quantity? How many items have never sold? How many are best sellers?
These insights may seem to be BASIC and TRIVIAL, yet, many eBay sellers don’t really understand them.
Only after figuring these insights out can you really know best which items need to be boosted with discounts and which don’t.
Once equipped with this information, you are ready for creating optimal markdowns.
Complementing Your Markdowns
As we established above, Markdowns are essential for your Online Business’s success. Does that mean that Markdowns alone are enough? Not at all! A good way of understanding this notion would be to think of your eBay stores as a plant. This metaphor helps us remember that just as a plant needs its essentials to thrive (i.e. oxygen, water, sunlight, etc.) so does your eBay store.
Within the framework of your marketing efforts, Markdowns play a leading role, but even the best of Markdowns should be anchored in a strong marketing plan that will serve as a support system and help you meet your objectives. So here are some complementing Markdown strategies that will help you increase sales:
Combining Markdowns with Best Offers
As we mentioned earlier, creating an additional Best Offer option on top of the Markdown is highly beneficial for sales, because it strongly signifies that you are willing to negotiate with your buyers.
Another great advantage of the Best Offer feature is that it enables you DIRECT communication with your potential buyers that have shown significant purchase intent, and that’s a big deal!
By submitting a Best Offer the potential buyers indicates that they are interested in your listing, and now the only thing standing between you and the complete sale is accepting or countering the offer. Chances are you will be able to seal the deal as long as you communicate properly and respectfully. Don’t get discouraged if you receive a rude response or a significantly low offer.
Always remember that interpersonal communication holds great potential; first and foremost because buyers appreciate the personal service, even more so when it comes to eCommerce platforms. Communicating directly helps enhance a positive buyer experience, and a satisfied customer is usually a returning customer.
Best Offers can also help determine pricing. As we all know pricing isn’t always an easy and straightforward task due to market and product value dynamism. The Best Offer feature can help us learn how much customers are willing to actually pay for the item in question, and what is considered a realistic price range.
Just like Markdowns, auctions can serve as gateways and lure buyers to browse through your store. Enabling buyers to bid on your listing helps increase traffic and leads to more sales. Putting items on auction is also useful when wanting to get rid of items that haven’t sold with a fixed price.
Another great idea is to combine the auction with the Buy It Now option. That way, as long as there are no bidders, buyers can still purchase your listing for a fixed price. You should always take into account that by running an auction you may find yourself selling an item for less money than you intended initially (although in many cases you will actually sell it for more). That’s why a good idea is to always choose the minimum price that you are willing to sell your listing for.
If you have a few items of the same kind you can spread them in different auctions, Best Offers and Markdowns. Once the auctions are over, odds are buyers that haven’t won the item will continue looking for it, and by using the techniques above you will make it easier for them to find your listings. Having that said, don’t forget to keep track of your auctions, because unlike Good ‘Til Cancelled, actions are dynamic, require re-listing, and their fees differ.
Newsletters and Social Media
A common mistake that most sellers make at one point or another is flooding social media with their listings. Keep in mind that no one likes spammers, and excessive advertising won’t bring you more buyers – on the contrary!
A good way to promote your store would be through providing beneficial content, and that’s the reason why “CONTENT IS KING” became such a popular marketing catchphrase nowadays. The recommended guideline is 80% content that either entertains, educates, or engages your audience and 20% or less that talks about specific products you’re selling.
Are the holidays coming up? Perfect! It’s a great opportunity to write a Newsletter for your customer mailing list explaining “How To Prepare Yourself For The Holidays”and embed photos of the special holiday-oriented items that you put on Sale.
You can also Prepare a home-made YouTube video demonstrating fun and creative ways of using them and share them on Twitter, Facebook and Pinterest. Humorous and cute videos tend to go viral so keep it fun and relaxed. Don’t forget to give your store a quick mention and add the listing link below.
Another great idea is sharing your work related stories on social media. You can post about great new findings, show your secure packing techniques, share interesting information regarding your listings or even engage your followers with fun trivia questions about the items you sell. Don’t forget to find relevant Facebook groups to participate in as well! The keyword is engagement – that’s what social media is all about.
This post was by Lahav Gan, CEO at CampaignGo. CampaignGo develops tools to increase eBay stores’ traffic and boost revenues while saving substantial time and money. Their flagship tool is the Markdown Guru that provides deep store insights and lets you create eBay sales easily and quickly.
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Boost Your eBay Store With Markdown Sales Promotions