Selling on eBay: Myths and Facts

This post is by Victor Levitin, CEO and co-founder of CrazyLister.

eBay just celebrated twenty years in business. That’s a long time on the internet, and a lot has changed.

eBay has changed too.

Some of the changes were just a case of moving with the times, others were made deliberately to try and alter the direction of the business.

Some of those changes have sparked heated discussions amongst eBay sellers, with a lot of wild claims being made. When those claims get repeated over and over, they can take on a life of their own and become full-blown myths.

So here’s the most common myths I have heard about selling on eBay. I’ll try to explain where each of them came from, and what the reality is for eBay sellers today.

Myth #1 – Descriptions Don’t Matter Any More

Some people think that the eBay listing description isn’t important now, because it has been moved to a separate tab on the mobile eBay site and eBay apps. We all know how important mobile is for buyers, making up 34% of eBay sales and sure to grow further.

But eBay are constantly working on improving the compatibility of the listing description for mobile, and we are working pretty closely with them on it. We’ve seen how this has advanced. At first they didn’t support JavaScript, and now they do. They also didn’t support YouTube videos, and now they do. Clearly eBay thinks the listing description is important for mobile.

Naturally the importance of the description depends on the product category. If you’re buying a brand new iPhone then you know exactly what you’re getting. But if you are shopping for anything that is not so well-known, or unbranded, used or unique, buyers will definitely go to the description. It’s still very important.

But you do have to take mobile buyers into consideration when writing your descriptions. If you use a design template, make sure it’s responsive so it adapts to the screen size. And it’s really hard to read a lot of text on mobile, so talk with images rather than with text. Use images and videos as much as possible.

Myth #2 – eBay Buyers Are All Bargain Hunters

eBay has 157 million active users.

Yes, some are dollar-driven, but for others shipping is really important. Then some buyers want the best customer service, and others are willing to pay more for high quality and QA standards. eBay is huge and there’s room for everybody.

But that doesn’t mean you should pursue everybody. You cannot win them all. You can’t appeal to the bargain hunters, and those that need fast shipping, and those that want the high standards. Choose your group and go after them.

So eBay is not completely dollar-driven. We are the living proof of that. Being based in Israel we have never had the best price – we just could not. We found our strength and fought with that, and if we didn’t have any strength then we would just close our business. If I can’t offer extraordinary customer service, or be very personal with my users, or be fastest, or cheaper, then I don’t have any advantage and my business is not sustainable. There’s no reason for me to be in business.

My advice is to be laser-pointed at one business advantage, and make sure your customers know that. For us, it was customer service. We were working out of our skins to make sure our customers were happy, even if it meant losing money in the immediate timeframe. In the long run the word spread and we got a lot more customers. Shipping times are among the most important factors for online shoppers.

Tell a personal story if you can. I see a lot of army veterans, special ops guys, that sell sports gear and they tell their story. If you have a personal story about the products you sell, that’s appealing and people will buy from you.

Myth #3 – eBay Only Wants The Big Sellers and Brand Names

In his speech at the eBay 20^th anniversary convention, eBay CEO Devin Wenig talked about what they are now focusing on now: the small and medium-sized merchants.

It seems like a shift for them. Over the years they’ve tried to imitate Amazon, and bring in the big merchants and big brands. But now they’ve seen that this contradicts the spirit of eBay, which is still “people for people”, not brands for people. So they are shifting back to the core sellers, SMBs, and you can hear it in his speech.

But actions speak louder than words. I’m not easily impressed by the words of CEOs – they’re being paid to speak. But eBay took action. The recent changes to the way they count defect rates are a step in the right direction for SMBs.

It’s true that eBay has given more and more power to buyers, to increase conversions overall. And that’s great, because it brings in more sales for everybody. But for me it’s still very personal on eBay. When I buy, I check the seller from every angle. I go to their feedback and see if they have any negatives, what the negatives are for, and so on.

But if you buy off an authorised brand store on eBay, it’s not really personal. You know that you’ll get a good service and you’re in good hands. In the future I think it will become more personal again. Amazon are beating them hands-down with the corporate “shopping mall” style of selling, and they know that they have to do something different to that. It’s just a matter of time until there are more and more small sellers on eBay, and fewer and fewer official brand name stores.

Myth #4 – The Cassini Search Engine Can’t Handle HTML

eBay’s current search engine, codenamed Cassini, launched at the end of 2013. There have been a lot of rumours about it like it can’t handle HTML or long descriptions. We were concerned because naturally CrazyLister generates HTML to create its listing templates. So we contacted eBay to ask about HTML and Cassini, and their formal answer was that it was complete bull.

eBay are aware of these myths, and the discussions in the forums. But Cassini is like any modern search engine. It reads all of the HTML, and it would have damaged eBay if it didn’t. It’s a really basic function. If it were true it would have hurt eBay’s overall conversion rates, and affected the many sellers who didn’t hear this myth and remove all their listings’ HTML in a panic. It would be very plain to see, not just a rumour.

I have never seen any concrete data showing that if you have a lot of HTML in your listings you will fall down in the search results. Some people have reported that when they removed all the HTML from their listings their sales suddenly improved, but again I’ve never seen any data that can prove it.

There are other explanations that are more likely, for example the designs might have been badly done. Having a designed listing does not necessarily mean that it’s good. I’ve seen many people add tons of images, text, tabs and so on. Plain text is much better than a badly designed listing, because it’s straight to the point. But if you use graphic design correctly it’s certainly better than plain text. Another possibility is that listings are given a short-term boost to test if big changes make them any more attractive to buyers.

With that said, I would still recommend keeping your listings short and to the point, and don’t include too many different elements. Not because Cassini won’t read it, but because it’s heavy on the eye, and heavy on the buyer. Give only the information you need to, and no more.

Myth #5 – eBay Selling Limits Mean You Have To Grow Very Slowly

You can at least double your limits every month, for a fact. That’s not slow, because within just six months your selling limits can be 30 times higher than when you started. Again, we are the living proof that it is completely possible. We began basically with nothing but an Israeli eBay account, which actually has even more limitations than a US or a UK account. We did not even have a local eBay site at that time. And we grew fast.

The limits are in place to establish trust. eBay need to see that you are a trustworthy seller. Without limits, I can put a yacht for sale on eBay, get five million dollars for it, then run away. That’s it. If that happened eBay would not be considered a safe environment and buyers would not come. The marketplace would shrink and, as a merchant, my sales would fall.

To grow quickly, work really hard on customer satisfaction. If your customers are happy, eBay is happy. If eBay is happy, they will raise your limits, and you will be happy. It’s a magic circle. Don’t forget that every month on the 20th you’re eligible to ask for an increase. Put a note in your calendar to contact eBay support, and tell them something like, “Hey, I’m working hard, I’m making my customers happy as you can see, and so I would like you to increase my limits”. You don’t have anything to lose.

Myth #6 – With Your Own Web Store You Will Save All the Fees

First of all, I believe that opening your own store is absolutely the right way to go. But this is a long term strategy.

Let’s say you went ahead and you’ve opened your store. You’re one of about a billion websites out there with absolutely no traffic. If you do things right, it will take you at least six months until you get some decent traffic to the site. Most sites never get more than a tiny trickle of visitors. But if you start an eBay listing today you can generate sales within hours or days. That’s what you are paying eBay for – their traffic and marketing efforts to get people to the site.

When opening your own web store you have two marketing approaches: paid marketing and organic unpaid marketing. eBay fees are the equivalent of paid marketing, including all sorts of PPC ads. If you open your own store and want to get immediate traffic, go ahead, do AdWords on Google and you will pay for every visitor to your store.

But you don’t pay eBay for visitors. You pay them final value fees when somebody buys your item. This is awesome if you compare it to Google. If Adwords brings you one million visitors and nobody buys, you’ll pay Google a huge sum of money without any return on the investment. eBay ensures that you get a return on your investment.

Yes, you have listing fees on eBay, but in my view they are insignificant compared to what you pay to other channels. Google PPC ads cost on average around one to two dollars per click, and sometimes much more, just to get eyeballs to your website.

Myth #7 – It’s Impossible to Compete with Chinese Sellers on eBay

Not all the Chinese sellers on eBay are the same, but they’ve got a reputation now for crappy customer service, crappy quality, slow shipping and so on. The only good thing that they can offer is a low price. And price is not always the most important factor for online shoppers. We’ve been selling at prices 20-30% higher than our direct Chinese competitors who are selling exactly the same products, and we outsell them.

This is because we are much better at customer service, we are better communicators, and we understand Western customers much better. We take responsibility for everything, whether it’s our fault or not. That’s no so common in Chinese business culture.

But there is a real problem with Chinese sellers dominating the search results. There are Chinese sellers with tens and even hundreds of eBay accounts, and they do everything they can to take over the search results. For example, they ensure that some of their listings have the highest prices, some of their listings have the lowest prices, so that whichever filters you use you still see their listings first. eBay will fight this phenomenon, just like they did with the duplicate listing policy. It’s in eBay’s best interests to battle this, and they will continue to do so.

In time, looking beyond just eBay, I think China will dominate the world. It took about two years for our Chinese competitors to understand why we were selling more than them. They realised that our listings looked more professional, we offered a longer warranty, and a better service both before and after the sale. So then they started working on those things, and they improved. We continued to fight them, and it was good. We were winning.

There’s a lot of potential to sell to the Chinese too. The more they develop, the more free income they have. They have really serious buying power, and they are crazy about brands. But the road to China is still not paved. It’s up to the big guys to pave it: the Amazons, the eBays, the PayPals and so on. For a western seller to sell to China it’s still a nightmare to learn the business culture, and to get all the admin and registrations done properly. Importing into China is hard too – they have really harsh customs.

But it’s a question of time. The Chinese are buying like crazy, and someone will figure out how to make China a lot more accessible to small sellers.

Myth #8 – eBay Gives Too Much Power to Buyers

You can complain about eBay’s harshness all you want, but think of what they allow. Anonymous merchants from Thailand can do safe transactions with customers from Australia, for example. The power and protection they provide is huge. Anything that looks harsh to you as a seller is only meant to make life as easy as possible on the buyers. Making the marketplace as safe an environment as possible for buyers increases sales overall.

So whenever you lose a dispute and you’re angry, think of it as just the cost of doing business online. Personally I would not go and buy on eBay if the rules were not so much in favour of buyers. I know I have all the power – negative feedback, PayPal disputes, and so on – and that’s what gives me the confidence to buy.

Of course sometimes this power is being misused, but I completely agree with eBay’s slogan, “People are good”. The vast majority of people are good. The minority who are assholes are just the cost of doing business online, and should not determine if your business is profitable or not.

When we were selling, at first we took each and every experience with a bad buyer really close to our hearts. It’s so frustrating that you are working really hard to make every customer happy, and then you get a dispute or negative feedback from buyers who are basically extorting you. Those cases are really frustrating, but take a deep breath and look at the whole picture.

This is the reality of doing business online. People don’t know you, you don’t know those people, why on earth would a customer from Italy buy your product from the UK when they’ve never spoken to you, never even seen you? It’s only because they know they have the power, and this is what drives the business. You have to constantly remember that the vast majority of buyers are good, and not take the bad cases personally. There’s really nothing you can do about it besides doing your best, and look at it as the cost of doing business.

Myth #9 – eBay Is Weaker Without PayPal

Some people believe that eBay became a less of a company when they split from PayPal. They look at it as eBay losing PayPal rather than PayPal losing eBay. I’ve talked to people from both companies, and they are very excited on both sides, even relieved that being apart opens up new opportunities for both parties.

For example, there could be new options for eBay on how to accept payments. There are some exciting players out there, like Klarna, who have a service where you buy something online but don’t pay for it until you get the package. The seller gets their money immediately, and Klarna take all the risk on themselves. I think that would be an awesome fit for eBay because it removes one of the last barriers for buying online.

Being apart from PayPal opens up opportunities for eBay to partner with innovative companies like Klarna, and that can only be good for them.

This post was by Victor Levitin, CEO and co-founder of CrazyLister (a tool for easily creating professional eBay templates), a successful eBay seller, and author of the eBay sellers journey to $100k a month blog.