A Tale of two customer bases: Amazon and Ebay

My company is four years old this week, and while we do have our own web site where we sell from, we need to be on Amazon and Ebay as well to make sure we get the largest audience possible for our products. Going through the data over the last year, and over the last four years some interesting if trivial data points are showing up in terms of how successful someone can be on someone else’s system. Admitted there is no way I could spend the money on advertising to reach 88 million visitors a month like Ebay or Amazon, what is interesting though is the customer behavior exhibited by buyers on both of these systems.

No worries Amazon and Ebay, I won’t give out the customers names or addresses, I won’t name names or talk about things I should not talk about.

There is a huge difference between Amazon and Ebay Customers. It is almost startling how much of a difference in terms of customer connection, interaction, and support we provide based on either system.

Amazon is a black hole, the only time we really hear from any customer is when we messed up an order, or they want to do a quick return and keep the product.

Ebay is hugely interactive in that we can do custom orders for products, our customers talk to us on a regular basis, they know when we are getting in product and will pre order it from us to we can almost do a “pull box” for customers before we get stuff in. Then we post their special links to their custom order and off we go selling stuff.

Amazon customers seem like they are getting increasingly frustrated, all of our feedback this year that has been negative or neutral has been about pricing. Amazon Toys and Games, many of the list prices are pennies above what I pay in wholesale. If you charge anything above that, Amazon customers have no problems providing negative feedback that then in turn kills your customer service ratings. For us, this means we have been slowly moving toys off Amazon and onto Ebay because pennies above whole sale list pricing means I lose money on each toy no matter what.

Ebay customers seem like they are enjoying the ability to negotiate prices, and we do haggle through the best offer system. People seem to like that a lot, and it leads to happier customers.

2% of our Amazon customers are unhappy with the service they got from us, 0% of our ebay customers are unhappy with the service they got from us.

Nearly 100% of our orders on Ebay get feedback, on Amazon about 8% of our orders get feedback; this makes a negative or neutral feedback on Amazon more likely to influence our overall feedback scores than they do on Ebay. I never hear from customers on our own web site, so I don’t know if they are happy or sad about what they got.

Pricing pressures and downward margins are higher on Amazon than they are on Ebay, we get a better price for our product (near retail) on Ebay than we do on Amazon, for a small company that means the difference from going out of business to surviving the recession we are in.

Batman sells best at 10AM on Amazon, but sells best at 5PM on Ebay, Superman sells best at 6AM on Amazon, but does not sell on Ebay.

Of all the systems, and reflected in the latest Ebay quarterly sales statistics, Ebay pound for pound, item for item sells better, performs better, fetches a nearly full retail price, and is much easier to work with customers on. Amazon has been difficult this year with an amazing amount of negative feedback from customers thinking they are not getting a deal from us, and the way that toys and game pricing is reflecting wholesale (what I pay in wholesale) rather than retail. In the longer term, the best strategy for my company is to focus on Ebay, and start reducing what we are doing through Amazon.