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EcommerceBytes-NewsFlash, Number 1487 - March 05, 2007 - ISSN 1539-5065    4 of 5

eBay, Google and Amazon Woo IMA Members

By Brad and Debra Schepp
March 05, 2007

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Just when you thought some of the magic had left Internet retailing, the four-month old Internet Merchants Association held its 2007 Conference February 27 - March 1 at the Las Vegas Convention Center. Forget David Copperfield and Penn and Teller, there was a buzz in the air that many Internet retailers haven't felt in a long time.

Nasty ice storms delayed some attendees, but once they got there and joined their colleagues they weren't disappointed, based on our own impressions and the attendees we spoke with. PowerSeller Mark Freeman, of golden-rule-auctions, for example, thought the IMA did a "fantastic job" in pulling the show together so quickly.

Held in conjunction with the Associated Surplus Dealers/ Associated Merchandise Dealers (ASD/AMD) merchandising show, the event packed a tremendous one-two punch. Not only did attendees get the latest word on the newest services from eBay, Google and Amazon, they could make key contacts at one of the most important sourcing shows around. ASD/AMD's Las Vegas show is the nation's biggest variety and merchandising trade show. This year, 3,400 exhibitors and 50,000 buyers attended.

Following are some of our takeaways from the Conference. We're also going to share a secret support phone number that only attendees were told! But first, some more background on the IMA.

The IMA, a not-for-profit trade association, was founded by former members of the Professional eBay Sellers Alliance (PESA). It now has about 125 members, but expects to have twice that number within a year, according to Steve Grossberg, one of the IMA's founders. IMA membership requirements for Internet retailers are as follows:

  • 3000 minimum feedbacks
  • 98.9 percent positive rating
  • 1500+ in last 6 months
  • $5,000 GMV per month

Our Takeaways
Aside from sore feet, writer's cramp from jotting down all the pearls we heard, and lighter wallets (the show was in Vegas, after all), we left with the following key thoughts:

More Internet retailers are going virtual, or should be, meaning they are "touching their products less," and relying more drop shippers. While a show of hands indicated the great majority of sellers attending still handle their own warehousing and fulfillment, the interest in drop shipping and other alternative fulfillment services (more on Amazon's service soon) was tremendous.

Many more buyers now use search engines to locate retailers instead of going directly to retailer sites. This means sellers should seriously consider Google's AdWords service to help ensure potential buyers can find them. If you are just trying to reach buyers through websites, or eBay, or other "Marketplace" venues, speaker Scott Wingo admonished, you are missing 75 percent of the opportunity (to reach customers). Have AdWords questions? Here's that secret telephone number we promised: 866-2-GOOGLE.

eBay is moving toward greater transparency in pricing, meaning that price and shipping charges will soon show up in search results. They are well aware that buyers evaluate shipping costs carefully, and in fact run from sellers who charge a fortune to ship stuff.

IMA members offering Google Checkout are already big fans. PowerSeller Charise Richards of One-Chic-Boutique told the crowd "Google Checkout is amazingly simple, and I've had great success with it." Google Checkout is free for merchants through 2007 (no transaction charges). And coupling Google Checkout with AdWords is a great idea. If you offer your customers checkout, your AdWords ads will include an eye-catching shopping cart icon. Google's research has found that the presence of that button gives sellers a 10% boost in click-through rates.

The term accidental entrepreneur characterizes many of the sellers on eBay, according to the eBay reps there. They started businesses on eBay, but may know little about the nuts and bolts of running a business day to day. eBay recognizes this and will make educating its sellers in business practices more of a priority. For example, Matthew Ledwith, eBay's Director of Topseller Development, told us that eBay Live will be more "businessy." He's also working with PowerSeller account managers to help them better understand profitability.

Turns out that 95 percent of eBay sellers differentiate themselves from other sellers based on pricing, noted Marketwork's Paul Lundy. "This is not sustainable." eBay sellers must find other ways to distinguish themselves from their competition. Think of how Target competes with Walmart, Paul advised. It doesn't compete on price but on variety and quality instead.

Amazon is attracting a great number of eBay sellers, with perhaps 65 percent of IMA attendees saying they now sell on the site. Gary Richardson of gogglesandglasses has found that his ASPs are higher on Amazon (than on eBay), and has his own store now through Amazon's Seller Central. While Amazon's third party seller program has been available for a while (now accounting for 25% of its total sales) a new service -"Fulfillment by Amazon" could be a great boon to sellers looking to avoid the hassles of warehousing and fulfillment. (For details go to fba.amazon.com.)

Perhaps some of the verve and excitement has been missing from the Internet retailing scene in the past couple of years, whether it's due to rampant reports of fraud, more sellers chasing a more scattered base of buyers, whatever. Given the size and enthusiasm shown by the sellers there, the IMA, as well as Amazon and Google are bringing back some of that magic. Take that Penn and Teller!

Note: Thanks to Sharon Clem and ASD/AMD for photos.
Brad and Debra Schepp have written about cutting-edge technologies for more than 20 years. They are the authors of 13 books, and their work has been featured in publications such as Newsweek, The Chicago Tribune, and Life Magazine. They have been online since 1984, and buying and selling on eBay since 1999. Their most recent book is eBay PowerSeller Million Dollar Ideas: Innovative Ways to Make Your eBay Sales Soar, published by McGraw-Hill (2007) and available through retailers such as Amazon (http://digbig.com/4rsfg). Visit their website at http://www.bradanddeb.com.

About the author:

Brad and Debra Schepp have written about cutting-edge technologies for more than 20 years. Their most recent book is eBay PowerSeller Million Dollar Ideas: Innovative Strategies to Make Your eBay Sales Soar, published by McGraw-Hill. The 2nd edition of eBay PowerSeller Secrets will be published November 27, and be available through retailers such as Amazon. Visit Brad and Deb's website at http://www.bradanddeb.com.

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