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EcommerceBytes-Update, Number 319 - September 23, 2012 - ISSN 1528-6703     4 of 6

New Amazon Category Draws Mixed Reactions from Sellers


By Greg Holden
EcommerceBytes.com

September 23, 2012
 



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Does creating a new marketplace category help consumers better find what they're looking for and foster more sales in that area? Two sellers in Amazon.com's "Sports Collectibles" category provide different perspectives on what it's like to run a storefront in this relatively new "mini-marketplace."

The category, which Amazon launched early this year, takes a little bit of hunting to find. When you go to Amazon's home page and click the down arrow next to the search box at the top of the page, you don't see Sports Collectibles as an option. If you search for "Sports Collectibles," and then scroll down the page, you'll see the link "Visit the Sports Collectibles and Memorabilia Store." If you remember or bookmark the URL, you can go there quickly: Amazon.com/sportscollectibles.

The logo for the store still bears the word "beta." Within the store, autographed items get special attention. Merchandise is broken into professional sports leagues (NFL, NBA, NHL, and MLB). Other sub-categories include jerseys, balls, signed photos and shoes.

The question is, does giving individual businesses their own area within Amazon's voluminous marketplace improve their bottom line? Mike Mac Donald, who runs a store called White Ball Autographs, said in early February that the answer was a resounding yes: "since I was accepted, and my items started appearing there, my sales have been fantastic. The last two weeks of January sales up over 100 percent YOY. February is off the chart. Incredible, being that baseball autographs / game used cards are the vast majority of my listings and it is currently off season."

But Joe Davis, 44, who runs J&J's Collectibles SuperStore on Amazon and sells through his own website (GotBaseballCards.com), and who has sold on Amazon since 2004, says having a new category hasn't produced more sales.

On the contrary, he says, "Quite honestly, for us, it was far more profitable years ago. Even though (Amazon's) gross sales continue to grow, so does the competition on their site, and in my opinion, many of the changes that have been implemented within the Sports Collectibles category have made shopping far more confusing for the consumer. We do not disclose sales information, but our sales on their site have dropped continuously for the last 5 years and the introduction of the sports collectibles category has not actually helped our sales due to some of the policies in place within the category. We hope that with some refinements in the future, things will turn around."

Getting a store listed in Sports Collectibles isn't always straightforward. Mac Donald said that when the category first opened, Amazon rejected his application three times. "I finally emailed (Amazon CEO) Jeff Bezos, and immediately received a phone call from Jon Lyon of Amazon. Jon transferred my items to the Sports Collectibles category, something I wouldn't have been able to do by myself because I'm tech challenged. I talked to him for approx. 15 minutes and received excellent customer service."

Davis says that as a longtime Amazon.com seller, he was invited to sell in the new category. He agrees that moving sales listings to Sports Collectibles presents technical challenges. "Without paying for an online tool, this is a very complicated process," he says. "You must be very proficient at using Excel and understand that, unlike some other portals that provide stock titles, descriptions, images, etc., that you basically start all listings from scratch."

Fees are another thing to consider before moving into Sports Collectibles. "The fees are higher than other sites, but the trade-off is the exposure to their customer base," says Davis.

Mac Donald, for his part, says that his sales fees jumped a full 33 percent when he moved into the category. Amazon's sports collectible store charges a 20 percent Final Value Fee as well as shipping costs, he says. But, he added later in his interview, he gets higher final selling prices on Amazon than he did previously on eBay.

When Mac Donald spoke last February, though, he said that selling in the new category was worthwhile and far better than selling on eBay. (He did not respond to several requests for an update for this article.) A former eBay PowerSeller, he closed his eBay store and moved to Amazon in April 2010 due to "anti-seller" policies. He called the move "fantastic" saying that it easier to sell on Amazon: you are paid immediately and you get very little communication from buyers. "I have many, many more regular customers in a short period here than all my 12 years on eBay. Nearly half my sales are repeat customers."

He added that selling on Amazon was less stressful than on eBay, despite Amazon's high standards for sellers. "I believe a much nicer - and honest - clientele at Amazon is the primary reason."

As for Davis, he said it was hard to compare sales on eBay and Amazon. "Percentage wise, we have greater sell through on eBay and the final value fees are lower on eBay as well, but of course you have to pay for every item listed there as well, so there is a trade-off."

For Davis, the new Sports Collectibles category provide a new venue for promoting a very popular line of merchandise, saying, "We continue to look for new avenues both to offer products to customers and for other ways in which we can serve this hobby." But even though they have set aside a special area, Amazon still has some work to do to help shoppers find the collectibles they want.

"It is my opinion that a far more refined search needs to be put in place, and similar listings need to be merged under one Amazon product ID. This would simplify the process for the customer," he said.

Restrictions
Amazon continues to restrict the Sports Collectibles category "to ensure that customers are able to buy with confidence from all sellers on Amazon.com. The requirements for selling in the Sports Collectibles Store reflect buyer concern for product quality and consumer trust."

Merchants must meet the following requirements:

  • Have an order defect rate lower than 0.75%.
  • Have images with at least 500px on the longest side that comply with Amazon's image guidelines.
  • A majority of the products listed must be authenticated or graded by one or more of the companies in Amazon's list.
  • Be on the Professional selling plan.

Referral Fees
Amazon charges a referral fee on each item sold that is listed in the Sports Collectibles category:

  • 20% for the portion of the total sales price up to $100 (with a minimum referral fee of $1.00);
  • 10% for any portion of the total sales price greater than $100 up to $1,000;
  • 6% for any portion of the total sales price greater than $1,000.

For example, Amazon explains, "if the total sales price is $500, the referral fee is calculated as follows: $20 (for the first $100 of the total sales price) plus $40 (for the remaining $400 of the total sales price) for a total referral fee of $60."

More information about selling in the Sports Collectibles category is available on the Amazon.com help pages.

About the author:

Greg Holden is EcommerceBytes Contributing Editor. He is a journalist and the author of many books, including "Starting an Online Business For Dummies," "Go Google: 20 Ways to Reach More Customers and Build Revenue with Google Business Tools," and several books about eBay, including "How to Do Everything with Your eBay Business," second edition, and "Secrets of the eBay Millionaires," both published by Osborne-McGraw Hill. Find out more on Greg's website, which includes his blog, a list of his books, and his fiction and biographical writing.


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