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Tue Oct 22 2013 14:58:10

eBay Should Follow Amazon When It Comes to Free Shipping

By: Reader

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Dear Ina,
I have sold on eBay for over 10 years, have over 11,000 feedback (99.9%) and am a Top Rated Seller. I noted with interest today that Amazon has raised the minimum for FREE shipping to $35.

I participate in the eBay encouraged FREE shipping on my listed items - with a few exceptions for items weighing more than one pound.

Today's announcement at Amazon made me wonder if eBay has ever considered establishing a minimum purchase amount for FREE shipping. It would be nice if eBay would use their IT resources to work that one out for the sellers instead of working so hard on the "seller updates" that come to us twice a year.

Since all sellers realize shipping is NOT free - and now eBay wants us to provide FREE returns (again not free) I thought maybe you could "shake the tree" at eBay with a question about setting a minimum for FREE SHIPPING.
Thanks for listening - and always being a voice for eBay sellers!
Sincerely,
Gina




Comments (20) | Permalink

Readers Comments

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: pace306 This user has validated their user name.

Tue Oct 22 15:38:49 2013

There's no such thing as "free shipping" (lets skip the "tehres no such thing as the Easter Bunny or Santa either for now LOL).

SOMEONE, SOMEWHERE has to pay the cost - and that person is the seller.

On Amazon its been $79.99 for a 2 yr PRIME membership for free shipping - and any OTHER free shipping issue was based on seller discretion.

eBay has 2 reasons for being on the "free shipping" bandwagon.

1) Pushing the seller to do it at no charge to eBay gets them free positive PR. "I got my item cheap AND with free shipping". eBay's modus operandi is to do nothing and then claim credit. eBay invests nothing in its seller platform, and sits back and awaits the FVFs.

2) eBay takes a cut of the "action". eBay takes the listing fee (if any) and a portion of the final value cost. THAT cost is higher if theres free shipping - as the seller has to build it into thier price!

So for eBay its win/win. They come out ahead no matter what.

Thats why it wont change. Thats why nothing ever changes on eBay unless someone in the company somewhere (JD, Lyin Ryan, Griff, Wenig) are pocketing the monies that come from that change.

There are no glitches on eBay, its not sloppy programing, there is no seller protection, Paypal is used like a mafia enforcer to force you into eBays rules - its a big con game. As long as you can stay ahead of the con and make money - you are GOLDEN. If you get caught in the net like a hapless dolphin - you're sunk!

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Captain Nemo

Tue Oct 22 16:05:46 2013

Let's not forget that all of us made more money than Amazon - who managed to lose over $100 million in the past 12 months.

A big part of this was - yes - shipping.  Amazon spent $1.3 BILLION dollars in the last 3 months on shipping, while only taking in $646 million in shipping charges (and this includes Prime Membership dues), for a net LOSS of $716 million dollars.

So no, shipping is never free, even for Amazon, who is basically giving up ALL of their profits to offer ''free'' shipping.

It's all in the quarterly report

Nothing new here, they lost $2.4 BILLION in 2011 in shipping costs.


eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: Steevo This user has validated their user name.

Tue Oct 22 16:32:55 2013

Pace, I disagree.

The buyer must pay the full costs of their purchases, including ''free shipping''.  

Somehow someway the customers have to pay the cost of operation of *all* businesses. Who pays to change the lightbulbs at Walmart?  You do, when you buy that bottle of shampoo.  

The seller, neither Walmart or any ebay seller goes out and gets a job at night to pay those business costs, they must be paid by customers.  That's all the money we have.

Excluded of course might be hobby sellers who are subsidizing their ebay sales with their dayjob.  

I discourage that but I am sure it goes on.  

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Tula

Tue Oct 22 16:45:50 2013

Yup, even Amazon, with their massive shipping discounts, loses money on shipping. That's why we have to build free shipping into our margins. Customers want free shipping and they don't really care that it isn't free. They think they're getting a deal. In some cases, they are. But any savvy sellers will build those costs into their prices, just like any other costs.

Just because the common term is free shipping, doesn't mean you should be making it truly free by pulling money out of your own pocket. That's no way to do business. Even Amazon is learning that, with the new $35 threshold for free shipping. It would be nice to see a similar capability on eBay, but I won't hold my breath. I'd rather see a smooth, uninterrupted holiday sales season rather than a boatload of changes to implement during a busy sales period.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Anonymous Annie

Tue Oct 22 16:58:36 2013

I offer ''free'' shipping (also known as ''shipping-included'') pricing on my website.

I'm pretty sure that customers are smart enough to know that ''free shipping'' is just the lingo-shorthand that isn't to be interpreted literally.

It appears that my customers like it because there are NO SURPRISES at checkout. The customer can look at the sub-total in their shopping cart, and they know EXACTLY what they'll pay at checkout.

Based on my own experiences, one of the things that I *truly* dislike about some shopping carts is that it's impossible to tell what the shipping charges will be UNTIL the NEXT-TO-LAST page of the checkout process.

I dislike having to fill in my name, address, phone & email... click-click-click... paging through the checkout... just so that I can get to the next-to-last page and discover that I'm being gouged in shipping.

Then what? Do I continue anyway? Do I remove an item (or two) until the total price is within my budget? -- Or do I abandon my cart and move on in disgust?

I'm sure that everyone's mileage may vary, but looking at my traffic reports, I can tell that I have VERY few abandoned carts. Over 95% of the time, if a customer puts an item IN their cart, they end up buying it!! :-)

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Tula

Tue Oct 22 17:41:38 2013

I agree 100% Annie. All sites should calculate your shipping costs at the first step and not force you to enter anything more than your zip code to do so. Having flat or free shipping makes the whole process go so much faster for both parties.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Ric

Tue Oct 22 18:26:58 2013

The reason eBay attempts to get every seller to offer free shipping is the simple fact that when shipping is included in the selling price of an item, eBay gets to count the entire value of the purchase as part of Gross Merchandise Value reported to Wall Street.

When shipping is not included in the selling price, eBay can not count it towards their inflated GMV, which is the reason they decided to impose a penalty fee on added shipping costs.

Any other benefits such as buyers believing they got a deal is a distant second - eBay values "free shipping" solely because it artificially inflates their GMV. They have been bamboozling Wall Street for years with this smoke and mirrors. Wall Street analysts are too vested in promoting stocks such as eBay which is why eBay is never questioned about their smoke and mirror financial reporting.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Basset

Tue Oct 22 18:38:26 2013

''Today's announcement at Amazon made me wonder if eBay has ever considered establishing a minimum purchase amount for FREE shipping.''



I'm puzzled on the OP's experience. eBay DOES  have that feature, I'm using it right now - it is called the promotional shipping feature.  Seller sets minimum purchase & once that total is reached, shipping is free for the buyer.


A side benefit from using promotional shipping is a row of items from MY store are featured below my main photo. It also highlights a second larger entrance into my store:

First you see ''Free shipping on orders over $xx.00'' (the seller sets this figure),

then  ''see more items''…. that leads right into my store (in a second location from the blue door).  

Finally, there is a running total on the right side to show how far away customers are from free shipping. Perhaps an incentive for some to take a peek & purchase more of your items.

From what I see, this feature is better than offering free shipping on everything if it gets the additional features and encourages more purchases from me.
 

Is no one else seeing this choice or feature?

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Marie

Tue Oct 22 19:35:30 2013

Free shipping has been called Free shipping LONG BEFORE Ebay ever brought it to the site.  It  was used and defined by the industry a very long time ago.  We need to get past trying to correct it very time someone uses the words free shipping.  We know shipping isn't truly free.  I think we can all agree we get that.

As to the OP's question regarding FS once a buyer reaches a certain threshold [ie $35].  Ebay does have a way for you to do that.  You go to your Site Preferences, then Shipping Preferences, then edit your combine shipping rules.  You can create a Promotional rule if you offer combine shipping.  There you can do what you are looking to do.

On Amazon you do not have to pay $80 to be a member of Prime to get FS.  Prime is expedited shipping not free shipping.  You can simply just shop on Amazon and you will see FS items.

@ Pace
"eBay takes a cut of the "action". eBay takes the listing fee (if any) and a portion of the final value cost. THAT cost is higher if theres free shipping - as the seller has to build it into thier price!"  When a seller on Amazon offers FS, they also increase their FVF paid to Amazon because that seller has to increase their pricing to accomodate the FS.  

On Ebay it doesn't matter.  The FVF on the product price is the same as the FVF on shipping.  So put it together or charge separately, Ebay will get the FVF.  Now I certainly don't agree with FVF on shipping, I'm simply stating how it is on Ebay currently.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Anonymous Annie

Tue Oct 22 21:54:07 2013

----- ''We need to get past trying to correct it very time someone uses the words free shipping.  We know shipping isn't truly free.  I think we can all agree we get that.''

Can I get an ''Amen''??

AMEN!!!

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: pace306 This user has validated their user name.

Tue Oct 22 23:00:10 2013

Marie

On Amazon - the choice to offer free shipping is the sellers choice. If you DONT choose to offer it, then you get a standard Amazon shipping credit.

The amount Amazon gets has that credit built into it - it tells you at the bottom of the listing page - so you as the seller know up front.

eBay has no such feature. They dont give you ANY credit - shipping or otherwise, so you cant compare the 2 - at all.

I echoed what RIC said - "gently forcing sellers" to include free shipping (and we can "argue" stick or carrot method and what is "forcing") is a money game/grab for eBay.

Yes eBay gets it both ways - but its used as a gimick when the verbage itself isnt true.

eBay has no "right" to take FVFs on shipping - its got nothing to do with them at all.

Back to Amazon for a moment - they have the aforementioned PRIME shipping plan, eBay does not. Amazon has a stake in the game (esp when its FBA items).

I didnt see the financials as someone mentioned - but then again - back end monies, shipping credits, etc are usually never reported.

"If you are big enough" (and Ive seen it done here in NY by 3 major retailers/etailers - and as someone who was invloved in discussions about buying for Amazon I was made privy to it) Fed Ex and DHL offer to larger accounts ... they bring trailers (empty ones) in the morning WITH employees that pack and load the trailers, then remove them at night.

That means - the employee costs to pack and load the trailers arent theirs (regardless of what the financial statements say) and the cost to get and remove the trailers arent thiers either.

There are alot of games that go on - dont think for  second that Amazon is loosing on this - they arent.

As for eBay - they have no infrastructor - no wharehouses (except GSI Commerce which isnt in the dicsussion here), no loaders, no packaging costs - nothing - just mandates that sellers come up with a free shipping gimick "or else you wont get shown - so says the nwe UA"

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: Tiffee Jasso This user has validated their user name.

Tue Oct 22 23:32:19 2013

I do not offer free shipping for many of my 2 pound or heavier items. Why should my California buyers have to pay $5 or more so that I can be covered in case a New Jersey customer buys the item. And just for the record, about 50% or more of my heaviest items go to the East Coast. Some say I should just pocket the extra money and leave it at that, but to me that is dishonest. I know to the Corporate business mind it is not dishonest, it is just the way you are supposed to do business. ("Take all you can get and give nothing back!" Pirates of the Caribbean.)  

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: trader_chris This user has validated their user name.

Tue Oct 22 23:50:44 2013

Amazon is able to offer free shipping because they have 15 fulfillment centers strategically located around the country that help to minimize transportation distance. They also ship such a huge volume of stuff that they are able to still make a lot of money even with low margins.

eBay on the otherhand, doesn't seem to get this. Shipping a 20lb item from my location in NC to anywhere on the east coast typically costs much less than if I have to ship the item cross country to CA, where a lot of my buyers come from. For that reason, I rarely offer free shipping unless the item is both small and valuable (i.e. coins, jewelry, watches, etc.)

As a consignment business, shipping is one area that I pay particular attention to detail, especially for the heavier or difficult to pack items (i.e. vintage stereo equipment, crystal glasses, framed art). You should know both the cheapest and fastest ways to get things from point ''A'' to point ''B'' (and sometimes they're one in the same... which is nice for both the buyer and seller.)

If you ''free'' shipping right, you should be able to account for the material costs, postage, and eBay fees and still come out ahead. It helps to sell hard-to-find items, where there's less pressure on price. And for the people that still gripe about shipping (even when the item is listed at a fraction of the going market price), I simply remind them that local pick-up is always free :)

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: FREDDY This user has validated their user name.

Tue Oct 22 23:57:32 2013

Amazon also charges a fee on shipping for third party sellers. If I remember correctly it was $1.35 on media. - fee of 3.99. ??

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Rexford

Wed Oct 23 07:21:51 2013

Steep yearly increases from the USPS make "free shipping" even less free.  Free shipping works for some and for some it does not. It should not be forced down a seller's throat.  We offer it where it makes sense, but not always.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

This user has validated their user name. by: Captain Nemo

Wed Oct 23 09:14:58 2013

@Marie - Amazon prime is Expedited AND Free shipping (with no minimum).

@Basset - Good call!  Yeah, this feature has been available on bay for at least 5 years

@trader_chris - actually, Amazon loses ALL of their profits on shipping and they are now operating on a negative markup of .15% on everything they sell.  This is why they raised the limit to $35 (just so they might break even)

@Ric - the fact that Ebay can include shipping as GMV is not why they do it. That would not  give them sustainable GMV growth - and growth is ALL that wallstreet cares about.

Ebay encourages it for the same reason that Amazon does - shoppers overwhelmingly like it and it adds up to more sales.  But Amazon is doing it to the extreme so they can destroy all of their online competition by capturing more market share at the expense of profits.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: Moonwishes This user has validated their user name.
Web Site

Wed Oct 23 09:53:18 2013

Amazon only has 'free shipping' for it's own products and those fulfilled by Amazon. 3P merchants will still get an individual shipping fee for each item they buy. Amazon also discourages refunds when calculating the seller's metrics. So a 3P merchant is in a pickle when someone buys two or more items, if you refund part of their money assuming it costs much less to send, it makes the seller look bad in amazon's eyes and if you don't you look bad in the buyer's eyes. However, the buyer does know ahead of time that they will be charged for each item purchased. I did have one customer after the fact question me as to why I didn't give her a refund of part of the fee. Well there is nothing on my Amazon account that promises that I would, nothing on Amazon that promises that they would make me, so why they would get mad over the shipping cost that they willingly paid is a puzzle to me.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: FREDDY This user has validated their user name.

Wed Oct 23 10:10:01 2013

Amazon did ''thank'' me for giving a partial refund on shipping. I had to call to figure out how to do it. Anyway, what the csr did not inform me was that the fees of $1.35 each on shipping would not be lowered. Amazon still made full profit. After that incident, I still offered reduced shipping if applicable on the order. However, I did not credit the shipping but the product price. This resulted in a fee credit from Amazon.  
The buyer should understand when they buy multiple from the same seller- they see it upon checkout what the total charges are - that is the price. Don't come back and ask ''what''.
Amazon does not give discounts on shipping on items they sell.
Amazon shows a loss. But they can only do it for so long. This is the reason the increase to $35.00 just before the holiday rush. Also, for prime membership. Sounds good. But do your homework first. The price that Amazon charges can be significantly higher than others - even taking the shipping into account.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: JustTheFacts This user has validated their user name.

Wed Oct 23 10:37:25 2013

I have some questions for Amazon sellers.

I am setting my listing and not understanding the shipping thing.

From what I just read on the last 2 posts.

1.Are you saying Amazon charges us 1.35 for every order or every item for the shipping?

2.Are we not allowed to do free shipping?

3.What is the band shipping then.  It allows us to do zero.

4.I was thinking that because of the high amount of returns it probably would not be good to do free shipping.  Would you agree?

If someone could give us all some deeper details on how shipping works and works out accounting for refunds etc through Amazon that would be great.

I will add my thought here. Because the returns seem to be pretty high on Amazon, we have to consider this when pricing our items as we have to consider the cost of shipping and return shipping and what ever they may do to our items during the 5 years they are allowed to use and abuse it then return it (yes I know it is not 5 years but at 90 days, it might as well be).

How do we truly account for the losses is my point.

Thanks.

eBay Should Follow Amazon When It Comes to Free Sh   eBay Should Follow Amazon When It Comes to Free Sh

by: lemonsandlemonade This user has validated their user name.

Wed Oct 23 19:47:56 2013

@ Captain Nemo

''Amazon prime is Expedited AND Free shipping (with no minimum).''

If we are talking ACTUALLY FREE here, this is not true.

Once again it is built into the price.  What you get from Amazon is SPEEDY shipping.

If you want something closer to Free Shipping- you need to look for other online shops that have the product at a lower price than Amazon (because they charge for shipping), but then have a 'Free Shipping When Order Totals X Amount' - that is when you sort of have 'free shipping'.

I do this all the time.  I see a product on Amazon, look at the seller advertisements for the same product on their site, then see if they have shipping deals after a certain amount.  Then see how many products they offer that I need stocking up on, compare costs, and does it make sense to buy more to get to the 'free shipping' amount.  Sometimes it does, sometimes not.

It takes more time but this is much closer to free shipping.  

When the Amazon or FBA price with 'free shipping' is the same as the 3P seller when the shipping is added- that is NOT free shipping.  What you get is the SPEEDY Amazon shipping, and that is sometimes why I buy, because I need it quickly and you can usually count on Amazon to do that, though they drop the ball sometimes also.



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