eBay is one of the world’s best-known and longest-running online marketplaces, providing a platform for selling and buying both new and second-hand goods. But what exactly is eBay, how does it work, why is it growing and who is it for? In this blog, we will explore these questions and also consider the opportunities and threats eBay offers sellers, especially in Finland.
Did you know? eBay is the second most popular online shopping platform in Europe.
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What is eBay?
eBay is one of the world’s oldest and best-known online trading platforms. The platform was founded in 1995, when it started as an auction-based marketplace. Since then, eBay has expanded strongly into fixed-price trading. eBay allows third-party sellers to list their products for sale to the general public and is now known as a marketplace for both used and new products. Although eBay has its roots in auctions and second-hand goods from individuals like tori.fi, the platform has largely evolved into a model similar to Amazon and other online trading platforms.
Did you know? Today, up to 80% of products sold on eBay are new.
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How does eBay work?
eBay offers a very similar model to other e-commerce platforms, where sellers can create listings and buyers can browse and buy products. One difference to other platforms is that sellers can choose whether they want to put their products up for auction or at a fixed price. eBay also offers a range of tools and services to help sellers and buyers, such as integrating payment methods and managing returns. Furthermore, like Amazon or Walmart, sellers do not receive direct logistical support from eBay; sellers are responsible for their own warehousing and end-customer logistics. However, eBay recommends on its website certain third-party logistics partners that it has approved.
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Users and customers can register on the platform for free. Sellers, on the other hand, pay listing fees and final value fees based on the number of sales made. Listing fees are small payments for each item added to the list, but eBay offers up to 250 free listings per month, making the platform particularly attractive to small sellers and new entrepreneurs.
Value-added payments are paid as a percentage of the selling price of the product, which includes delivery and handling costs but not sales tax. These fees are determined by the category in which the product is sold, so it is important that sellers familiarise themselves with eBay’s final value fees on the eBay website. In general, eBay’s costs for sellers are lower than Amazon’s, which can be a significant advantage, especially for small and medium-sized businesses.
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Why is eBay growing and who is it for?
eBay’s growth is driven by its ability to offer a diverse range of products and its global reach. eBay has more than 132 million active users and over 18 million sellers worldwide, making it an attractive platform for both small and large businesses. In addition to the US, eBay also has a very strong market position in Europe. Every month, more than 460 million people visit eBay in its five largest European markets. eBay is particularly strong in Germany (147.8 million), the UK (232.8 million) and Italy (46.9 million).
The Foxintelligence table below shows the most popular e-commerce platforms in the major European economic areas (measured in October 2023). After Amazon, eBay is the most popular single e-commerce platform in Europe.
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The eBay platform is particularly suitable for businesses and individuals who want to sell a wide range of products – new or used – quickly and widely. eBay offers faster and easier access to start selling than other e-commerce platforms, which also makes it suitable for faster market testing and selling needs. In addition, eBay’s easy market access and low listing costs make it an attractive alternative.
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Is eBay coming to Finland?
eBay is already available in Finland and Finnish users can both buy and sell products through eBay. The platform provides information and support for international sellers, for example on customs documentation and returns processing, making it a little easier for Finnish sellers to operate globally. In Finland, eBay has not yet achieved the same popularity as in the US or elsewhere in Europe, but its growing user base and expanding services make it a potential marketplace for Finnish sellers.
Read also: International selling on Amazon – how to enter new markets?
Threats and Opportunities for Sellers
Opportunities
- International exposure: eBay offers sellers the opportunity to reach a wide international customer base.
- Diverse product range: eBay’s flexible platform is suitable for both new and used products, opening up many business opportunities.
- Low threshold: eBay’s easy registration and listing process makes it attractive to new sellers.
Threats
- Competition: eBay’s large seller base means fierce competition, which can make it difficult for new sellers to stand out.
- Returns and customer service: Unlike Amazon, eBay does not always offer the same comprehensive returns policy, which can affect buyer confidence.
- Logistics: Sellers have to manage their own logistics, which can be challenging, especially when trading internationally.
Read also: Marketing on Amazon – How to differentiate from competition
eBay offers significant opportunities for sellers looking to expand into international markets and reach a wide range of customers. At the same time, however, sellers need to be aware of the competitive and logistical challenges.
Our expert tour guides will be happy to discuss your company’s potential in the e-commerce jungle with you – contact us for a low threshold.
