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Acquire and Keep Your Customers

I started pulling this stuff out of the trash can and putting it into kits that we put up for sale for $10 or $12 each. People just bought it up like crazy. One month we sold $30,000 worth of scrap paper. It was a perfect fit.” Now, the scrapbooking craze has slowed considerably. Having acquired a database of more than 20,000 customers through eBay, McCullough is trying to do the same thing for them that he did for recycled scrap paper: find new uses for that database of names in order to continue growing his business.

Using Your eBay Store to Acquire Customers: Creative Paper
When times are hard and you can’t sell your original product line as well as you did, you need to find new products and new ways to sell them. Business on eBay was great for Creative Paper for several years, especially in its eBay Store. Things have changed for reasons that other eBay sellers know all too well. As one seller put it to me, “eBay has lots of sellers, but it needs to find more buyers.”

Business was great for quite a while. “We started in 2001, really going crazy in 2002 and 2003, tapering off in 2003. Now scrapbooking is maybe 10 percent of our total business. eBay has now been flooded with a lot of other sellers doing the same thing we do—selling scrapbooking kits and scrap paper. That is compounded with the fact that the market just is not as good as it used to be. If you combine the two, it’s tough.”

But when you look at the big picture, things are much rosier: Less than six years before this was written, Creative Paper didn’t exist at all. And he was throwing his scrap paper in the recycle bin. Jeff ran Suburban Paper and primarily serviced customers in his local area. He didn’t know anything about mailing lists, databases of customers, packaging, or selling products directly to the public. Current monthly sales from scrapbooking materials are $10,000. It was all made possible and continues to be possible thanks to eBay.

“The Whole Purpose of eBay Is to Get Customers”
It should be obvious: People sell on eBay in order to find customers for their merchandise. What’s changed in recent years is the role eBay plays in the relationships businesses develop with those customers. In the early years, many companies saw no need to go beyond having an eBay Store. But now, with rising eBay fees and increased competition cutting their profit margins, an increasing number of businesses see eBay primarily as a “front end” tool. eBay gives them a way to make initial contact with customers, but their ultimate goal is to sell directly to those customers without eBay’s involvement. Creative Paper is one of those businesses. “We don’t do much better than break even with eBay sales because we are selling such small items,” says McCullough. “When we started doing this, eBay was charging a dime per sale. Now they charge 30 cents to list an item, and more for Gallery photos and other extras. The whole deal costs 60 to 70 cents per listing now. In the beginning, four out of five auctions were selling. Now, if I list ten auctions, I am lucky if three of them sell. Now, we encourage customers to go to our web site to make purchases. The whole point of eBay is to get customers we can sell to later on.” The Creative Paper web site (http://shop.store.yahoo.com/creativepapers/index.html), which is hosted by Yahoo!,

“We Do a Blast E-Mail to 20,000 Customers”
When you are just starting out, customers come and go. You barely notice their names and addresses as you write them on the package you’re about to take to the post office. But smart businesspeople know those names and addresses are like gold. They or their employees record the information in databases for later use. What kinds of things can you do with this business “treasure”? Some suggestions are presented in the following sections.

Send E-Mail Announcements
One thing Jeff McCullough does is send out regular e-mail communications to tell people about new promotions, seasonal specials, closeouts, and the like. Such messages enable Jeff to keep his company’s name in their minds so that, when they are ready to place an order for more paper, they’ll know exactly where to turn. It’s also a way to develop a kind of “one to one relationship” that marketing professionals talk about in regard to e-commerce.
McCullough’s mass e-mail “blast” is essential to his online business. “Right now my web site sales are about $5,000 a month, and half of that business comes from the blast e-mail I send out once a month offering free shipping, two-for-one deals, whatever. Business always spikes after I do the blast e-mail.”

Include a Gift
Like many successful eBay sellers, Jeff includes something extra in each package he sends to a buyer. Along with the item they ordered, they get some additional paper on a ring

“We throw a swatch ring in with all of our orders; it includes samples of our paper, hundreds of different patterns and shapes, and encourages customers to go to our web site to find out more.”

When a customer places an order on the Creative Paper web site or when he or she is viewing a short explanation about how to order he or she is given the option to sign up for the company’s free newsletter. What can a newsletter do to help you keep customers? Here’s what:
  • Builds credibility A newsletter lets people know you’re on the ball and actively managing your business.
  • Reminds them about you Web shoppers are fickle and will go anywhere they can find the best price unless you develop a sense of loyalty.
  • Gives them new reasons to visit your site Your newsletter can include descriptions of products your customers didn’t buy and didn’t know about originally. You introduce them to your entire product line; since they already know and trust you, they’re more likely to purchase one of those new items than someone who’s visiting you for the first time.
A newsletter like Creative Paper’s requires a commitment on your part. You or one of your employees (or a freelance writer like me) will have to be assigned to provide copy for it. Like many other parts of your business, a newsletter requires work up front but brings benefits in the long run. But then, a newsletter is a twentieth-century communications tool. If you want to really be on the cutting edge, you can create a blog for your area of business. A blog is an online diary that you or staff need to update on a regular basis. The eBay business profiled later in this chapter, Dallas Golf, operates such a blog through the blog hosting service TypePad.

“We Do Give People the Option to Opt Out”
Jeff McCullough is very conscious of what separates legitimate business communications from the dreaded “Unsolicited Commercial E-Mail,” otherwise known as “spam.” Whenever he sends an e-mail “blast” or a newsletter, he includes a note giving recipients the chance to “opt out” and not receive such messages in the future. The bottom line: Don’t approach your valued customers unless they have chosen to receive such e-mails from you, or unless you have specifically asked them if they want to receive such notification from you in future.

“When someone buys a product from us, they do so through Andale, which provides us with a checkout system. The checkout system gives people the option to opt out of any future communications from us after the purchase is made. Some people do opt out, but most don’t. It’s surprising, considering all the spam that’s out there on the Internet, but in a typical month we add 400 names to the list of 20,000, and we usually get 100 who opt out. Once they opt out, they don’t get messages about our products anymore.”.

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Upselling and Cross-Promoting: Dallas Golf

Dallas Golf started out small. In 1983, it was a single club repair shop located in Dallas, Texas. The company grew along with the recent popularity of the sport to which it is devoted. It became a consignment shop, a retail store, two retail stores, and finally, four retail stores. It was 1996, and the World Wide Web was the latest novelty. “Somebody said, ‘We’d better have a web site,’ so we jumped into the dot-com boom era,” recalls company E-Commerce Manager Chris Smith, along with some of his inventory. “Everybody was speculating and nobody was selling; we did that, too.”

By 1999, Dallas Golf’s retail stores were booming, even though its web site was not. Customers eagerly bought up new products. “We had lots of used inventory piling up in our retail stores, and those stores were small, so we said, ‘We need to do something with this.’ My boss read an article about eBay. He store the article out of the newspaper and said, ‘Here, try this.’ We put 10 things up for sale, then 100, then 250. Pretty soon, we had 20 employees assigned just to eBay, and that part of our business really took off.”

“Golf Is Almost the Perfect eBay Product”
Today, Dallas Golf is a Titanium PowerSeller and one of eBay’s biggest success stories. The store has only two retail locations now; it has actually closed some of its brick-and-mortar stores in order to concentrate its energy on Internet sales. “eBay has become a major part of our business,” says Smith. People who sell golf balls and golf equipment have always done well on the Internet and on eBay in particular. The qualities about the merchandise that make it such a success are ones that every budding eBay seller should look for:

Much of the equipment is small and easily transportable. True, golf bags and golf clubs are heavy. But most items like tees, balls, gloves, shoes, hats, and other accessories are small and easy to pack and ship.

There are many different product lines, each with its own models. Golf enthusiasts have a plethora of options when it comes to making purchases online. They can buy a complete set, an individual club, or they can mix and match. “Almost everything we sell is unique in some way, especially if it is used,” says Smith.

Used equipment is still valuable. Even though certain styles of golf clubs go out of style, according to Smith, they often come back in style a few years later. Golfers who are looking for quality equipment at bargain prices are eager to buy used equipment.

At certain times, it sells very quickly. The warm weather months find golfers shopping and buying on eBay in droves. Smith often conducts relatively short three-day auctions because the turnover comes so fast. “If there was a twelve-hour auction format, I might use it in summer,” he jokes.

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It’s Like Tapping Them on the Shoulder and Saying, Would You Like to Buy Something Else?

When you create an eBay Store, you have to pay an additional monthly fee to eBay, and this is on top of the insertion fees and Final Value Fees you already have to pay. But you get some additional advantages that other sellers don’t enjoy:
  • You pay only pennies for small Gallery photos, instead of the 35-cent fee charged to auction sellers.
  • You get a place to promote your business and develop an identity through a name and logo.
  • You get your fixed-price store sales included in keyword searches on Google and other search engines.
  • You get the chance to do cross-promoting.
Cross-promoting is the practice of presenting shoppers with additional purchasing options even as they are browsing or preparing to make a purchase from you. In an eBay Store, this takes the form of the “See More Great Items From This Seller” box that is familiar to many eBay members “We have an eBay Anchored Store, so we can include the See More Great Items feature on an unlimited number of listings,” says Smith. “We do this sort of cross-promotion in our item listings and on our web site at checkout as well. It’s like tapping a customer on the shoulder and saying, ‘Would you like to buy something else?’

“Cross-promotions and other tools for encouraging repeat business are essential,” he adds. “At least 25 percent of our transactions include multiple item purchases; 25 percent of our business is repeat business. On eBay, you’re always into the new customer that’s what eBay does, just the way the marketplace works. Everyone is new, basically. We get a lot of repeat business within the same transaction. Sometimes people will buy up to 20 different items. We get wholesale buyers who buy in large quantity from us, and they will sell in their retail store or at the local flea market.”

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We’re Sourcing Through Our Competitors

Chris Smith’s big priority is moving inventory. He wants to put as much stock on eBay as rapidly as he can, rather than letting it sit around the showroom or warehouse. Dallas Golf has its wholesale suppliers, like any other eBay business. But even their own wholesalers can’t keep up with demand, especially in the busy spring and summer months. Smith scratched his head, wondering where he could come up with new (or used) golf equipment to sell. Two sources came to him:
  • Dallas Golf’s competitors
  • Customers who want to replace used equipment with new equipment
Sourcing through your competitors? It sounds improbable, but Dallas Golf manages to do it.

“We go to our competition and say: ‘You sell new products, we have a database of the values of trade-in merchandise. Here are those values; call us once a week with your used inventory and sell it to us for the price we have in the database.’ Once we have the used merchandise, we can mark it up for a profit and sell it directly to customers on eBay.” Smith says he understands the problem with eBay’s rising fees, but golf is insulated from the fee increases to an extent because of the high turnover. “They eat out of your profit, but it’s better than having merchandise in your warehouse waiting for someone to come to your web site,” he comments.

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If We Can Get Customers to Trade in Their Old Clubs on eBay, We Can Sell Them on eBay

What about that other, highly unusual source for merchandise that was mentioned in the preceding section? Can you get people to trade in their used equipment on eBay, so you can turn around and resell it on eBay?

Dallas Golf is one of the first merchants to do so through a pilot program being conducted with eBay’s approval. In each of the Dallas Golf listings, which invites customers to calculate the value of their old golf clubs. Once they find out how much Dallas Golf will pay for those old clubs, they’ll be more likely to purchase brand-new clubs from Dallas Golf, or so the theory goes. “We are trying out ways to get more merchandise to sell. If we can get these people to trade in their old merchandise, we can sell it faster; we can sell it on eBay for more than they can list it for themselves. Since a good deal of our merchandise comes from our competitors’ buyers, we are giving those buyers the same technology, only in modular form.”

Dallas Golf was, in fact, the first company to be allowed to use the trade-in feature on eBay; any other listings prior to December of 2004 that asked buyers for trade-ins were ended. “We came up with a technology that met eBay’s requirements to allow someone to solicit,” Smith says. “We advertise in the listing, we use a flash calculator to tell the bidder that, if they win, their golf club is worth X amount. If you win, you can use your club as this much credit toward your purchase. That way, buyers can tell their significant other they didn’t spend so much on their new equipment because they got money for their old equipment.” In the six months it used the trade-in feature, Dallas Golf saw a 30 percent increase in bids, page views, and selling price, he adds.

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We Do a Daily E-Mail That Highlights Auctions That Are About to Close

Lots of eBay businesses (like the other business profiled in this chapter, Creative Paper) send e-mail messages to their customer database, informing customers about new promotions. Dallas Golf takes this concept a step further and tells shoppers about eBay auctions that are about to end that same day.

“We don’t send out a newsletter, but rather, a ‘featured products’ list that contains one-shot-opportunity type buys. We might get a limited run like 50 putters or 10 woods. Golf is an ultra-competitive category on eBay, so to stay ahead of the competition, we do a daily e-mail that highlights auctions that are about to close. ‘You want to take advantage of the poor performance of this sale . . .’ we might say. ‘This item is currently selling for 99 cents, no reserve. Auction closes at 8 p.m.’ When I send the e-mail out at noon, I might have a $100 driver about to sell for $6. I can guarantee you that, when the sale ends, it will sell for more than $6.”

“We’re Always Trying to Say, ‘If You Don’t Like This, Here, Look at This’”
Dallas Golf’s sales descriptions are long compared to those of other sellers. Along with the Trade-In utility and the See More Great Items box, they have another feature: they provide shoppers with a table that lets them see the entire inventory that’s for sale by Dallas Golf on eBay.

“We’re always trying to say, ‘If you don’t like this, look here, look at this,’ ” Smith comments. “We generally display only the items that are live on eBay; that list is expandable by category. It’s a short list, but you can click folders to display a menu and submenu.”

Tips : You don’t need to turn to expensive programming to tell your customers about other items you have for sale. You can take the low-tech approach and type a note at the bottom of your description, saying “See my other auctions for similar items, other models of the same item,” or something similar.

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Be a Salesperson: Tell People What They Really Need on the Phone

Dallas Golf uses many of the tried-and-true promotional tools that have built customer loyalty in the past: They have seasonal promotions and closeouts. They aren’t afraid to sell used merchandise. “We sell a lot of used equipment because the trade-in model works for us. More recently, we are into the ‘liquidation’ model, where we sell equipment that is at the end of its product life. It might be that the item ‘died’ five years ago, when the manufacturer stopped making it, and we’re bringing it back. In golf, the technology only cycles around, like clothes. A particular type of club might be regarded like a bad idea now, but three years later, it might be seen as a good idea again.” eBay is the ideal place for such liquidations, he says.

Dallas Golf also includes its toll-free phone number on every listing. This allows Smith and his employees to perform some old-fashioned salesmanship. “When customers do call, sometimes golf is one of those things, where you buy something, you want it to perform just the way you want. People say to me on the phone, ‘I’m a 25 handicap, only played six rounds, would this driver work for me?’ I say, try this thing, and by the way, you might think of buying this thing, too. Don’t be afraid to be a salesperson and tell people what they really need on the phone.”

Lessons Learned in This Chapter
  • Recycled and “repurposed” manufacturing materials can be packaged and sold on eBay to specialty buyers who have shown an interest in them.
  • Many businesses regard eBay as a customer acquisition tool as much as a sales tool; they find customers through eBay and try to court their business through marketing strategies.
  • E-mail announcements and extra items placed in the packages you ship can encourage buyers to revisit your eBay Store or your web site to make more purchases from you.
  • Be careful when you approach customers with marketing information so you aren’t accused of sending “spam” e-mail; give recipients the chance to opt out of future communications, or get their permission before hand.
  • Take advantage of holidays and other special events to create products that can attract new customers.
  • Products like golf-related equipment sell well on eBay because they have many different brands and models and users are frequently interested in trading up to the newest varieties.
  • If you open an eBay Store, take advantage of the See More Great Items box as a way of cross-promoting your merchandise for sale.

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Doing eBay Bigger, Better, Faster

“Always been a sort of an entrepreneur,”. “In college, at the University of Illinois at Champaign-Urbana, I had a T-shirt business. That’s how I paid for college. I had a coupon business for a while.

I have owned several types of entities some worked, and some didn’t.” eBay definitely seems to be working for Harmon. Since he first bought a purse as a Christmas present for his wife on eBay in 2002, he has managed to build up, in less than three years, a feedback rating of more than 58,000. To build up that many sales and positive feedbacks that quickly, he has managed to sell an average of 52 items every day. At any time, he has as many as 381,000 items for sale in his eBay Store. How did he ramp up so quickly, and how does he keep his sales level constant? He passes on some of his tips and best practices in the sections that follow.

“I got started on eBay because I didn’t want to pay full price for an expensive purse for my wife for Christmas 2002,” Harmon recalls. “I joined up, and I found a really nice purse for two-thirds the price it would cost in a store. I thought ‘Huh, that’s interesting. Maybe there’s something to eBay.’ So I sold some things out of my closet, to see how the e-mails work and how My eBay works.”

So far, the story is probably one you are familiar with. You start out selling your own possessions, and you move on by finding merchandise to sell in bulk. What’s special about Kevin Harmon’s story? One thing is that he decided to sell something that’s in high demand. Another is that he wasn’t reluctant to find as many items as he possibly could.

“You Need a Solid Breadth of Product to Sell Well on eBay”
“Once I got the hang of selling, I looked for things I knew well enough that I could resell them. I am a movie buff, so I decided to try to find DVD and VHS movies. I went to local flea markets, buying stuff I thought I could resell DVDs, wacky stuff. That got me off the ground. There are 15 flea Business name Inflatable Madness LLC Seller name Kevin Harmon


Sells DVDs, CDs, Xbox games, PS2 games, Gamecube games, tools markets within 15 miles of Charlotte, North Carolina, so that kept me going for a while. But I needed to find larger suppliers and variety. That’s the problem with eBay: It’s two miles wide and two inches deep. You need a solid breadth of product to sell well on eBay. There are at least 45,000 DVDs and 200,000 CDs, so I knew there were lots to sell, if I could find them. I started a big search and scoured the Internet to find suppliers.”

Another secret to success: the realization that people don’t like to click on link after link on eBay when they’re shopping. They want to find a single store that has thousands of different items for sale rather than going through thousands of stores, each with a handful of items. As you can see from his eBay Store which has the easy to remember name Inflatable Madness LLC he carries as many as 38,000 DVDs and around 100,000 CDs

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Our Model: Virtual Inventory We Don’t Own Until It’s Sold, and National Distributors

When you ramp up and start putting thousands (or tens of thousands, or even hundreds of thousands) of items for sale on eBay, the question naturally arises: Where are you going to store all this stuff? If you don’t ask the question, your spouse or your children surely will. There are two different solutions to this problem, and Kevin Harmon uses both of them. “I started my office in my house. I had one bookshelf that held 200 DVDs, and I remember at that time, I was freaking out with how many DVDs I had. (Now I have 200,000.) When I ran out of space, I moved to an 800-sq. ft. office. Then, I moved to the office next door and took over both spaces. Now we’re in a 2,000-sq. ft. warehouse, and we’re moving to a new space.” The key to such growth is having lots of merchandise to sell, and that, of course, depends on finding the right suppliers. “Through our distributors we can offer as many as 300,000 items,” says Harmon. “There’s a whole lot we could offer; it’s just a matter of finding what sells on eBay.”

Finding what sells requires research in eBay’s completed auctions, which Harmon conducts on a regular basis. It’s also a matter of pricing lower than the competition. In the case of CDs and DVDs, Harmon knows he’s competing with the many brick-and-mortar stores that sell movies and music. He realizes that the only reasons someone would make a purchase on eBay are price and selection: He has to offer items at a lower price than the competition, and he has to offer unusual, even strange items that people can’t find easily, such as the movie shown in “Ninety percent of our items are more expensive than a brick and mortar store. Someone could indeed buy a DVD for $16 in a physical, retail store and they would pay $21 through me if you include shipping. I’m taking advantage of the laziness of the world. The average big-box store like Best Buy has 2,000 titles. We have 200,000 titles including many unique, rare movies. You have limited movie selections in the local store, so you go online.

My business works because I found a lot of products to buy the right type of products. eBay is a site where you have to sell at competitive wholesale pricing, and then you just offer everything under the sun.” The Inflatable Madness LLC business model doesn’t require Harmon to store every one of the items he sells in his warehouse, however. Like many eBay PowerSellers, he uses drop-shippers: suppliers who sell merchandise and hold on to it for the owner; when a purchase is made, they pack and ship it as part of their services. The eBay seller never actually sees them. “Our business model is two fold virtual inventory we don’t own until it’s sold, then national distributors.”

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We Are Plugged in Directly to eBay with Our Own Software

“You just don’t find enough time to do everything yourself before you need some help,” says Harmon. “I have certainly committed the sin of trying to do everything myself. I can’t do that anymore. We have two full-timers and several part-timers wandering around our warehouse at any one time.”

His wife Linda and their two children might also be found helping with packing and shipping. “Finding time for your family is the hardest part of running your own business. People talk about how wonderful it is, doing what you really like what you do, but keep in mind that you are going to spend a lot of time doing it. I work 70 hours a week; I love it, I involve my family too. My wife has started her own business on the side, and she will occasionally help with shipping or whatever she can do to bring our family together. My four-year-old is all over this place. We use a third-party company that gets mail every day. They do all our shipping. We pack it up and put labels on it, they insert it into the post office system.” Most big-time eBay PowerSellers use some kind of selling tools to expedite the management of their sales. Many start with eBay’s own Selling Manager or Turbo Lister. The most successful sellers move beyond software that is available “off the shelf.” They hire a programmer who creates software that is customized for their own business. David Hardin (see Chapter 7) uses custom software in his various shoe stores on eBay. So does ExpressDrop (also profiled in Chapter 7). And so does Kevin Harmon. “At first, I was using eBay’s tools—we still use Turbo Lister, in fact. As we grew, I moved to my own software; we developed software that can launch and manage auctions (see Figure 11-3). We are plugged in directly to eBay at this point. Our applications send data to eBay behind the scenes. To grow to a modest level, and bigger, off-the-shelf tools work up to a certain point.”

“I Never Buy Anything Unless Research It First on eBay”
Looking ahead, Kevin Harmon strikes a cautious note. He indicates that in the future, he isn’t going to expand his business as quickly as he did over the past few years.

“I would advise new sellers to not even bother to start an eBay business if you can’t find things to sell on eBay. Sourcing the product is the most important thing you can do on eBay. If you can find something that is rare and unique, there are so many things out there that you can sell. You have a big personal advantage: Before you buy on eBay, research it. I never buy anything unless I research it first on eBay. I still find new suppliers today. It’s a consistent, constant search on my end, because DVDs are a massively popular product. eBay provides you with a unique opportunity to find out what something sells for, nationwide. So always do your research.”

Like many of eBay’s most active sellers, eBay’s own price increases have forced Harmon to look beyond eBay to sell merchandise. “eBay’s price increases for eBay Stores hurt tremendously. Now it costs us more to do the same thing. For someone like myself who has 130,000 items in store, when they take dead aim at you, you have to say, ‘OK, eBay is a large portion of the business, but it can no longer be the only portion of the business.’ A lot of the larger sellers are launching web sites, and we are launching a web site, too.”

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Choose Your Operational Partner Carefully

Unless you have the resources to hire a programmer and develop your own sales software, chances are you’re going to choose a company to serve as your operational partner. Such a company can do more than provide you with software to keep track of sales. Some partners can even help you find sources for your merchandise or market your eBay business by writing about it on their own web site. “We think it’s important to choose your operational partners carefully,” says David Yaskulka of Blueberry Boutique, a PowerSeller profiled in Chapter 9. “For example, we launched a partnership with ChannelAdvisor (http://www.channeladvisor.com) to provide their auction management software. They are a real strategic partner.

“There’s another, underutilized resource,” adds Yaskulka. “Many sellers would do well to partner with a full-service auction company. People who want to sell on eBay might not be better off inventing the wheel but could find someone who has packaged a whole business for them. A company like Auction Safari (see Chapter 6) will help with training, marketing, cross-marketing, shipping. They would take a percentage of sales, and each seller has to do the math. For some sellers, that sort of partnership would help you get products you need.”

“Everyone Gets Burned Trying to Find New Suppliers”
If finding suppliers is the key to doing business on eBay, how does one find a reputable source of merchandise? “That’s very difficult,” Harmon admits. “You have to do a lot of testing. There are a lot of dos and don’ts for finding a new contact. If they want payment up front or wire transfer up front, I would suggest not going with them.

“Believe it or not, a lot of suppliers are already selling on eBay,” he adds. “I can look up their feedback on eBay. It’s very tough, everyone gets burned trying to get new suppliers. If you can’t get them on the phone, that’s not a good thing. If you can’t see images of their products online, that’s not good, either. You have to be very careful that you are getting a legitimate product. Buy 10 things to try them out, or ask them for some samples first. That way, if you get burned, you’re not out a lot of money.”

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Start with Something You Really Love

Jake’s Dog House, which sells treats, collars, and toys for dogs as well as accessories for dog lovers, began in 1995 as the brainchild of Jon and Jeane Stein. They started with a single cart in a shopping mall and a mail order catalog. In 1996 the business expanded to include the Web with the creation of their web site (http://www.jakesdoghouse.com). Jon, the CEO, considers the online business to be the “sixth store in the chain” and also believes that this is an area with “significant and exponential growth potential.” The company motto over the years has been “Great Stores, Great Products, and Great People,” and Jon points out that “it is mission critical for the e-commerce business to carry the same solid branding and upscale image as the stores.”

Jake’s Dog House went on eBay in the summer of 2003. Jon says, “We just woke up one day and decided that we would list a few items.” Initially, Stein was skeptical, but the sales on eBay exceeded his expectations. The company quickly scaled up their listings to several hundred per week. Within three months, Jake’s Dog House (User ID: jakesdoghouse) had become a PowerSeller on eBay.

When it comes to starting out, Stein advises that sellers “understand what it is that they are selling. If you sell dog accessories, you should be passionate about dogs, you should sell something you really know and love.” But Stein’s focus is and always has been the desire to grow his business exponentially. Only a year or so after starting out on eBay, he began looking for the “perfect e-commerce software solution.”

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Choose the Right Solution Carefully

“We are always looking for ways to improve our business,” says Stein. This comment might seem surprising when you consider that, besides his many sales venues, he has about 60 employees. And he lists as many as a thousand items on eBay each week. But Stein is always looking for ways to grow and operate more efficiently, and he credits a particular auction service provider with his success.

One of Jon’s biggest tips on growing a business, especially as the e-commerce field matures, is to find the right management software. After shopping around with several software vendors, Jon chose Infopia. The company’s Marketplace Manager package manages listings both on eBay and another rival auction site, Overstock.com (http://www.overstock.com). When we spoke, he was planning to double the Jake’s Dog House online business revenue compared to the previous year.

“We just felt Infopia was the best technology out there. This type of solution is not for everybody, but we felt it was right for us. An auction management package is not a one-size-fits-all solution. There are a lot of different providers. I advise sellers to go out and talk to as many providers as they can, and try them on for size. It’s not a one-size-fits-all thing. Someone selling at the volume we have is different than seller B working at a different volume. A service provider should be able to give you a demo version of their product so you can try it out for a period of time. “In the case of Infopia, we didn’t really try the Marketplace Manager software out per se, but we went through an extensive evaluation. We did hands-on demos to make sure it would fit our needs,” Stein adds.

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Time and Time Again, We Look for New Eyeballs and New Customers

One way to expand a business that has already achieved a certain amount of success on eBay is to develop its web site. Many of the sellers profiled in preceding chapters encourage the shoppers they acquire from eBay to make subsequent purchases from their web sites. They devote considerable effort to making their web sites customer-friendly and able to conduct e-commerce.

The Jake’s Dog House site (http://www.jakesdoghouse.com) is no exception. One thing you notice the moment you view the home page is the slogan: “Cool Stuff for Cool Dogs.”

The site’s appearance is due, in part, to Infopia’s Marketplace Manager software. “Infopia redid our web site, and we have very strict and certain requirements as to how we want to present ourselves. The site looks awesome and is performing well.” Infopia provides the company with its own shopping cart and checkout system. The Jake’s Dog House web site includes a number of other features that you can’t duplicate in an eBay Store. When you decide to create your own web site you should consider including them as well:
  1. Multiple search options When you set up an eBay Store, you can let your customers search your merchandise by keyword. When you create a web site, if you have a programmer to help you, you can set up multiple types of searches. Jake’s Dog House lets shoppers search for merchandise by breed of dog and by the brand of the merchandise as well.
  2. Extensive customer service information eBay Stores do include sections such as About the Seller and Seller Policies. But with a web site, you are able to separate your customer service information into multiple pages. Jake’s Dog House has separate pages entitled About Us, Customer Service, Policies & FAQ, and Throw Us a Bone, which includes contact information.
  3. Links to other web sites The more useful information you include on your web site, the more return visits you’ll have. Jake’s Dog House includes a page full of links to eBay and PayPal, as well as animal hospitals and animal welfare associations.
Although the web site is operating well, Stein realized he needed to integrate all of his sales the ones made in his retail stores as well as those online. “We needed more automation, between our integration software, our point-of-sale software, and our online management.” He doesn’t want to have inventory mixups occur for instance, if he sells one item twice in two of his stores, forcing one customer to wait while new stock is ordered. Marketplace Manager coordinates sales information and inventory data for all of his storefronts so each one is working with the same information.

Read more!

Think the Best Is Yet to Come

As e-commerce becomes an everyday way of shopping, it’s important to manage growth, but not to forget the core task of any eBay sellers: customer satisfaction.

“Hire Someone Who Has Already Gone Where You Want to Go”
When your business is off and running and you want to take it to a new level, where do you turn? “For some companies that want to sell on eBay, it is worth hiring an expert consultant who has already gone where you want to go, and who can help you to get there,” says David Yaskulka of Blueberry Boutique. Not surprisingly, Yaskulka acts as a consultant for other eBay sellers himself.

“The beauty of eBay is you can test your concept and put toes in water,” says Yaskulka. “Sophisticated branding is very important in our niche, but we didn’t have a professional design for eight months after we started selling on eBay.”

Not only that, but you can—and should—start out with only a small investment. “In fact, I don’t recommend a lot of investment,” says Yaskulka. “I recommend capping your investment at a couple of hundred bucks and trying it out to see if you have the potential for success. At a certain stage it often makes sense to say, ‘I’ve got something here, I want to grow it in the best possible way.’ Hiring an expert can help you do that.”


“There really aren’t that many secrets to running a business on eBay (other than revealing who our suppliers are); our goal is always 100 percent customer satisfaction,” says Jon Stein. “We have a very liberal return policy. Our main criteria is, we will accept returned items if they are in a new or resellable condition. It can’t be half of a package of dog cookies that has already been opened, for instance. I would also provide not just a phone number but 9 to 5 customer service Monday through Friday, at a minimum.”

While eBay is the biggest marketplace on the Web and the biggest auction seller online, other outlets exist. Jake’s is, in fact, expanding to open storefronts with Overstock.com (http://www.overstock.com) and Amazon.com’s Marketplace. Overstock doesn’t have as many members as eBay, but it charges lower fees than eBay, and a growing number of sellers are attracted to such alternatives. “I think the best is yet to come,” concludes Jon Stein. “We are just starting to see inroads made with sites like Overstock. Quite honestly, our web site is our most mature sales venue, and eBay is second, but other sites are worth looking at as well.”

FIGURE 11-8 Once you are established on eBay, consider expanding to other auction sites.

Lessons Learned in This Chapter

  • Even if you sell in a popular category like DVDs and VHS movies,
  • you can be competitive if you find a supplier who can provide you with items that are unusual and hard to find in retail stores, and that come in wide variety.
  • Many sellers use drop-shippers to build up their sales volume: Such companies sell you merchandise but don’t ship it to you. When someone buys the merchandise from you, the drop-shipper sends it out, so you never have to deal with the inventory.
  • If you have a programmer on staff or can find one who is an eBay Certified Solution Provider, you can create custom solutions that automatically list your items and manage sales for you.
  • Don’t purchase merchandise from a wholesale supplier unless you research it first on eBay to see if there’s a demand for it, and what the market will bear.
  • When you sell something you love and that personally interests you, it’s easier to devote the time and effort needed to complete transactions and develop web sites and other sales channels.
  • An auction service provider can help you ramp up your sales substantially. But choose your provider carefully: ask for references and try out a demo version to make sure the software does what you want.
  • Once you are established on eBay, consider developing your own web site so you can deal directly with customers.
  • eBay sales can also be supplemented by other outlets like Overstock.com and Amazon.com.

Read more!

Web Resources for PowerSellers

One of the things that makes PowerSellers successful is the fact that they don’t try to do everything on their own. In order to sell at volume and make a profit, they know they need help. Sometimes, help comes in the form of software they use to keep track of what’s been sold and what steps in a transaction need to be completed. Sometimes, they hire employees. But just as often, they know where to turn on the Internet. The following set of resources has been compiled from talking to PowerSellers featured in this and other books; these resources include web sites and other tools that can help any eBay member sell smarter and more efficiently, no matter what level they’re at.

Read more!

Resources on eBay

The logical place to start, when it comes to finding out how to be a PowerSeller, is eBay itself. The following pages on eBay’s voluminous web site will give you some good starting points.

eBay Keywords
http://buy.ebay.com and https://ebay.admarketplace.net
There are two different eBay Keywords pages, and each brings a different benefit to sellers. The first page (http://buy.ebay.com) gives you an alphabetical list of terms that members have searched for recently on eBay. If you include the same keywords in your descriptions, the chances of having your sales turn up in search results goes up. The other URL (https://
ebay.admarketplace.net) takes you to the eBay Keywords program, which lets you place bids on keywords; if you place the high bid and someone searches for your chosen word, an ad you create will appear at the top of the eBay search results. The ad can lead to your eBay Store.

PowerSeller Information
http://pages.ebay.com/services/buyandsell/powerseller/
You’ll find criteria for earning the PowerSeller designation, as well as benefits for being admitted to the program. You’ll also find back issues of the eBay PowerSeller’s newsletter. The back issues only go up to June 2002, but they still contain tips and articles that are relevant to anyone who wants to obtain the coveted PowerSeller designation.

“What’s Hot” Lists
http://pages.ebay.com/sellercentral/whatshot.html
eBay’s Seller Central area (http://pages.ebay.com/sellercentral/)
provides general information on best practices and news for eBay sellers. Within this area, you’ll find the What’s Hot lists, which are of special interest to anyone who’s looking to find merchandise to sell on the auction site. The Hot Items by Category hot lists are detailed reports on what’s been selling best on eBay recently, arranged by category.

Read more!

Software Tools

PowerSellers are independent by nature. The act of starting up a business on eBay is one they usually try to handle by themselves as much as possible. After a short time of juggling feedback, packing, and creating listings, they realize a software tool will help them work more efficiently and free up more time for the things that matter, such as customer service and sourcing merchandise. There are lots of companies that function as auction service providers; the following are a few examples used by some of the PowerSellers interviewed for this book.

Andale
http://www.andale.com
Andale provides a variety of tools for listing sales and researching items to sell. One of the best is the Price Finder ($3.95 per month), which provides you with far more detailed sales reports than eBay’s own Completed Items search. The basic version of the auction counters Andale provides is free. For hosting 3MB of images you’ll only pay $3 per month.

buySAFE
http://www.buysafe.com
buySAFE isn’t a software tool for managing auctions, but it does
provide auction sellers with a service. buySAFE’s service is a “seal of approval.” buySAFE places the seal on the auction sales descriptions of sellers who meet the right qualifications for customer service and who pay a 1 percent fee to buySAFE for each completed transaction. In return, according to buySAFE, you get more bids for what you sell as well as higher sale prices.

Ethical Technologies
http://www.ethicaltools.com
Scott Samuel, who founded Honesty.com and invented the auction counters that are now used by Andale, founded Ethical Technologies, which offers a wide variety of sophisticated relisting tools, thank-you-for-bidding utilities, and software that you can’t find anywhere else.

Infopia
http://www.infopia.com
Several of the PowerSellers profiled in this book use Infopia’s software to create web sites and list sales on the Web and on eBay. If you sell products that can be customized, such as golf clubs, you can use Infopia’s Configurator to enable your shoppers to enter their specifications right in your sales descriptions.

Marketworks
http://www.marketworks.com
One of the oldest and best-known auction service providers, Marketworks has tools that can help you find more buyers for your products. The company can help you sign up for pay-per-click programs that get your eBay Store listings better placement on search engines such as Google. If you want to outsource the work involved in listing items on eBay, Marketworks can create listings and complete transactions for you, too.

SpareDollar
http://www.sparedollar.com
I’ve only met one PowerSeller who has used SpareDollar, and that fact surprises me. SpareDollar is one of the lowest-priced auction service providers around. For a mere $4.95 per month, a SpareDollar account gives you the ability to post thousands of auction images, create formatted sales listings, track visitors to your auction, and streamline correspondence with your buyers.

Vendio
http://www.vendio.com
Vendio, a popular service used by many eBay PowerSellers, primarily advertises itself as a web hosting service rather than an auction service. Nonetheless, its image hosting plans and “slide show” feature, which shows multiple items for sale, are perfect for eBay sellers. Plans start at $3.95 per month; a more full-featured plan is also available for $6.95 a month.

Zoovy
http://www.zoovy.com
At least one of the sellers profiled in this book chose Zoovy after shopping around with many other service providers. Zoovy’s Auction Seller product helps you schedule and relist your sales, automatically process eBay order checkout, print labels and invoices, and many other functions.

Read more!

Tools for Finding and Selling Merchandise

The primary challenge for many (if not most) PowerSellers is not selling and providing customer service. They’re naturally good at that. The problem is finding a steady and reliable supply of merchandise to sell at a reasonable price and that is not already being sold cut-rate by many other sellers. There’s no single magic solution for sourcing merchandise on eBay, but the resources listed in this section will get you started.

Alibaba
http://www.alibaba.com
Alibaba is a Chinese-based business-to-business marketplace.
Wholesalers from China and other locations place listings on the site for merchandise they want to sell; buyers around the world contact them and strike up deals. It’s an intriguing idea, one that cuts across many cultural and economic barriers. (The site is so intriguing that it was recently purchased by Yahoo!.) Normally, it’s difficult to find wholesale suppliers located in the Far East; you have to work with brokers or others who are familiar with the ins and outs of this particular marketplace. Alibaba opens the marketplace to you directly.

Association of Independent Information Professionals
http://www.aiip.org
When you’re looking for merchandise to sell, you can benefit greatly from hiring a professional, especially if you’ve never been through the process before. An Information Broker will charge you an hourly fee to prepare a detailed report on almost any subject, including researching wholesale sellers.

“How to Find Wholesalers” Workshop
http://forums.ebay.com/db2/thread.jspa?threadID=410484269
This eBay workshop, held in March 2005, provided some excellent tips on how to approach wholesalers and convince them that you should be a reseller.

Multistate Tax Commission
http://www.mtc.gov/TXPYRSVS/actualpage.htm
In order to resell items you buy wholesale, you’ll need a Tax ID number. Having a Tax ID, in fact, is one of the things that wholesalers are sure to ask you for when you contact them. The Multistate Tax Commission provides a set of links to the tax forms web pages in many states.

Read more!

Groups and Forums

Networking is one of the best ways to get inspired, find support, be encouraged, and get problems solved on eBay. PowerSellers, like all eBay members, turn to online discussion forums when they need to boost their enthusiasm or simply commiserate with other entrepreneurs who are facing the same challenges. Here are a few places where PowerSellers can find help and support.

eBay Sales Reports Discussion Board
http://forums.ebay.com/db1/forum.jspa?forumID=4024
This board is for eBay members who want to learn from, and share best practices with, other community members about eBay data products available to help sellers track and analyze their sales over time. If you have problems or complaints about the way eBay tracks your sales, this is the place to compare notes with your fellow sellers.

Professional eBay Sellers Alliance (PESA)
http://www.gopesa.org
Many PowerSellers would love to be admitted to this group. PESA currently represents more than 700 high-volume eBay sellers who are responsible for $1 billion in sales. As a result, eBay eally listens to this group. When they complain or make suggestions, things happen. Members ave to meet two of the following criteria: $25,000 in gross sales, $1,500 per month in eBay fees, 500 feedbacks in the past 30 days, or 500 listings in the past 30 days.

Seller Central Discussion Board
http://forums.ebay.com/db2/forum.jspa?forumID=143
This board helps eBay members to learn all the latest selling tips, tools, and resources to maximize sales and build a thriving eBay business. eBay sellers, with the support of eBay staff, share their experiences, their feedback, and their most effective, time-tested strategies for success!

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Tools for Tracking Income and Expenses

Conducting online auctions requires solid record keeping. Here are some powerful, yet user-friendly, accounting programs that can help you keep track of your expenses and earnings. The web sites associated with these products often include links to related sites where you can perform financial operations online, such as basic record keeping or payroll.

Microsoft Money 2005
http://www.microsoft.com/money
One of the distinguishing features of Microsoft Money is its level of integration with the Internet. You can get suggestions regarding online resources, such as to check whether your bank is online and then set up online banking. You can learn how to control your auction finances through the Money Academy and Money Wise web sites. You can also try a demo version of Microsoft Money 2005 Deluxe or Small Business. (A new version, Microsoft Money for the Pocket PC, is now available for mobile users.) Current users of Microsoft Money will find a set of Frequently Asked Questions, an offer for a free year of online data backups, and links to financial institutions that support Microsoft Money bill payments.

MYOB Web Site
http://www.myob.com/us/products
You can purchase the MYOB accounting software from this site. You can also order a trial version of MYOB AccountEdge, FirstEdge, or Premier Accounting. MYOB accounting software comes in versions for Macintosh and Windows. Links to the MYOB eBusiness Gateway enable you to establish yourself as an American Express credit card merchant or automatically bill your customers.

Peachtree Office Accounting
http://www.peachtree.com
Peachtree Accounting and Peachtree Complete Accounting allow you to work seamlessly with Microsoft Office products such as Excel and Word. Peachtree Premium Accounting is available for auction sellers with advanced accounting needs. A new product, Peachtree First Accounting, is designed for businesspeople who are converting a personal financial system to a business system. The Peachtree Software site is distinguished from its competitors’ sites by providing easy-to-find business services built around its software. Services include payroll and tax filing, bill payment, banking, and web site building. Peachtree Office Accounting and Peachtree Complete Accounting are available for Windows users only.

Quicken 2006

http://www.quicken.com
Quicken 2006 for Windows isn’t a single product but rather a family of accounting software packages, each with a different purpose. For example, you can order Quicken Premier Home and Business 2006, which enables you to manage both your personal finances and auction accounting. With this software, you can create business forms that will impress your buyers with a logo based on your domain or web site name, reports and graphs that track your monthly expenses and earnings, and business plans. Quicken Deluxe 2006 for Macintosh is available for Mac users with OS 9 or later.

QuickBooks
http://quickbooks.intuit.com
The QuickBooks products, like the Quicken products, are produced by Intuit, Inc. Whereas Quicken emphasizes personal finance and includes features that you can use to manage your personal as well as auction accounts QuickBooks is more of a straight business product. The software comes in four versions: Basic, Pro, Premier, and QuickBooks Online Edition. Another difference between Quicken and QuickBooks is that you can order a trial CD of QuickBooks Basic from the Intuit web site or try out QuickBooks for the Web, which lets you or your auction assistants access your books from any location that’s connected to the Web. Current users of QuickBooks can find plenty of support on this site, including user discussion forums and ways to contact QuickBooks Professional Advisors.

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Other Places to Sell Your Merchandise

Being an eBay millionaire doesn’t mean you have to sell solely on eBay. Some experienced eBay sellers supplement their sales on this well-traveled auction site with sales on other sites. Having multiple sales channels gives you a way to reach as many potential customers as possible. And some sites let you reach a niche audience of devoted collectors. Here are a few suggestions for sites that can help you expand your sales operation even further than eBay can take you.

Craigslist
http://www.craigslist.org
Craigslist is fast becoming a national phenomenon, and it’s a must-visit site if you have anything you want to sell locally. It’s a popular community based posting board with categories for personals, jobs, events, and services. There are no images, very little spam, and no fees for posting sales listings; in addition, categories are updated on a regular basis, so listings are bound to be fresh.

iOffer
http://www.ioffer.com
iOffer is a good marketplace to turn to if you have items that don’t sell on eBay. iOffer isn’t an auction marketplace, exactly: it’s based on negotiation between buyers and sellers. Sellers can put items up for sale either at a suggested price or simply invite prospective buyers to make an offer without starting the negotiation at any price. In either case, buyers can make an offer to sellers, who can either accept the offer or make a counteroffer; bargaining continues until the item is sold. iOffer includes an innovative software program called Mr. Grabber that brings feedback as well as unsold sales listings to their site from eBay.

Yahoo! Auctions
http://auctions.yahoo.com
Yahoo! allows you to browse its auction categories in order to identify auction web sites or search for a particular item available at a current auction site. There is no cost to sell, bid on, or purchase an item.

Yahoo! Classifieds
http://classifieds.yahoo.com
Yahoo! allows you to place ads that prospective buyers can browse by region or by category. It’s a good option if you have something big and heavy to sell that needs to be picked up by a local buyer rather than shipped. Most sales categories are free; some like household pets carry a listing fee.

Read more!

E-Commerce Hosting Services

If you decide to start up a web site to supplement your sales on eBay, you’ll probably need a hosting service. The hosts listed in this section are affordable and popular; they have plenty of features for both beginning and experienced sellers.

AOL Hometown
http://hometown.aol.com
You can use this site, which is America Online’s (AOL’s) hosting service, without being a member of AOL. It’s an ideal venue for beginners; you are presented with 100 web page templates to help jump-start your design. You can use a web-based page creation tool to start creating your site. Another plus: you end up with a site with 12MB of storage space for free.

Bigstep.com
http://go.bigstep.com
Bigstep is a typical web hosting service for small businesses. First, you can sign up to host your online store for a free 30-day trial period. Then, you can choose one of two hosting packages that cost $29.95 or $49.95 per month. The $29.95 per month option lets you sell 20 catalog items in an online catalog; the more expensive Bigstep Pro allows you to maintain a much larger sales catalog. The advantage of using a service like Bigstep is that you get help obtaining a domain name, maintaining a backup copy of your site for security purposes, and marketing your business.

Microsoft Small Business
http://www.microsoft.com/smallbusiness
Sometimes, it pays to partner with a big name for your web host. When you sign up for an account with Microsoft Small Business, you have to pay a little more per month for hosting, but you get a payment system that includes a shopping cart and checkout buttons. If you use Microsoft FrontPage to create your web site, consider using Microsoft Small Business to host your online business. You also get to use the FrontPage Server Extensions, which is a set of server software that enables you to do one-step publishing as well as set up online forms.

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12 Step Becoming an eBay Millionaire

The bulk of this blog’s contents focuses on stories and tips provided by eBay PowerSellers. I made a conscious effort to minimize the amount of direct instructional text. You don’t see many how-to sections or step by step instructions. In this appendix, however, I’d like to turn that around.

I summarize, below, practical tips and techniques for becoming a more effective and productive eBay seller. The tips are taken from the interviews presented in this book, from talking to sellers for other books I’ve written, and last but not least from my own experience.

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Find Something You Love and Sell It

Step 1:
No matter whether you’re a PowerSeller or casual eBay seller, you’re going to spend a lot of time working on your sales. You’re going to go out and hunt for merchandise to sell; you’re going to spend hours researching what you have, photographing it, writing descriptions, answering questions, packing, shipping . . . you will be much better off, and your time will go faster, if you are buying and selling something that you know and love.

Sellers like the ones profiled in this book succeed because they have a positive attitude. They find something they love to sell, and they put all their energies into selling it. They don’t let a week or two of slow sales get them down. The first step is to start thinking like a committed, successful eBay seller; before too long, you’ll be one yourself.

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Set Out to Build a Business Rather than a Hobby

Practically everyone I’ve interviewed over the years, including the sellers described in these pages, started out on eBay as a part-time, haphazard activity. How did they get from cleaning out their closets and putting half a dozen household items up for sale to selling hundreds of items every month?

Nathan Sanel, the seller described in Chapter 2 who operates National PowerSports Distributors, provides a good example. His statement “I set out from the beginning to build a business” says it all. He had a plan; he developed a business ethic; he conveyed his ethic to his employees; he opened a brick-and-mortar store to complement his eBay Store. He did everything he could to promote trust in his customers even though he’s not going to get a huge amount of repeat business because he sells motorcycles and other high-priced vehicles. When people do come back to upgrade their jet-ski or motorcycle, they’ll want to return to his store rather than someone else’s.

Read more!

Do the Research Up Front

Step 3:
People who are beginning to sell on eBay tend to ask a single predictable question: What’s the best thing to sell on eBay? Every PowerSeller asked that question at one time or another. The difference between PowerSellers and the Rest of Us is simple: The PowerSellers spend the time and energy needed to answer that question for themselves. Don’t sit back and expect to get the answer from another seller or from a book. The answer to the best-thing-to-sell question is different for every individual. And it’s different from one time of year to the next.

Consider Drew Friedman of White Mountain Trading Company, who is profiled in Chapter 3. Drew told me that when he was starting out, he spent a good deal of time researching the best thing to sell. “I spent weeks scouring the Internet, looking at every market and dozens of B2B web sites,” he explained. Think about how much time is involved if you spend every day for two to three weeks looking for wholesale suppliers, checking eBay’s completed auctions to see what fetches consistently high prices, and thinking about what you would like to sell yourself.
In the end, Drew picked something that interested him personally: fountain pens. Even when he had settled on one line of pens, he didn’t rest there. He looked around even more until he found the high-end handcrafted pens he sells now.

Drew was so helpful to me and so generous with advice that I confess I couldn’t resist asking him about where to find wholesale suppliers myself. His response? “‘What do I sell on eBay?’ Nearly every seller or want-to-be seller asks the same thing. The answer I always give is to sell those things which are of interest to you and that you are, or could be, an expert in. It certainly makes the process of dealing with customers easier when you are intimately familiar with the products you sell.” A less polite but just as accurate response might go like this: “I did the work and figured out what was best for me to sell; now you follow my example and do the same for yourself.”

Read more!

Develop a Steady Supply of Merchandise

Step 4:
One thing that sets PowerSellers apart from the Rest of Us is the fact that they deal in volume. They always have a supply of merchandise waiting to go online. They don’t have any gaps between the time someone purchases everything they have available and the next batch of items for sale.

Almost all PowerSellers have a source of wholesale merchandise to sell on eBay. In many—but not all—cases, they don’t have to go out shopping for that merchandise. They order it from their supplier, and it arrives in quantity. This is the sort of merchandise that is all the same: a batch of Christmas ornaments or collectors’ plates or figurines, for instance. They visit trade shows, make connections, and order batches of goods that they know will sell on eBay because they’ve taken the time to research similar items that have been sold there.

But other sellers do deal in one-of-a-kind collectibles. They just don’t spend all of their time scouring flea markets and garage sales for those collectibles. They advertise their services as estate sale liquidators, and people come to them with large quantities of heirlooms and antiques to sell. Whether you like to sell new or used stuff, the point is that you need to find a regular supply of it, and you have to keep finding it on a regular basis. And don’t be afraid to expand your product line and try new things: ideally, you’ll have merchandise to sell at back-to-school time as well as the end of-the-year holiday season.

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Know Who Your Customers Are and What They Want

Step 5:
This may be as simple as saying something along these lines: My customers are like me. They like to buy designer clothing at a deep discount. They want to look good, but they don’t want to pay full price for anything. They love the feeling of getting a bargain. They love quality. They like the feeling of prestige they get from wearing high-end clothing made by a well-known company.

If you know something about your customers and their backgrounds, you’ll write better descriptions, and you’ll sell more effectively. Try to engage your customers in a virtual “conversation,” perhaps after a transaction has been completed (and they’re filled with goodwill toward you). Ask if they collect what you sell, or what they plan to do with what you sold them. Even better, ask if there are other, similar items they’re looking for and if you can alert them by e-mail when you find those objects.

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Don’t Be Afraid to Grow

Step 6:
eBay millionaires are different than you and me. Yes, they have more money. But they spend more money in order to get more money. They aren’t afraid to buy merchandise in bulk, even if it’s uncertain how they’re going to sell it. They order hundreds of Priority Mail boxes at a time, even if they don’t have hundreds of items immediately ready to ship. They buy new product lines they’ve never sold before. When something doesn’t sell, they don’t despair; they put it up for sale on their eBay Store for a few cents and leave it up for sale indefinitely.

The point is that you need, as one e-commerce merchant told me, “to plan for success.” It’s well and good to put ten items online each week when you’re starting out, but you’ll never have a chance of selling more merchandise if you don’t put as much as you can online in the first place. Think like a successful merchant, and invest a few dollars in your eBay business up front. You’ll at least be giving yourself a chance to succeed.

Read more!

Find People or Software to Help You

Step 7:
People who are self-employed are, by nature, the do-it-yourself type. I’m one of those types myself. The problem is that do-it-yourselfers have a tendency to try to take on too much. They think that the more they take on, the more they have to do themselves. It doesn’t naturally occur to them to look around for assistance, whether it comes in the form of a human being or a computer application.

The fact is that very few PowerSellers do everything themselves. In almost all cases, they have a friend or relative, or one or more employees, to help them. Pam Thien and her family (see Chapter 2) use Infopia to run Shiana.com. Even Alan Warshauer, a true do-it-yourselfer described in Chapter 4, turned to an auction management service called Zoovy to help automate feedback and other tasks. In order to put more sales online and make more money, you need help. Look around to your immediate family or your immediate circle of friends and see who’s available. Hire a high school student to help you with packing and shipping one or two days a week. The point is to stop thinking you have to do everything on your own, and to turn your one-person activity into a business with employees who are there to keep things moving along smoothly.

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Act Like a Salesperson

Step 8:
One of the most interesting things I ever did as a seller on eBay was to try my own personalized brand of “upselling.” Once, someone bought a pair of shoes that didn’t fit. He asked to return them, and I quickly consented.

I looked in my inventory and found another, different pair of shoes that I thought he might like and that were in the size he wanted—and that were more expensive than the ones he was returning. Rather than having to return his money, I suggested a trade; I sent photos of the shoes I had available. I felt odd doing this because I was selling on my own rather than through eBay: For the first time I was doing direct person-to-person sales. When he accepted, I felt terrific. I was a real salesperson.

eBay millionaires do this sort of thing all the time. They cross-sell (they promote other product they have for sale even as someone is viewing another item for sale). They upsell—after a purchase is made, they say, “Would you like something more?” and offer similar, complementary items for sale.

Remember that you’re not just an eBay seller, you’re a real salesperson. You can approach your customers directly, after they make purchases from you, through a special mailing that you send out to announce new products or special sales. Cultivate your customers and induce them to return to you so they can purchase more. Loyal customers are the best resources you have as an e-commerce merchant.

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Market Yourself and Your Business

Step 9:
One aspect of being a “real” salesperson is the care with which you market your online business. There are thousands and thousands of eBay Stores and web sites. Chances are yours is not going to stand out from the crowd unless you do some advertising. When my brother first started an audio restoration business through a web site, he got a few visitors to begin with. But he didn’t get any inquiries until he paid a few hundred dollars to a service that would submit his site to the major search engines and indexes to the Internet.

You should do the same: Value your business enough to make an investment in it. I know how hard it is to cut into your hard-earned profits and “gamble” money on advertising that may or may not pay off. But if you do nothing, your chances of success are low. If you at least purchase a few keywords with eBay or Google, you give yourself a fighting chance to get noticed and, by extension, get more customers.

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Sell in More than One Venue

Step 10:
Of the 28 PowerSellers interviewed in this book, I can only think of two or three who sell solely through eBay auction sales or an eBay Store. The vast majority have a web site, a brick-and-mortar store, or other auction venues that they use to reach the public in addition to eBay. Once you get a solid foundation on eBay—in other words, once you have found a niche and come up with a system for making sales consistently—you can and should branch out to other venues.

At the very least, you should create your own web site, which gives people a way to find out more about you. If you want to really make a splash, do any or all of the following:
  • Create an eBay About Me page.
  • Link your About Me page to your web site.
  • Use your web site to point to your eBay Store.
  • Sell on Overstock.com or on Yahoo!Auctions as well as on eBay.
  • Create a “feed” of your online catalog or eBay Store contents and send it to Google’s shopping service Froogle so it can be indexed on that popular shopping site.
  • Purchase keywords on eBay and Google that will help people find your store more easily.
That way you’ll get your merchandise and yourself before as many “eyeballs” as possible, and you can use your various sales venues to promote one another, too.

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Make Your Customer Your King or Queen

Step 11:
The requirements for becoming a PowerSeller do depend, in part, on your gross monthly income. But that’s not all. You have to maintain a consistently high feedback rating as well. After you’ve been selling for a while, you realize that not everyone is going to leave feedback for you. Some buyers just can’t be bothered. They’ll only leave feedback if you “wow” them in some way. This is where customer service comes in. To provide customer service that helps you build up your feedback, you need to consider doing things like this:

1) Accepting returns happily
This is a very difficult prospect, but if you cheerfully tell someone to send you your item back (at their expense) and then quickly give them a refund, you’ll make them very happy—and they might just come back to you in the future for another purchase.

2) Giving refunds when you don’t have to
On occasion, I’ve refunded people some of their shipping charges when, say, I charged them $9.99 for shipping and the postage only ended up costing $5.45. Just giving them back a dollar or two through PayPal impresses them.

3) Shipping quickly When you have a bunch of sales end on a Sunday, you need to do everything you can to get the “instant purchases” (the items for which buyers have paid instantly through PayPal) out the door on Monday or Tuesday. Receiving packages just a few days after the purchase was made will certainly “wow” your buyers into leaving positive feedback.

4) Shipping carefully
If you overpack—use several different kinds of packing material, or pack fragile items in a box-within-a-box— you’ll impress your customer with your care. It’s not easy to maintain this level of customer service (unless, as described elsewhere in this appendix, you have people to help you do the work). Regard your customer as your king or your queen, and put them first, and the service will come naturally to you.

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Be Prepared for Really Hard Work

Step 12:
Nobody ever said selling on eBay was easy. I don’t think I’ve ever said that. If I did, I take it back. I remember talking to the PowerSellers I met at a convention in Atlanta and thinking that many of them looked really tired. When you’ve been selling for a while, even on a small scale, you begin to know why. You have to make yourself stay up late to pack boxes so you can ship them out in the morning. You have to sometimes force yourself to run to the post office before it closes so you can get some of your purchases out the door in a reasonable amount of time. You compulsively check your auctions to see if any inquiries or Buy It Now purchases have been made. You’re continually leaving feedback, answering e-mail, and trying to keep track of who has paid you and who has not.

Why do you do it?
You keep the big picture in mind. If you’re not yet a PowerSeller, you want to start earning at least $1,000 a month in gross sales so you can gain that distinction. Once you have the PowerSeller icon, you want to hold on to it. Once you’ve held on to it for a while, you want to try to support yourself and your family and provide a steady income. Keeping the big picture in mind and reminding yourself of how well you’re doing will make that hard work easier. Just keep reminding yourself how things were before you were selling successfully on eBay, and you’ll find carrying those boxes out to the car less of a burden than you would otherwise.

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