Lost My Job. Can Really I Make Money on eBay?

The eBay Seller's News, January 2009, Volume 9, No. 2

Learn How To Sell More on eBay with The Newsletter for Professional
eBay Sellers by:  Skip McGrath

In This Issue:

Musings

1. Lost My Job. Can Really I Make Money on eBay?
2. eBay Marketplace Sales Tank 16%
3. Making Money With Instant Niche Websites
4. Boost Your Sales by Making Your Fixed Price Listings, Auctions and eBay Store Work Together
5. More New eBay Wholesale Sources for January 2009

"Life doesn't require that we be the best, only that we try our best." 
~H. Jackson Brown

Musings

This week marks our tenth anniversary on eBay and in a few months it will be the 10^th anniversary of this newsletter.  I started selling on eBay ten years ago and started the newsletter a few months later.  I think we only had about 300 subscribers at the end of our first year but we now have over 45,000 subscribers.  I was looking at our stats on my newsletter service provider, Aweber, and we are now signing up new subscribers at the rate of 20-30 per day. So despite the tough economy -or maybe because of it, there are more and more people interested in selling on eBay.  So let me take this occasion to thank all of my loyal subscribers for sticking with me all these years and helping us grow.

I received a lot of email from readers that they really enjoyed seeing my listings on eBay and several told me they learned a lot by looking at what I was doing.  So I have decided to make the scrolling gallery of my listings a regular feature of the newsletter. But instead of putting it in the middle of each issue, I have moved it to the bottom of the page. Don't go there now -read the issue first and it will be there when you finish.

In the last issue I told you about a half-day workshop I hope to put on in Las Vegas in conjunction with the ASD/AMD wholesale trade show. I put out a link for people who are interested to sign up for a mailing list. We had about 25 signups. When I sent out a message to see how many would really attend we got eight people.  My threshold is fifteen, so we need seven more paid attendees to go ahead.  I had planned to make the decision by now, but decided I would try one more time with this newsletter to see if we can pick up an additional 8 to 10 folks to make this happen.

The cost is only $199 per person (or couple) and includes the workshop only -no airfare, meals or hotel. You will be on your own for all your personal and travel expenses.

If you have any interest, please click here for more details and to sign up for a special mailing list for those who are interested. Once I see how much interest there is, I will make a decision and let everyone on the mailing list know. Basically my decision will come down to how much interest there is. If I think I can get at least 15-20 people then we will probably go ahead.

To the eight of you who did reply that you will be coming, please be patient. I will be in touch with you shortly.

The ASD/AMD Wholesale Trade Show is one of the largest wholesale trade shows in the world. This is a great place to find products to sell on eBay. We will also be attending the show the day after the seminar and can arrange for you to tag along with Karen and me and see how we work the show.

As this is one of the largest shows in Vegas, normally hotels are booked, but in this economy there are plenty of great airfare and hotel deals.  Just check with Expedia and Hotels.com for some good rates. The ASD/AMD is one of the largest wholesale trade shows in the world and this is a great place to find products to sell on eBay, Amazon and your web site.

I have been dreading the launch of the new My eBay Page for quite a while and it finally happened.  Yes, it has a lot of new features that sellers will like, but the pages are very slow to load and it now takes more steps and clicks to get to the information sellers really want.

If I had to give it a grade I would give it a B-minus. On the old My eBay Page I could see all of my listings at one time on one page. Now I can only see 10 at a time unless click on more pages. that are agonizingly slow to load. This seems to be another case of eBay fixing something that wasn't broken.

But there are some good features -the problem is navigating the new interface. I did come across a review on eBay by eBay member Glenda.  If you want some help finding your way around I suggest you read Glenda's review. Here is the link:

http://reviews.ebay.com/How-to-use-the-new-My-eBay_W0QQugidZ10000000009469992

Several reports have surfaced that eBay is trying to sell Skype. John Donohoe admitted as much in an interview with the Financial Times. Google is reported to be one of the interested companies. Yahoo would also be a good fit, but no longer has the money. Skype could really give Yahoo a boost if it could somehow swing a deal. eBay way overpaid for Skype in 2005 when they bought the company for $2.5 Billion.  Although it's finally starting to make some good money, they have a long way to go to recover their investment. eBay doesn't really need the cash -they are sitting on over $5 Billion so it will be interesting to see how this plays out.

Let's get started with this month's articles:

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1. Lost My Job. Can Really I Make Money on eBay?

I used to get emails with that question once or twice a month. Now with thousands of people losing their jobs, I receive several of these a week.

Of course my answer to that question is yes -after all I make my living by selling on eBay and by teaching people how to do what I do. But a more honest answer to that question is "I don't really know."  You see, it all comes down to how and what you actually do and if you are willing to put in the hard work. Also, I am always worried when desperate people ask that question. When your back is up against the wall so many people simply panic and try anything.  They are desperate and worried that they often can't focus.  They jump from one scheme to another looking for that quick fix.

There is no doubt that making money on eBay is more challenging and competitive than it was a few years ago, but thousands of people are still doing it -even in this tough economy.  In the next story I point out that although eBay's sales are down, there are still going to be over $44 Billion worth of goods sold on eBay this year.  That is a lot of money. So although the sales will be down from last year there is still a lot of money to be made if you do it right.

If you are an existing seller and your business is struggling then you need to look at what you are doing. I am not wedded to any product or product category. I have a few products that are doing well and some that are not. If a product isn't selling, I blow out and move on to something else. Successful selling on eBay is a mixture of constant research and experimentation. If something isn't working, make sure you have fully explored what you are doing to determine if you are making some mistakes. If the problem is you, then admit it and fix it. If the problem is the product, then get rid of it and move on to something else.

If you are a new seller just starting out, the best advice I can give you is to just take your time. Learn all you can about the eBay marketplace. Focus on the basics:

• Finding good products
• Taking good photos
• Writing compelling, keyword rich titles
• Writing complete descriptions that sell the benefits of your product
• Providing a professional communications and shipping experience

As for being desperate, the only advice I can give you is that worry and self-doubt are destructive emotions that get in the way of success. If you have just lost your job and you have no idea where your next mortgage or rent payment will come from, you are probably thinking: "That's easy for you to say Skip. You have an income and I don't." What you don't know is that I have been there too. Believe me I learned the hard way that you can't undo the past, you can only move forward.

So I don't really know if "you" can be successful selling on eBay, but I do know that thousands of people are.  In this economic environment many will try and many will fail, but many will succeed. If it works for you then you will never again have to rely on someone else for your income and security.

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2. eBay Marketplace Sales Tank 16%

eBay reported their financial results for the 4^th Quarter of 2008 and it was pretty bad. The Marketplaces business unit, which consists of eBay, Shopping.com, StubHub, Kijiji and other ecommerce sites, recorded $1.27 billion in revenue, equating to a 16% year-over-year decline. eBay attributed the revenue drop to the impact made by the strengthening dollar and the slow-down of the ecommerce market globally on the eBay business.

Approximately 55% of Marketplaces revenue came from markets outside the U.S. Gross merchandise volume (the value of all goods and services sold on eBay --excluding vehicles) was $11.47 billion for the quarter, a decrease of 12%, compared to the fourth quarter of 2007.

On the positive side PayPal did pretty well --posting another solid quarter with $623 million in revenue, an increase of 11% year over year. Net total payment volume (TPV) for the quarter was $15.99 billion, an increase of 14% year over year. Most of this growth came from more and more website businesses adopting PayPal for their payment system.

As an eBay seller it is easy to see this news and become discouraged but all is not bad.  Considering the overall economy, online sales are actually holding up fairly well.  If eBay sold around $11.5 Billion for the quarter that works out to over $44 Billion a year.  Down a lot, but that is still a pretty big market for eBay sellers.

High priced consumer goods are taking the biggest hit, but bargain products, used goods and collectibles are holding up pretty well.

Last week I spoke with several different collectible dealers who sell on eBay.  All of them reported OK to Strong sales growth.  One dealer was flat and a sports card dealer I spoke with said that sales volume is good but prices and margins are down. All of the others I spoke with said their sales were strong and prices were holding up.

I also spoke with a seller who specializes in used baby clothes, toys and other products. She said her business is booming.  My daughter-in-law listed a small lot of used toddlers clothing the other day and it was snapped up within 30 minutes at the BIN price.  The other strong area continues to be used books, CDs and DVDs.  As people reign in their spending they are more likely to buy a used product than they were a year ago.

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3. Making Money With Instant Niche Websites

Although I make my primary living from eBay, there are other ways to make money online as well. If you are just starting out on eBay, or your eBay business is struggling, then I suggest you focus your attention on that first.  Becoming unfocused and trying to do too many things at one time is a great way to fail at all of them.

There are tons of sellers (including myself) who sell on eBay and have expanded their business to selling on Amazon and other sites, setting up their own eCommerce website and making money with affiliate marketing, Google AdSense and other methods.  But as I said above, you want to focus on one thing at a time. But if you have some time and a little money to invest, you may look at making money from niche websites.  No technical knowledge needed -there are plenty of cheap webpage builders that anyone can use.

The idea of setting up niche websites to make money is not new. I have been doing it on a small scale for years.  In fact it is one of the businesses I cover in my latest book in the Geezer series, The Official Geezer Guide to Making Money With an Online Business.

The basic idea is to create a website with content built around a highly specific topic. Then you create content (words, photos, videos, etc.) that will come up in search engines when someone is looking for a product or some information about the subject of your website.  The way you make money is to put text links and banner ads on your site that pay you when someone clicks on them or buys a product or service you recommend.

A niche topic can be almost anything. Typically you would create a website on a topic that both interests you, and you can write about. It can be about anything from fly fishing to quilting or sausage making to sailing.  Any topic that interests people --and that people search for information about, will work. The narrower the topic the better.  For example, there are hundreds of websites about fly fishing.  If you created a website about such a general topic you would be buried in the search results. But a web site about fly fishing for salmon in Alaska in more targeted and will come better when someone searches for information about that.

There are three ways to create niche websites:

1. If you have the skills or can hire a webmaster you can do it yourself.
    
2. You can use one of the many online services that allow you to build websites quickly and easily yourself.  Two of the best ones are XsitePro and BeBiz.  Both are very inexpensive and easy to use and come with very good support
    
3. You can use an instant niche website builder service. The theory behind these services is that you create dozens of sites that might only make a few dollars a day each. But after a while you are bringing in $20-$50 a day pretty much on auto-pilot. It only takes a few minutes to create the site because the program does most of the work for you. $20 a day doesn't sound like much, but remember, the internet works 365 days a year.  Do the math and you will see that this really adds up. And there is no theoretical limit to how many sites you can build.

If you want to quickly and easily build your own army of niche sites without requiring any technical knowledge, there is a new service from Mike Enos called the Instant Niche Maker.  I have looked at several similar services on the market and I like this one the best.  If you are not sure you can do this, Mike will even give you a 5-day test drive for $4.95.

You simply think of a niche, select a theme for your site, and click the create button. The site is instantly created, ready for action, and setup with eBay products, news, videos, digital and physical shopping cart, blog, and a price comparison engine that allows you to make affiliate commissions from over 6200 online merchants offering over 30 million different products.

You can immediately create up to 15 sites, and as a member, each month you can make up to 5 more sites. The site features over 6 ways to monetize your site, and training videos that explain each feature and show you step by step how to think of a niche, how to build the site, start getting traffic, and how to start generating income with it.

No technical or previous site experience is necessary. If you think this might interest you, take Instant Niche Maker for a test drive.

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4. Boost Your Sales by Making Your Fixed Price Listings, Auctions and eBay Store Work Together

Before I explain how this works, let's review the three main types of listings and some facts and features about each:

• Auctions - Auction style listings have the highest visibility on eBay and, in general, get the highest preference in the eBay search engine -and therefore the most traffic. They also have the highest listing fees. When you calculate your listing fees you need to remember that not all listings sell. For example if you list an item 4 times and only two of them result in a sale, then your listing fee is essentially double.
   
• Fixed price Listings -FP listings are where you list an item at a fixed price. There is no bidding. You can list an unlimited number of items for 30 days for a listing fee of 15¢ for Books, Music, DVDs & Movies, Video Games and 35¢ for all other products. The listings can be set up as Good til Cancelled, so they automatically renew at the end of 30 days. When an item sells, the buyer is taken to check out to pay for the item and that sale happens right away. But your listing stays active until all of the items are sold at which time it ends. Remember the quantity is unlimited. You can list 10, 20, 100 or even a 1000 items.
   
• eBay Store Listings - eBay store listings are also fixed price listings and you can list an unlimited number of items for the same fee. The fees start at 3¢ and go up to 10¢ so they are even cheaper than FP listing fees. However, one big difference is that eBay store listings don't show up when eBay members use the eBay search engine. They have to specifically use a store search to find your item. Another disadvantage is that eBay stores have a monthly subscription fee.

All three of these listing types have different final value fees and I am going to ignore those for purposes of this discussion as it would just get too complicated. I want to focus on a strategy to make all of the listing types work together.

First of all remember that auction style listings come up the most often in search results and that 80% of people shopping on eBay find products through the eBay search engine.

The key to this strategy is using your auctions to drive traffic to your store and fixed price listings where you can get instant sales.  There are plenty of people on eBay who just don't want to wait for an auction to end. I don't know the exact percentage of sales on eBay that occur at a fixed price, but it is quite high -probably around 40%.

So the key to this strategy is to use your auction listings to drive traffic to your store and fixed price listings. This is very simple to do.  Just put a statement in your auction description such as:

Don't wait for this auction to end. We have other models, colors, sizes in stock for immediate sale in our eBay Store.

Notice that the words eBay Store are a hyperlink to my store.  Here is how you do this. Look at the image below. Notice the little chain link symbol on the right of the image.  This is from the top of the eBay Sell Your Item form.

Simply type your sentence then highlight the words you want to be linkable and click on the symbol to Create links.  When you do this a box will open up.  Now just copy/paste the URL of your eBay store into the box and click OK. Your link is now created.

If you don't have a store and you have fixed price listings you can simply use the link from any of your listing pages that says View sellers other items.

A lot of buyers don't read all the way through an auction listing, so put your copy somewhere in the first 1/3^rd of your description.

Another way to help cross sell to your store, fixed price and auction listings is to put a scrolling gallery at the bottom of your auction.  If you look at the bottom of this page you can see the scrolling gallery that appears in all of my auctions.  I get mine from Vendio.  InkFrog also has one and Auctiva has a free one.

This may seem very simple but believe me it works.  I cross sell almost all of my listings. My fixed price sales vary. Over Christmas they were almost 60% of my sales but during the rest of the year they will average between 30% and 40%.  Before I put these statements in my listings my fixed price sales were about 10-15%, most of them were buy-it-now with very few store sales.

You should put a cross sell message in all of your listings but remember it is most important to place them in your auction style listings because these come up the most often in search results -especially on the ending day of the listing.

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 5. More New eBay Wholesale Sources for January 2009

This week I am going to feature more liquidation and surplus sources. Retail stores are hurting and stuck with tons of inventory that they are clearing out.

A few words of caution when dealing with any of these sources:

• You can find some great stuff from liquidation outlets, but expect some junk too. Communicate with the seller and ask lots of questions to make sure you understand exactly what you are buying
   
• Watch the shipping costs. Make sure you are still getting a good deal when they are added in
   
• Don't buy "Returns." These are goods that people returned. They often include items that are defective, broken or damaged in some way.
   
• The best items are "shelf pulls." These are goods that just didn't sell and the retailer had to move them out to make way for new stock

So here are a few sources to look at.

R.G. Riley is an off-price wholesale company featuring cheap clothes including irregular clothing and overstock apparel.

Genco sells deeply discounted wholesale closeouts, wholesale customer returns and overstock items, direct from America's largest retailers and manufacturers.

Jacobs Trading Company, JTC, is a direct source for many retailers' and manufacturers' customer returns, over- stocks, shelf-pulls, and damaged goods

Countryside Closeouts is a business to business firm specializing in low-cost, high return retail products to dollar stores; eBay stores; convenience stores; thrift centers; discount stores; discount furniture stores; hardware stores and other businesses interested in selling quality products bought at aggressive, below wholesale prices.

All-star Wholesalers offers wholesale lots, surplus merchandise, warehouse overstocks, salvage merchandise, store liquidations, shelf pulls, store closeouts, wholesale pallets and excess store inventory.

Surplus.net is the main portal for the Internet Marketing Association of Surplus Dealers. Here you will find Surplus liquidation overstock closeout salvage imports and exports sources.  Be sure and click on the link to Deal of the week.

International Dropship and Wholesale Corp. offers a wide selection of good quality surplus merchandise and they have a drop ship program for heavy items.

That's it for now.

Skip McGrath
The eBay Seller's News

P.S. If you missed the last issue, click here to read it.

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