What Sellers Need to Know About Intangible Goods and Services on eBay

The vast majority of transactions of eBay involve the sale of a physical item. The seller creates a listing with factual information and photographs about the product. With a clear expectation of the item, a buyer then makes a purchase and awaits a delivery in the mail.

This process is turned on its head by a small number of eBay sellers who instead choose to sell intangible goods and services. This article will explore the concept and practicality of selling such items on eBay, an online marketplace best known for physical products.

What are intangible goods and services?

An intangible good is an item that it is not possible to physically touch. This includes data, information, software and other digital products. Examples would be eBooks, audio files, graphics, online courses, games and downloadable content.

Services sold on eBay can include artistic work (crafts, interior design, painting, photography), custom clothing, website development (design, hosting, technical support), media editing and home improvement services. Sellers selling services sell their expertise, time or labor (or a combination of all three).

The problem with selling intangible goods and services on eBay

There are three major problems with selling intangible goods and services on eBay, with two being particularly significant.

eBay policy

Sellers looking to sell intangible items should be especially cautious concerning eBay policy. Violating these rules could lead to selling restrictions or even suspension from eBay.

First and foremost, it is imperative to find a way for buyers to confirm that they have received the service or ‘item.’ eBay does not allow sellers to list items that buyers cannot confirm that they have received. Examples of such items include a ghost in a jar or other haunted items.

Personal advice or coaching as well as website traffic driving services are not permitted to be sold on eBay. Perhaps less surprisingly, escort and dating services are banned as well.

Digital products can only be sold by pre-approved sellers who have complied with an extensive list of terms and conditions. Verification of ownership is required or proof that the seller has authorization to legally offer and sell the electronically delivered goods.

Sellers should be careful to avoid intellectual property infringement, as protected by the VeRO program. While it is true that all sellers have to adhere to VeRO policies, they can be easier to forget when selling intangible items.

Seller protection

The second biggest issue is that of seller protection. eBay categorically does not provide any kind of seller protection for services, digital products or intangible goods.

The situation on PayPal is similar, with services, digital products and intangible items also being specifically excluded from their Seller Protection program.

Simply put, if you sell something that is considered to be a service, digital product or intangible and the transaction goes wrong, eBay will not help. If the payment is processed through PayPal, there is also no chance for assistance there either.

Keep in mind that selling intangible items can come with unique challenges. Listing creation, for example, usually focuses on item specifics and photographs. The eBay Feedback and seller performance system were both created with physical items in mind.

Buyer expectations and experience

The third issue relates to buyers. Selling intangible goods and services can be a difficult prospect even in traditional retail marketplaces. Buyers are, however, more familiar with buying these kinds of products offline.

In addition, eBay is known best for being an online marketplace for second hand goods. While there is an ongoing marketing program to encourage buyers to think of eBay when buying new products too, this does not highlight services and intangible items.

Like sellers, buyers are also not protected when buying intangible items on eBay. The Money Back Guarantee specifically excludes items in certain categories, which includes services, intangible goods and digital content.

These factors could be a crucial barrier for sellers attempting to sell these kind of items on eBay.

Is it worth selling intangible goods and services on eBay?

Based on the lack of protection if something goes wrong, most experienced eBay sellers would say no to this question. Selling intangible goods online is already somewhat risky but this danger is elevated when using a platform that is not designed for it.

Primarily known and used to sell tangible items, eBay is not the ideal online marketplace for selling services and nonphysical products. In addition to the problem of buyers not accustomed to such items being sold, there is no protection for sellers if something goes wrong.

For some people, however, the billion dollar marketplace that eBay provides is too lucrative to set aside. In this case, the seller should tread carefully, consider low priced items only and be prepared to pivot their marketing plan if needed.

Do you sell any intangible items on eBay? Tell us about your business in the comments below

Gemma
Gemma
Gemma is our all things eBay expert. Originally from the UK, she now lives in Canada and travels extensively. You can read about her travels at her blog Off Track Travel.