It’s official; auction sales are falling fast on eBay, the website originally founded as ‘AuctionWeb’ in 1995. Numbers of eBay auctions have been falling for years, with it being claimed that less than 15% of all eBay listings are auction style in a Stanford University study.
This change has an impact on both new and long-time eBay sellers, most commonly in terms of whether to list an item in an auction or fixed price listing.
There are a variety of factors for sellers to keep in mind when deciding between allowing buyers to purchase an item at a fixed price or bid for it in an auction. One of the main considerations to keep in mind is that every eBay seller is different; there is no formula that will work perfectly for every person.
Back to basics – auctions and fixed price listings
Before getting into the debate of the merits of each type of listing, new sellers must understand the primary differences between auctions and fixed price sales. The names do give most of the game away, but there are a few other (important) features to point out:
- Auctions offer buyers the opportunity to bid against other potential buyers OR buy the item immediately (using ‘Buy It Now’) before any bids are placed or the reserve is met.
- Fixed price listings offer items (multiple items can be sold in one listing) at a set price using ‘Buy It Now’ unless a seller selects the ‘Best Offer’ option and allows buyers the chance to negotiate
- Final value fees are the same for both types of listing
- An insertion fee credit is given if an item in an auction sells, with some conditions.
Auction-style listings: the advantages
Selling potential – Using the traditional eBay listing style has the major benefit of offering the seller the chance to sell an item for a lot more than they were hoping. After all, only two people are needed for a bidding war on an item.
Items with no specific value – It can be difficult to put a set price on collectible or rare items. For this reason, auction-style listings often work well for this type of item, as well as items from the other side of the spectrum – one-offs and items considered ‘junk’
Auction buyers – Auctions are sorted by time remaining and so an item may attract attention from bargain hunters close to the end. Don’t forget that there is still a stalwart of traditional eBay buyers around who will only purchase from auctions rather than fixed price listings.
A good back up – While not always ideal for profit, auctions can help move items that a seller has been unable to shift using a fixed price listing. As noted previously, insertion is basically free in auction-style listings as long as the item sells and a reserve can be added for an extra fee to ensure the item is sold for a minimum price if desired.
Fixed price listings: the advantages
Consistent and worthwhile sales: A fixed price listing means a seller will never be disappointed with how much something sells for as the price is specified.
Faster payment: Sellers can require buyers to pay immediately using PayPal. This option is available with auction-style listings too, but only before any bids are placed. Potentially a big time saver.
Length of listing: This type of listing can be run for up to 30 days or ‘Good Till Cancelled,’ which means it will be renewed every 30 days automatically until the item is sold. Another huge time saver, especially if a seller has duplicate items. As of March 2019, all new fixed price listings on eBay.com will be Good Till Cancelled automatically, renewing every 30 days until the item is purchased.
Desirability for buyers: Recent trends and studies show that online shoppers are opting for quick, direct sales as opposed to deal-hunting. More commonly, buyers do not want to want 3 or 5 days for an auction to finish to buy an item.
Auctions vs. fixed price listings
There is no definitive answer to which type of listing is more successful for eBay sellers as there are so many variables involved. A top tip for new sellers would be to research similar items currently on sale and watch to see which type of listing gains the most sales and profit.
The type of item being sold is a large factor in the choice and success of using one type of listing over another, as is the buyers visiting eBay on the day – the latter of which cannot be predicted or controlled.
As shown by the statistics and backed up by some great advantages, fixed price listings are proving to be more popular with current eBay sellers. This does not mean however that auctions are not worth trying; they still have a time and a place on eBay.
Many sellers are running accomplished businesses using this type of listing, enjoying both the potential of a higher final sale price as well as the profitable “Buy It Now” option. As with many other aspects on eBay, experimentation and research is necessary to find a potentially winning formula for listings.
Do you have any experience comparing auctions to fixed price listings? If so we’d love to hear about it – get in contact via the comment form below.