Ebay Vs. Amazon Vs. Walmart

EBay

Amazon

Walmart

Profile/ Identity

eBay, an online auction and shopping website in which people and businesses buy and sell a broad variety of goods and services worldwide. It prides itself on its mission “to provide a global online marketplace where practically anyone can trade practically anything, enabling economic opportunity around the world.”

Amazon sells products in every category imaginable – their mission is to become the “Earth’s most customer-centric company where customers can find and discover anything they might want to buy online.”

Walmart is the largest company in the world by revenue and is known for its mission “to provide a wide variety of high quality, branded and unbranded products at the lowest possible prices".

Business  

Model

eBay is considered a C2C business model, but is now transforming itself into a B2C platform.

Amazon started as B2C and is now entering the B2B market.

Walmart offers both business-to-buyer (B2C) and business-to-business (B2B) items.

Positioning Strategy

eBay positions itself as not only a safe online auction site but also a user-friendly site for selling and buying various items. It then augmented its core method with the addition of fixed price, ”Buy It Now” options. Unlike most dot-coms, eBay was based on a model that produced profits, not just revenue.

Amazon is the king of new products, continuing to expand its selection of fixed-price items, often with free shipping. It has been able to maintain sustainable competitive advantage based on three operational strategies. These are low cost-leadership, customer differentiation and focus strategies.

The Wal-Mart brand positioning is all about everyday low price rather than shopping experience and affiliation.

Business

Strategies

(1)         Empower sellers – eBay’s strategies are align with the interest of its best sellers.  

 (2)         Long transactions - due to auction process / reliance of eBay to supplier for fulfillment.

(1) Empower Customers - the company prefers to keep customers as happy as possible, earning and consolidating their trust and loyalty for the long term. Management is willing to forego current profits to deliver the best possible customer experience.

(2) Quick transactions - fast delivery, free shipping handled by amazon to ensure satisfactory service

(1) Empower Customers – they tailor merchandise assortment and store experience to meet the specific needs of a broader customer base

(2) Aggressive Pricing - Walmart products are usually priced 20% lower than those of its competitors.

Stability

eBay frequently makes major changes, including Feedback, fees, how the search engine works, digitally delivered items, search results, Detailed Seller Ratings, etc..  Sellers have been greatly affected in real and perceived ways. Some changes have been rolled out, only to be reversed causing even more concerns among sellers.

Amazon has had very few major changes in the past few years and even those are fairly minor. Even though there are some restrictions, they generally stay the same, and are enforced consistently. When changes have been made, they tend to stick and sellers can adjust.

With Wal-Mart, it is pretty well-known what an investor is going to get from an operational perspective. The company is a retail juggernaut and continues to be the largest company in the world by sales.

User Platform

eBay’s user interface is more complicated and frustrating as when you search for a product, everybody’s listings come up. Your potential customers will have to sort through page after page of listings for the same item.

Amazon has one single listing for each product and well-known for its algorithmic approach to presenting particular product to its customers, as well as using real-time data to fuel dynamic pricing.

Absence of an online platform that can collect the volume and quality of consumer data needed for stronger decision-making.

Shipping

Shipping charges are very outrageous in eBay.

The amount is fixed by Amazon. You cannot ask for more from the customer, and even if the shipping credit does not cover your shipping costs, you must ship the item. Since the shipping credit is fixed, it can be figured in when setting your price.

Walmart allows for Site-to-Store Shipping. Buy online; pick-up in store.

Average Sales Price

eBay buyers tend to look for bargains, and are willing to wait through an auction to save a buck or two.

Amazon buyers are affluent, and willing to spend more on similar items and are less bargain-hunter mentality.

Walmart buyers tend to look for low price or high discounted products.

Payment Options

eBay sellers can accept PayPal, and credit cards. The big advantage of PayPal is that seller get their money faster. With eBay, you can get paid every day, even multiple times a day.

Amazon sellers must use Amazon Payments to accept payment. Amazon collects the payment, and deposits it into your bank account twice per month.  They collect and deposit the funds with no fees added. (But they do take the credit card risk which PayPal does not)

Walmart accepts credit cards, ATM/Debit/Check Cards, Walmart gift/egift/master/credit cards, PayPal and Cash.

Buyer and Seller Relationship

Because this is truly a transaction between and buyer and seller, there is quite a bit of interaction between the two parties. Various areas of the transaction are discussed and decided between the parties (ie. payment and shipping).

Buyers and sellers will rarely interact with regards to a transaction. Amazon is highly involved by playing the middle man between the buyer and seller. This leads to a higher expectation of customer service.

Walmart make deals with sellers. Sellers accepted these deals even with lower prices, because they know now that they would sell more of their product. In turn, Wal-Mart is trading directly to buyers, where they could find their products for extraordinarily low prices.

Feedback System

eBay has placed a lot more weight on their buyer reviews. So much so that they penalize their sellers for having poor reviews and ratings by lowering their search rankings.

Amazon is known for their reviews. In addition, it does not penalize their sellers by pushing them down the search rankings for having poor reviews. Therefore, the reviews and buyer feedback is more for buyer education on the product.    

By offering its marketplace retailers access to customer reviews and ratings data, those merchants get direct feedback on the merchandise they’re already offering and insight into future products that they might want to add.

Return Policy

The return and refund policy is decided completely between the buyer and seller. This could provide a positive or negative review for the buyer. Sellers are not required to offer a refund here.

Amazon has their A-z Guarantee. This gives buyers piece of mind that they will be able to get a refund on items received that were not as they were promised (within 90 days). This is backed up by Amazon playing an active role between the buyer and seller.  

Generally, merchandise purchased in store or on Walmart.com can be returned or exchanged within ninety (90) days of purchase with or without a receipt.

Barriers to Entry

There are no barriers to entry and anyone can sell any item that isn't on eBay's restricted list.

It isn't so simple just to jump on Amazon and start selling. As the platform has become inundated with sellers who don't follow the rules, Amazon has had to become more strict in allowing who can sell, and what can be sold.

Walmart has rigorous process when it comes to partnering with a certain supplier. You need to apply for approval and wait for weeks till the marketplace grants you a go-ahead. Walmart is very strict with its 3P seller policies and not all applications are entertained.