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November 9, 2007

"I Am An Affiliate Marketer So Why Should I Give A Rat's A** About eBay?"

If you're like most folks, you think eBay is just a giant garage sale or flea market. (Isn't that the place where they sell those Beanie Babies?)

And if you follow "traditional" eBay marketing - the kind that has YOU working for EBAY - then you're right that it's a waste of time. But in truth, eBay is a playground for affiliate marketers ... just as long as you don't do what everybody else is doing.

So let's see how affiliate sales on eBay might work with an Xbox 360 which is available through the Buy.com affiliate program which you can join through Commission Junction.

Buy.com pays 5% commission on games and toys. Therefore, your affiliate commission would be $24. Let's see if that would be profitable on eBay using traditional auction marketing methods ...

A Typical Auction ...

The Xbox 360 Elite is hot, hot, hot on eBay, just like everywhere else on the Net. But let's keep in mind that eBay buyers have a bargain mentality. They demand good - make that great - prices on everything, including the Xbox.

On the other hand, because of eBay's bargain reputation, there are sellers who just assume that the posted prices are great and aren't savvy enough to do their homework. This definitely can work to the advantage of a seller.

Let's assume that an affiliate marketer wanted to use the Buy.com Xbox and auction it on eBay - Would this auction be profitable? Would it be worth the time of an affiliate marketer?

SHIPPING COSTS: The shipping costs are reasonable so the seller probably broke even on shipping. We can't know exactly since we don't know where the buyer lives.

EBAY COSTS:

1. Listing Fee: the opening bid on this auction was $2, so it cost the seller $.40 to list his Xbox

2. Final Value Fee: it the merchandise sells, the seller pays additional money. In this case, the cost is $16.10

3. eBay has a boatload of "Features" that - naturally - run up your eBay bill. In this case the seller chose:

* Bold: $1.00
* Highlight: $5.00
* Border: $3.00
* Gallery Picture: $.35

PAYPAL FEES: since we don't know who the buyer is, we can't know the exact amount but if the buyer was in the US the cost is 4.9% + $.30 or $23.82

Total: $49.67

Oops! That was definitely a losing transaction! With total fees of $49.67 and an affiliate commission of $24, that means the the seller LOST $25.67!

See why by reading the entire article here

Posted by SydneyJohnston at November 9, 2007 12:53 PM

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