Home > B2 > Amazon vs eBay:In economic terms

Amazon vs eBay:In economic terms

The recent wave of online shoppers has created hot debate over which online store is better, eBay or Amazon? Both are very similar. Both are online stores are where sellers can operate their business out of and where buyers can buy a plethora of goods out of just one site. But which web-site do consumers and businesses recommend? It all depends on the most you could get with the least of your resources. Or in other words they are trying to make the most cost-efficient decision to fit their needs. What sellers need to think about is the cost it takes to sell an item on either site. According to Economic-times, “It costs $3.92 to sell a $10 item on Amazon and $2.72 on eBay” Economic-Times.

Costs and Benefits

This is one thing to consider but they also say that, “eBay takes more time and most merchants store inventory themselves” Economic-Times. In making these decisions, retailers make trade-offs; sell out of Amazon without having to stock your own inventory which is easier and faster at a higher price, or sell out of eBay being less efficient and having to stock your own inventory but at lower prices. These economic trade-offs are decisions suppliers need to make, and it all depends on what they value more, time and efficiency or money. Consumers also make decisions that involve trade-offs when considering buying from wither online store. If a consumer buys from Amazon, they are most likely making that decision based off of the convenience and quickness the company provides for its customers, rather than considering the price compared to eBay. A customer choosing eBay most likely chose this alternative site because of its lower price, not valuing time and efficiency as much as they value money. But most consumers value time and efficiency over cost. This is why their choice is usually Amazon. Vice President of Amazon’s FBA business, Tom Taylor says, “Customers like lower prices, but customers also like greater convenience, faster shipping and great selection” Economic-Times. Consumers also state their opinion on consumer surveys on squidoo.com. They say that, “If we were going to choose just one to live with for the rest of our lives, we’d pick Amazon. Why? It’s easy to shop there, the items are always represented correctly, checkout is a snap” Squidoo. The experience is also a major factor for buying things at either store. According to Clark Howard of CNN, “In their testing, the best overall experience for shoppers – not necessarily always the lowest price – was amazon.com.” CNN. It is clear that these consumers weigh the cost and benefits.

Pros Vs Cons

The cost of choosing Amazon is more money for their product, while the benefit is the efficiency, simplicity of getting the product bought and delivered, and the overall experience. In my economics class we have studied these terms used to describe the economic process that consumers and producers use. By applying these terms to the choice between buying and selling on either Amazon or eBay, it is easier to decipher my specific value of time and efficiency versus money.

Making Decisions

I have always bought from Amazon because of its simplicity and efficiency. Although the cost of buying from Amazon is the higher price (compared to eBay), the benefits are efficiency and good experiences. The trade-off of this decision is buying from eBay with a lower price, but without a good experience. These decisions are small but are indeed involving economic thinking. By studying economics in school, I am able to apply my studies to everyday decisions, helping me make the most cost-efficient decisions possible. These terms I have learned to describe my economic decisions have given me the possibility to break down the economical processes people and I take, helping us see the best possible, cost-efficient decision to make for our benefit.

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  1. May 8, 2013 at 4:58 pm

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  2. May 13, 2013 at 6:26 am

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    • May 28, 2013 at 10:52 am

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    • July 4, 2013 at 1:41 pm

      Under ‘Appearance’, choose ‘Mobile’ and enable the mobile theme… Good luck with your blog!

  5. June 5, 2013 at 3:50 pm

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    • June 6, 2013 at 10:49 am

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  6. June 5, 2013 at 4:13 pm

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    • July 4, 2013 at 1:37 pm

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    • June 27, 2013 at 7:34 am

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    • July 4, 2013 at 1:38 pm

      Sorry to be so slow to reply!

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  9. January 28, 2014 at 10:49 am

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