In a recent article, Lucy Kellaway, Associate Editor and management columnist of the Financial Times, shared her top 12 lessons she gleaned from auction site eBay. The tips she gives apply mostly to making the most of your business on eBay, but many of the principles she highlights are good business practices that can be applied across the board for businesses both large and small.
We decided to give a rundown of her lessons, with our insights added in to the mix:
1. Trust is vital
When you’re buying something from someone you don’t know then trust is key. For eBay, trust “is built through feedback, something which other businesses deploy as a clumsy afterthought. EBay shows that there are three conditions for feedback to make a difference: it must be a) respected, b) universal and c) instant“, says Kellaway.
On eBay, a business’ reputation is solely built on feedback. It’s not the place for PR, social media or politics, and sellers (and by extension, buyers) have to behave for every sale in order to maintain 100% scores, build trust and start selling at higher prices.
Outside of eBay, you can start to make the most of good PR and social media to develop trust. Having an open way in which consumers can reach you or your business to commend you on your service or air their gripes will help you to develop consumer trust.
Openness and the ability to listen to and respond to feedback is key both inside and outside eBay’s world.
2. Consumers are sometimes irrational
According to Kellaway, “human desire for a bargain is such that it warps reason“.
Auctions which start with an opening bid of 99p often end with a higher end price than when the starting bid is higher as buyers get so excited they usually end up bidding the price up more.
Understanding that consumers can often act or think in this way can be a powerful tool, particularly when it comes to crafting sales messages to draw consumers in and then subtly leading them to make additional impulse purchases or upselling by exposing consumers to items they may not have previously considered.
3. …and sometimes dead sensible
That being said, just because you can lead a horse to water, it doesn’t mean you can make it drink.
“People don’t rate gimmicky sales techniques – all they want is to know exactly what they are buying“, shares Kellaway.
Clear photographs of items, straightforward product information and a simple buying process all aid the sale. It’s about knowing your target consumer and optimising the buying funnel to make converting as seamless as possible.
4. Jargon and hyperbole subtract value
“Fancy words and adjectives are pointless, as no one would ever use them as a search term“, Kellaway tells.
In order to rank for what you’re selling in search engines, you need to make sure your copy contains the keywords and terms that people will be searching for in order to find what you’re selling.
You can be a little more creative with descriptions, but make sure the facts and the selling points are clearly in there. Spending time developing your SEO strategies for sustainable performance should be a priority.
5. Spelling matters
This one’s a no brainer – “if you spell it wrong, people can’t find it“.
Despite sites like FatFingers existing solely to root out eBay spelling mistakes and typos to ‘uncover hidden gems’, it’s still best practice to double- and then triple-check that you’ve spelled everything correctly.
This goes for everything you write on the web that represents your brand or business. Whether it’s on your website, in emails or on flyers, or over on your social channels, taking the time to check your copy for spelling and grammatical errors is worth the effort, especially when statistics suggest that spelling mistakes cost millions in online sales.
6. Accentuate warts
“Far from putting buyers off,” Kellaway declares, “accentuating the warts builds trust“. She’s referring to the way in which eBay sellers draw attention to the scratches, tears or defects on the items they’re selling.
“No other retailer accentuates the negative like this,” Kellaway points out, and she’s right. This one’s a little harder to spin into the grander world of business, unless you’re dealing with pre-owned or handmade.
The key with this point is again trust or – for most businesses – how you deal with a product’s or service’s ‘warts’ if a customer ends up complaining about something they’re unhappy with. In the world of social complaints are becoming more and more public which means it’s essential to have a plan in place for how to respond and resolve any issues.
A consumer needs to trust your brand or business in order to buy, but they also need to trust that you’ll be there if something goes wrong once they’ve made a purchase.
7. Arbitrage opportunities are plentiful
“Markets are not perfect, even when there are millions of transactions taking place every day, partly because knowledge is imperfect: many participants don’t know what they are doing,” Kellaway points out.
Looking for opportunities or holes in the market which can be taken advantage of because people aren’t thinking carefully enough about what they’re selling or because they’re failing to do their market research can be prove to be profitable.
Looking at the price difference between markets (particularly with how much you can get something for and how much you can sell something for to make a profit) and giving yourself a competitive edge, or looking for holes in the market and filling them with a product or service can both help to cultivate sales.
Keeping up to date with what’s happening in the market will give you chance to spot possible gaps and chances to widen your market. You have to move quickly to supply the demand, but the opportunities exist for those willing to take advantage of them.
8. Do something you love
It’s harder to sell something that you have no interest or are not vested in. “If you love what you are selling you understand it better, describe it better – and you end up making more money,” says Kellaway.
When you believe in your product or service, it’s much easier to sell it. Your business or brand should be something that you’re proud to be a part of and consumers can tell fairly quickly if you’re not.
It boils down to authenticity. It can come through the way you communicate with your consumers through social channels, the copy that’s on your website, or your tone of voice in direct communications like email or postal mail. Be aware of the sentiment you’re sending out.
9. Study the data
Data is your friend when it comes to figuring out consumer behaviour. EBay has a whole host of information to help you discover what prices similar items have sold for and to help you work out when’s best to have your auction end.
Utilising data isn’t limited to eBay. With tools like Google Analytics, the social analytics available through most social channels, and the data available from email clients, it’s becoming easier than ever to gain insight into consumer behaviour and the successes and failures of your marketing efforts.
Knowing what brought someone to your website, how long they stayed there, and at which point they left; which tweet or post gained the most engagement; or how many people clicked through your emails allows you to make informed choices about your business.
Decide what the important metrics are for you to track, monitor them, and use them to continue to develop your marketing strategy.
10. The human touch is vital
On eBay, Kellaway describes how “even in a place where no one meets or talk or knows each other’s names, sellers still answer questions nicely, and enclose little cards with the goods. They have discovered that good manners lead to repeat business.” The human touch is more important than ever.
Engagement on social channels is a great place to start. When we ran a Twitter survey to find out why people followed brands on the channel, we got a strong response in favour of people following brands in order to get a direct link to someone that can help, with 34% of respondents saying they follow brands because they tweet interesting or entertaining content.
Showing that there are people behind the business can help to personalise the service you’re offering. In the world of online interaction, knowing that there’s a person on the other end ready to deal with your request goes a long way.
11. Innovation is overrated
“On eBay almost everything has a value,” Kellaway writes. “You can make money out of virtually anything so long as you sell it well.”
New ideas, services or product are always great for keeping the market fresh and for keeping up with changing consumer behaviours. Bringing a business or brand into the modern age of technology is important, but that doesn’t have to come at the cost of traditional products or services.
While your product or service doesn’t need to be innovative in order to sell it, having an understanding of how to market your product in the modern age will work tremendously in your favour.
12. Tell stories
For her final point, Kellaway remarks that “storytelling is an aimless craze in the non-eBay world, but on the auction site can translate directly to profits.”
While we don’t wholeheartedly agree that storytelling is aimless, we can gather the sentiment as there’s certainly a time and place for telling the story behind a product or service.
Clever content marketing can be a powerful tool in telling the right story at the right time. You don’t need to know the story behind the 9 pack of loo roll came to be produced, but you might just enjoy reading about how a new flavour of ice cream came to pass. Storytelling isn’t aimless, but it should be used carefully to curate the information you want to share.