eBay Australia has announced they are launching eBay Plus in the country, making Australia the second country in which they offer this Amazon Prime style membership program.
eBay Plus is a membership program aimed at helping buyers get the most out of shopping on eBay, with exclusive benefits on Australia’s biggest range of products.
Members get free delivery and free returns on all eBay Plus listings, as well as double flybuys points, exclusive deals and premium customer service.
The marketplace is offering the service with a 30-day trial period and an introductory price of $29 (AUD) for the first year, $49 (AUD) thereafter.
Most sellers will see this as a preemptive strike against Amazon Prime in Australia which has been rumored to become available sometime this year.
Of course, eBay’s spin is slightly different, but the company makes a valid point as the Australian market has a lot of room to grow.
“eCcommerce is underpenetrated in Australia: only about eight percent of retail dollars is spent online in Australia, which is about half what is spent in more advanced markets like Korea and the UK.”Senior Director, Product & Shipping at eBay told AAP (Associated Press Australia)
Just earlier today we highlighted some metrics from Australia Post about 2017 eCommerce business in Australia that reached a record $21 billion.
How Will eBay Plus Work for Sellers?
The company outline seller requirements in its Winter 2018 update (it is Winter down under now).
- Sellers who are Above Standard or eBay Top Rated (eTRS)
- New and fixed priced listings
- Returns are accepted
- The item is located in Australia
- Item is non-bulky or heavy
According to eBay, the roll-out of the service has begun to select sellers but should become available by the end of June to all sellers that qualify.
There are no additional fees for the eBay Plus program to sellers. And while eBay strongly suggests items include free delivery, the company will offer free delivery on listings that have delivery charges associated with them.
Here is how eBay explained this to sellers:
“Listings can still qualify for eBay Plus if you’ve specified a postage cost. eBay Plus members get free delivery as one of the benefits of their subscription, so we’ll cover the difference.”
For the free return service, eBay Australia stated the following:
“You must accept returns for your listing to be considered for eBay Plus, but it’s up to you to decide who pays for return postage. eBay Plus members get free returns as one of the benefits of their subscription, so eBay will provide a return label in cases where the buyer would be responsible for return postage.
However, we encourage all sellers to offer free returns, because it’s great customer service and will help make your listing appealing to buyers who aren’t part of eBay Plus.”
Additional information about eBay Plus for Australian sellers can be found here.
eBay Fighting Hard to Keep Market Share in Australia
Until Amazon came to the country last year, eBay had a fairly easy time expanding its business in Australia.
With Amazon, a new competitor emerged that is well funded and obviously very good at penetrating markets and taking market share.
Since the eCommerce market in Australia is underpenetrated, there is a good chance that Amazon’s impact on sales will hit more traditional Australian retailers than it will hit eBay.
But that doesn’t mean eBay is not going to sit on its hands and just allow Amazon to introduce faster shipping and better customer service.
In Australia, eBay seems to have taken a very aggressive approach in defending its market share, including not allowing Amazon and other retailers to act as fulfillment warehouses for eBay orders.
eBay Plus now seems to make sure that if Australian shoppers are looking for free and fast delivery and better return experiences, the company will offer these services before Amazon has a chance to gain those customers with Amazon Prime.
eBay Plus Coming to America or the UK?
Most sellers probably didn’t know that eBay Plus already exists in one other market, Germany. The company launched the program in 2015 and offers similar features as Australia’s program, except it is only 19,90 € per year.
That roughly matches the introductory price for Australia of $29 (AUD), but renewals of the program in Australia will be $20 (AUD) more.
It is interesting that eBay decided to roll out this service in Australia, a market that has even worse geographic size challenges than the US.
Certainly, Germany and UK are similar in size and logistics services are well advanced in both to reach just about every address the next day.
For Australia, eBay appears to be giving itself a bit of leeway on promised delivery dates.
But just like in the US and UK, eBay is pushing for guaranteed delivery services in Australia. So if this program is successful, eBay could look at eBay Plus as an option for introduction in the US, UK, and other markets.
Earlier this year, Wenig downplayed any fulfillment warehouse investments by eBay, therefore it appears the company will rely on sellers to make this program work.
One could argue that if a seller is willing to offer free shipping, then if eBay had to pay for the occasional return shipping, it can work out for both parties.
But for the US, the big question would be one of Another Membership?
Are US buyers willing to pay $49 for a membership program if they already belong to Amazon Prime? Walmart tried that route and it didn’t work, so why would it work better if eBay tried it in the US?
This is certainly an interesting development by eBay and one worth watching.
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