How to adapt against competition underpricing

[rocketscollectibles]

All in the title

I'm in an insanaly competitive category and i noticed since many weeks a drop in sales on my $10-20 items. This price range was my best sellers and i focused a lot to grow my inventory of them. Meantime i noticed that even if i growed, my sales dropped. It was suspicious and then i found an explanation, i just noticed that one big seller actually added most of my inventory to his, and price all the same items like 50% of my prices. And he use stock pictures... He's a big seller with high rep, so everyone obviously will and do blind buy to him with this pricing. I can assume that this is why i'm not selling much past week, buyers can have everything i have for half the price somewhere else

That being said i could price like him but i would close to breakeven. I don't understand those sellers, he clearly not doing any money on those items, or like a 10%. Many items he list at $10, could be sold for $15-$20. It's a slow market his inventory could take months to sell, and he have multiple quantity on everything. And nothing says he wont add quantity and hold his prices

So how to adapt to this? I'm not making a living of sales so it's not a must for me to get sales. But still i wanna compete and sell my stuff

Just wonder if it's better to hold the prices and wait that he sell his items, or drop the prices enough to give buyers an acceptable alternative to him? What would you do. Any suggestion? This is annoying to see that items i could sell for $20 two months ago would need to be priced at $8 to sell today. he's burning the market. Not sure what to do  

[byto253]

As you said, it is an  insanaly competitive category, almost a commodity market for common cards.  You would hope that $20 cards would not be in the commodity class but the big seller is making it so.   

I am also guessing that he is in the US and offers free shipping, which is likely tracked, so that is in their favour as well.  All things being equal I will buy from a Canadian seller first, so I expect Americans to do the same.   Your advantage is you take more care with photographs and perhaps descriptions. 

One thing you should do is draw attention to the differences and your advantage. Emphasis that in the title and the condition description.  "Actual Photo, NO Stock Pics" or something.  In the condition section  “Near Mint (NM). Actual Photo of Listed Card, NOT a Stock Photo”.   In the description, pound it again, and state something like, "Buy with confidence, each card is inspected with care for condition, and the picture provide is the actual card you will get.  Stock photos are never used in my listings. "    But use wording you are comfortable with, I just popped off this stuff.   

The idea is to draw attention to and highlite your competitive advantage.  IMHO it is that you take the time and care to ensure buyers are fully informed up front and know for sure what they are buying and the big volume guy does not. 

Will that flip things around? I honestly don't think so with a 50% price difference, but it never hurts to emphasis your listings advantage.  To have a chance you may need to lower that gap so some folks may be willing to pay a bit of a premium for your better listing.    It is tough, you are between a rock and a hard place as most parameters are market conditions and largely out of your hands. 

As you say, you could wait and try to ride it out if you don't want to play the price match game.  Put your new listing efforts in to other areas, and have very low expectations for the current ones.  As you say,  you don't know if the competitor has multiples of the cards, or just what is listed.  Prices do fluctuate for stuff, and panicking in a low point is not usually good.  The unknown is if this is permanent price situation, or something that will sort itself out in 4-5 months.   

Another option is to pull your cards off the market and park the listings for a few months.  If you end them, they will stay in the system available to relist for 90 days, so they would need to relisted (or use sell similar) before that or need to re-create the listing from scratch (yuck).  To sit them longer than 90 days, end them again after the relist and you have another 90 days.  I have done this when taking a break, and there have been some good results as it shows up as new stock vs. an old listing.   

No magic solutions, it is an open market and what was valuable yesterday can lose it, while other things go up.     Good luck with the listings. 

[reallynicestamps]

You might emphasize that your actual picture is NOT stock by using a special background, like a lightly patterned cloth.

If you do that also include a picture with a plain background for clarity.

I scan most of my items (books, sewing patterns, stamps) and at one point I had a slogan "Proudly Canadian" and a maple leaf taped to my scanner which then showed on every scan.  The scanner broke down eventually.

And always keep in mind that he is not targetting you. You are not that important to him. Perhaps he bought a big estate and has to clear out. Perhaps he is getting ready to retire.

Don't lose money because someone else is.

Also there are some consumers who think the more they pay for an item the better it will be and the happier they are. 

Are you including a printed price list of your overstocked items in each shipment?

[recped]

Be very careful getting into a price war, many of the big sellers use autopricing software, the instant you drop your prices theirs will go down.

I price in the middle of the pack and snag buyers with presentation and reputation. Like you I am not highly motivated to make a sale at any price so I just have to wait out the competition if it exists.

[ilikehockeyjerseys]

When you say price, do you mean the actual total price (BIN+Shipping+Import Fees+Taxes), or do you mean price as in BIN only?

Assuming we're talking about total price and not just BIN, if you cannot compete on price because larger operations are more efficient, then you shouldn't sell in that category because you won't make any money.

Nobody cares about "high rep" if your definition of high rep is the number of feedbacks beside the eBay na,e Once you pass maybe 100 feedback points with 99+ percent positive feedback, your profile looks the same to 99 percent of people. No one looks at it for a basic transaction. If you sell something extremely expensive and prone to scams, like a graphics card, someone might look at your feedback profile. If you sell a 50 dollar Pokemon card, let alone a 5-10 dollar card, no one is taking a second look at your profile if you're above 99 percent positive. 

eBay doesn't show feedback or anything about the seller feedback quantity on the search page, so there isn't even a way for that to inform a buyer's purchase. For that to happen, a buyer would have to really like the offering they see on a best match, click it, and then click the back button because the guy only has let's say 121 feedbacks, and maybe they think they can find someone with 5000 feedbacks....that never happens. Buyers don't operate that way on eBay. People choose to click based on either searching through best match or searching through price+shipping=lowest first. How your listing appears or is placed in the best match is the most important thing, along with the total price shipped to the buyer (Not just the BIN).

Best match placement is where size of seller might come into play. A more active seller might get better placement in the best match, or they might have a deeper budget to spend on promoted listings, which gives them a better placement. They might be set up better to offer things like free returns, or free shipping, which also gives them a better placement. 

I have never noticed any real difference to how customers view me based on my feedback rating, and just like you, I started with a low quantity of feedback. The way you present your eBay store, both in your listing (title, pictures, description), and your communication with buyers, will go a lot farther to determining whether they view you as a professional seller.

Price is very important, and if you cannot come close to the lowest price, you will have trouble competing. With that said, you do not have to have the lowest price for an item. You just need to be in the ballpark, but have the greatest value in the best match search (best placement, title, pictures, free shipping, free returns, etc). 

[femmefan1946]

Worth repeating.

People choose to click based on either searching through best match or searching through price+shipping=lowest first.

[rocketscollectibles]

Thanks for the answers. Can't really answer to everything i'll write a book

I am also guessing that he is in the US and offers free shipping, which is likely tracked, so that is in their favour as well. All things being equal I will buy from a Canadian seller first, so I expect Americans to do the same. Your advantage is you take more care with photographs and perhaps descriptions

He's a canadian seller. Really i consider my competition to be the canadian sellers since we have the same basics (same sources access, shipping cost, location of buyers, etc). US sellers is totally different i can't compare myself to them entirely since we are not equals on many aspects

You might emphasize that your actual picture is NOT stock by using a special background, like a lightly patterned cloth

I always had pictures showing it's not stock, but with a 50% price difference really people will just gamble on the stock photo and the reputation. Let's say i'm selling a lightly played card $10 and show that there is wear and imperfections, and the seller use a stock photo selling the same, stated to be near mint for $7. Showing no defects, no wear, nothing. If i had to choose i would buy the $7 too as buyer, no brainer. At worst the seller overgraded and you receive a lightly played card for $7, at best it's really near mint, while the other listing is a confirmed lightly played for $10. Thinking about it while writting the move to do may be to price my lightly played condition to match his near mint one, then my near mint one just over his price is a confirmed and shown real near mint, the no gamble factor may push to pay a bit more and buyers to pick mine instead

For pictures i worked past days to update them, i think i really upgraded and i really like the set up i found. I found something that gives me multiple unique artwork backgrounds that i can change and all looking pretty cool. The deep of pictures also provide good lightning while not over showing defects (close light white the borders and create a ''fake wear'', cards photography can be really complicated). Actually i really like where the result of this going, i think i found something to work with. I'll clearly stand out in searchs with this imo

Nobody cares about "high rep" if your definition of high rep is the number of feedbacks beside the eBay na,e Once you pass maybe 100 feedback points with 99+ percent positive feedback, your profile looks the same to 99 percent of people

Maybe but the point is no there (i'm not over 100 too but it's another topic). The point is that for someone using stock pictures in a category where the price is based on the condition, while not showing it, reputation and feedbacks is the big decisive factor here. If the seller had hundred feedbacks saying that his near mint cards are not near mint cards, but more lightly played ones (which could explain the pricing), he would not sell them. Or at least people would look somewhere else for near mint ones. But the fact he have high feedback score without anyone saying he overgrade, people won't feel the need to see the cards at this pricing, they will blind buy and trust his grading

[rocketscollectibles]

I forgot though that past weeks even if i seen a huge slow down, i had so many ''send offers'' options, past days i sent around 20 more. Actually it shows that buyers may consider my listings, but just not buying. So i'm not that sure what to think anymore

[terence427427]

There is a price where you'd say screw this and walk away from ebay and l think generally we are about 10% above this price. lf we can't make a few dollars after paying ebays commission, the cost of packaging, cost of gas running it to the mail service and the ever price increasing cost of postage, which is very likely to bloat up again by 30% soon.  Actually, we should start to increase our prices by 30% just like everyone else out there.

[rocketscollectibles]

There is a price where you'd say screw this and walk away from ebay

This is kinda what someone underpricing want i think, burning the competition and see them leave. Then after he can raise his prices and take everything

[teenytrinkets]

First off... it's been slow lately.  Give your listings more time to see just how much your competition is really affecting your sales before you do anything. 

Secondly, I've seen this happen to me for smaller items lately. New sellers are popping up and seemingly just undercutting well-established sellers. But they have to, in order to compete, I suppose.

My sales strategy has always been to offer something my competitors don't: free shipping, free gifts, buy one/get one free, etc. This could get you regular customers.

Also, don't underestimate the value of the loss-leader. Attracting repeat buyers is so helpful these days, when competition is so fierce, and sales are largely driven by the power of the search (and we all know how eBay’s search tool works...or doesn't...lol).

[msau4301]

I see you have already had tons of great advice/opinions here but in answer to "what would you do?"

I would not drop the price to where I would not be making anything, especially if as you say this is not your only business/work. I've always been shocked since day one selling (even buying for that matter) the immense range of pricing for almost the same item. I always questioned why someone would pay so much more (sometimes hundreds of dollars!) without any major difference, at least to my eyes.

I mostly use auction (I know I'm a dinosaur) but that is where I have had the most luck personally. The mistake I made early on was I saw some of the big sellers (I've bought from myself and respected) start auctions at 99 cents and sell for hundreds so I thought maybe it was the low starting price that was attracting so many...well you guessed it, as a newbie I had hardly any views and had to sell for the low, low price. Now I only list at the lowest to make it worth my while. Many, many times things have gone for so much more than I thought I think it must be a joke (but it wasnt!) Remember there are lots out there who are looking for super cheap items to re-sell for more themselves (like those last minute garage sale people who want to buy for 50 cents!)

Patience is best and I find if every couple of weeks or so I add a couple of items I know will be popular, a lot of times I sell stuff I had for a while since people who have looked may look at "sellers other items".

I peaked at your listings by the way and the backdrops you use for some are wonderful! That kind of thing would catch my eye for sure! Good luck!

[ilikehockeyjerseys]

There are too many potential sellers of things like Pokemon cards for that to ever happen, or for anybody to think that would even be remotely possible.

For something extremely niche and specific where there are almost no suppliers, and it isn't easy to start selling, that might be a viable concern. 

Odds are, if someone is selling for a lot less than you, they are either a collector moving out their collection. So they don't care about turning a profit. Or, they own an actual physical card shop, which gives them a more efficient way to obtain collections that they resell. 

[ilikehockeyjerseys]

I chose 100 as an arbitrary number. 

You have already stated that this guys prices are way below market value. That is why he is getting sales in spite of using stock images. It has nothing directly to do with amount of feedback.

He is likely getting a better best match placement than you, and as you stated has a much better price. I think you are overestimating the value of the feedback number when it comes to adding value for the buyer and influencing their buying decision. 

As far as what I would do, unless you can come up with a solution to obtain cards at a lower price so that you can compete with other sellers on price, I wouldn't sell in that category. Or at least, I would move on to cards with a higher value, where there is less competition, and things like good images are more likely to influence the choice of a buyer. 

I sold a few sports cards earlier this year. These were cards in the 100-600 dollar range. What I learned was that by taking good pictures, being patient with the sale, and having a reasonably professional copy in the listing, I was able to attract sales at the high end of the market value. I don't think those same things would have made as much of a difference with cards in the 5-10 dollar range.