EBay is preparing to launch this month a free shipping and returns program in Germany called eBay Plus, aimed at competing with Amazon Prime.
EBay’s program will cost 19.9 euros ($22) per year, versus 79 euros ($89) for Amazon Prime. EBay’s program promises free returns, which Prime does not.
EBay describes the program as different from those of rivals because eBay Plus is designed to benefit both buyers and sellers, an eBay spokeswoman says. “The point of the program is increasing the delivery options for buyers in Germany, and offering sellers new ways to deliver great experiences to their buyers,” she says.
Thousands of sellers have signed up and millions of listings are eligible for the program, but eBay Plus won’t go live until later in September, according to eBay, which declined to give the exact date for the launch.
In Germany, sellers classified as top-rated in customer satisfaction receive a 15% discount on the fees they pay eBay on sales, the spokeswoman says. The terms apply only to fixed-price listings, and eligible sellers must agree to offer free returns and free and express shipping. That means they must process and post orders received by 2 p.m. on the same day, so buyers will receive their items the next day (or two days following, at the latest). Sellers also must offer free returns within one month and track items with prices greater than 10 euro (approximately USD$11), the spokeswoman says.
By participating in eBay Plus, sellers also receive free return labels and better placement within search results, she says.
Buyers can sign up, too, though eBay has not set a date. Sign-up should start later this month or in early September, the spokeswoman says. For approximately 19.9 euro a month (USD$22), buyers get free and express shipping, unlimited free returns, access to exclusive deals and promotions, and they may receive listing promotions for goods they sell on the online marketplace. Membership fees buyers pay for eBay Plus will go toward funding the cost of the free returns, the spokeswoman says, noting that buyers in Germany cite free returns as a top request.
The announcement comes on the heels of eBay unveiling more merchant-friendly standards in the United States as eBay celebrates its 20th anniversary and as eBay operates separately from PayPal, which spun off in July.
ChannelAdvisor executive chairman Scot Wingo says eBay Plus will have a tough slog.
“Amazon is very strong in Germany and seems to have taken share from eBay pretty aggressively there,” he says. “It will be interesting to see if eBay can make the economics work since they don’t have any control over the fulfillment process and thus can’t lower the costs. Amazon can because they own the fulfillment centers, so the seller pays for Fulfillment by Amazon.” Fulfillment by Amazon is a program in which Amazon marketplace sellers store goods with Amazon, which handles fulfillment.
Wingo says eBay needs to act to counter Amazon’s rapid growth, particularly in products other than books or music, the category Amazon calls Electronics and General Merchandise, or EGM. “In a world where eBay is growing in the low single digits and Amazon is growing 20% all in, and EGM is growing more than 30% percent, we would love to see eBay get more aggressive and roll this out globally,” Wingo says.
Amazon.com Inc. is No. 1 in the Internet Retailer 2015 Top 500 Guide.