Promoted Listings math

[bashort]

So I decided to do some calculations on doing a promoted listing.

I looked at a unpromoted item that sells for $100, has a buyer paid actual shipping cost of $20.00 and a 7% sales tax, that sale nets $84.26 total fees 15.74%

If I were to promote the item at the ebay suggested promotion rate of 10%, that sale would net $58.52 or 30% less.

If I were to raise the price of the item to net the same amount I would need to raise the price from $100 to 

 $139.00 or 39% more. total ebay fees 27.21%

So in my example promoting the $100 item at 10% or not promoting and lowering the price from $100 to $70 would net the same amount.

I would think that the 30% markdown would be much more effective than the promotion.

It is possible that I have made a mistake in the math but that is what I come up with. Someone please correct me if I am wrong

[onlinecentral]

Message 9: eBay disclosed at eBay Open that most sales (I think they were talking about most PLS sales, not sales generally) are actually made from PLS listings on other pages, NOT the search results page.

The effectiveness of Promoted Listings is dependent on what you are selling.

A buyer looking to add to their collection may browse many suggested related Promoted items.
A buyer looking for a canister style shop vacuum will consider different makes and models.

My replacement parts only fit specific brands and models of equipment. Otherwise, size and fitment are the issues.

A buyer looking for 0.315 amp fuses with a size of 5x20mm will not look at or buy the hundreds of other fuse sizes available, regardless of the percentage paid for Promoted Listings.

[my-cottage-books-and-antiques]

@stainlessenginecovers 

Exactly. The two things serve two different purposes.

PLS to (hopefully) increase sales velocity by increasing visibility

The discount to (hopefully) provide the buyer with an additional incentive to purchase...once he has seen the item.

So, while the math is interesting, the comparison is really more of an apples and oranges kind of thing. 

I want a net I can live with, but I also would like better sales velocity because I have so much stuff (most of it still unlisted)  Some sellers aren't very concerned about sales velocity, and some sellers have higher net requirements than I do, or work on much closer margins than I do, etc.  And, as @onlinecentral notes, a lot depends on what you are selling. 

So, I don't think there's really any answer that works best for everyone. 

The main thing is to understand the financial impact of PL  and the impact of  discounting so you can make smart decisions.

[sextons-sweet-deals]

my confusion of this promoted listings is the percentage the seller sets and the so called 'clicks'.

Are the clicks based on buyer views? If so, can this be a positive and / or a negative?

Example 1: a former buyer who may be mad at you for whatever reason starts clicking constantly on your listing(s). I understand that the buyer / shopper probably doesn't know if the seller has listing set up for promoted. 

Example 2:  buyers constantly looking at your listing, but not biding and creating more cost to the seller.

Example 3: Maybe seller is calculating their investment cost in their item to the selling cost & fees and clicking up their item for top view. 

[my-cottage-books-and-antiques]

@sextons-sweet-deals  I think the thread is talking about PL Standard, which applies a fee only if a sale is made. You are talking about PL Advanced, which is the Pay Per Click model. Well, actually, you seem to be conflating the two. The seller sets a percentage with PLS, which is like an extra FVF.....so, if (and only if) the item sells as a PLS, you are charged your normal FVF plus whatever percentage you chose for the PLS listing. 

PLA you choose an amount you are willing to pay per click (and you cap this, so that you aren't charged more than a certain total amount). You get charged for each click, but there is no additional charge when your listing sells.

PLA is more complicated than PLS, and for the most part, sellers of single quantity listings should avoid it (as even ebay has said).

[sextons-sweet-deals]

thank you for the information, but I think my examples still raises questions / concerns for sellers

This is why I don't buy into eBay promotions. They don't give enough detail up front just like their current new message to sellers: 

Shop with sales proceeds

Start using money earned from sales to cover selling costs or shop on eBay. Enroll now!

[my-cottage-books-and-antiques]

@sextons-sweet-deals   There is a good bit of information available from ebay on PLS and PLA.  I sell mostly single quantity listings, so I don't use PLA, which is why I didn't try to answer your specific PLA questions. (Also, a PLA discussion takes the thread way off track).

[nuclearomen]

it's not price, it's visibility that is the issue, promote, get seen, don't promote, don't get seen - it's really coming down to that. I can tell you from full experience of using PLs since they started. When they started didn't much matter, sales, visibility would be either way, tides have turned, now anything not promoted sits for longtime and gets near no views, vs promoted they get at least views. I don't however use suggested rates, they are just inflations for ebays ego, if they suggest 10% - 4-5% election is fine. 

[sextons-sweet-deals]

thank you

I rather work on my new and revising current listings than figure out eBay's game play / promotions.

the current promotion I have received: Get the first $30 off your Promoted Listings Advancedᴮᴱᵀᴬ ad fees

[nuclearomen]

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@sextons-sweet-deals wrote:

thank you

I rather work on my new and revising current listings than figure out eBay's game play / promotions.

the current promotion I have received: Get the first $30 off your Promoted Listings Advancedᴮᴱᵀᴬ ad fees

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vs get $500 off PLA fees campaign they ran for 2+ months lol

[my-cottage-books-and-antiques]

@sextons-sweet-deals  Just taking a very quick glance at your active and sold listings, it looks to me like, first, PLA would be worthless, because you seem to be mostly single quantity listings. and second, your sales look good (although I realize that you might or might not be satisfied with them), so I don't see much reason to use PLS. So, I'd agree: you can pretty safely ignore PL and just keep listing and revising. 

[sextons-sweet-deals]

I have no information / notices on the $500 game.

Maybe eBay is picking certain sellers for such a promotion. 

[my-cottage-books-and-antiques]

@sextons-sweet-deals  Yep. I didn't get either one, the $500 or the $30. I think they have certain parameters they use to decide who gets offers like this. Since they were both for PLA, I wouldn't have taken advantage of either one anyway.

Now, if they want to send me a discount for PLS, that I would probably use. LOL

[nuclearomen]

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@sextons-sweet-deals wrote:

I have no information / notices on the $500 game.

Maybe eBay is picking certain sellers for such a promotion. 

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they do, always have, but point was not who got it, who didn't, it was that was the offer they previously had to get sellers to use PLA, that ended and now they are sending $30...which is - NOTHING - in terms of PLA fees, can spend that in one day on cpc's. 

[toomuchstuffagain35]

The $500 PLA credit they offered that was denied when you tried to activate it? LOL

[thebrickstore-free-postage-any-3-part-lots-see-terms]

Hey bashort,

I Believe your more taking about the maths & effectively by not adding the 10% promoted listing will save you just that $12 (total sale) also by reducing the sales price by $30 will save you the category Final sale fee (10.9% in the category I use) as well as you sales tax 7%) 17.9% of $30 $5.37 so a total of $17.37 Saving in fees.

Compared to your $30 reduction so overall you will be worse off. listing at $86 will give you pretty much parity 🙂

Steve