May 17, 2016 by Andrew Minalto - 32 Comments

Promoted Listings on eBay – Profit Multiplier or Complete Waste of Money?

promoted-listings

Experienced eBay sellers will remember those great days when eBay offered a Featured Listing Upgrade, which basically meant that for £14.99 you could buy your way to the top of eBay’s search results (featured listings worked in a similar way to how they are on Gumtree – you were featured above normal listings if you paid the fee).

Not surprisingly it became hugely popular and demand reached such a high level that eBay had to abandon the idea. Why they didn’t just increase the price to filter out sellers is beyond me – after all that’s basic economics…

Anyway, fast forward to 2016 and it seems that eBay are trying out a new form of paid listing upgrade, called Promoted Listings.

promoted-listings

Once again they seem to be borrowing heavily from Amazon and their Sponsored Products, which is an extremely common theme recently, with product reviews and product identifiers, particularly since eBay’s split from PayPal.

But unlike Amazon’s system, which utilises cost per click pricing akin to Google’s AdWords program, the fee for eBay’s promoted listings is based on the value of the item for sale and you only pay once it’s sold.

In some ways this commission model might be more suitable for some sellers, though on first impressions I prefer the tried and trusted pay per click pricing – simple because it’s easier to scale and grow your campaigns.

But let’s take a closer look at exactly how Promoted Listings work before we come to any conclusions.

Promote Your Listings Explained

The process to start promoting a listing is incredibly simple:

1. Create your programme – choose the listings you want to promote and give some basic info to eBay.

2. Set your ad rate – choose what percentage of the final sale price (not including shipping) you want to allocate as your ad rate. This has to be between 1 and 20%.

3. Name your campaign and select your start and end dates.

4. Start promoting!

placement_uk

And that’s it! Your promoted listing will now be shown “in prominent locations on eBay where buyers are actively shopping for related items.” To be more precise, promoted listings will appear at the bottom or right hand side of the search results page for desktop usage and on mobile devices, they’ll appear at key positions within the search results.

This means more views, more click-throughs, more sales, and ultimately – more profit.

One of the best things about this system is that you only pay once a sale is made – so there is no fee taken upfront.

Of course the big question is how much to set as your ad rate? We want to pay as little as possible, but spending less will obviously result in less promotion so it’s important to try and strike a balance.

One good way to gauge what sort of percentage you should be putting towards your campaign is to check eBay’s weekly promoted listings ad rate trends page. This basically tells you the average ad rate for each category that week, so you know what others sellers are spending and can adjust your campaigns to suit.

But also bear in mind that your chosen ad rate is not the only factor that will determine how often your ads are shown. It also depends on the relevance of your item to a buyer’s search and how well your listing was selling before the promotion.

What this means is that a) your listing will only be promoted when buyers are searching for an item like it, or at least something similar, and b) that the sell-through rate of your listing will also play a big part.

So what this tells us is that promoting a listing will work best when it’s a popular product that is already making a decent amount of sales… rather than something you can use to kick-start a lagging listing.

In fact eBay themselves pretty much confirm this:

“Recommend sellers choose items to promote that are in demand and are being listed by many sellers simultaneously, e.g. selfie sticks. These listings will have the highest chance of selling when they are promoted to more buyers.”

They even go on to say that “this type of promotion isn’t as successful for rare items, collector’s items, or limited edition items.”

And if you think about it this does actually make a lot of sense. After all if a buyer searches for a highly specialist product, which you already have a listing for, then there’s really very little need to promote it to them, as they’ll most likely see it anyway.

Whereas with a very popular item with loads of competition, your listing might sell well when people actually see it, but the problem is it’s on the 5th page of search results! In this case promoting it makes perfect sense as you can increase the number of views it gets without having to climb eBay’s Best Match algorithm.

This actually brings me on to two very important points – firstly, do you have to pay the promotion fee when your item sells, regardless of whether or not the buyer found your listing via an ad?

Thankfully the answer is NO! All sales you make via regular search results are not charged the promote your listing fee.

And secondly, how does promote your listing affect your listing’s search rankings under eBay’s Best Match algorithm?

Once again the answer is good – sales gained through your promoted listings also have a positive impact on your listing in Best Match and “there is no negative impact from promoted listings on Best Match.”

Knowing this, you could use promote your listings in combination with my price increase strategy to get those crucial first sales in for a new listing and really climb eBay’s search rankings first.

From what I’ve read, this could be the perfect way to utilise this new system although we of course don’t have any concrete data on how your listing will perform after you stop promoting it.

But before you run off to start your own campaign, at the moment Promote Your Listings is still in beta and only available to select shop owners who have been invited to trial it. However I am seeing a lot more of these promoted listings, so eBay have most likely expanded their test phase recently, and will roll the program out to all shop owners some time this year.

I for one am very excited for that, so that I can test it thoroughly and see what results are achievable!

If you have any experience with promoted listings, or would just like to share your thoughts, then I’d love to hear from you so please post below in the comments section below.

Otherwise, until next time!

All the best,
Andrew

32 Comments
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  1. Hi Andrew,

    As my business is seasonal I decided to promote a couple of listings in August and September to boost sales. It certainly did that. What I noticed also is that, somewhere, it boosted the non promoted sales of the same item. So I paid additional fees for about 18 promoted items but got the benefit of another 25 sales. Since I stopped promoting sells have fallen back to their normal level. Curious

    1. Andrew Minalto

      Hi Gaye,

      Yes, that’s how it works because when you drive promoted traffic to listings and increase sales velocity for that item, natural rankings also increase as a result. That’s why in many product groups you want to constantly run these promotions, unless you’re already in top 3 search positions.

      Andrew

      1. Thanks Andrew. I have noticed that eBay charges VAT on the fee so that’s something for sellers to watch out for. Gaye

  2. I tried this a few times and every time i could see my promoted listings in the search results, sometimes even on the first page but never got any sale. Strangely my sales stopped for other, non-promoted products from the same type.
    Once i disabled the promoted listings, the sales came back. Very strange…

    1. Andrew Minalto

      That sounds very strange indeed…

      It could be just co-incidence. It’s very hard to make any conclusions like these as you would have to do very detailed tests, make notes on click through rates from search, search positions etc. to know for sure what caused those sales to stop.

      Andrew

  3. Another eBay trick to raise revenue. Update: Ebay makes this available for single item listings and expands promoted listings to larger group of sellers. Result: Active impressions on promoted items drops significantly. Action: Raise pay per sale percent to increase impressions. Result: More single item sellers increase pay per sale percent to compete. Action: Raise pay per sale percent to outperform new users. Result: Diluted market place. Too many people promoting listings. Raised cost per sale for anyone who chooses promoted listings. Less effective way to promote. Forced promoting in order to compete. Even by setting pay per sale percent above the eBay recorded average (which could be just a moving scale depending on how much eBay wants to make rather than actual average for all we know) impressions are about half what they used to be. Even after increasing number of listings in the promotion by over 20% the result is the same. Promoted listings are about eBay making more money without raising normal fees. It really has nothing to do with helping sellers improve their business.

    1. Andrew Minalto

      Of course it is Dave – eBay is a business and they want to make as much money from every search/view/click as possible.

      Their goal is to not help anyone but to make as much money as possible.

      With Promoted Listings specifically – it’s exactly same thing as AdWords or Sponsored products on Amazon. The more people start selling and promoting same products, the cost per click goes up. After some time that product basically becomes un-profitable as cost of sale accusation is simply too high.

      Andrew

  4. I found that you can only promote listings if you have more than 1 of the same item, which is something that every time I hear about nobody seems to mention. I can tell you that only 1 out of 3 eBay reps seems to know anything about promoted listings.

    1. Andrew Minalto

      Thanks Julie!

  5. I started using this feature about a month ago. I created 14 promotion campaigns. 13 live and one which I never got around to setting up as I ran out of time and then forgot about. Number 14 was not live and had NO products listed against it.

    I have just had a rather long telephone conversation with ebay who were unable to explain to me why 50% of my sponsored listing sales (and a number of clicks) were attributed to the non-live and empty campaign. (A campaign which has NEVER been live or had products listed against it).

    They say they do not know why approx 5% of my total sales are being charged sponsored ad fees for promotion against an inactive campaign with no products in it. Which leads me to wonder how many of my ‘normal’ unpromoted sales are being ‘linked’ to a live promotion campaign and the fees being racked up as if it was a sponsored ad sale when in reality it was just a normal sale through a normal listing.

    Ebay say they have referred the case for further investigation. I have turned off ALL my campaigns in the meantime. It will be interesting to see how many clicks and sales are now linked to my campaigns now they are all switched off.

    I fully recommend anyone who uses this feature to create a dead campaign for each one you make live and monitor if your inactive campaigns are registering clicks and sales..

    1. Andrew Minalto

      Hi Paul,

      That’s very interesting, Thanks for sharing this with us!

      Andrew

    2. Hi Paul B,
      I am the Product Marketing Manager from the eBay promoted listings team. Can you please share your eBay userID? I’d like to investigate the issue.

      Thanks
      Shefali.

  6. Hi Andrew, I love your article! I have a question concerning Promoted Listings. I started doing these several weeks ago and my impressions were going up on a daily basis. However, about a week ago, my impressions have been going down on a daily basis by about 10 percent. The graph looks like I’m going down a slide! Anyways, do you have any idea why I could be seeing such a huge drop in the last week after experiencing so much success with Promoted Listings? Thanks a lot!

    Steve

    1. Andrew Minalto

      Hi Steve,

      Most likely that your competitors started doing higher bids? e.g. offering higher share of sale to eBay?

      Andrew

  7. Now, if only the buyers had a way to turn off/block these annoying promoted listings. I have tried putting filters in my searches to exclude sellers who clutter up my search results with their promoted listings, but apparently this ad method gets around that formerly tried and true method. Sellers might want to consider how this method of forcing unwanted results into potential buyers’ searches might turn off customers. I now have a policy of never buying from a seller from whom I’ve seen a “promoted” search result. So there’s that.

    1. Andrew Minalto

      Thanks for your comment Tim & sharing your thoughts on this with us.

  8. Hi Andrew,

    Thanks for this post

    With this new feature, my listings are dropping in search results due to other sellers promoted listings – even when they are not listing the same products, as eBay includes “similar products”.

    It is a shame if I have to start paying to get my listings higher in results, since I was getting this free until now.

    I have started a campaign & I will report back when I see its effects.

    1. Andrew Minalto

      Yeah, I’m also worried that this will basically start bidding wars and you won’t be able to get to high search positions UNLESS you pay.

      We’ll see how it goes when more people start using it.

      Promoted listings don’t appear to top results though, they’re usually somewhere in the middle.

      Andrew

  9. All quiet here in nearly 3 weeks. I’m missing your posts as it felt like someone holding my hand as I get my business up and running. Is everything OK? When will you be back?

    1. Andrew Minalto

      Hi Mike,

      It’s all good, Thanks! 🙂

      Been very busy with other things for last couple of weeks but will resume posting starting from next week.

      So stay tuned!

      Andrew

      1. Glad to hear it. Thanks Andrew.

  10. Alastair Smith

    can any business seller that is not in below standard sue this or do you have to be offered it by eBay?

    1. Andrew Minalto

      Currently this is available to selected shop owners only as it’s still in beta testing phase.

      Andrew

  11. Anthony Micallef

    Ive just noticed that I’m legible for this so Ive selected some items and promoted them at 5% for one month just to see what happens.

    1. Andrew Minalto

      Good stuff!

      Let me know in a month or two results you got from this.

      Andrew

  12. John Edwards

    Very interesting…I remember a few years ago eBay released their own PPC advertising…forget what that program was called now…but they didn’t pursue it for long…however I think they released that maybe too many sellers were playing to cagey to risk spending?

    Where as this way there really is no risk at all on spending as you say *pay when sold*…and of course this is even more apetising by not charging anything at all upfront…

    Maybe this is to capture eBay sellers who use say Google PPC to their own listings…I mean keep paying advertisers *in-house*?

    Anyways great post Andrew.

    John.

  13. Hi Andrew

    The one thing that puts me off using it, is the word PROMOTED by the listing title in the search results. I worry that the buyer might feel its not related and is only there because its being paid for. If that makes sense?

    Cheers
    Paul

    1. Andrew Minalto

      Hi Paul,

      Yes, I have also been thinking about this – in one way it helps as your listing stands out from others BUT as you say – people may see these listings as ADS and may not want to click. Similar to Google search where you often, intentionally avoid clicking on ads/paid listings in search.

      Hard to say how majority of people react to this though….

      Andrew

  14. Hey, Andrew! I’ve been using the promoted listings for a couple of months, but have only made one sale through them.

    It’s very easy to bid too much, and kill any profit you would have made.

    I do like the idea of using it to jump start a new listing, because I have found that items can gain momentum and start making more sales after the initial sale, so using this start the ball rolling seems like a great idea.

    Thanks!

    1. Andrew Minalto

      Thanks for sharing this with us Dylan!

      Andrew

      1. I just started using this. According to the dashboard, I am getting a lot impressions but not so many clicks.
        I have many items for sale. So the question is, do I promote them all, or should I just choose my most popular items to promote? Any suggestions greatly appreciated.

        1. Andrew Minalto

          Hi Mark,

          Click through % from search results to listing are generally very, very low (unless your listing is in top 3 search results). So don’t be surprised to see low numbers there.

          As for selecting items – I would say – as long as you make profit by doing it, you should advertise your whole inventory! But if you make small loss with advertising and just want to use this to boost sales history/rankings, pick your most popular items you want to massively promote and get good rankings for.

          Thanks,
          Andrew

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