Friday, December 18, 2015

Amazon Payments on Bonanza

I decided to write this post because Bonanza no longer has discussion forums, and other sellers might have the same questions I had and might need some answers.

This fall, Amazon notified users of its Checkout by Amazon service that they needed to transition to Amazon Payments.  Bonanza completed the necessary steps for sellers to make the transition.  This change is good, because Amazon Payments is a payment method where Amazon users can use their actual Amazon login information to complete purchases on Bonanza.  They never need to create a Bonanza account or give Bonanza their information directly.  Everything is done via Amazon.  I can see where this payment method could increase sales on Bonanza.

I followed the directions that Bonanza provided on this page to get my Bonanza account changed to where I can accept Amazon Payments.  The directions are extremely easy to follow, and the entire process was completed in just a few minutes.  The process was so easy, in fact, that I wasn't sure whether I had completed it correctly.  Apparently I did, because within a couple of days I had my first payment through Amazon Payments.

After the payment came through, I was quite confused.  I was used to how Checkout by Amazon worked, and I couldn't figure out the Amazon Payments setup.  I could not click on the transaction like I could with Checkout by Amazon.  I could not enter a tracking number to confirm shipment.  With Checkout by Amazon, I had to enter a tracking number to confirm shipment before Amazon would release the funds.  I couldn't do that with Amazon Payments.  This was a concern, and I was also not completely sure if the transaction had gone through.

I contacted Amazon customer service, where I was told that that I needed to take no action.  I was still a little confused and concerned, because the customer service representative did not write the response very well.  Here it is.
Once difference between Login and Pay with Amazon and Checkout by Amazon is that usually there are no further actions required from your end to collect the payment if you have set it up to Authorize and Capture. We will automatically collect the payment for you and deposit it directly to your bank account. There is no need for you to confirm the shipment or enter the tracking number upon using Login and Pay with Amazon.

Looking at this transaction, yes it went through and was captured successfully, you would know if there is an issue with the transaction if the status is Suspended, in this case the payment method of the buyer was invalid and they would have to update it first before you can collect the payment.
After reading the response carefully quite a few times, I concluded that the transaction did go through, even though the last paragraph was poorly written and confusing.  I also concluded that I truly did not need to do anything other than create the shipping label as I always do using PayPal and then enter the delivery confirmation on Bonanza to indicate that I had shipped the order.  Amazon Payments works just like PayPal in that money is received and no additional action is needed.

I noted that Amazon states in the FAQ section that a new account has a 14-day hold before funds will be released to the seller via checking account.  I was still a little uncomfortable, but I figured that 14 days later that the funds would be released.  Of course, I immediately ended up with a second transaction, but at least the amount was smaller, and I determined not to worry about it.

On the 13th day after the first transaction, Amazon released the funds for both transactions, so now I know for sure than everything is good and that I don't need to do anything other than what I do on Bonanza.

I want to mention some other Bonanza topics.  I do not recommend that the average seller take up a membership.  I did pay for a membership for five years, and the final year was a mistake.  The membership was well worth it for the first four years, but I never should have paid for the 2013 membership.  That was the year when sales began dropping due to Bonanza placing links to items on Amazon throughout all of its search results.  Bonanza did that because they get a commission when buyers follow those links and make purchases.  It was a good financial move for Bonanza to do that, but it reduced our sales.

Bonanza also has a number of advertising options where sellers can agree to pay a higher fee to Bonanza, and Bonanza will pay for the seller's items to be listed in Google's shopping search, PriceGrabber, and a few other sites.  I did, for a few months, try out Bonanza's advertising option where my fee to Bonanza could be up to 16% to see whether it would help.  I only had to pay the higher fee if the transaction came through one of the advertising venues.

I had four transactions where I paid the 16% fee.  Interestingly, three of them were the very first month I paid for advertising.  The fee wasn't that bad except for the last one where my fee was $17.77 on a $111.01 order.  I decided that was too high and that I should not pay 16% for advertising.  I reduced my advertising option to 9% to see what happens, but I will likely remove it eventually.

In the time I had the advertising option active, I had 44 transactions.  Only four of them came through advertising, which is quite low.  Advertising does not help much for vintage books.  I assume that it helps more for people who sell electronics and other popular items.

You might wonder why I keep my booth open since traffic to my booth is not anywhere near what it once was.  I have some repeat customers who pay by money order, and that option is not available on eBay.  It's worth it to me to keep the Bonanza booth open for them and for some other buyers who do purchase from me periodically on Bonanza who do not use eBay.

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