The 4 profit factors on how to make money on eBay are very essential for your auction business to gain your eBay success. They are leads, conversion rates, margins and average number of transactions per customer. You have to understand these factors of fundamental concept in direct marketing to minimize your efforts and maximize your profits on eBay.

It is much less difficult to convince your existing customers make business with you again than to sell to the new customers. You will need time and money to sell your product listings to the new customers. The satisfied existing customers will eagerly come back to you again that will make your business more cost-effective and profitable. They do so, because they think it is better doing business with you than buy from your competitor who they never in business with before. So if you want to know how to make money on eBay properly than you should know the 4 profit factors more deep.

Therefore you should not only sell your initial product to your increase new customers, but you should also sell a lot more products to your existing customers. So here the 4 profit factors as your fundamental concept in direct marketing on how to make money on eBay.

1. Leads.
Leads are simply people who stop and visit to your auction listing products. You must consider every visitor as your leads even though they visit with high bounce rate or in a short time of visit to your store. Whether they buy or not they are counted as your leads.

2. Conversion Rates.
Conversion rates are the number of visitor compared with the number of people who buy your products. So it is dividing the number of your sales by the number of your leads. It can be measured as for every how many visitor will buy your auction listing products.

3. Margins
Margins are amount of profit that calculated by subtracted your sales with your costs. The money you have spend in eBay listing fees, PayPal fees and other overhead are cost that must carefully take into consideration to calculate your margin.

4. Average Number of Transactions
Average number of transactions is the number of times that each customer buys from you. For example, if 1 out of every 8 people that purchase a MP3 player from you buys another MP3 player or an accessory, in this case your average number of transactions per customer is 1.125.

With these 4 profit factors on how to make money on eBay will absolutely give great value and fantastic service to your customers constantly. They are very important because small increase on each of these factors can make exponential results on the performance your eBay business. In the end you will have your profit increase and create your lucrative income by making money on eBay.