Posts filed under 'eBay'
This past year many long time Ebay sellers moved the bulk of their business to Amazon, and became multi-channel sellers. During the testing of “best match”, and “finding 2.0″, there were many sellers with a huge drop in sell through rates that lasted for a week or more. The only way to continue to sell on Ebay was to find another avenue to make sales. The avenue of choice for many was Amazon.
As you can see from my last post, Amazon is now becoming the number one place for ecommerce shoppers. So, I have to ask if all the problems on Ebay are really the fault of the sellers? Because after last week, it seems they are blaming the Ebay sellers for the poor buying experience. But, since those same sellers are making Amazon a fortune, how can it be the sellers fault?
Most of the changes to the Ebay site over the last 2 years have not stopped phishing e-mails, or account highjackings, or fixed system glitches, but they have taken a toll on my time to sell on Ebay. Many Ebay initiatives force me to use my time for customer service. Such as the “unpaid item process” where I have to spend a lot of my time because the number of unpaid items keeps rising each month.
The point is that I spend an incredible amount of time taking care of my customers on Ebay. Most Ebay sellers are constantly afraid of making even the tiniest mistake. We have been told by Ebay so many times that we are the reason buyers don’t like to shop at Ebay anymore, that I think we’ve begun to believe it. It has become part of our psychic makeup.
And I want to know where a buyer is going to get the same level of customer service at a regular Brick & Mortar store. Wal-Mart? Best Buy? I don’t think so.
And the most terrible thing is that, if we are doing everything possible to be a perfect Ebay seller, and Ebay is still losing buyers, then it must be the other sellers on Ebay who are to blame. I don’t know how many times I have heard one Ebay seller blame the other “scam” Ebay sellers for all the wrongs on Ebay.
So I have to ask again, is it Ebay’s habit of passing the customer service buck to the sellers, their habit of not telling buyers about account takeovers, their habit of not fixing system glitches that cost buyers and sellers time, their messing with search until nobody can find anything, and most of all blaming the sellers for trying to stay profitable and secure that is actually causing all their problems?
After all, the very same sellers Ebay is blaming, are making Amazon a fortune.
Jennie
February 4th, 2008
I was not one of the top 200 Ebay sellers invited to the Ebay Ecommerce Summit last week where Ebay announced the changes to Fees, Search, and Feedback. I was one of the lower volume Ebay sellers on the sidelines at home waiting to hear the long awaited announcements about fee reductions. As we all know now, the fee changes will probably hurt more Ebay sellers than they help. The changes overall made me ask myself how the new CEO designate of Ebay, Mr. John Donahoe, can make changes to Ebay’s platform that blatantly copy the Amazon platform without feeling a bit unimaginative. Mr. Donahoe has been at Ebay since March 2005. If you would like to check out his salary on Forbes Mag. Is Ebay going to become Amazon Lite?
The new final value fees (FVFs) for Ebay stores are just slightly less than Amazon’s FVFs are now. Not allowing sellers to leave negative feedback for buyers is similar to the Amazon feedback system. The star rating system is similar to the Amazon seller rating system. Amazon already has a relevance based customer search that sounds like the “finding experience” Mr. Donahoe has been working on, and which is scheduled to be rolled out to Ebay this year. My guess is it is time for us all to examine the Amazon sellers marketplace because the new CEO-designate of Ebay seems to want the Ebay buyers experience to be just like the Amazon buyers experience, and will probably continue to imitate Amazon features.
Jennie
February 3rd, 2008
written by Steve Grossberg, IMA President
Back in September 2007 I posted to this blog, a piece titled “Looking at eBay’s DSR (Detailed Seller Ratings), Click Here to Read Part 1.
Yesterday I did a podcast interview with Ina Steiner from AuctionBytes, Click Here to Listen To Interview Some of the points and more I am going to be talking about below are covered in the interview. I encourage everyone to listen to the interview.
Okay for starters ebay says 15% of sellers currently qualify for the 4.8 DSR bonus. My question is what percent of the ebay listings or GMV does that represent. This has yet to be answered by my best guess is somewhere less then 2%. Of the top 100 seller date as referenced in post 1, there is only 1 of the top 100 USA based sellers according to the Nortica 500 that has a 4.8 DSR is shipping and handling. There was another 19 who had 4.6 or better. Ebay stated over and over how 66% of sellers have a 4.6 or better but again what percent of listings and GMV is this? Certainly it is not 66%, so always do you own due diligence. As the old saying goes trust but confirm.
A few days back I posted my own personal math on reviewing the situation now confronting sellers, and if it made sense to go after the 4.8 DSR.
I caution everyone to look at your own economics. Remember if you obtain the 4.8 DSR on all 4 you get back 15% of your FVF. Look at me for example.
Items listed 40,000
Items Sold = 8,000
ASP = $14
So $14 x 1.23 FVF x 8000 items = $9800 FVF paid
$9800 FVF paid x 15% discount = $1470
$1470 savings divided by 8000 items = 19 cents per item
So in essence I have to say to myself will a 19 cent reduction in my shipping and handling move my DSR from 4.4 to 4.8? The answer is heck no it will not. Even if it did the ebay discount is not guaranteed as it is a 30 day rolling average and some months I may get it and some not.
However I could simply raise my shipping and handling by 19 cents and guarantee my bonus that is equal to eBay’s bonus offered for obtaining all 4.8’s. I am not suggesting sellers raise shipping and handling fees and I am not indicating I am raising my own because I am not. However I am point out that ebay is not providing enough incentives to sellers here and putting the entire burden of fixing the problem on sellers. So in summary I would think most sellers would be best doing the math as I showed above for their own sales and evaluating whether it makes sense to lower your shipping and handling to strive for a 4.8.
I do not think anyone knows what the affect these changes will have including ebay themselves. My inclination here is to say run your business the way you always did and let the DSR’s fall where they may. We as sellers have very little control over DSR’s but we do have control over others aspects of our business such as
Describing items accurately
Providing good communications
Shipping items out timely
And charging what we as sellers feel is a fair shipping and handling
Remember ebay talked about other sites on the internet offering free shipping and handling etc. However they failed to talk about the ebay buyer mentality and the fact merchants here must offer their products much cheaper then anywhere else on the internet as buyers expect bargains on ebay. They also mentioned how buyers complain about shipping and handling after the fact. But are they complaining about total cost? I doubt it very much. I know when I sell a pokemon diamond nintendo DS game for $24.99 on ebay that I paid $28.50 for wholesale nobody is complaining about product price or even total cost. So the ebay buyer wants items at or below wholesale cost and want to be charged exact postage. Amazon offers prime members free shipping and handling and sells this same game for $35.00. My price on ebay with shipping and handling is $33.00. I cannot sell it lower and now ebay took another 83 cents of profit away from me leaving me with a whopping 2 cent profit per game if I had 100% sell through.
Ebay also made it clear if a seller is accurate in the description and sets clear expectations of what is being offered, then that is what is expected. So if your shipping and handling is clearly stated who cares what buyers think after the fact? I did all I could do and clearly stated what is being offered and for how much. I did not click the mouse on the other end and place their bid or hit the buy it now.
Now let’s talk about non paying bidders here for a minute. Ebay spokesperson Usher Lieberman has confirmed to the associated press recently some date I provided and that is 6% of ebay listings end up with NPB. Several times during the recent ebay e-eomm forum ebay folks stated 7 million items were listed to the site daily. So let’s do some math here.
7 million listings daily x 6% NPB = 420,000 NPB daily.
420,000 x average list price 70 cents (my guess here) = 294,000 dollars made DAILY on NPB. Multiply this out for a year and ebay brings in over 100 MILLION DOLLARS IN REVENUE FROM NON PAYING BIDDERS. That equates to nearly 2.5% of the total ebay company profits .
Forget about the re-listing credit ebay offers on NPB re-lists, as it means nothing unless you have a 100 %sell through rate (would that be nice, even a 30% would be nice)
So where is there an incentive on eBay’s part to stop these non paying bidders? How much does amazon or wlamart.com make on NPB? What is extremely disturbing here is that ebay also allows these same NPB leave us negative feedback and give us all 1’s on DSR. But wait, ebay says if a buyer does not respond to UPI or is suspended feedback will be removed. So then I ask does ebay back retroactively and re-calculate our DSRs from a time in history to see if we would have qualified for the bonus discount based on DSR rating after removals, and then provide us the discount?
What I mean here is let’s say in June you have a 4.5 shipping and handling DSR. In August, say you get 30 feedbacks removed because of suspended buyers. The feedbacks that were removed were left in June. So once the feedbacks are removed if ebay went back in time and looked again at the DSR for that June 30 day period your DSR would have been 4.6 on shipping and handling, does ebay now pay you the would have been June discount? I sincerely doubt it. So I see this as more spin. In essence the feedback removals will never help your current 30 day roiling DSR period so what good is it?
Now let’s look at eBay’s broken dispute console. Ebay says they will remove feedback if buyer does not respond. Okay almost everyone responds though. Quite often they select a standard response ebay offers via a check mark which reads “buyer indicates they will pay for item”
Well the buyer indicated that 15 days ago when they won the auction. Fool me once shame on you, but fool me twice shame on you. I immediately close these disputes and get my FVF back (not listing fees). Guess what no feedback removal because buyer responded.
Here is yet another issue, at least for media and some other sellers who list via catalogue. Lets frame this part by saying during the e-comm as the finding 2.0 break out sessions ebay folks hammered home the fact if cataloged listing (UPC) is available it is essential we use it.
So a few days ago I received a neutral feedback on item number 140201873682. God only knows what DSR I got because they are invisible to us. The feedback left reads as follows, “product is new, but only 1 person can play. It said 2 can play, huh” Well in the media category you list items for items specifics using UPC code. Ebay then has a data provider called Muze who provides detailed information about the item.
Additional Information about Fishermans Bass Club; Portions of this page Copyright 2001 – 2008 Muze Inc. All rights reserved. Players: 1-2 Players
Now even though this content is totally controlled by eBay and Muze, they cleverly attach a sellers user name to the bottom as follows: The seller, 1busyman, assumes full responsibility for the content of this listing and the item offered.
Also there is no way to even know the data ebay is providing via Muze is flawed as sellers cannot possibly go verify all eBay’s data. Additionally the only way to report bad data is in the SYI form and who uses the SYI form? I have not for 10 years now. So once again ebay is placing all the burden of fixing their issues onto the sellers.
Yet another issue in International shipping. Yesterday my ebay sales were analyzed and 30% of my items ship were to International destinations and it represented over 15 different countries. With 15 different countries customs and duties policies buyers have to deal with how can I control shipping time? Also if shipping time is long rest assured buyer will ding you on shipping and handling fees because any item taking a long time to receive will surely not be worth the price paid to ship in buyers minds.
In summary while eBay’s intentions appear be good with the recent changes announced, it will never work in my opinion. The only way to get sellers to lower shipping and handling fees would be for ebay to drastically lower the cost structure for sellers to sell on the site and bring back the buyers from yester-year. The fee changes only offered fee relief to about half the sellers at best. Fee relief would be needed to nearly 100% of the sellers and meaningful fee relief like a 20-30% reduction.
The next step would be for ebay to collect payments on behalf of sellers. But wait if ebay did this they would lose the 100 million in NPB revenue.
February 3rd, 2008
This is a question that most full time Ebay sellers will be asking themselves over the next month or two. The “best match” finding 2.0 changes to Ebay’s default search in March 08, and the May 08 removal of a sellers “mutual feedback” privileges will cause unknown changes to many Ebay sellers bottom lines. (I am leaving out fee changes because they can be calculated.) I know of one seller locally who has already closed his doors, and started selling off his inventory. He felt it was too big a gamble with three small children to continue counting on Ebay as his sole source of income. Buy out companies have been quick to take most of his stock of brand new Budweiser mugs off his hands.
If you use Ebay as a part time source of income, you will probably be OK waiting to see how your income changes. For sellers who have made a full time commitment of resources and time to build a business on Ebay, the wait and see approach will probably not work. I personally have two building leases, and several buyers who depend on me. Not to mention year long advertising contracts that cost quite a bit each month. For me, waiting to see what happens to my Ebay income isn’t going to work very well. I have to plan for the worst, and hope for the best.
I plan to sell off as much inventory as I can this month, and stop buying additional stock until I see how “Best Match” is going to change my sell through rates. I have also created a selling account on Amazon. Amazon has a very vital marketplace where you can usually sell your items at a higher price than you can get on Ebay. Amazon has no upfront fees, handles the payment processing (no paypal fees), and the final value fees are 12% to 15% which is just slightly higher than Ebays new fee changes. But Amazon handles more of the customer service tasks, and there are no listing fees. For more advice on selling through Amazon’s marketplace see the IMA forum. For more information about the differences in selling on Amazon vs. Ebay try this link.
There are also niche marketplace websites if you are selling in a collectibles category. Many niche marketplace websites have also seen a surge over the past year in sales, and sellers. The best way to find them is through collectors newsletters or the IMA forum.
For all the Ebay sellers who face extreme business changes over the next few months, I wish you the best and hope all your planning in the next few months bring you a better overall marketplace experience for the coming year.
Jennie
February 3rd, 2008
written by Steve Grossberg
Anyone who lowers shipping in my own opinion, is foolish. Look at your own economics. Remember if you obtain the 4.8 Detailed Seller Rating on all 4 you get back 15% of your FVF. Look at me for example.
Items listed 40,000
Items Sold = 8,000
ASP = $14
So $14 x 1.23 FVF x 8000 items = $9800 FVF paid
$9800 FVF paid x 15% discount = $1470
$1470 savings divided by 8000 items = 19 cents per item
So in essence I have to say to myself will a 19 cent reduction in my shipping and handling move my DSR from 4.4 to 4.8? The answer is hell no it will not. Even if it did the ebay discount is not guaranteed as it is a 30 day rolling average and some months I may get it and some not.
However I could simply raise my shipping and handling by 25 cents and guarantee my only bonus better then the bonus ebay will pay out. Also remember this will not affect you in search unless DSR is 4.2 or lower. So ebay is not providing enough incentives to sellers here and putting the entire burden of fixing the problem on sellers. So in summary I would think most sellers would be best doing the math as I showed above for their own sales and raising your shipping and handling to provide you the same bonus or better then the 4.8 would have got you.
So ebay sellers, please look at your own numbers!
February 2nd, 2008
Last month I signed up as a member of the Better Business Bureau (BBB). One of the reasons I joined is they allow you to use their emblem on your website. They also don’t let any random person file a complaint against you without documentation of a transaction, and without giving the store owner a chance to refute the complaint.
Why do they do this? Because they do not want to hurt a persons business. A lot of investment goes into a business. Especially a true solid physical store front. You have contracts that last for years with other vendors. Security systems, utilities, advertising, product, etc. If your business goes under, a lot of other businesses are affected. In addition, if someone publishes false negative information about you for the public to read, they could be sued for defamation of character.
Why would I make these comparisons? In May 2008 Ebay plans to let anyone post negative information about my Ebay business without any regard to how it may affect that business. As far as I know, I will be given no chance to refute any negative information that a buyer leaves me, and that negative information will remain there for anyone to read for 12 months.
This would be comparable to someone picketing outside my physical store for 12 months without my being able to do anything about it. Is this fair? Ebay thinks so. They think that if a buyer has a negative experience in any way in my “Ebay” store, that the buyer has the right to harm my business for 12 months without giving me any hearing or even reviewing the facts. They feel it is the same thing as the bad word of mouth a physical store owner receives from a buyer who has poor buying experience.
The difference is that a buyer who has a bad experience in a physical store isn’t allowed to publish defamatory information about a store to a public forum without proof, or they are left open to a libel suit. The BBB knows this, and reviews all complaints. So welcome to Ebays new neighborhood where anyone is allowed to post negative information about a business, without allowing a store owner any rights. Perhaps Ebay management feels that an Ebay store owner has nothing invested in that Ebay store, or no obligations to other people with businesses?
All I know is that I hope I find more friends than foes in the “new” Ebay neighborhood starting May 2008.
Jennie
February 2nd, 2008
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