eBay Sends DVD Shoppers to Netflix

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AuctionBytes Blog
News and insight focusing on
ecommerce and the online auction industry
by Ina Steiner, Editor of AuctionBytes.com

May 22, 2007

eBay Sends DVD Shoppers to Netflix

By: Ina Steiner

Tue May 22 2007 18:46:56

I noticed something odd yesterday about the ads that appear on eBay search results pages. Do a search on eBay.com for "sopranos dvd" and you are likely to see an ad for Netflix. This means eBay is sending people who are coming to the site to buy DVDs away from its own site to a service where people can rent DVDs.

Back in 2000, sellers were so angry when eBay did the same thing, they organized the "Million Auction March." That time, eBay backed down, and the "toaster ad flap," as it was called, is described in Adam Cohen's book, "The Perfect Store."

When Yahoo Auctions decided to serve ads that competed with its sellers listings, it made the site free, but eBay sellers pay lots of money for listing fees on eBay.

Sellers have also been complaining that Yahoo ads (Yahoo serves up ads for eBay) are appearing on search results pages even under non-"null search results" conditions. Clearly eBay is getting bolder with the Yahoo ads. (It's the frog in boiling water scenario; I'll explain in a comment below.)

eBay also announced this week it would be targeting ads based on information it has collected about users. As a buyer, I don't mind when Amazon makes product suggestions, but eBay serving up ads based on my past bids and purchases seems creepy.

I've commented in the past about eBay's commoditization of the site. Interesting that it is following a path Yahoo Auctions took, and look what happened to them.

Comments (20) | Permalink

Readers Comments

eBay Sends DVD Shoppers to Netflix

by: Ina Steiner

Tue May 22 20:49:19 2007

The boiling frog reference I made relates to a story often used by consultants to warn people that gradual change can make them accept unpleasant situations that, if presented at once, they would immediately object to, see wiki reference:
http://en.wikipedia.org/wiki/Boiling_frog

eBay Sends DVD Shoppers to Netflix

by: Randy Smythe

Tue May 22 22:35:48 2007

Ina, it is exactly like the boiling frog. They don't want any further unrest among sellers so if they dish these changes out a little at a time nothing will get out of control. Maybe they think Sellers will eventually give-up.

Apparently they want advertisers not sellers.

eBay Sends DVD Shoppers to Netflix

by: Fruity

Tue May 22 22:57:41 2007

That's not all they're changing. Every basic store owner better do some general searches and find out why suddenly it takes an act of God to show up at that Shop Ebay Stores box. And wonder why Ebay is forcing onto buyers who opt to search US only...Int'l store seller products and pushing US sellers even further back

and while we're at it, Ebay Express has a new glitch, for certain sellers it's not even returning Store Items, ONLY Auction BIN items

eBay Sends DVD Shoppers to Netflix

by: stevel

Wed May 23 06:05:53 2007

What's more disconcerting than the banner ads, such as the Netflix one, are the new ads theyre considering putting on the bottom of search results.

These ads show product on other sites (such as amazon) in direct competition to the items you just searched for, and in a format similar to that of eBay's search results, complete with thumbnail image and price.

For an example, see this image that was recently posted on the ebay discussion forums:

http://i210.photobucket.com/albums/bb99/cockytoo_photos
/beadscreen.jpg

This was the result from a search on ebay for 'bead cord' which was performed by a person that is experiencing one of the new search formats currently being tested. As you can see, when searching for bead cord, not only does the person see results on ebay, they see results on other sites (such as amazon), presumably served up by shopping.com

eBay Sends DVD Shoppers to Netflix

by: Carl

Wed May 23 06:25:15 2007

This pretty much all feeds into my understanding -- and I empasize it is only my interpretation of what I see ---

eBAY is in the process of splitting into two very distinct sales channels -

The first is the traditional (for them) auction -- or if IT prefers Core -- offerings.

The second --- Appears to be pointed to being focussed as a general search engine with a few twists.

IF one takes this back to 2006 a general picture begins to emerge ---

SIS --- Was it truly an error ???? Or was it a major test. The timing smacks of test to me.

01 -- SIS was rolled out just before eXPRESS --- It may have been a toe in the water to see just how much potential eBAY had within its own base for traditional based shopping.

02 -- On site advertising for offsite vendors APPEARS to be in lockstep with Store minimalization within Core as well as with the eXPRESS push.

03 -- General observation building within the financial community seems to be that Auction has pretty much matured to the point of of level and possibly declining growth -- I would say a comparison would be when a dam breaks --- A rushing wall of water that eventually spends itself out then ebbs and flows as it finds its level.

Auctions in general have a limited utility in commerce -- They serve no real function outside of specialty -- distressed -- and limited widgets - (from a sellers perspective). Auctions will in fact have a tendancy to depress seller profitabilty when used as a selling method for run of the mill items that are readily available. This is probably the biggest single force involved in the depressing of prices on eBAY.

To leave CORE and STORE as integrally entwined ''partners'' serves no real long term profit goals for eBAY. To leave them like that actually runs the risk of price depression spilling over into this items that are traditionally suitable for an auction ----

At the same time an auction -- store has potential of growth and profitabilty --- IF the store inventory is close to auction suitabilty ---

For instance there are numerous auctioneers with little collectable stores --- They fill those little stores with things that are just under the auction radar --- Say will bring 25.00 at auction -- BUT -- will bring 40.00 in a store within a reasonable period of time -- and if they do not -- well after a period of time go to the auction for the 25.00.

You never see dollar store and rarely see new widgets in these stores.

I believe that is what eBAY envisiond in its' core format -- Auctioneers with little stores that have unique just under the radar widgets sitting in a store.

THE REST ---- We are seeing it just outside the horizon as it develops --- A shopping portal that has not only its own built in mall -- but also shuttle buses to the whole shopping district called the internet.

My issue is not with the vision --- I find it intringuing -- forward thinking -- and potentially profitable. My issue is witth the manner in which it is being brought about. The process is extremely destructive to a great many people --- Wheras a transparent migration would allow many sellers to actually practice damage control and make adjustments that would have some long term meaning and effectiveness.

That is the basis of my understanding of what we are enduring --- It is not based on more than observation -- adding facts -- and deducing likely results. It could be totally in left field -- but -- I do not believe so.

eBay Sends DVD Shoppers to Netflix

by: firemeg

Wed May 23 06:32:15 2007

Good post Carl.

Ina, it's actually a bit worse than sending people off-site to rent movies instead of buying them. Netflix now offers previously viewed movies for SALE. They are cheap. They come with all original boxes and are guaranteed to work....many on eBay are not.

eBay Sends DVD Shoppers to Netflix

by: coyote

Wed May 23 08:46:48 2007

Hurrah! Hurrah!
We've got yet another .20 cent listing day tomorrow! Ooo'boy, I can hardley wait. And the freakin little gallery thumbnail image is only .35 cents each?? Oh, what a deal!!
I cannot believe I can expect to get a whole 10 page views per listing for 7 days, for only a dollar! I must have a freakin' screw loose or something?
Why doesn't ebay just go jump in a lake. Are they actually planning on spending some money on bringing buyers to the site this week? Or is this just another wiffle ball?
Someday soon, no more of this stick it up my @zz routine. I'll gladly keep my listing fees in my own pocket were they belong, as it is apparently clear that this company will bilk it's users in every possible way to obtain it's end result. Ebay is a fad that is dying the slow death, I say ''good riddens''.

eBay Sends DVD Shoppers to Netflix

by: Dino

Wed May 23 12:42:24 2007

So why doesn't ebay have any competition? Where are the competitors? All I hear over and over again is how angry sellers are with the lack of loyalty and gouging, but Yahoo just died, so what gives? Why can't the market seem to support a competitor?

eBay Sends DVD Shoppers to Netflix

by: Ina Steiner

Wed May 23 15:55:18 2007

In the case of some competitors, it is they themselves that are to blame for not being competent or really screwing up. In other cases, just not enough funding (and street smarts) to be able to bring buyers to the site. And finally, there are some decent auction sites out there - I don't think you have to be eBay's size and have their breadth of categories to do well. Interesting to note that two of the sites that Yahoo Auction sellers seem to be seriously considering are Bidville and eCrater.

eBay Sends DVD Shoppers to Netflix

by: Bidofthis.com

Wed May 23 20:30:59 2007

A little Internet History factoid:

Circa 1996: OpenText was the first search engine which enabled companies for paid placement the search results for specific queries.

The Google Gods even mention this in their dissertation on Google/Backrub
http://infolab.stanford.edu/~backrub/google.html

I actually remember using the OpenText search Engine back in the day......

eBay Sends DVD Shoppers to Netflix

by: Roger

Thu May 24 03:09:35 2007

eBAY want to take money from advertising. It's not a strange. But i think sellers must see this adv, no buyers.

eBay Sends DVD Shoppers to Netflix

by: Shesawaya

Thu May 24 07:01:27 2007

Since it seems to be okay to post alternative selling sites - don't forget about iOffer. STILL free to list for up to 60 days at one time and very low fees for upgrades and FVFs.

eBay Sends DVD Shoppers to Netflix

by: Benjamin

Fri May 25 10:05:08 2007

That's horrible news! I wish that people would really stand up against Ebay, but they are the King for right now. However, everyone knows that you can't stay in power forever! I think that this blog has it right in saying that Business to consumer sites are the way of the future
-----
www.alltheauctions.com

eBay Sends DVD Shoppers to Netflix

by: Corey Kossack

Tue May 29 00:50:25 2007

This one hits really close to home for me Ina! I am usually very understanding when it comes to eBay's fee and policy changes in an effort to support the greater good, but this one's just not right. As Randy knows, the DVD business is a tough one and sellers spend thousands in insertion fees every month to get their listings noticed. Sending DVD shoppers to Netflix is a serious conflict of interest. There is no way they can argue that they are putting their sellers (or even buyers for that matter) first in this scenario. I'm really not pleased with this one.

eBay Sends DVD Shoppers to Netflix

by: Laura

Wed May 30 21:01:46 2007

I was very surprised to see the banner ads leading offsite. It's taken years and a lot of work by a lot of artists to get the thousands of asian prints and reproductions (many of the images taken right out of our listings!)out of the American Original Art Catagory. Now the huge print/repro outlets don't even have to bother listing with a direct link to their factory!

eBay Sends DVD Shoppers to Netflix

by: Genie

Sun Jun 3 09:49:47 2007

Google is the only one who can give eBay a serious competition effort. There are close to 3000 signatures on Petition for Google to Start Online Auctions
http://www.petitiononline.com/ga05/petition.html
I would love to know what's Google's thinking on this.

eBay Sends DVD Shoppers to Netflix

by: Debbie

Sun Jun 3 09:52:30 2007

I'm shocked at ebays mendacity, after reading about the Netflix situation of off site advertising, I wondered what effect this policy my lis tings. I searched for Herbs de Provence spice abd found 5 sponsored links to 5 different off site spice companys

eBay Sends DVD Shoppers to Netflix

by: Debbie

Sun Jun 3 10:10:05 2007

I'm shocked at ebays mendacity, after reading about the Netflix situation of off site advertising, I wondered what effect this policy had on my listings. I searched for Herbs de Provence spice and found 5 sponsored links to 5 different off site spice companies for that product. They are Zamouris Spices, Calibrex, Igourmet, Scandinavian spices, and Shopping.Yahoo. No wonder my sales have suffered recently. Is there any grounds for a class action law suit? All
ads that directs costumers away from ebay hurts us, but this direct off site competition on ebay should be unexceptible! Shame on them for crying poor and raising fees!

eBay Sends DVD Shoppers to Netflix

by: online auction

Tue Jun 5 22:41:22 2007

I can see nothing wrong with this. It is an honest attempt to expand their horizons and line their pockets.

eBay Sends DVD Shoppers to Netflix

by: http://www.auctionsellingrevealed.com

Tue Apr 22 03:20:53 2008

Wow! This is interesting to know that if one has good knowledge in internet as well as marketing knowledge then one can make lots of money. Yahoo Auctions on Ebay is the best way to make huge sums of money.

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