eBay Pricing Announcement Comes Next Week

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

January 23, 2008

eBay Pricing Announcement Comes Next Week

By:

Wed Jan 23 2008 17:22:50

eBay will announce a restructuring of its pricing next week, according to the company's financial presentation made available this afternoon. In a slide called "Pricing... Listening and Responding to Buyers and Sellers," eBay revealed its testing of pricing and the results.

eBay said reducing Final Value Fees had a minimal impact on key metrics. Reducing Insertion Fees had a "Good lift," while making Gallery Photos free improved conversion.

eBay's conclusion: Sellers are more interested in reducing upfront fee risk, and back-end success fee reductions are secondary, and buyers like pervasive photos across al listings.

Feedback, customer support and pricing changes are coming, according to Donahoe on the conference call, happening right now.

eBay is hosting top sellers at its annual Ecommerce Forum on January 29 in Washington, DC. Expect to see some of these announcements then so eBay can answer questions those sellers may have.

Comments (28) | Permalink

Readers Comments

eBay Pricing Announcement Comes Next Week

by: good

Wed Jan 23 21:37:36 2008

good

eBay Pricing Announcement Comes Next Week

by: Greg

Wed Jan 23 23:12:01 2008

Why wait a week? Announce the new fees now and let's get rolling!

eBay Pricing Announcement Comes Next Week

by: Andrew

Wed Jan 23 23:27:51 2008

Talk about intentioanlly skewing results to provide the desired spin - the statement re: "Reduction in Final Value Fee (back end)" test gave "minimal results" conveniently leaves out one major component.

The "minimal results" came because the Final Value Fee reductions were only for the 1st tier of FVF - the 1st $25 - which was a savings of $1.31 (5.25% of the 1st $25).

This resulted in savings of pennies on the dollar for the majority of sellers.

To truly test FVF reduction efficacy, a more level pilot should have been implemented.

eBay Pricing Announcement Comes Next Week

by: Ming the Merciless

Thu Jan 24 02:19:38 2008

Does anyone really think ebay EVER tells the truth about anything? Of course, the FVF report is skewed because ebay wants to RAISE, not lower, those fees. No one should ever believe anything ebay says without independent verification because they habitually are considerably less than truthful.

If past experience is any indication, whatever ebay does will be too little too late or just plain wrong. Lowering fees alone isn't the solution.

Ebay must understand that they've created an adversarial, hostile relationship with too many of their customers -- SELLERS -- on many different levels and these gross deficiencies must be addressed and corrected as well.

Two things ebay sellers can count on from ebay: insufficent solutions and and wrong responses.

Ebay doesn't need idiotic ebaywikis, or blogs, or any of the other asinine sites and ads that keep buyers away or take them away from seller listings. What ebay needs to do is to create a broad base of happy, profitable sellers instead of a growing base of sellers who hate them because of their less than forthright and honest business practices.

And it's abundantly clear that these Wall Street analysts don't understand how ebay works and care only about getting ebay's stock up to $38 by the end of 2008. And I suspect they don't care how ebay manages to accomplish this target because Wall Street has no ethics, either.

Greed, thy name is ebay and every other avaricious corporation whose unregulated business practices have brought this country to the brink of depression with sub prime loans and credit card usury.

Ebay is, among other, things a microcosmic model of the modern, ethics-free American corporation.

eBay Pricing Announcement Comes Next Week

by: buyers_needed

Thu Jan 24 04:51:10 2008

we don't need no stinkin' sellers. sellers come if buyers are present. life is cruel for sellers, but if you make your money - you'll pull your pants down for anyone...

eBay Pricing Announcement Comes Next Week

by: In the Know

Thu Jan 24 05:23:05 2008

Keep an eye on the eBay Announcements Board this Friday, Jan 25th.

The Fee changes will be made public then.

Expect some changes based on Category and potentially some based on volume.

Sellers with high ''customer satisfaction'' ratings will get some extra savings, maybe free gallery.

The cost to list items will go down, even if it is back end rebates on fees. EBay wants to keep the product flow on the site and will reduce the risk for sellers to keep it.

On the back end FVF's will go up slightly to offset the upfront reductions.

Keep in mind these changes may not go into affect all at once and may be different in some categories.

Overall it looks like eBay will sacrifice some up front revenue for the next few quarters to keep their sellers and those products listed. And to help the shopping experience and buyers the Gallery Fee should go away for most if not all sellers.

These will be welcome changes for most, except for those with very high sell through rates now. If like the average seller only about 35-40% of your listings are converting, then the lower up front and higher back end fees should balance out the net eBay take on each sale but allow for more listings and potentially more sales for the same percentage investment.

One thing that may come of all this is a more complex rate structure which could open the system up to gaming be some users. Listing in the wrong category to take advantage of a more favorable cost structure.

Have fun, the sparks will start to fly on Friday, but be kind, at least they are trying....

In The Know

eBay Pricing Announcement Comes Next Week

by: JR

Thu Jan 24 07:12:14 2008

As with any changes that are made are geared only to benefit the high volumn sellers.

According to:

In The Know

Sounds like ebay will be implementing another corrupt despicable debacle to enhance the fall of smaller sellers.

You sound like an eBay flunkie that thrives on having the smaller sellers being taken out. Apparently, you will be getting some self gratification on the 26th.

As long as Whitman is always going to be in the background there will never be any hope for the smaller seller to thrive let alone sustain on eBay. Her replacement has been groomed to follow in her footsteps.

Can you imgagine what she will do to this country if Romney is elected?

eBay Pricing Announcement Comes Next Week

by: JH

Thu Jan 24 07:46:39 2008

Ebay is just getting worse and worse. They need to change more then just their fees. They need to get rid of their new CEO and the stupid rules their putting in place.

They are geared for their buyers but they rip off and mess over every seller they can, their latest bumble being the rules cutting sellers abilities to list if a very small minority of buyers have an unsatisfactory experience. Even if those sellers are completely in the right and list everything in their auctions honestly. If a buyer gets their item late and leaves you a neutral its your fault and that counts as a strike against you.

If the buyer just didn't like what they purchased and leaves you a bad feedback just because they didn't like the item its your fault.

If your buyer has a problem and does not contact you at all about the problem and leaves you a negative without contacting you its yet again your fault.

eBay cares little about their sellers. They just want your money. And they could care less if their stupid policies ruin your business.

They boast their papal monster as being the best payment service out there yet papal robs and steals millions from its members each year by freezing accounts and never ever giving the money back because they know that most people don't know they can file a lawsuit against them and win. All Because they agreed to a user agreement that 5 supreme court judges all stated was invalid and only worked in the interests of papal.

The scenario does not end with eBay. I bet hard money that when ebay drops their fees. Paypal will raise theirs. They wont loose any money, they are just giving sellers false hopes while they secretly bump prices elsewhere to compensate. They will probably start freezing even more paypal accounts and robbing the funds out of those too.

They do everything they can to hide what they are doing to the small sellers, but us seasoned sellers that have been around for years know exactly whats going on behind the scenes. eBay will never change for the benefit of their sellers.

My opinion is that smart sellers sell on more then one venue then ebay. Build a website, fill it with products and do small work on ebay to use thier site in your favor. Never use them as your only source of income.

eBay Pricing Announcement Comes Next Week

by: Bob

Thu Jan 24 07:48:10 2008

It's about time they did some thing anything for buyers

eBay Pricing Announcement Comes Next Week

by: Jennifer Smith

Thu Jan 24 09:39:18 2008

Regardless of eBay's implementation of new fees, you are commiting retail suicide if you are using only eBay.

I would hope that sellers are making use of some of the many other sites available for listing, many of which are free. Many of which are commanding more and more traffic all the time due to eBay's botched decision-making processes!

I invite you to take a look - it's worth a few minutes of your time~

http://www.squidoo.com/OnlineAuctionSites

eBay Pricing Announcement Comes Next Week

by: Louisa

Thu Jan 24 10:00:31 2008

The fun of eBay for sellers and buyers was in the search for unique items, usually "found" items. It was not in buying new merchandise from a business. The small seller should not be linked with the big guys. A separation should be considered.

Also, I suggest NOT listing when the auction will end, thus encouraging bids the first time around. Everyone waits to the last moments.

Besides "watch this item," how about a "watch this seller's items" quick link. I know as a buyer I "watch" an item just to see the seller's site again.

Let's make the listing fees 10 cents, and leave the final value fee as is, which is bad enough for the small seller. I am going broke on my items don't sell.

eBay Pricing Announcement Comes Next Week

by: Mr. Hern

Thu Jan 24 10:48:33 2008

I just have a question, what does conversion mean in the statement ''making Gallery Photos free improved conversion''.

eBay Pricing Announcement Comes Next Week

by: tula

Thu Jan 24 12:45:16 2008

Works for me! Those of us who sell relatively low-cost items that don't get huge traffic will benefit greatly from this. In my own case, having to relist more than 2 or 3 times usually kills any profit margin I might have had. Free gallery just makes sense. I'd gladly pay a little more on the back end to save up front and improve the chances of a sale.

To Mr. Hern - conversion is simply the successful conclusion to your auction. You see people talk about their "conversion rate" and all this means is what percentage of their listings result in a sale. If you list 100 items and 50 sell during their auction period, then you have a 50% conversion rate. Apparently, items with gallery photos sold more often than those without in eBay's tests.

eBay Pricing Announcement Comes Next Week

by: In the Know

Thu Jan 24 13:47:48 2008

I am tired of hearing “small” sellers constantly whining about how eBay is favoring big sellers and putting down the small sellers.

Every seller starts small and has the same exact opportunity to grow on eBay. For the past 12+ years eBay has charged all sellers, big or small, exactly the same fees. There has been no incentive for sellers to gain in volume.

The fee changes that are coming should reward those that grow and succeed at their own hand and don’t just try to step back and blame eBay for their own decisions or failings.

As for sellers being addressed by eBay for “seller non-performance”, only those with 5% or more poor buying experiences are being affected here. The average seller has about 1% poor buyer experiences on the eBay marketplace overall. Sellers that eBay is taking needed action on have 5 times that rate and need to make changes or be removed from selling on eBay for everyone’s benifit.

Of course these sellers also want to make sure everyone thinks that eBay and the buyers are to blame for their problems. No personal responsibility what so ever, always pointing the finger at others.

As a “Business” eBay is going to make changes that favor their own continued success just like any business should. Sellers that create good buying experiences based on their FB % and DSR’s will most likely see rewards in the new fee structure because this is GOOD for the marketplace. Those sellers that do not gain the rewards yet will have every opportunity to change their selling & customer service practices to have the opportunity to gain those rewards, again GOOD for the marketplace.

While the upcoming fee changes may start to favor “better” sellers, every seller has an equal opportunity to improve and become a “better” seller. And the only ones that will disagree with that will be the ones that want to continue to try to make eBay and buyers the source of all their woes, while shirking all personal responsibility.

It is a very simple business concept, if “YOU” cannot make money selling on eBay, sell somewhere else. Don’t just sit there and blame eBay & the buyers for your inability adjust your business to the marketplace. And when you want to whine one more time about how you used to be able to make money but “eBay” changed all of that. Remember that for 12 straight years the changes eBay has made have INCREASED sales on the marketplace. If more of “your” stuff is not selling then maybe you are not selling it right. Maybe, just maybe, eBay is NOT the problem and something you have failed to do is your demise.

So if you want to be successful you need to keep a few things in mind:

1. You are responsible for your own success or failure, not eBay or anyone else.
2. Diversify your sales channels
3. Be willing and able to change with the marketplace to keep up with its growth.

In The Know

eBay Pricing Announcement Comes Next Week

by: Michele

Thu Jan 24 14:09:04 2008

I agree with what ''In the Know'' said about being responsible for your own success. I have searched,without a lot of trouble, thrift stores and found some real treasures that sold great. I do my research about what sells through newsletters of other eBay sellers and use what I can. It is working for me inspite of fees, eBay or PayPal. And I am not inflating my shipping to make it work.

eBay Pricing Announcement Comes Next Week

by: Auctiva Jeff

Thu Jan 24 15:00:20 2008

"Why wait a week?"

They're waiting for the summit in Washington D.C. that starts Monday for their biggest Powersellers. So my guess is that the wait to know the new fees will end Monday.

eBay Pricing Announcement Comes Next Week

by: Top Seller

Thu Jan 24 15:16:41 2008

After over 20,000+ sales in only a few years at eBay, We have moved our operation over to Amazon Services. It is a much more professional operation- start to finish. Listing and inventory mgmt is so much easier. The only thing we sacrifice is when Amazon doesn't recognize the ASIN or UPC, then we have to list it ourselves. eBay got cocky thru their success, and the alternative is so much more efficient. We realized a long time ago, there was no level playing field for sellers, despite what Meg and everyone else said.

eBay Pricing Announcement Comes Next Week

by: Jeanne

Thu Jan 24 15:31:47 2008

I'll bet that if eBay lowers its listing fees, it will INCREASE the Final Value Fees to offset the decrease.

eBay Pricing Announcement Comes Next Week

by: justine

Thu Jan 24 16:31:47 2008

"eBay's conclusion: Sellers are more interested in reducing upfront fee risk, and back-end success fee reductions are secondary, and buyers like pervasive photos across al listings." Well, duh. All they had to do was call me- I could have told them that 3 years ago.

Customer support? Which customers would that be? OUR customers- the buyers? Or ebay's customer's- Us- the Sellers?

Obviously, all these peachy-keen changes have been in the works for months, saved for the week of the big regime change announcement, so they could make it look like the new guy is doing all these great things, and we, the naive, gullible EBAY CUSTOMERS THE SELLERS WHO PAY THEM would welcome him with joy and gratitude instead of skepticism and suspicion. The timing is very manipulative. It's insulting to our intelligence.

Fee structure changes? The last time that happened, I don't remember it being a good thing. Oh well, there goes our 16 cent, 30-day store listings. Probably just another nail in the coffin. I'll go back to playing Yahtzee now....

eBay Pricing Announcement Comes Next Week

by: Randy Smythe

Thu Jan 24 16:56:56 2008

I have been one of the biggest critics of the direction that eBay took over the past 2 years but I am seeing a glimmer of hope for sellers (all sellers)Hopefully when the details of the fee changes are announced we will see where eBay is headed.

Online sellers need a healthy eBay in order to maximize their business. When I sold I constantly asked for some of these same changes that appear to be coming. I am cautiously hopeful and I'll give Donahoe and his management team some time to make this work.

I look forward to a time when I can write positive stuff about eBay.

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