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Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Mon Dec 3 2012 13:43:11

eBay Lacks Expertise to Succeed in Same-Day Delivery

 By: Ina Steiner
Sponsored Link
eBay is running a test of same-day delivery, but it's not using eBay sellers to source the goods. Instead, eBay pays couriers $12.50 per hour, plus 55 cents per mile driven, to purchase goods from local stores such as Macy's and then deliver them to customers. (This may be more than some eBay sellers earn an hour, I can hear some of you thinking.)

Today's Wall Street Journal says the service, called eBay Now, is available in San Francisco (launched in August) and New York (launched in November) and is available only through an iPhone app.



Here's what eBay Marketplaces President Devin Wenig told the Journal, "There's a lot of inventory that's close to customers, in stores and warehouses, but the link through delivery hasn't really been cracked yet. This is an experiment to determine if we can cement eBay into local markets by handling all aspects of commerce."

As the article points out, Amazon has offered same-day delivery since 2009 in 10 cities including Seattle, Indianapolis and Boston, and notes that Google and Walmart are also testing same-day delivery services.

To operate such a service without bleeding dollars requires logistics expertise that eBay lacks. Amazon and Walmart, which uses UPS and other services rather than hiring couriers of its own (which seems like a very Web 1.0 idea on eBay's part), both have experience running supply chains and know how to maximize operational efficiencies to slash costs.

Same-day delivery reminds me of another craze ecommerce giants are taking a crack at, "package pickup" delivery lockers, which paid off last week for a Canadian company called BufferBox when Google acquired it for what might be upwards of $17 million.

The question comes down to who is paying for enhanced delivery services? Customers demand free shipping and retail margins are tight. Whoever runs the tightest ship will likely win - if demand for such services truly exist on a wide scale.

Update: Time's Harry McCracken's take on eBay Now.
Comments (29) | Leave Comment | Permalink
Readers Comments

Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Anonymous Annie
       
Mon Dec 3 15:09:55 2012
It appears to me that someone is trying to CREATE a niche rather than fill one. That's all well and good, and there's nothing inherently wrong with that... but when you consider all the other things that eBay could be doing (SHOULD be doing) to improve the site and to make it easier and safer for sellers, it seems to me to be a rather short-sighted effort.

Once again, we're treated to a peek into the (frightening) minds of those in charge at eBay... and each time we learn more about their priorities... it makes me even more relieved that I've ''left'' eBay.

And by ''left eBay'' I mean that I still list on the free-days, but it's NOT my bread-and-butter anymore. (In fact... while reviewing my sales for November, I can happily report that in ONE DAY... 24 hours... I did more business at my web site than I did for the ENTIRE MONTH AT EBAY!! :-)

I know, I'm bragging. Forgive me.  
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: Susan Averello This user has validated their user name.
       Web Site
Mon Dec 3 15:18:05 2012
Creating a niche is what it feels like to me to, especially with the pickup boxes. If I have to go out to get an item available locally, why not just go out and buy it myself.

Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: iheartjacksparrow
       
Mon Dec 3 15:39:10 2012
I couldn't read the WSJ article since they are behind a pay wall, so my question is: If I buy something from a store that I'm two hours away from, is my shipping $25.00 plus an additional approximately $66.00 for mileage? I'm guessing eBay isn't absorbing the money they pay the couriers.  
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: Scotty This user has validated their user name.
       
Mon Dec 3 15:40:26 2012
As a deserving consumer, I am now demanding ''Previous-Day Delivery''.....I believe studies have shown that consumers are now demanding items be delivered before they have even requested them from ebay.....and I will settle for nothing less!
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Basset
       
Mon Dec 3 16:21:04 2012
I'm still trying to think of something ''I gotta have right now!Today!''

Toner Cartridge? Forgotten Anniversary Present? Kidney?

Most things I've learned to plan for or wait to come through normal channels. If I need something THAT urgently, I'm not sure I would trust it to internet venues.

 
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Anonymous Annie
       
Mon Dec 3 17:06:29 2012
@Scotty: Here you go!

http://youtu.be/HA_gwzx39LQ
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: iheartjacksparrow
       
Mon Dec 3 17:37:37 2012
Basset says: "Most things I've learned to plan for ...."

Exactly. If I know my toner cartridge is getting low (per the graph on my printer), I buy a replacement before it runs out so I don't have stop in the middle of a printing job and run to an office supply store. Same with everything else I use on a regular basis.

And Scotty is right. eBay needs to start anticipating what we will want the following day and make sure it arrives early.
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: Steevo This user has validated their user name.
       
Mon Dec 3 18:22:13 2012
It's not a matter of expertise, it's more like cockeyed optimism.

This reminds me of a home grocery delivery service that started up locally. You went on their site, ordered stuff and they delivered it.

They had custom built refrigerated trucks.  It looked to me like a high cost business.  

I said I can't see them making money on that, they had to be losing money.  When they went out of business within a year a friend said how much he liked their service.  

My response:  What's not to like?  They bring your food to you for less than it costs them.  Sure, it's great.

But how long are they able to subsidize your purchases? Not long it turns out.

This thing in the article, same day delivery, they are losing money on that. There is no way to make money on it unless you can charge a giant premium. Same day Amazon delivery, I doubt very much that it's free or anywhere close.

I just don't see that giant premium happening. Most people are more interested in planning ahead briefly, saving half the money.  That's probably what the ratio would be to fully fund such a service. It would double the costs. Customers have to pay those costs.

At that price, I suspect there would be just no demand at all. There would be demand if you didn't charge that much, but it would then not be a going business.

How long is it going to go on?  Well, long enough for someone with a brain to say ''are you guys nuts?''
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: AgendaSwallowsAll This user has validated their user name.
       
Mon Dec 3 18:26:18 2012
@iheartjacksparrow & @Scotty

''And Scotty is right. eBay needs to start anticipating what we will want the following day and make sure it arrives early''

Cute but not really that funny as I assure you, ebay is working on knowing more about all of us than we know about ourselves. If it were just buying habits I'd say so flippin' what, I'll just continue deleting what has already become a consistent intrusion in to my life with this offer or that but it's going to go far beyond that and that my friends should strike fear in all.

Mind control is ebay's attempted direction, anyone with a shred of intellect can look back through a number of the site's moves over these past 5 plus years and acknowledge that reality.
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Ed Gadfly
       Web Site
Mon Dec 3 18:30:02 2012
It must be comforting for eBa'al listers to realize that eBa'al is spending the lister's fees in a foolish manner that cut's the lister's own throats. Anyone who subsidizes is contributing to their own demise.

Best place there is, huh?  
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Sandymenu
       
Mon Dec 3 20:29:34 2012
Buyers are becoming wiser (the crooked ones that is) because during November, buyers have been asking two days after their payments ''where' my item'' or ''the tracking number you provided show no delivery information''...''when will it arrive if I paid two days ago''.

What's going to keep eBay from targeting in on non-sameday delivery sellers next?
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: Ebay's Slow Death This user has validated their user name.
       
Tue Dec 4 03:57:07 2012
Who thinks this stuff up?  Oh, ya, MBAs fresh out of business school.

If someone in New York needs something today from Macys, don't they just call the store and order it, and have a bike courier deliver it to them?  Why get Ebay and a car involved?

What next? Is Ebay going to require its small sellers to hand deliver items the same day?

But, as others have suggested, you don't need to order anything from Ebay, they already know what you want and will deliver it to you soon.

Ebay getting into same-day delivery, is just plain dumb. However, that's business as usual for them.  
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: Brainiac jones This user has validated their user name.
       
Tue Dec 4 10:51:19 2012
Sounds like they are trying to compete with the Amazon Box system, designed for local pickup possibly. Not quite the same, but still advancing speedier delivery.
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: nothingnew This user has validated their user name.
       Web Site
Tue Dec 4 12:14:09 2012
Ya'll missed it! eBay Lacks Expertise in EVERYTHING! :)
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: eBankrupted
       
Tue Dec 4 13:39:55 2012
ebay has two main criteria for implementing disruptive change:

1) The change must give sellers the common symptoms of a heart attack.

2) The change must be designed to financially destroy the seller's business and pricing.

Anytime the selling community is otherwise distracted by such non-ebay activity as tax deadlines, outside of ebay sales, success and profits. etc.; ebay's MBA bots must inject stress and fear into the seller slave community to show them who's boss.

Heart attack shipping is a perfect torture to keep the PTSD spreading so sellers don't have time, sanity or the energy to succeed in the real world, outside of the cult.
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: DonC
       Web Site
Tue Dec 4 14:44:12 2012
Sounds like someone retyped an old term paper and much to their surprise the decision makes bought in.

Someone at eBay needs to take a reality check. Running a delivery service is miles away from their core business.

I suspect this will be featured in the Harvard Business Review as an example of how to fail by straying from your core business.  
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Ming the Merciless
       
Tue Dec 4 15:36:44 2012
Ebafia will implement this latest brilliantly disruptive, game changing innovation with the same competency, efficiency, elan, and trustworthiness that they're known far and wide for.
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: Massachusets Howler This user has validated their user name.
       
Tue Dec 4 15:47:13 2012
Okay, so paid couriers are going to make MORE on my items than me now, and ebay.
So ME, the finder and seller of the item, while assuming all the liability, will make the lEAST now?
What if the said courier ''smokes on my package'' or what if he FLAKES OUT and quits with my item still in his DINGY car?
What happens then?
What happens when he says, let me just go to the grocery store, as ebay is paying my mileage and I can do this stop on ebays dime, and his MILK crushes my widget- What will happen then?
JD, whu don't you buy PEAPOD and deliver GROCERIES and our widgets, then you can force Giant to accept paypal- IS THIS THE NEXT CRAZY IDEA??
Next?
Mass Howler
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
by: RCL This user has validated their user name.
       
Tue Dec 4 15:51:54 2012
I often think of Netflix and the price it paid for inelegantly forcing change down its customers' throats....what really WILL be the breaking point for eBay? When will greedy short-sighted mismanagement COST eBay? ... That's all I really want for Christmas, by the way. Oh but Donohoe has a scapegoat: the fiscal cliff! This was a very good article.
Perminate Link for eBay Lacks Expertise to Succeed in Same-Day Delivery   eBay Lacks Expertise to Succeed in Same-Day Delivery
This user has validated their user name. by: Ming the Merciless
       
Tue Dec 4 19:59:02 2012
Yes, this is the next big idea for the urban landscape from the next small mind at ebafia.

Wenig got his inspiration and training from delivering Chinese.

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