|Tue Dec 10 2013 19:31:12|
eBay Throttling Leads to Layoffs
Great article on the selling limits - however I wish the focus would have been less on selling limits and more on what we and few others sellers have coined as "throttling."
Selling limits should really be called Listing Limits. While many sellers think there are rolling blackouts, that really is not the case, your account is being averaged or throttled. That is why if you kill it one day you can bet that the next day or two will be lackluster as eBay gets your average back to where they want you.
We have been following "throttling" for nearly 6 months now as it was originally introduced to our account in January of 2013 and then removed from March until July 20th. On July 21st it was reinstated and we have been barely keeping our head above water ever since. Regardless of Best Practices, the number of listings doubling, etc, our sales and transactions numbers stay the same.
A few months ago, I confronted a Top Level eBay Rep with data on throttling. At first the rep was left speechless and then began to tell me I need to speak to the Vetting Department - and when I asked if that was confirmation of the "Throttling" being real he did not confirm with a yes, but with, "well we have a very large department devoted to limits, so it is something eBay is very interested in." I took that as full on confirmation.
We have a very good idea how this is being done and the data we have been analyzing confirms this. Like Cassini (and the throttling ties into Cassini) the variables are endless. Consider one variable: Auctions. eBay knows the average price of the widget you are selling. Going into a day if you have 20 auctions selling widget a, eBay will assume you are going to get the average price for each auction ending. Your sales will then be throttled until the end of those auctions. When they end if you did poorly your fixed price listings will get a bump in best match across platforms to further your chance of hitting your limit.
If your customers have $1000 worth of items in their shopping carts, eBay knows that your account has a x% successful checkout percentage and y% abandonment rate. This is also used in your throttling. The list of variables like this goes on and on.
When Donahoe mentioned several years ago that he would like to be the Walmart of online commerce I do not think he was talking about product offering nearly has much as he was suggesting the sheer control eBay would like to have over the entire search and transaction process.
Like the subject of your article, we too are veterans, we were relying on 8 years of data to prepare for our 4th quarter sales and 2014 growth projections. We anticipated a nearly 50% growth rate based on our product offering and best practices. Even with our listings doubled from last year and all Best Practices implemented, we have dropped over $100,000 in sales since July 21st from the same numbers last year. We were expecting to be roughly $50,000 over last years numbers.
We have now fired two employees and have lost a major supplier as we are not able to move product quickly enough any longer. Last year we sold an average of 70 items a day and now we are throttled at 30.
Additionally, our sales are consistently at $1000 a day. If we hit $600 one day we can pretty much guarantee $1400 the next, etc., etc.
Throttling is real and is killing businesses on eBay. I think it is time to stop asking Ryan Moore and get to someone with actual answers.