eBay Tests Consignment Service in Atlanta - Is It Working?
By Ina Steiner
eBay continues to tap into a new source of revenue by reaching out to people who don't wish to sell on eBay themselves. In January we wrote about two programs the marketplace was testing in California and Kansas in which it offers to sell peoples' household items on eBay on their behalf.
eBay is now running another test of Selling Assistant, this time in Atlanta, Georgia. eBay's Director of Consumer Business Vikram Singh told EcommerceBytes the goal of the program was to offer choice to customers. "Selling has continuously become easier as the years have gone by on eBay and yet, we know that there are a number of people for whom time is an issue - they just don't have the time to get this done. And so the goal was to offer choice."
When eBay launched the Selling Assistant program in San Jose, the company wanted to see if there was a demand for that type of service - and they found there was actually "overwhelming demand," Singh said.
The page at eBaySellingAssistant.com features a video describing the program in which eBay will pick up items from people's homes and sell the items on eBay. The program is available in the greater Atlanta area through July 31st.
As with eBay's January pilot program, it will give the consignor 75% of the selling price of items that sell. Consignors contact eBay to schedule an appointment online, or call 855-EBAY-VAN; eBay pick up the consignor's items and have them listed on eBay. Unsold items can be donated or returned to customer.
While the site says, "the eBay Selling Assistant partner will charge a 25% commission on sale price of items," the consignment sellers we spoke to in January said the client received 75% and the Trading Assistants received 45% of the proceeds (about 30% after eBay/PayPal fees), meaning eBay is prepared to subsidize at least the pilot testing of the program.
Singh said he wouldn't discuss the exact numbers, but said the model was feasible - if eBay thought it didn't work, they would have adjusted the numbers in the Atlanta pilot, he said.
But selling on eBay on consignment is a difficult business model. Karen Blankenship was one of two Trading Assistants participating in the Selling Assistant pilot program in January. "Almost half of the items I listed for the pilot did not sell, that was JUST PURE LOSS on our part," she wrote to EcommerceBytes in an email.
"During the pilot, I worked 12 hour days, 7 days a week, and listed about 60-90 items a day." Each listing was unique with its own research, pictures, and descriptions, she explained. Blankenship said the pilot was a good way for her to experiment with other goods that she would normally stay away from - "I learned that I am best off listing items that I have a personal background in."
The challenges she faced were dealing with clients and the accompanying paperwork, and the low value of items brought in by participants. "If clients are bringing in $10 items all day long, you can see the numbers on a 30% margin along with eBay and PayPal fees, it is A LOT OF WORK for peanuts." She has since closed the store/warehouse and the seller ID under which she had participated in the pilot Selling Assistant program.
eBay's Singh also runs the Trading Assistant program for eBay, and when asked if it was a growing or shrinking program these days, he called it stable.
In January, eBay had also tested a drop-off location at a mall where people could bring their items rather than use the van pick-up service. And Singh said they continue to test a program called Sell It Forward in the Bay area where customers can mail in clothing, shoes and accessories for eBay to sell for them on consignment, which EcommerceBytes wrote about in March.
eBay has no set plans for additional pilot testing at this point - it continues to evaluate different programs, according to Singh. They have determined that the programs increase engagement and bring people into eBay. Ultimately they will scale something, he said, but they haven't nailed it down yet.
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About the author:
Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to firstname.lastname@example.org.
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