AuctionBytes Survey Finds eBay Sellers in Transition
By Ina Steiner
The results of AuctionBytes reader survey are in and reveal some fascinating information about online auction sellers. As you might guess from the state of the industry, most respondents currently sell on eBay (92%), but can you guess which sites are number two and three? We also asked where people plan to sell in 6 months, and those answers may surprise you.
Thank you to readers who took the time to complete the survey. We know you are busy, and appreciate your efforts! Now, here are the results.
AuctionBytes conducted an online survey of readers in September 2006. A request to readers to complete the survey was made in the September 3, 2006 issue of AuctionBytes-Update and in several issues of the AuctionBytes Newflash newsletter. The online survey form was live from September 3 to September 13. A total of 1225 people completed the survey.
Who are the respondents?
The survey shows respondents come from around the world, with the majority based in the U.S. (88%). And, reflective of eBay as a whole, there are many small sellers and a small amount of high-volume sellers: 79% report the value of all items sold on online-auction sites in the last 12 months equals $50,000 or less, while 72% report the value of all items sold online in total in the last 12 months equals $50,000 or less.
Items most frequently listed to sell range all over the board, and cluster in certain popular categories such as collectibles (21%), clothing, shoes & accessories (10%), books (9.5%), home & garden (6.1%) and jewelry & watches (5.6%).
34% of all respondents do consignment sales, 4% are drop-off stores with regular hours for walk-in trade.
Where are sellers selling, and will this change in 6 months?
Some answers to this question are dramatic and surprising. We asked sellers where they are selling now (on which sites they "regularly list items"), and whether they would be selling there in 6 months. We broke it into three categories: online auction sites, storefronts, and classifieds and other websites.
The most startling figure that jumps out from the results come from eBay sellers. 92% of respondents currently sell on eBay. According to the results, only 38% of the respondents plan to be selling on eBay in 6 months. One might presume that this number is skewed by smaller sellers, who may not earn their primary income from eBay. However, filtering the results to include only sellers who earned over $100,000 annually in sales showed an even wider disparity: 95% of those who earn $100,000 or more annually currently sell on eBay. When that subset was asked if they would be selling on eBay in 6 months, the number dropped to 33%.
Those results would be less surprising if they applied to eBay Stores, given the recent Store fee increases, however this question focused specifically on auction sales.
We did notice that while other auction sites had a net increase, much of it was turnover. Looking at the first figure, you can see that 46 respondents currently sell on Amazon Auctions. In 6 months, 136 respondents plan to be selling on Amazon Auctions. But in looking at the "Respondent Total" column, 163 respondents answered this question. That means of the 46 people currently selling on Amazon, only 19 plan to be selling there in 6 months. Amazon gained 117 people who are not currently selling there but plan to in 6 months. This was common across almost all of the auction sites.
The second part of this section dealing with Storefronts showed that 56% of all respondents currently sell on eBay Stores. That number drops to 21% for sellers who plan to be selling on eBay Stores in 6 months.
Given those statistics, one might expect to see an increase in the number of respondents who plan to sell on their own ecommerce-enabled website. However, that number remains the same. 22% of respondents said they currently sell on their own ecommerce-enabled website, and 22% said they plan to sell on their own ecommerce-enabled website in 6 months.
Some storefront services are set to pick up some slack in 6 months, such as small gains for online antiques malls (1% - 2%) and for Yahoo Stores (2% currently sell there, 6% plan to sell there in 6 months), but other storefront services are set to lose some business.
The third part of this section dealing with "Classifieds sites & other websites" showed either no change or declines for all venues listed, with the exception of Google Base: 16% of respondents sell on Google Base currently, and 20% said they will sell on Google Base in 6 months. Froogle, however, declined from 19% to 16%, and Craigslist (in which eBay owns a 25% stake) stayed steady at 15%.
What are sellers' biggest concerns?
When asked to rank five concerns in order of importance, fees were ranked the number one "biggest concern about selling on online auction sites."
Fraud came in second, with non-paying bidders/buyers closely on its heals as third biggest concern about selling on online auction sites.
"Payment services" was ranked as the fourth biggest concern, and "Inventory and product sourcing issues" came in fifth.
How many sellers have their own sites, and how significant are sales from those independent sites?
A large number of respondents (54%) have their own website or storefront. For those who do, 29% said it makes up over 50% of their sales, and 50% said they made more sales in the past 12 months from their website/storefront than in the previous 12 months.
Looking at it another way, a large number of respondents (46%) do not have their own website or storefront. 33% of those who do said their own sites and storefronts make up only between 1% - 10% of their total sales, and 19% said they had fewer sales in the past 12 months from their website/storefront than in the previous 12 months.
What payment services do respondents offer?
Far and away, the largest number of respondents - 96% - accept PayPal. Recently launched Google Checkout (which eBay bans sellers from mentioning in their listings) is accepted by 8%.
In asking this question, we were focused on the online payment services; however, many respondents checked "other," entering responses that revealed that checks, money orders and postal orders were popular payment methods.
How are auction sellers marketing their businesses?
There appears to be a tremendous opportunity for online sellers to explore paid-search advertising and marketing techniques. 9% - 12% of those with their own website or storefront do not do any search-engine advertising at all. And 39% of all survey respondents do no marketing to promote their online sales.
17% said they use the eBay Keyword Program (which eBay is discontinuing on September 30). 17% use Google AdWords, and 6% use Yahoo Search Marketing. 5% of respondents checked "other," and wrote in marketing techniques such as search engine optimization, link exchanges, shopping comparison sites and feeds.
Respondents market to acquire new customers, such as including signatures on discussion board posts (29%) and in emails, using link exchanges and even print advertising. And they also use marketing techniques to try and retain customers, such as including marketing material inside customer orders (42%) and offering email newsletters (33%).
How can shoppers contact sellers?
Background: eBay limits sellers in the type of contact information they can provide in listings to discourage off-eBay transactions. eBay allows telephone numbers but no links or URLs, though they can include links and URLs on their About Me pages.
We asked respondents what features they included in their ecommerce/Storefront listings so customers could reach them, then we asked them what features they included in their online-auction listings so customers could reach them.
Email addresses topped the list, followed by a wide margin by telephone numbers and Website URLs. On ecommerce sites and Storefronts, only 5% include instant messaging or text messaging, and only 2% included click-to-call buttons such as SkypeMe buttons. For auction listings, 2% include instant messaging or text messaging, and 2% include click-to-call buttons such as SkypeMe buttons.
There are tremendous challenges and opportunities for sellers who want to sell independently. 46% of respondents do not have their own ecommerce site or storefront, and when asked where they sell now and where they will sell in 6 months, there was no change in the number of people who sell on ecommerce-enabled websites.
Respondents did plan to change which storefront services they used, however, with some services losing and some increasing. For example, Yahoo Stores saw a 253% increase in the number of people who said they planned to regularly list items there, indicating sellers may be looking for easy-to-use, branded storefronts that can bring them traffic.
There's either a large group of sellers who will never set up shop online independently, or there's a tremendous opportunity in web-hosting to service these "newbies" - probably for the company that can make their service as easy as listing an item on eBay.
There also appears to be an opportunity for services that can drive traffic to ecommerce sites and storefronts, and possibly for businesses who can help sellers to create, design and market their independent sites.
In terms of respondents' stated intentions in where they will sell in 6 months, it's hard to know what to make of these statistics that show an impending industry-wide seller-retention problem. As explained earlier, a significant percentage of respondents who currently sell on a particular auction site say they will not be selling on that auction site in 6 months, and this cuts across most online auction sites, including eBay.
There does seem to be special concern by eBay, since, unlike other auction sites, there is no net gain due to new users. Since the data reflects respondents' intentions, not actions, the data could reflect a temporary malaise among online auction sellers. We believe the fourth quarter (historically the busiest due to holiday shoppers) will be crucial in either curing the malaise or cementing the current attitude of sellers. Fees were ranked the number one biggest concern about selling on online auction sites by respondents. A surge in traffic and conversion rates (Sales) accompanied by reduced fraud and more reasonable fees may be the prescription for retaining online auction sellers.
We hope you'll talk about the survey with colleagues on forums. If you do, please remember to link to AuctionBytes.com. And for members of the media, including citizen journalists and bloggers, please ask permission before publishing survey data. We may be able to provide you with additional charts reflecting different segments of the respondents, depending on your interest.
We'll be conducting a follow-up survey next year to take another pulse of the industry. In the meantime, please share your thoughts on the AuctionBytes blog (http://digbig.com/4mxsd).
Copyright (c) 2006 Steiner Associates LLC. All rights reserved.
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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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