From the Editor - May 4, 2014
By Ina Steiner
eBay made a surprise announcement last week to help revive its ailing auction business, giving sellers only 2 weeks to prepare for new fee changes that take effect on May 15th. eBay CEO John Donahoe and his chief financial officer Bob Swan told Wall Street analysts that fixed-price listings grew 19% year-year-year in the first quarter of 2014, but that auctions had fallen 9%. Auction listings account for a quarter of eBay's revenue.
Swan blamed the decline on "changes in consumer preferences and slower consumer selling." Donahoe was more specific, blaming the fact eBay had made pricing changes to C2C (consumer to consumer) last year, and had made "a little bit of search changes."
It's naive to think simply pushing sellers to list in the auction format instead of fixed-price will revive sales of collectibles and used items. Many believe eBay should spin off those categories into a separate site, or at least should have a way to search for such items separately with different parameters and different policies than when searching for new commodity items. One thing is sure - eBay executives will continue tweaking fees and its search algorithm in an attempt to control how much auction activity takes place on its site rather than letting it expand and contract organically as a marketplace of buyers and sellers should.
While it seems counterintuitive, Donahoe doesn't want to see growth in the auction business - he is striving for "zero growth," he told analysts. It's clear that eBay pushes levers whenever auctions grow "too fast" or too slow for management's liking. Why not embrace strong growth in auctions? That's a question for John Donahoe and his team to answer.
You can read an explanation of the new fees that take effect on May 15th in this EcommerceBytes Newsflash article, eBay Restructures Fees to Revive Ailing Auctions, and you can read more about eBay's first quarter performance and earnings call in eBay GMV Grows 11 Percent in First Quarter of 2014, Changes Ahead.
Amazon also released its first-quarter earnings, reporting net sales had increased 23% in Q1 2014 compared to the same period in 2013.
There remains a lot of confusion and angst over eBay's new seller performance standards; Julia Wilkinson covered the recent eBay webinar about the new dashboard and defect rates. Be sure and read her article where she reveals important tips including one about how to refund buyers so it won't count against you as a defect. (Over 100 people commented on her accompanying blog post.)
I've noticed a lot of confusion over the requirement that Top Rated Sellers offer a 3-month return policy during the holidays. eBay wrote on its Spring Seller Update page, "The extended holiday return option will be required for any listing to qualify for Top Rated Plus benefits from November 1 through December 31."
Many sellers think that if they don't offer extended returns during the holidays, they will lose top rated status. That's not the case. You must offer extended returns in order to receive the TRS discount, but you can be a Top Rated Seller and not offer extended returns - you just won't get the discount for those listings.
Sellers of all sizes and types find listing and inventory management tools beneficial. Julia Wilkinson continues her look at some popular tools for small and medium sized sellers in today's issue as she catches up with Greg Sisung of inkFrog to learn more about his company's solution.
Amazon has begun promoting its Login and Pay solution for ecommerce websites more aggressively, and Greg Holden talked to Lar Quigley, Director of Corporate Development for Cymax, to find out why he uses it along with PayPal and Visa V.me.
Michele Alice primes us for yard sale season with advice on what to bring with you when hunting for treasures, and we wrap up today's issue with Letters from Readers.
Happy spring, and thanks for reading.
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 email@example.com.
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