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Wed Sept 6 2006 22:11:12

Quick Excerpts from eBay Town Hall Meeting

By: Ina Steiner

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eBay's Bill Cobb addressed several questions about the eBay Stores fee increases at tonight's Town Hall meeting. I'm writing up a summary of the event for tomorrow's Newsflash newsletter, but thought I would share some excerpts from my notes here that I don't have room for in the article. Please note that eBay will provide a full transcript at and these are my quicky notes - I don't guarantee this is error- and typo-free!

An eBay member submitted a question: "What do you owe Store subscribers such as me that spent hundreds of hours creating listings, only to have eBay's prices raised so dramatically that it's no longer worth selling at certain price levels,...You cannot expect continued loyalty to the eBay community by employing such betrayal tactics."

Bill Cobb answered:

I understand the sentiment and I've heard this from Stores sellers especially those who sold primarily or exclusively in the Stores format and especially those who sold at lower average selling prices. With the action we took in July, while across the board, we have talked about this in our posts, etc., we do think it was the right move to help balance the marketplace, and to restore the balance between auctions and store listings, it certainly created a very difficult situation for some individuals, Store sellers. We believe that this is a fair comment that we seem to have been very inconsistent in the way we have dealt with Stores, and I want to say a couple of things here.

One, I think that's right, we went a little bit too far in terms of how much we were exposing the Store format, I think we got ahead of ourselves. The store format was designed to be supplemental inventory to the core format. It is a very important format, we will be keeping this format for a long time,...I think Chris is going to address some of the ways we are going to build value and enhance the functionality of Stores.

So we are very committed to the Stores product. But I understand that in some specific instances that it is no longer viable for people to sell on eBay and that's unfortunate.

I do think that overall we've taken the right steps. I think that the eBay marketplace needs to be centered on auctions and auction style listings, i think that is the right way to go. I think it is what draws the most buyers, it draws the most interest, and frankly it's what provides the greatest value for buyers in the form of lower prices.

I do feel that what we owe store subscribers is to continue to enhance the product and continue to enhance the value they that they pay for that, but I understand that we have been inconsistent over the past months, that's why we tried to be very specific, and the post was long on July 19th, in terms of what our go-forward strategy is and where our focus is going to be. We are going to center the concept - center the marketplace on auctions, and that's not going to change going forward.

Another user submitted a question that - bottom line - asked, why is eBay penalizing Storeowners.

Part of Bill Cobb's answer was the following was regarding the value proposition of eBay:

The reason you should sell on eBay is not to take a lot of inventory and load it up into a format and have it sit there and see if it sells over the course of months or years. eBay is a fast-turning marketplace. eBay is the place where you have the most visitors who spend the most time on the site and fortunately spend the most money on the site. That's why we lead ecommerce.

We are the place on the Internet where the seller can, within 2 weeks, have a very high probability of selling an item between the original listing or the relist, if they are pricing it at the appropriate level.

So we want our sellers to use the core format as their primary means of selling and that the store format would be a supplement to that. So what we're trying to do - and I realize that sometimes it's wrapped up in the emotion of a fee increase - is to really articulate why it is you should sell on eBay, and we think that the reason you should sell on eBay is that you'll maximize your cash flow because you'll turn your items faster than any other place on the net.

Comments (8) | Permalink

Readers Comments

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by: JCSales

Thu Sep 7 08:55:24 2006

In other words,it comes down to one thing.Money for EBAY.Appropriate level means we want you the seller to take bottom dollar for your items.EBAY's evasiveness is not helping EBAY,it's destroying EBAY.It's sad because obviously the powers that be that run EBAY would much rather listen to those that buy instead of those that sell or basically feed the machine.Bill Cobb is the worse CEO in the history of EBAY.He has literally destroyed all trust with sellers.

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by: Kathleen Lupole

Thu Sep 7 11:05:58 2006

I closed my ebay store only about 2 days before this big fee hike! I am so thankful I did this. It was the best thing I did for myself. No more selling garage sale items online. Ebay is a yard sale and that is what it will remain. Buyers will always complain about shipping charges when they know gas prices are higher. They want everything for nothing and ebay wants the sellers to pay for it all. It's best to get out of that type of selling. Bill can have it!

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by: Rhonda

Thu Sep 7 11:36:14 2006

Stats have, for the last 2 years, shown that Buy It Now (BIN) has out performed auctions by roughly 20%.

With the auction Sell Through Rate (STR) at an average of 40%, and BIN at an average of 60%, is this latest move to "balance" the marketplace or is it eBay giving themsleves a raise?

Based on stats, an auction item needs to be listed an average of 3 times to make a sale. One can recover fees if it sells the second time, but not if it goes to 3 sales.

eBay states that consumers get mdse at a lower price, but are not factoring in the increased costs associated with relisting. Sellers don't eat that, buyers do.

eBay raises costs, sellers raise costs. JQ Consumer pays the price. Consumers, not eBay, not sellers, will be the ones to tip the scales of balance.

It looks really, like eBay is giving themselves a raise. The only way selelrs can give themselves a raise is to cut operating costs. The first step is to re-evaluate (like eBay did) business plans and diversify.

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by: Jean

Thu Sep 7 12:28:33 2006

"So we want our sellers to use the core format as their primary means of selling and that the store format would be a supplement to that"  What eBay fails to grasp is that how eBay wants sellers to use the site, and how SELLERS want to use the site for their business aren't necessarily the same thing.  I'm a seller who is primarily a SIF user, and these fee increases have been devestating to me.  Whether I'll be around selling another year is still up in the air.  Not that eBay really cares if little stores like mine are still there or not - we're sacrificial lambs for the good of the marketplace.

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by: Kerig Pope

Thu Sep 7 13:25:07 2006

I had been reading up on how to start a home-based business on eBay for over a year. After I lost my job last April, I thought it would be a perfect time to finally start my own business and put forth the knowledge that I learned over the last year.

After 3 months I struggled using the core format, and although I was reluctant, I decided to use the eBay store format. I did this not because I wanted to put in the extra effort and expense to create a store, but because eBay convinced me that this was the way to sell professionally on their site as a legitimate business. My decision to open a store was also reinforced by the reports from eBay Live that I read here, and on the numerous other sites that offer free eBay information for new sellers starting their own online business. After eBay Live it seemed that the store format was simply the correct way for sellers to sell professionally, while the core listings still remain to be a big-giant-sloppy garage sale.

So I opened my store on July 17th after a week of hard would to make it look and feel professional and legitimate. Two days later I received Bill Cobb's email. Needless to say, I felt I was duped, and after recently having lost my corporate job, I once again felt that I was duped by corporate America.

I was in a state of limbo for the next month until the fee hike went into affect, reading all I could as to what I should do next to still make a legitimate business out of the situation at hand. Like others, I relisted my store listings the day before the fee hike to buy me more time to make a decision. But since then, all that I have read points to the fact that eBay simple wants to keep their site as a big-giant-sloppy garage sale. They now refer to it as the 'Magic of eBay'.

And as they continue to push the core listings over the more professional store format, make their sellers (mind you, the people that pay their salaries) feel like they are unimportant, and continue to allow fraud to run rampant, then the buyers that they'll attract will be just the sort of people that professional sellers don't want to deal with. The kind of buyers that don't take eBay as a serious marketplace and don't have a sense of commitment to follow through on a transaction made there.

After all, eBay is just a big-giant-sloppy garage sale.

All the signs are there for me now; It's time to get back into the corporate job market and forget any 'pipe dreams' that I had for starting my own legitimate business on eBay. Maybe I can sell all those 'How to be an eBay Powerseller' books that I my very own big-giant-sloppy garage sale!

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by: hulamermaid

Thu Sep 7 13:55:38 2006

No investor should be surprised at the failed work-product cranked out yesterday by one of the most arrogant and incompetent executives in the history of American capitalism. If eBay is to survive and prosper, Cobb and his broom-transported cohort must be removed from the corporation.

The pair are doing nothing other than setting investors up for further huge losses. They have no idea how to say ''no'' to institutional investors and analysts; they simply move forward, blindly chasing pennies to meet quarterly-demands, at the expense of future dollars.

Unable to stem the flood of fraud on eBay, the minions have now instituted a “fraud-profiling algorithm.” This new failed tactic has resulted in nothing other than closing down the eBay listings and stores of thousands of completely honest sellers, while scamsters continue to thrive. Sellers who normally list items under $100.00, are now being “profile-identified” as fraudsters if they suddenly begin to list “substantially more expensive” items. Once these innocent and honest sellers are swept into the suspect net, it is virtually impossible for them to vindicate themselves. eBay cannot catch criminals, thus, in order to “prove” that they are “doing something” about fraud, the dimwitted Meg and Bill are now closing down legitimate sellers and branding their victims as “potential” scamsters. The “catch figures” will soon soar into the multi-thousands and M&B will wave the bodies of these innocents as evidence that eBay is “cracking down on crime.” Meanwhile, real consumer-fraud will continue to increase and prevail on eBay.

Investors will soon be hit with scores of lawsuits filed by business owners whose eBay enterprises have been closed down by the corporation’s Keystone Cops. Some of those lawsuits will be tried and won or settled; all at the expense of shareholders.

The FTC is now receiving consumer-complaints that will likely ultimately result in the largest punitive findings in the history of online-commerce, against eBay. Bill and Meg’s branding of honest sellers as criminals is not going to be viewed kindly by Federal investigators; it will be seen as a mere smokescreen designed to obfuscate the truth about what has now become little more than a Racketeer Influenced Corrupt Organization. Under current leadership, eBay can only “make its numbers” if the criminals are allowed to work their “listing magic” on the site. Meg and Bill need the money derived from crime to satisfy the institutional investors, who have made it clear that missed-numbers will result in the massive dumping of shares.

eBay has continued and stepped-up its longstanding policy of retaliating against dissident sellers on the site. People who post negative comments on eBay forums – even under “posting Ids” - are being targeted for elimination from the site. Soon, the mainstream media will be reporting this outrage, and the nitwits at “Trust & Safety” who have “just followed orders” will be forced to explain exactly who gave those orders. The T&S employees should remember that they are acting as agents of eBay, and that when the lawsuits begin to flood the plains, those employees will not be immune from the consequences. Will Meg and Bill defend those employees, or will they cut them loose and claim the employees were “over-zealous renegades?” Honest employees being told to do things that they know are wrong, should begin documenting their receipt of “instructions.”

cleanupebay dot com has now allegedly privately-compiled massive files of horror stories about the activities of what appears to have become a totally corrupted enterprise. Disgruntled former employees and current honest employees are now telling their stories; many more will likely step forward as time passes. When the “truth” is made public, we will probably all have a new buying opportunity in the minus-$10.00 range. All of the troubles and losses that shareholders have suffered and are about to suffer are the fault of two arrogant and incompetent “leaders,” and the sycophantic managers whose loyalty has been purchased with tens-of-millions in shareholders equity. Investors should hope that the BOD takes action quickly, before it really is too late.


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by: Ty Tribble - PowerSellerKing

Fri Sep 8 12:52:18 2006

The only reason that store inventory outpaced auction inventory is because eBay  overpriced the auction format. Their solution to this problem?

Overprice the store format too.


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by: Fred Murphy

Sun Sep 24 09:17:05 2006

"I had been reading up on how to start a home-based business on eBay for over a year."

I don't understand this.  EbAy is an advertising medium, nothing more, and an extremely restrictive one at that.

Have you ever heard anyone say something like "I had been reading up on how to start a home-based business in the NYT classified for over a year," or "I had been reading up on how to start a home-based business by running radio ads on WLS for over a year?"

Of course not.  Any business would only consider a single advertising outlet to be a portion of its overall campaign, yet there are thousands of people selling on ebaY who apparently think that's the only way in the world to sell mailorder.

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