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Sat June 28 2008 11:41:38

Should You Report eBay Deadbeats?

By: Ina Steiner

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I've heard that ever since buyers figured out sellers can't leave them negative feedback ratings due to eBay's May 12th policy changes, there's been an increase in non-paying buyers (NPBs) and late-payers. But at the eBay Live conference last week, eBay said the rate of "UPI" (Unpaid Item) reports against deadbeats had not increased.

This apparent contradiction may actually be the result of unintended consequences from eBay's changes. Sellers are fearful of what filing UPIs might do to their DSR ratings, which have a powerful impact on their bottom line. So it does not necessarily follow that an increase in non-paying bidders would lead to an increase in Unpaid Item reports.

To expand on this point, consider: ChannelAdvisor CEO Scot Wingo has been writing and speaking about seller strategies for achieving and maintaining high DSRs. eBay invited him present his tips during the eBay Live conference. Scot added two strategies to his list after the conference, one of which was, "Improve your DSRs Tip 14 - Consider NOT filing for UPI credits."

So despite the fact that not filing UPIs hurt sellers' wallets (they must pay commission fees on those non-sales), higher DSRs mean being advantaged in Best Match search and receiving discounts on fees. (Scot walks through the math in his blog post.)

But if sellers do not report NPBs, those bad "buyers" will remain on the site. eBay will still get their Final Value fees on sales that were never consummated.

While people are basically good, they also act in their own best interests. That's why DSRs, for all their flaws, are causing many sellers to become better at serving their customers. Now eBay needs to look at buyer behavior and ensure buyers are rewarded for paying for items they purchase.

Analyzing data is crucial, but listening to anecdotal experiences can help get a more complete picture and should not be discounted.




Comments (82) | Permalink

Readers Comments

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Doctor Deals

Sat Jun 28 12:20:44 2008

So lets remove all ''Anecdotal'' experiences and look at the cold hard data.

We looked at our UPI filing rate for the 8 weeks prior to the May 19th FB change and the 4 weeks of eBay Sales Reports Plus data available thus far after the May 19th FB changes.

Our data is a follows:

3-23 through 5-17

Reported 2.27% of sales
FVF Completed 1.59% of sales

5-18 through 6-14 (Most recent data available)

Reported 6.04% of sales
FVF Completed 4.02% of sales.

Figures are based on nearly 2000 transactions as the representative sample of buyer activities.

Our data clearly shows that with transactions averaging around $60-$65 each, buyers are MORE THAN 2.5 TIMES as unlikely to pay after the May 19th FB change than before.

For full disclosure, we did have one Neg FB received after May 19th from a buyer that responded to their UPI as follows:

''Sorry I spaced paying for this''

EBay Trust & Safety removed the Neg FB within 6hrs of us reporting it.  To me that is eBay standing behind the sellers and protecting them from the bad actions on NPB's.

The ONLY tool to run NPB's off of eBay is the UPI reporting tool.  Sellers have to use it so NPB's will be run off the site.

Our 30-Day DSR's are 4.9, 4.9, 4.9 & 4.8.  You can maintain high DSR's and report UPI's.

Don't let the bad buyers win.  File UPI's , get your money back and hold the NPB's accountable.  The NPB's make up a small percentage of eBay users now and will be a smaller and smaller segment if we all run them off the site together.  

Or better yet, if they know they are going to get UPI strikes maybe they will just start paying for their purchases.  That would be the best outcome of all.


Our experiences,

DD

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Randy Smythe

Sat Jun 28 12:37:53 2008

If you sell using the Fixed Price format or in Stores, you might just consider using Immediate Pay -- no NPB's, no need to worry about UPI's

Potential issues with Imediate Pay are cart abandonment (I've heard as high as 20%) and combining orders.

For one of my clients, Immediate pay saved him customer service aggravation his NPB rate was 10%. His sales did drop by about 10% so it was a wash with the NPB rate and he had a lot less aggravation and DSRs didn't take a hit.

Just an option many FP only sellers should consider.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Lisa

Sat Jun 28 12:41:56 2008

My UPI's have certainly gone up. I file a dispute for everyone. I haven't yet rec'd a neg for any of them. I'm glad to hear that Ebay removed a neg from a NPB (Doctor Deals post). That's clearly the right thing to do. If Ebay does that everytime, deadbeat buyers will decline immensely and it will be a safer site for all.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: dimes

Sat Jun 28 13:02:12 2008

No offense, Doctor Deals, but there's no way to ''run them off the site''.  Bad buyers and bad sellers can simply create new ID's and start all over again.   It's that pesky refusal on eBay's part to verify users.  Trying to verify the IP address is simply eBay's ludicrous alternative.

And just to prolong the negativity of this post (sorry), I'm not sure whether requesting immediate payment would work, either.  With the exception of buy.com, sellers are no longer allowed to block echeck payments that take days -at best- to clear.  

I've posted several times about this on the eBay boards, asking for clarification of how being forced to accept an echeck and requiring instant payment can co-exist.  Still waiting for someone from the company to respond, but I'm not holding my breath.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Patricia

Sat Jun 28 13:06:07 2008

Okay - due to policy changes we now have sellers afraid to even get their fees back from deadbeat bidders....this on top of the policy to hide bidder's ID's in order to keep their second chance offers but increase shilling.  One can only wonder what's next!  :-(

www.ACEOart.net

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: daylily

Sat Jun 28 13:14:00 2008

at the eBay Live conference last week, eBay said the rate of ''UPI'' (Unpaid Item) reports against deadbeats had not increased.

Ina, surely you don't think eBay's mouth is a prayerbook!  As fouled up as their figures and accounting are for feedback, Best Match, DSRs, etc., and as duplicitous as they have proven to be towards sellers that are being swept down the drain, you can't possibly think that they'd be honest about the number on NPBs that are being reported.

I read the feedback boards on eBay and can tell you that though only a minor percentage of sellers report there, we're seeing tons of issues with buyers not paying, with consequences to seller if those bidders are reported, with all the ills that that eBay has visited upon sellers.  We're seeing some crowing by buyers who like to brag that they can now give negs and neuts with impunity.

Granted most buyers are good people who would not in all conscience misuse the advantage they've been given.  Conversely, most sellers are also good people, who are seeing their businesses crumble and their spirit to continue selling on eBay go down the tubes when the changes affect them personally, in their pocketbooks as well as their comfort in selling at all.

Don't believe everything that comes out of eBay's corporate mouth.  The company has proven itself to be expert at dodging the truth.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Clapton*is*God

Sat Jun 28 13:22:34 2008

Why is BUY also allowed to keep the SKU number on their auctions, which is sku number for the same item, on buy.com. Live help told me that this is NOT allowed. I have reported several dozen and they don't remove them. How can someone tell me it's against policy and then not do anything about it?

It looks like posting auction numbers in articles, is the best way to get rid of them, rather than reporting them.

So, since I am not selling and ebay has banned me from their discussion board, for posting the TRUTH, I guess I have plenty of time to start scouring through buys items and I will just start listing them here.

All of them, have the buy.com SKU in the ad, so all of them should just be removed, then we have a true listing count and not a smokescreen!

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: daylily

Sat Jun 28 13:24:00 2008

To more nearly address the topic of this blog, I will just give you some of the results that sellers have undergone for reporting eBay deadbeats:
Most sellers, after having once reported a deadbeat buy under the new rules, come to the boards in a quandary about reporting the next one (or two or three or more, as the case may be).

Reporting the deadbeat has proven to be so unsatisfactory and so damaging to seller that many just bite the bullet, eat the fees and keep quiet.

Many who report unpaid bidders waiting to be dealt with are told by other sellers to go ahead and report - sellers can still look up a buyers ''Feedback left for other'' in order to get a sense of whether to deal with that person.

However, when seller reports a deadbeat bidder, the result is almost without fail (I've never heard of an exception) that the seller will get a negative, which, of course, impacts his feedback score and his DSRs and his exposure in the listing.

Many sellers are dealing with buyers who pay by credit card for items won, receive the item, then do a chargeback on the card and keep the item, leaving seller holding the bag and out his money entirely.  He is also likely to sustain a neg on this transaction.  And eBay allows it.

eBay may be heading off for a brighter tomorrow for itself, but it's gaining a dismal reputation among those who deal with it now.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Jim S.

Sat Jun 28 14:38:05 2008

My NPB disputes are up the last 2 months AND many buyers are taking far longer to pay for their purchases. Could be eBay policy changes or could be the economy. Either way it is taking more of my time.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

This user has validated their user name. by: Ming the Merciless

Sat Jun 28 14:40:38 2008

@Ina

"...ensure buyers are rewarded for paying for items they purchase..."

Usually you're on target, but this is ridiculous and it's the kind wrong headed thinking that ebay engages in!

Buyers are "rewarded" when they pay for what they bought by expeditiously and safely receiving the item they paid for. Sellers shouldn't and I hope won't feel any additional "reward" is necessary. Otherwise, sellers should be "rewarded" for fulfilling their end of the sales contrast.

Just more entitlement thinking for the adolescent ebay buyer mindset (still a minority, thank heavens) that I personally have had enough of!

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

This user has validated their user name. by: Ming the Merciless

Sat Jun 28 14:43:25 2008

The ONLY way to get ebay to prevent deadbeat buyers freom leaving feedback is to file for fees.

Money is the ONLY thing ebay udnerstand (especially when it's THEIR money), and having to reimburse sellers for all those FVFs will result in polivcy change if and when ebay loses enough money.

Ebay: the Most Despicable Corporation in the world.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Doctor Deals

Sat Jun 28 14:58:10 2008

@daylily,

''However, when seller reports a deadbeat bidder, the result is almost without fail (I've never heard of an exception) that the seller will get a negative, which, of course, impacts his feedback score and his DSRs and his exposure in the listing.''


We have filed about 40 UPI Reports since May 19th and only one has resulted in Neg FB and that ONE was removed by eBay T&S.

So I cannot understand exactly where you are getting your data regarding UPI reports when you state: ''...the result is almost without fail (I've never heard of an exception) that the seller will get a negative...''.

Our results clearly show that rarely does a UPI report result in Neg FB and if it does eBay will stand behind its statements of buyer accountability and seller protections and remove it as outlined by their policy.

Some here accuse eBay of lying about the UPI and FB rates while at the same time fabricating information based on no facts what so ever.

While I cannot speak for all sellers, our representative sample of about 2000 recent eBay transactions tells us quite a different story than some profess here.

So me the data...

DD

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Jayne

Sat Jun 28 15:22:36 2008

Wow - I can't believe that Scott Wingo is that irresponsible to tell Sellers not to file for the FVRS!?  Ebay will LOVE to see that!  That makes me so mad - for experienced Sellers, we know the deal ... but the for the newer ones, they are likely to listen/learn from what he is saying!  Bad, Bad Information!!  

Funny to see on his blog he started out with a warning that this idea was controversial .. controversial to the Sellers that know the deal, yes!  

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Gail

Sat Jun 28 15:52:32 2008

Doctor Deals, you are obviously a larger seller.  What happens to the small seller who receives just one neg from an NPB, and doesn't have a powerseller rep to call to speed up the process of removing it?  While eBay is ''deliberating'', the small seller's listings fall into an abyss where nobody will find them. The best match algorithm takes care of that.  Have you even considered the situation from a small seller's perspective?  Of course not, why would you?

A bidder should not be permitted to leave feedback until he has paid for an item. Otherwise, there is no transaction for him to evaluate.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Jane

Sat Jun 28 16:37:58 2008

eBay is the only winner in either case.  If you don't report they eBay keeps the fees, and you can still get negged and adversly rated. If you do report, you lose your good reputation (negged and adversly rated)... plus eBay probably will still figure out how to keep your fees.

I think I just answered the question.... REPORT!

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Jane

Sat Jun 28 16:43:28 2008

I also wanted to say... remember a very old TV program where they filmed an experiment to see if nice normal people are capable of torturing others if urged to do it by an authority figure?  I am certain this is eBay's version of the 'Milgram Experiment'and one day soon the whole thing will show up on 'Fear Factor' or a new internet Candid Camera.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: anonymous

Sat Jun 28 17:01:56 2008

I spoke with an eBay rep this week, and told her that my DSR in shipping fees may be low (according to eBay) 4.4, but the monies I make in shipping far surpasses the fee discount.

It still makes no sense that a 5 is a perfect score, and getting in the mid 4's is bad. A 1 or 2 is bad- 3 is average- 4 is above average and 5 is perfect....OH Darn...I forgot - this is ebay

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Lars

Sat Jun 28 21:01:48 2008

I can see why sellers are reluctant to not file unpaid buyer disputes, but that hasn't detered me. Since the feedback changes my unpaid percentage has gone up and is climbing. I personally feel its the least sellers can do to clean up Ebay and to support one another. Your all we got and based on Ebays policy.

My advice is to DON'T STOP FILING UNPAID DISPUTES and set your preferences to block buyers with 2 unpaid disputes in 12 months. It will filter the serial deadbeat and make them rethink their buying habits as they will be frustrated that they have no buying freedom.

Here are the facts for my store:

Please note the numbers are March, April and then May

Unpaid Item reminders sent 20 24 37  
Final Value Fee claims requested 20 13 21  
Unpaid Items reported as % of sold items 1.6% 1.8% 3.2%  

There you have it. You should be able to find your percentage in your store reports in My Ebay. I would be curious to see what others have.

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Lars

Sat Jun 28 21:20:22 2008

It's funny that Ebay says the unpaid item disputes have not gone up. There is a reason behind that. Sellers are scared to death to file them. It works in Ebays favor. Duh!

The numbers Ebay will not tell you is how many unpaid items without disputes opened up on them. I betcha this is through the roof. It's all in the presentation and Ebay is only presenting a half-truth. Shame, shame shame!

Should You Report eBay Deadbeats?   Should You Report eBay Deadbeats?

by: Scot Wingo

Sat Jun 28 21:27:11 2008

Hey everyone,

Scot Wingo here.  I think you are missing the point.  I was pointing out that there are sellers actively utilizing this policy and trying to show the math.  If you take all emotion out of the equation, I hope you can see this  math:

* If you have a high UPI rate
* and those UPIs file negs or even worse, positives and 1-stars.
* It could be economically BETTER for you to not file UPIs.

The fact many sellers are missing with DSRs is not only the discounts, but the search advantaging.  I've heard hundreds of times: ''I'm not lowering my S+H, because I make more profit on it than the FVF fees would ever add up to.''  That's great, but it's my theory these sellers will not have a viable model on eBay as their items will increasingly not be surfaced by bestmatch.  So any economic decision HAS to include the bestmatch advantage.

Thus, many sellers who feel they have done everything possible and DO care about DSRs and DO want to be BM-advantaged, still end up with a 4.6 or 4.7 on their S+H DSR.  This potential strategy 'don't file UPI strategy' (that admittedly isn't for everyone), is one that we're seeing move many sellers a .1 and some with high UPI rates a .2.

Economically that can be a net neutral or slight positive when you just weight the FVF discount vs. $ frm UPI, but the BM-advantage can be huge.


It's great that many of you want to help other sellers and what not.  But consider this, when other sellers are advantaged in BM over you because they are doing this or because they are having smaller margins than you and offering lower S+H, then what happens?

Scot

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