Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Mon June 22 2015 17:10:59

Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

By: Ina Steiner

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Now we know why Alibaba laid off staff at its subsidiaries, which we reported in April - the Chinese ecommerce giant has sold its 11 Main marketplace along with its two subsidiaries that provided tools to eBay sellers, according to media reports.

But if Alibaba sold its only U.S. marketplace, does that mean it's not interested in buying eBay Marketplaces once it splits from PayPal later this year? Or could it be part of a larger strategy with the new owner of 11 Main (now partially owned by Alibaba) getting ready to make a bid for eBay?

Alibaba laid off employees at its U.S. subsidiaries Auctiva and Vendio in the spring, confirmed by spokesperson Abbygail Reyes. "We have made changes that align the organization with the needs of our business and our long-term growth strategy," she told us at the time.

Reyes' phone number is now non-working,* and we've got inquiries in to Alibaba and 11 Main's new owner to learn more about the fate of the three companies.

What may be most worrying to eBay sellers is the possible loss of eBay tools provided for free or low cost by Vendio and Auctiva.

Sellers had been initially optimistic when we reported last February on the pending launch of 11 Main, many of whom were hopeful that Alibaba could provide an alternative to eBay. But the site had an identity crisis from the beginning, and its highly selective "curation" approach proved frustrating to sellers, and the site failed to gain critical mass.

One such seller wrote to EcommerceBytes today and said sales were nonexistent on 11 Main. "Since Feb. 27, I've had exactly 6 sales out of more than 1,800 items, with 5 in April, NONE in May and 1 in June. During that time, their order numbers have increased at a rate of less than 400 a day. I have sent an email to my supposed customer rep and filed a trouble ticket with customer service and have not even received the courtesy of an acknowledgement. I think that everyone assumed that with Alibaba behind it, 11Main would make a splash, but apparently Alibaba gave them a budget of about $12 and told them to sink or swim."

If Alibaba was planning to acquire eBay, it would seem it would not sell its own marketplace to rival OpenSky. However, TechCrunch, which broke the news, said as a result of the transaction, Alibaba will become a 37 percent owner of OpenSky.

Could an OpenSky-eBay combination make sense? We honestly don't know much about OpenSky, but we can say that the 11 Main brand is not enough to guarantee it will keep the site operating separately.

We'll provide updates as we learn more. You can read the TechCrunch post here.

Update: Abbygail Reyes of 11 Main reached out to let us know her phone number is working, apparently we had a number that no longer works - we've asked for some further information and will report back.

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Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

by: sickandtired This user has validated their user name.

Tue Jun 23 09:41:16 2015

20 to 30 % then PP fees on top of that !!!!!!!! NO WAY  would I list there, no matter what they promised.

For those who wonder why Bonanza basically sucks for sales, this is my experience. Tried the site when it first started up and again off and on over the years.

Internal search sucks so had hopes when they started the Google feeds.
I have never been able to get my items to appear in that feed....still get a once a week notice that "no items added".
Does not matter how I tweak descriptions to the way other users on the site say to do, no luck. Bonanza's own support is useless and there are no crystal clear instructions about the do's and don'ts to get items included.

11 Main missed a golden opportunity to be an alternative site to ebay but was is so restrictive in who can sell there that they pretty well guaranteed failure.

I assumed from the start that they were not going to gain any traction and would fail or fade. Makes one wonder how "smart" business people could not see this......perhaps as others have said, it was a trojan horse, never intended to be a going concern.

I live in constant hope of finding an alternative selling site, but nothing out there meets my needs. I think a start up based on what ebay was in the hey day would be doomed .......remember what happened to Golds.  



 

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

by: sickandtired This user has validated their user name.

Tue Jun 23 09:41:17 2015

20 to 30 % then PP fees on top of that !!!!!!!! NO WAY  would I list there, no matter what they promised.

For those who wonder why Bonanza basically sucks for sales, this is my experience. Tried the site when it first started up and again off and on over the years.

Internal search sucks so had hopes when they started the Google feeds.
I have never been able to get my items to appear in that feed....still get a once a week notice that "no items added".
Does not matter how I tweak descriptions to the way other users on the site say to do, no luck. Bonanza's own support is useless and there are no crystal clear instructions about the do's and don'ts to get items included.

11 Main missed a golden opportunity to be an alternative site to ebay but was is so restrictive in who can sell there that they pretty well guaranteed failure.

I assumed from the start that they were not going to gain any traction and would fail or fade. Makes one wonder how "smart" business people could not see this......perhaps as others have said, it was a trojan horse, never intended to be a going concern.

I live in constant hope of finding an alternative selling site, but nothing out there meets my needs. I think a start up based on what ebay was in the hey day would be doomed .......remember what happened to Golds.  



 

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

This user has validated their user name. by: Map

Tue Jun 23 09:42:48 2015

Hey Jack Ma!

Let ebay collapse into Bankruptcy court and then you can get ebay for pennies on the dollar.

Ebay is a used item and should not be listed as "new"

Also ebay will not have a UPC so it may not show up in search.

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

by: Cyclestripper This user has validated their user name.

Tue Jun 23 09:43:25 2015

Well, my bet changes to a Yahoo purchase of Ebay. The debt just lowers the price.

Something changed that caused this 11 Main sale to an unknown. Obviously it is a disposal of a losing operation where they took equity in another losing operation just to get rid of a problem.

The more I think about this, there may have been a plan and some contracts put in place with top management (which was awful) and this was the easiest way to dump the whole thing and move on.

Probably a smart move on the part of Alibaba.  

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by: ajeweler This user has validated their user name.

Tue Jun 23 09:52:56 2015

I have been saying now for months ebay soon will be alibay with alipay that is why they are so hard set to exterminate united states TRS this just reinforces my thoughts on the issue never used 11 main so I cannot comment on that ebay is in a downward action steadily since the new defect rating in addition to selling level and the 5 star system, and in addition to feedback just how many ratings can one place on a seller 20-25 it only points to failure and a slow death to all its remanding sellers if there are any left?? I see fewer and fewer as months pass by

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

This user has validated their user name. by: toolguy

Tue Jun 23 11:00:32 2015

If Alibaba wants to buy eBay they better break out the bank!

I expect that eBay will be worth $50 Billion without Paypal.

Does Alibaba have that kind of cash or assets?

Wall Street will make them pay BIG TIME!

Paypal will be worth another $50 Billion on it's own.

That's why they're breaking them up to unlock the true value of each company.

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

by: Mr. Me This user has validated their user name.

Tue Jun 23 11:24:39 2015

Let Alibabble give eBay a nice Chinese funeral, and hopefully somebody else will come up with a simple site for individuals to buy and sell to eachother .....

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

This user has validated their user name. by: iheartjacksparrow

Tue Jun 23 11:35:51 2015

toolguy writes: "I expect that eBay will be worth $50 Billion without Paypal."

According to Forbes, the entirety of eBay Inc. is worth $68.9 billion. That includes PayPal, StubHub, Half.com, etc. I believe eBay is considered to be the least valuable of the corporation's holdings, so maybe $20-25 billion? But would anyone actually pay that? With all the recent negative articles, the price would probably be lower. Also, when someone buys a business, they get the assets, liabilities and good will. We all know eBay doesn't have any good will. And they have no real assets. They'd be basically selling the name and the debt.

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This user has validated their user name. by: toolguy

Tue Jun 23 11:45:18 2015

@ iheartjacksparrow

eBay will come out the gates with a value of approx. $35 billion on the 1st day they trade as a stand alone company. Paypal will enjoy the same valuation on that 1st day.

Paypal & eBay made about the same profit last quarter.

I expect that both stocks will rise sharply in the following days.

We shall see.





Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

This user has validated their user name. by: Basset

Tue Jun 23 11:57:09 2015

I did not think 11main would make it.  

They seemed to want to be so elite with screening sellers and not letting buyers browse without handing over their contact information.  They sent me coupons and emails, but when I tried to search for items on the site - I could not get past a gatekeeper window that wanted my info.  

Mistake.  Some potential buyers like to see if they LIKE the site before handing over information.

Elitism is NOT a big draw for many.  At least not folks I hang out with.

Maybe just me, but I could never remember that name without thinking of the number ''9'' first - with the name popping up in my brain as 9-11 Main.  Then mentally having to drop the ''9''.

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

by: The Grey Fox This user has validated their user name.

Tue Jun 23 12:21:10 2015

We signed up with 11Main when it started (their acceptance process isn't really very difficult) as a hedge and adjunct to eBay. We didn't expect much, but we hoped with Alibabba behind it the site might at least get some promotion (hasn't happened).

We had an average of about 2 sales a week on 1,800 items until spring. Since April 15, about the time of the layoffs, we've had one sale. A customer service rep told me yesterday that visits to the site are booming and gave me that 3,000 shops and 2.5 million products BS, despite the fact their own order numbers show only about 400 sales a day. Basically she blamed our decreased sales on us, despite that fact we've been in business more than 25 years and have been selling online in various venues for nearly 20, and we kinda know what we're doing.

The fact is 11Main was not and still is not ready for prime time with various flaws that have been solved everywhere else (like invoicing, buyer-seller communications, search). The site has one flaw I can fix with Microsoft Word that their technology cannot seem to correct.

The people I've dealt with at 11Main have always displayed the attitude "we know what's best for you and have no intention of listening to your ideas or complaints."

I'd like to see what OpenSky plans, but if they start listing fees as scheduled on July 1, I will close up because it's not worth it. So, I suspect, will a lot of those other supposed 3,000 shop owners.

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by: madgeshatbox This user has validated their user name.
Web Site

Tue Jun 23 12:58:17 2015

I'm pulling the plug in my 11main shop.  Only 10 sales since it opened last October.  They haven't fixed glitches in my shop design for months and to add insult to injury they are favoring 3 sellers in my category search.  My items don't start showing up until page. 14.

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by: JohnGermaine This user has validated their user name.

Tue Jun 23 13:07:17 2015

I read that Alibaba has it's own bank now.  Not sure what will happen but since NutMeg and DonnyHo have trashed it and no one seems interested in fixing the issues, it will be sold off.  So sad.....

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by: I Must be Crazy This user has validated their user name.

Tue Jun 23 14:48:42 2015

I don't know anything about 11 Main. However if Alibaba is divesting itself of interests in the US, it makes me think they are not interested in a strong presence here. If Ebay's senior management had been counting on Alibaba as a potential buyer, I have to think they are a bit worried right now. I can't imagine any company wanting to purchase Ebay after being saddled with massive debt, no cash, shrinking customer base and declining market share. It's setting up for bankruptcy.  

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by: nsc This user has validated their user name.
Web Site

Tue Jun 23 15:03:05 2015

I agree with toolguy that eBay will have a large market cap, though when the Street gets a good look at its lack of growth I don't expect a very high P/E for it. The P/E is currently 25, much too high for a mature business.

But eBay's earnings remain massive. eBay has a genius business model that bad management has been unable to ruin (though they've tried). Think of it like an oil-producing country. It's very hard to improve the government in such a country because the government doesn't depend on tax money or public opinion, it depends on oil revenues.

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

This user has validated their user name. by: bitbybit

Tue Jun 23 15:35:15 2015

Agree with Basset. 11 Main failed when not letting potential buyers see and browse the site BEFORE requesting contact information. HauteLook and other sites require this first but are well known sites and not start-ups. Also it took 11 Main forever to even open the site where I would imagine interest had waned over such a long period of time. I am sure all those rejected seller applications wouldn't make them 11 Main buyers. Reminds me of eBay where sellers aren't wanted but welcomed to buy. It does make me wonder what exactly was 11 Main's purpose or should I say agenda?  

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by: Tim This user has validated their user name.

Tue Jun 23 16:10:09 2015

I see this a precursor to Alibaba buying eBay. They get rid of all currently owned businesses that would compete with eBay, they dump the tools back into the abyss - and then they are suddenly completely free, no previous entanglements, no federal competitive issues.

Yes, Jack Ma said Alibaba was not going to "invade" America... but he spoke highly of eBay (and Amazon)... if you BUY your way in, is that an invasion?  I don't think so... Alibaba wants eBay. They can use Chinese profits and the stock market to finance it.

They will then own dominant (if not always #1 in every category) marketplaces in the worlds two largest economies. The only thing that might stop this is Congress... after the latest Chinese (probably government) hacking of Federal computer systems, this may be a way to punish China.

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by: LightWing This user has validated their user name.

Tue Jun 23 16:15:10 2015

With 20-30% Seller fees OpenSky sounds like THE place to be!

ROFLMAO!

Perminate Link for Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?   Is Sale of 11 Main a Hint of Alibaba's Interest in eBay?

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

Tue Jun 23 16:18:46 2015

When 11 Main began, I was a big cheerleader.  I still think they did a lot of things right, but one critical factor kept them from being successful.

What some call "elitism" I think was a bold attempt to limit or even eliminate both bad sellers and bad buyers so common on ebay.

How many times have I read here that buyers should have to provide ebay with credit card numbers and other identifiers as a way to reduce bad buyers? More than I can count?

The fees are/were reasonable IF there was any sales activity which are virtually non existent.

Their customer service reps were positive and helpful -- 180 degrees from ebay's and sellers had a dedmicated rep, their eail address, and telephone number.

And we all know that in spite of TRS, there are still far too many really bad sellers that ebay coddles.

By not having feedback and carefully vetting sellers, 11 Main eliminated feedback and refund extortion.

What I do fault them for is telling sellers there would be widespread media advertising especially during the holidays.

It is the unwillingness of these sites to advertise that is their downfall, and 11 Main did none just like Bonanza and other all the other marginal and failing sites.

If Jack Ma or anyone else buys ebay and dismantles the marketplace, it would be a costly mistake virtually handing someone else a an immense void to fill on a silver platter.

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by: bb6 This user has validated their user name.

Tue Jun 23 16:33:31 2015

They could have stolen all of ebays sellers if they wouldn't have had so many restrictions for 11 Main. They had the infrastructure and $$$ to be the next best thing. Seems simple to me. Start with lower fees, set up some rules but don't keep changing things like ebay does, market/advertise the crap out of the site. Sellers will go anywhere to sell, as long as the customers are buying. If the customers don't know about the site then you are a sunk ship.

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