Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Fri Aug 3 2018 16:49:55

eBay Looks to Seller Ad Fees for Revenue Growth

By: Ina Steiner

Sponsored Link

eBay CEO Devin Wenig told Wall Street analysts on July 18th that he sees advertising one of eBay's most significant mid-term opportunities (the other is payments) - particularly Promoted Listing Ads. There are over 300,000 sellers promoting over 150 million listings, he said, "leading to revenue growth in excess of 150%." 

But that's currently a tiny percentage of revenue - total Marketplace revenue growth was 9% (or 6% on an FX-Neutral basis. Here's how eBay is looking to increase its advertising revenue.

2) Increase the number of sellers who advertise.
One obvious way to boost ad revenue is to increase the number of sellers who advertise. eBay is now targeting "consumer sellers" with a dumbed-down version of its seller ad program - see today's news story about eBay Promoted Listings Lite.

eBay also has some room to grow the program geographically - Promoted Listings Ads are currently available to all active eBay Stores subscribers in the US, Canada, UK, Germany, and Australia, and FRITES (France, Italy, and Spain). In the US, the program also available to Top Rated Sellers.

Moving to a catalog approach, as eBay is doing, may also help boost adoption. When sellers must compete for the Buy Box on a single Product page, they may be more inclined to consider advertising as a way to get visibility for their items.

2) Increase ad fees.
Sellers indicate how much they are willing to pay for Promoted Listings as a percentage of the selling price. eBay used to limit the rates at 20% of the selling price, but now it allows sellers to pay up to 100% of the selling price. 

That's obviously not a good idea, since any seller who moves the lever to 100% would be in effect paying eBay to sell their items, since they must also pay a commission (Final Value Fee) and often pay insertion fees, not to mention all the other costs they incur.

But as greater numbers of sellers begin advertising, they will be likely to pay more for each ad as placement gets increasingly competitive. 

3) Increase ad inventory.
Ads are appearing in more places on eBay's site, and in December, eBay expanded the availability of PLAs to Motors Parts & Accessories.

eBay is also testing a new pay-per-click advertising program called Highline Search Ads. Invited sellers can run ads that appear at the top of search results; they pay whenever a shopper clicks on the ad. 

eBay is also going local with ads for services, starting in the UK, so sellers will have to compete for ad space with local service providers, such as plumbers and hairdressers.

The message to Wall Street is clear: eBay wants more money from sellers on its site through ad fees. It's up to sellers to determine if paying more fees to advertise their listings on eBay shows a positive return on their investment.

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Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: Carol Is Here This user has validated their user name.

Sat Aug 4 00:20:36 2018

Devin Wenig is plundering more money than ever before, along with his cronies like Fisher, but it's a good hint about what is going on when you listen to reports from people who attended Ebay Open.

Devin cut back on everything, cheap and low budget. Throw the sellers who paid to be there some inexpensive garbage. Fewer Ebay employees there so that they couldn't tell the truth about Devin's lies and let secrets slip. More that Ebay sellers will have to pay, fewer profits for them, harder to sell, harder to compete with the sidelines like sponsored ads that benefit only Ebay executive management profits from.

It's the name of his game. Cut costs, (like sending tech contracts to India to destroy sellers' business,) bleed the sellers more and more, use Ebay as a front for a new payment business, and Devin and his cronies can plunder more.

Ebay is a cash cow to butcher for the few at the top.



People like Devin Wenig don't build up companies. They destroy them, take the money, and run away.

The only way this can change is if Ebay sellers get together and force the Wall Street media to pay attention. When voices get loud enough, they drown out the lies.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: Silver Ice King This user has validated their user name.

Sat Aug 4 01:18:09 2018

@Carol is Here

He not only made those changes but Ebay Open was moved to Mandalay Bay where they now basically give away the banquet halls and rooms just to get people in there since the shootings last year.  It also hasn't helped that MGM (who also owns Mandalay Bay) file a lawsuit against all the shooting victims and their families to try and reduce or eliminate any and all blame or liability for the shootings.  So Ebay got everything for nothing or almost nothing, cut the days from 4 days down to 3 but raised the price for those that paid to go so Ebay probably made money on the event, even after paying for all the security for Wenig and all the extravagant meals and rooms for the executives and it was held on the cheapest days of the week or getting rooms in Vegas as it ended on Thursday,  not Friday this year.  

Wenig is trying to make it look like they are doing everything bare bones because of comments that many of the employees that were laid off made when they left about how Ebay blows money on renting theme parks out, extravagant parties and such so I am sure only the executives got the nice rooms and fancy meals while the rest ate the normal food.  I am sure less employees went this year because they let a lot of those that were worth anything go so I am sure only the Yes Men were there to help make him look good.  But Wenig still looked like a fool talking about taking the site up to 500 million active buyers when the site can't even properly service the supposed 175 million they currently have.  The only way they will ever get to 500 million is if they were to add the Chinese buyers who already voted them out and chose Alibaba, so I don't see them getting to even 200 million while Wenig is still working there because once Ebay forces those sellers who are participating in the Processor Beta Test to not accept Paypal, they are going to start losing more and more buyers who will abandon their carts and assume that since Ebay supposedly requires the use of Paypal that something has happened and that no sellers will accept it, so away they will go to other sites.  

Great job of thinking ahead and now I see why Ebay once again would not tell sellers what the requirements were to participate in the Beta Test were as they knew they were going to hurt sales, but why should they care - not their problem because Sellers are a dime a dozen if that expensive.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: FrustratedBuyers This user has validated their user name.

Sat Aug 4 01:36:30 2018

As a buyer, I actively AVOID all Sponsored Listings. If I see two listings for the same item from the same seller, I'll clicked the one without the tag. If I see the same item from another seller without it, I'll go that route if I can.

I never even look at the paid ads at the bottom of the page.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

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

Sat Aug 4 08:42:01 2018

Although there are "only" 300k sellers using promoted listings, keep in mind Wenig fabricated this artificial mechanism (he called these ads a "new business" LOL) to have sellers further compete with each other and pay for an off buy-box sales opportunity out of thin air.

Wenig apparently soiled himself while gleefully boasting about his new cash-cow back in February during the Q4 '17 earnings call. Here's an excerpt:

WENIG:
"...On promoted listings, yeah, first of all, we're delighted!

This is probably the fastest-growing new business, for lack of a better term, launched in eBay in years and, as I said, 50% sequential revenue growth quarter on quarter. That is quite significant.

Most of the driver has been surface area.

We are increasing the surface area of availability to sellers. We're increasing the surface area of the exposure of promoted listing to buyers. So, a lot of it is just we have started and made sure we tested our way in and now we're on a very steep part of the curve where we're opening the aperture so that more and more sellers can use it and they should, and more and more buyers get exposure to those items and they are converting.

So, we are very pleased that we are now in that flywheel and the flywheel seems to be turning very well."

So now we have the following ads:

Promoted Listings - Sellers competing for visibility
PLA - Taking buyers off-site to competitor destinations
Highline - PPC banner ads
Services ads - Basically digital Valu-Pak ads to capture a piece of the Yelp/NextDoor/Homeadvisor/AngiesList/etc market

Pretty soon there's not going to be much screen real estate left for the actual listings sellers are paying for.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: ebayout This user has validated their user name.

Sat Aug 4 10:16:28 2018

Wenig obviously confuses human nature with whatever it is that he has...or lacks.
People click on a site primarily with a specific item in mind to BUY, not to be BOTHERED. An ad blast is not marketing. In ebay's case, it's terminal stupidity.

A monitor filled with ads is no diff than a TV screen running 5 straight minutes of commercials. You can walk away from the TV, or click away from the monitor.
Wenig's baby becomes a tree in the forest...it falls and nobody's there to hear it.

This amounts to throwing uncooked spaghetti at the wall. The man is clueless.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

This user has validated their user name. by: CanBrit

Sat Aug 4 11:00:43 2018

@FidoMaster
I noticed on my last invoice I was getting charged for promoted listings. I have never run one, nor would I in a million years give eBay anymore money than their are getting.
I tried to cancel the promoted listings and it gave me no option. It said it stared on May 17th and was listed as continuous. I called customer service and told them I don't do campaigns so someone set me up with one.
She couldn't cancel it either. All she could do was remove all the listings. Now if that wasn't hacking I don't know what it was.
I pay eBay to bring me the buyers not eBay charges me more to find the buyers.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

This user has validated their user name. by: toolguy

Sat Aug 4 11:05:22 2018

eBay is trying real hard to chase away the few buyers they have left!

Some of us shop at eBay because we hate the buy box at Amazon!

I've given up on this so called partner of mine

(mic drop)

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

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

Sat Aug 4 11:59:52 2018

CanBrit, depending on the amount you could continue to escalate the matter. As always, I recommend initiating the ticket via Twitter @AskeBay in order to ensure:

1) A record exists on a mainstream social media platform that eBay cannot sanitize (like the community forums and FB pages) AND,

2) The issue can be further socialized/escalated publicly with media, analysts, and others without eBay's interference

That being said, if you're a TRS you receive $30 in promoted listings credits each quarter, so there's an argument to be made that you should at least use those "free" credits you're paying for anyways. If you have an anchor store, you get an additional $25 promoted listing credit each quarter (for a total of $55 if TRS).

Whatever you decide to do, consider checking https://pls.ebay.com/plsweb/dashboard  

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: eBay Shill Buster This user has validated their user name.

Sat Aug 4 12:00:39 2018

Here is the 'New eBay experience' for all, experience Devin's magic.

 https://community.ebay.com/t5/Selling/Drop-in-Sales/m-p/28815959
#M1262699

 One sale for $5.85 in the last 7 days. This venue is beginning to be a nightmare. Normal sales are $100 to $200 per week and now they have fallen off the map. I have been running a test this last week to see how many views on 20 items change. Only 5 have had the views increase bu one to 3. With over 200 listings a person would think that you should be able to sell one or two items a day, but NADA. It almost seems like eBay is trying to get rid of sellers, except the big box and Chinese. This Amazon wanna be venue will never compete with them. I have lowered prices, tried promoted and offered free shipping and nothing improved. I will be making a decision in the near future as to whether I am going to jump through hoops for a losing venue. As it looks now, a shutdown may be coming. There are too, too many glitches that don't get fixed, that drive buyers away along with stupid ideas that eBay has.  

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: eBay Shill Buster This user has validated their user name.

Sat Aug 4 12:14:45 2018

Devin's advertising programs are a flop as sales on eBay tank for millions of sellers, the don't have the cash flow to buy ads on eBay, Devin is blowing smoke and telling pathological lies to Wall Street as always.

 https://community.ebay.com/t5/Seller-Hub/Sad-state-Ebay-is-in/m-
p/28814964#M28707

 we are in same boat this is a complete DISASTER business down by 60%

we have over 5000 items in active have been selling for about 12 years top rated seller working 7 days a week to make it happen and keep up with the never ending ebay changes and know we can't even  run a sale do to a new 14 day  rule policy what a joke its our Money its our merchandise its our inventory we should decide what and when we want to run a SALE NOT EBAY

please wake up and Listen to what your hard working sellers are telling you fix the make down manager now put it back to the way it was  

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

This user has validated their user name. by: CanBrit

Sat Aug 4 12:17:45 2018

I lost TRS a long time ago when eBay trolls set me up and started making false purchases at my store. I'm not an anchor store. Generally list 200 or so a month.

I will take your advise and start papering this issue (maybe the papering term is showing my age....lol).

Believe me I post everywhere and anywhere. Yahoo Finance is one of my favorite places.  

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

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

Sat Aug 4 12:30:43 2018

CanBrit, good analogy.

Note eBay doesn't consider Yahoo Finance a support channel however, and they do with Twitter.

To wit: what do you think the life expectancy of this post would have been on the community boards?

http://twitter.com/FidoMaster1/status/10254052680233000
96

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: maxmad This user has validated their user name.

Sat Aug 4 12:59:03 2018


having a 100% promotion button shows how stupid ebay thinks sellers really are, but the sad part is,,, they are probably right, and some sellers will actually use it.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: thievesBay This user has validated their user name.

Sat Aug 4 13:12:18 2018

I'm not sure who in their right mind would give these clowns even more money for promoted listings and ads. From all that I've read and seen it doesn't even help very much in sales, if at all.

The whole site is rigged and designed to spread sales around even to sellers that don't deserve it, for the only reason that eBay hopes they can keep them there paying for stores. eBay's only purpose is to harvest as much money as they can from sellers. That is, from the sellers that haven't already fled the site this year. Same goes for everything else eBay pushes and railroads sellers into claiming that they'll get more sales and better search placement. Just more fraudulent schemes by eBay that only benefits themselves and nobody else.

Hopefully Wall Street and investors are beginning to see through the lies that Wenig feeds them each quarter. I believe many analysts are still clueless to what's actually going on with this company. All they really need to do is check out the community forum, comments sections, blogs such as here, about eBay and see the true disgust it's users have with the site, policies, Wenig, and other upper management types. The stock deservedly should continue to drop.  The sooner these losers are fired/resign the better. It could not be any worse could it? They need people with ecommerce/retail experience. Time for the lawyers, bankers, mafiasos to go.  

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

This user has validated their user name. by: CanBrit

Sat Aug 4 13:12:33 2018

FidoMaster

Life expectancy? Pretty much as long as my four different ID's lasted on the boards. Uhhhh None. Hahahaha.

Such a bad, bad girl. I love sending them messages via Twitter....lol.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: Grady This user has validated their user name.

Sat Aug 4 13:54:20 2018

"Are other people reporting these issues? Thank you. Please restart windows"

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

This user has validated their user name. by: Ric

Sat Aug 4 14:13:49 2018

The answer for small sellers is basic & simple....

If eBay does not generate meaningful sales for you because they are burying your listings DO NOT pay more for Promoted Listings and move on to another marketplace where you do not have to pay more to be seen.

Paying more for exposure through Promoted Listings will just encourage eBay to make sure nothing sells but listings you have paid more for through added fees.

Get out...Move On... Put eBay in your rear view.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: RL15 This user has validated their user name.

Sat Aug 4 15:35:00 2018

I pulled all my listings on 12-15-17

So glad that I finally left the cesspool.

I sell more, make more profit, and no b.s.

Take your products elsewhere is highly recommended.

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

by: E4Fam This user has validated their user name.

Sat Aug 4 17:01:21 2018

This is exactly why I left Etsy. Silverman, formerly from feeBay, of course...came over to Etsy & pulled this same crap on Etsy sellers. He & Devin must be talking to each other. I closed both Etsy shops because of the new AI search engine debacle that killed traffic & the never ending fees.  I would really like to see some stats on how many sellers RegrEtsy & feeBay have lost. Is there anyone who has any data on this?  

Perminate Link for eBay Looks to Seller Ad Fees for Revenue Growth   eBay Looks to Seller Ad Fees for Revenue Growth

This user has validated their user name. by: Number 6
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Sat Aug 4 17:22:55 2018

thievesBay  
“Hopefully Wall Street and investors are beginning to see through the lies that Wenig feeds them each quarter.''

Apparently not, eBay's still a 'buy' from this 'expert' (or should that be, in the immortal words of John Lennon, 'texpert'):

'I'm admittedly on a bit of an island when it comes to eBay (NASDAQ: EBAY ). I think EBAY stock is attractive at these levels, but it's starting to look like I'm the only one...But I'm standing firmly behind eBay stock, at least for now. I understand the concerns about the company's growth outlook. Competition is increasing, as everyone from Amazon (NASDAQ: AMZN ) to Facebook (NASDAQ: FB ) to Etsy (NASDAQ: ETSY ) to Wayfair (NYSE: W ), not to mention traditional retailers and privately held startups, are moving onto eBay's turf.'

Self-delusion or what? - the signs are already in place, and it clearly will not improve: if sellers aren't making any money on ebay, there eventually won't be an eBay, at the very least, far less listings, less listings to plaster ads all over, less 'promoted ads' (the greatest shill game ever - Pay to list then pay us again so we might show your listings to potential buyers).  

You add...''I believe many analysts are still clueless to what's actually going on with this company.”

That much is for sure.

The ONLY plan for increased revenues that Adolf Wenig appears to have, is to take more money from the existing sellers, who, are leaving in droves, listing far less, selling on multiple sites of which ebay is just one nowadays.  

We all know taking more from existing sellers is not going to work for numerous reasons, and the only way eBay can ultimately plaster sellers' listings with ads that divert buyers elsewhere, will be if they, like, say Craigslist, become a free listing site - that would make sellers take the rough with the smooth, no or little sales, but at least no costs to list and only if sold.

But we know eBay's too greedy to do that, it makes a small fortune off hopefull sellers' listings it doesn't even show to buyers most of the time and don't ever sell - any glance in any genre of Completed listings show how few of anything actually sells on eBay these days.

Wenig's, and Donahue before him, only plan, which still seems to entrance Wall Street, is to take more from sellers - but there are only so many pips in the fruit, and once you squeeze it dry, that's that Buddy.  Pips all gone.

Store fee + Fee to list + Fee on sale + fee grab from shipping + semi-forced 'free returns' else we won't show your items + promoted ads or we 'won't show your items' +Paypal fee (soon to be eBay's Ayden fee) + increased fees if you have too many returns...

That's 7 to 8 fees PER ITEM sold, and sold if you are lucky these days.

This to sell mainly cheap items to mostly passing bargain hunters, rarely return or regular customers.  

Whoever would have thought that after all these years of selling online it is now more profitable and less hassle to sell at flea markets and the like again...with the plus that you take CASH home with you at the end of the day.

Talk about eBay killing its Golden Goose.

As far as having a store is concerned, everyone goes on about the 'Free Listings' that come with it - how come if Ebay wants to be Amazon so much, you can have a $40 monthly Pro Seller account and list ANY amount of items for 'free' and you only pay Amazon fees when they sell, yet on eBay you pay $60 a month and get 1,000 'free listings' after that you have to pay 10 cents per listing.

Hardly a comparable deal.

I think Wall Street investors and 'experts' are still drinking Wenig's Kool Aid because that is the word salad lingo THEY ALL TALK, and the one thing he's clever at is Wall Street BS.

For now, anyway.

If anyone spoke to any of them like the characters in 'The Yorkshiremen' sketch from Monty Python, in plain English telling it as it is, they wouldn't even get the joke, let alone understand anything.

Of course, there is one more revenue stream Wenig hasn't thought up yet - he could start charging sellers to put photos on there listings again...does anyone else remember when eBay charged for 'additional photos' if you added them!







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