Ina Steiner EcommerceBytes Blog
News and insight focusing on ecommerce.
by Ina Steiner, Editor of EcommerceBytes.com
Mon Sept 3 2012 22:31:38

Are Diamond Sellers Helping or Hurting the eBay Marketplace?

By: Ina Steiner

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eBay was founded on Labor Day 17 years ago, but the company has strayed from its roots. In Tuesday's newsletter, EcommerceBytes looks back at the origin of the Diamond Seller on eBay.

In 2008, eBay's new CEO John Donahoe cast aside the old rules and began negotiating with big brands and retailers, giving them special deals. eBay is a very different marketplace than it was 5 years ago, before the creation of the Diamond tier. eBay acquired GSI, which powers some of the top ecommerce sites from retail chains and manufacturers, and it is now trying to port their catalogs over to eBay.

eBay Sellers Now Compete with:
1) Daily Deals
2) Fashion Vault
3) Fashion Outlet http://www.ebay.com/fashion/outlet
4) Targeted Emails & Coupons (Barnes & Noble, for example)
5) Top brands on eBay http://brands.ebay.com/
6) Big-box retailers TOYS"R"US GIFTS, DEALS & EXCLUSIVES on Gift Guide page
7) Big-box Brick & Mortar Retailers (Milo integration)
8) Home page exposure for big-brands
9) Sponsored Links
10) Authorized reseller and brand logos in search results

Sony is one example of a brand getting special perks from eBay, as Tuesday's article reveals.

Is the "new" way of dealing with large brands and high-volume sellers good for the marketplace? Do brand names attract new shoppers, or does their presence make it harder for the small seller?

What would you tell eBay founder Pierre Omidyar on the 17th anniversary of the founding of eBay?




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Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: Philip Cohen
Web Site

Mon Sep 3 23:30:47 2012

The diamonds et al were supposed to replace, and then some, all those uncouth, unwashed flea marketers that had made eBay the great marketplace it used to be. The only reason Donahoe now occasionally dangles the carrot under the noses of those flea marketers is that his grand plan has, in effect, not grown eBay at all; the eBay marketplace has been stagnant since 2007; indeed, relatively speaking, the eBay marketplace has atrophied …

That Donahoe thinks that the diamonds will continue to stick with him, once he has served their purpose, indicated just how out of touch with reality is this narcissistic sociopath.

PreyPal has been keeping eBay afloat but, ultimately, the clunky PreyPal has little future outside of its effectively mandated use on the atrophying eBay marketplace. The naïve idea, promoted by some (paid) analysts, that PreyPal is the goose that will continue to lay ever-bigger golden eggs that will otherwise ensure eBay’s future, is simply laughable …

Regrettably, I suspect that the headless turkey, John Edward Donahoe, has damaged the now clunky eBay beyond repair in the eyes of many and it is only a matter of time before it finally sinks below the waves.

eBay / PayPal / Donahoe: Dead Men Walking

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: pace306 This user has validated their user name.

Tue Sep 4 00:01:36 2012

JD & Noah embarked on thier Jihad against small and medium sized sellers awhile back, and the demise of those sellers is quickening.

Philip hit the nail on the head - this scheme was cooked up to try and capture/and or to be what ''Amazon is not''.

Amazon will not allow ANY of the Diamond ''behaviors'' on thier servers - unless they are simply stores using Amazons web service. Sony et al do not directly sell on Amazon. (what they do however in controlling who sells on Amazon, how Amazon treats certain sellers, how and why Amazon blocks access to specific items and brands an entirely other story - one that a good lawyer should look into)(but I digress...)

The story of how this all unfolded has been told by myself MANY times - but it has fallen on deaf ears. It all starts and ends with VERO. There is no organization on planet earth that is as corrupt and law breaking as VERO. Like a post modern super hero gone bad, VERO was once a force for good, but was harnessed by JD and Noah to be used for evil. Skullcandy, Monster, Sony etc all have something in common - dealers are either forced to sell on eBay at MAP/UPP or not at all. In most dealer contracts (Ive seen them so I know they are real) it says NO eBay or Amazon sales.

VERO (getting back to the monster) was used by eBay corporate to rid eBays listings of all said sellers. I alone, know 3 sellers who were put out of business by VERO (even though they were selling legit original items and had not violated any trademark or copyright laws).
If you have a website of your own the 3 princes of darkness (mentioned above) use NET ENFORCERS, but on eBay they use VERO.

The big laugh (if there is one) is that the big diamonds:

1) use eBay to sell their leftover, refurb, old stock NOT the newest latest stuff.
2) Data mine the sales and lure them off eBay with special offers - its cheaper then advertising!
3) Create thier stores in conjunction with VERO to continue to ''thin the herds'' - but it backfires becuase there is less unique, cool, interesting items for sale.

This behavior WILL continue - and as mentioned is snowballing faster and faster. The timming of thier appearance on eBay coincides with a specific amont of seller removals - and was conditional. ''We wont have an anchor/diamond store until VERO removes XXXX sellers''.

Beyond all this is the unfair treatment that eBay gives those sellers. Of course the fees are not even close to being the same, DSR's dont count, negative feedbacks dont count, NOTHING does. Its pure pay for play - all the while eBay swears its all legit and its a level playing field.

All of us who still sell on eBay are here because we have to be, not because we want to be - and the downward pressure - from forced returns, impossible eBay buyers, impossible to make service levels and all the other rotten things eBay does - makes it harder each and every day.
''this is not your fathers Oldsmobile!''

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

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

Tue Sep 4 01:37:37 2012

Diamonds are responsible for the worst customer service on ebay.

Every change The Ho has made had lined his own pocket. He's deposited enormous profits in his bank account (and others with stock options) by way of stock options.

One of these days buyers will finally realize it's cheaper to buy things in brick and mortar stores and through their various web sites than to pay the bloat the ebay fees create despite the illegal, under the table, anti competitive dirty deals ebay makes with corporations.

With everybody and his brother getting into the mobile payments field, PayPal will soon be an also.

I won't pay for ANY brick and mortar or mobile purchase with PayPal mobile payments. Won't. Won't. Won't.  

John Donahoe will be responsible for the resurgence of flea markets, live auctions, actual person to person social shopping with friends, and increased antipathy towards China.

A record to be proud of to be sure.

Tell The Ho it's time to go.

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: bitbybit

Tue Sep 4 01:42:10 2012

By the way those goose eggs are no longer golden .. turning a darker shade of brown each and every day.

Oh, and those diamond sellers are looking more like cubic zirconias or maybe fool's gold. I believe buyers want the real original eBay pre-2008 and not this mundane, everyday, buy anywhere, convoluted marketplace.  

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: Digmen1 This user has validated their user name.
Web Site

Tue Sep 4 03:10:07 2012

I've been watching ebay since 2010 and am still waiting to see a marked decline.
Listings have gone up
JD makes millions
Their share price is good.
The traffic rating is about the same.
All the alt sellers say they can't sell on the alts but they can on ebay.

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: Ed Gadfly

Tue Sep 4 03:24:17 2012

''All animals are equal, but some animals are more equal than others''

When I consider selling on eBay my stomach churns and I throw up a little in my mouth.  

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

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

Tue Sep 4 06:58:33 2012

I don't mind the diamond sellers but where I think ebay has missed the boat is in not setting different tiers of sellers and setting different expectations for each tier.  Holding a casual seller the same expectations as, say a diamond, that's what is stunting ebay's growth the most IMO.  Yesterday I took my daughter to get her hair done and had a great conversation with the beautician about why they no longer sell their stuff on ebay.  She now uses facebook to sell her rummage and the main thing she said was that ebay had become a huge hassle and aggrivation for her.  She's "a beautician and not a retailer" she said.  "I have lots of stuff around the house that we get rid of and enjoyed using ebay to do so in the past.  But with their feedback system and current evironment it's become more of a hassle than what it's worth so I sell on facebook".  I've never been bothered by the diamonds because frankly if people are shopping on ebay I've always felt that was a good thing for my business rather or not I benefited directly from the sale.  I saw them as the anchor stores in the mall... bringing traffic.  I do think ebay has to ask itself a huge question though... if ebay is just diamonds and the stuff the diamonds sell can be found anywhere on line, including the diamonds website, or at the store down the street... why does the world need ebay?  

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: mylifeisgood This user has validated their user name.

Tue Sep 4 07:17:10 2012

Are there any diamond sellers that are TRS's or is it just the hobby sellers that are jumping through hoops for the carrots??

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: Basset

Tue Sep 4 07:48:41 2012

On the opposite end of the spectrum they are trying to attract the casual mobile sellers to clean out their closets & garages. So many of these listings have minimal to NO information.
“dimensions or measurements  – Why on earth do you want THAT?”

I agree with the person above, If I want new current big box store items I just go to THEIR site. However eBay would be better  to seek those items that have been discontinued or parts for older items. Those can be sold by regular eBay sellers, I would think.  

I’m not sure how much diamonds (fashion category) affect me – as a buyer AND seller, I think of new clothing vs. pre-owned clothing as apples & oranges.

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: Anonymous Annie

Tue Sep 4 08:11:31 2012

(With apologies to Melanie Safka.)

Look what they've done to eBay, Pierre
Look what they've done to eBay
From the very start... you had it right
And it's turning out all wrong
Look what they've done to eBay
...
Look what they've done to eBay, Pierre
Look what they've done to eBay
Well they've tied it up in a plastic bag
Then turned it upside down
Look what they've done to eBay!

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: Basset

Tue Sep 4 08:37:02 2012

Ahhh Annie - you reminded me....
I loved "Candles in the Rain"

sigh, off to itunes.

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: iheartjacksparrow

Tue Sep 4 10:07:31 2012

@Annie - Yeah! Another Melanie fan! My favorite song: "Beautiful People." I actually had buttons made and handed them out.

On topic: As many have said on other threads, it would be great if eBay split the site into two: one portal for diamonds, and the other for casual sellers. Unfortunately, with all the insane policies that have been implemented, I think eBay is broken and can never be fixed.  

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: pace306 This user has validated their user name.

Tue Sep 4 10:39:26 2012

''1) Daily Deals
2) Fashion Vault
3) Fashion Outlet http://www.ebay.com/fashion/outlet
4) Targeted Emails & Coupons (Barnes & Noble, for example)
5) Top brands on eBay http://brands.ebay.com/
6) Big-box retailers TOYS''R''US GIFTS, DEALS & EXCLUSIVES on Gift Guide page
7) Big-box Brick & Mortar Retailers (Milo integration)
8) Home page exposure for big-brands
9) Sponsored Links
10) Authorized reseller and brand logos in search results''

Its all about money - its not about making anyone have that ''feel good time'' when shopping on eBay. JD doesnt care how you feel, only that your seller kills him/herself bending backassward to fullfill the needs of his lowlife bottom feeding cutomers.

1) Any mid to large powerseller can ''officially'' become part of this program... BUT the hurdles are so high that its almost impossible  (I know , I tried)

2) LMAO - try selling branded jeans etc and watch the VERO machine roll - ''no you cant build that!''

3) only made for the brands themselves (who then take the customers eBay feeds them and sends them to thier own sites)(but eBay doesnt ever see anything long term so they miss this as well).

4) Like eBays stupidity of allowing buy.com to be a seller ... this too is the same ''moronics''. Buy.com (aka buy) has 2 of thier own competing ecommerce platforms (buy.com & Rakouten) and as mentioned above ... take the customers eBay feeds them and sends them to thier own sites. Its called cutting of your nose to spite your face!

5) Mentioned in my first post and by Philip. Intended to erase the ''scummy sellers who leach off eBay and use it as a means to make a living''. Those people aka mid sized sellers are the people eBay wants gone, either via the ever changing eBay rules that squeeze more out of a seller, or via VERO - where illegality is job #1. This satisfies the big brands (who really dont want thier goods on eBay to start with - they feel ONLY they have that right)

#6) see #5

#7) eBay thinks have a JC Pennys shop is some big deal - its not - no one cares. But it is about trying to trick people into thinking eBay is ''legit''. Like or dislike Amazon - no one questions their virtue. In eBayland ... EVERYONE knows eBay is the harlot on the corner .... fvfs for  listing sir!

#8) A gift to those they love - pure pay for play

#9) LMAO - you dont own that listing that you pay for .... REALLY, some lawyer should look into it - Ive never seen it in thier TOS!

#10) Intended and encouraged by people like Monster, Sony etc. Weed out the ones you dont want by creating a specialty that really means nothing. How many people who sell thier used stuff can get that badge? eBay would have been better off buying squaretrade and including a warranty on ANY new item in the listing/fvf price instead of the other monkey games (sorry monkees) they play.

Theres a system in play and in place - and its tilted against you. Read TWICE its there on the website - you and I are the unwanted trash of eBay  (no matter what the non english speaking reps tell you or the flowery emails they send!)

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: Patricia This user has validated their user name.

Tue Sep 4 12:16:01 2012

I don't think Pierre cares one whit what his Ebay has turned into.  He's busy counting his billions!  Ebay is a shambles....in trying to get rid of the flea market atmosphere...Donahoe discovered he can't make headway without us - yet he treats us poorly and with disdain!  Many of the best small sellers are gone from the site....taking a lot of the traffic with them.  Diamond sellers?  There's not one of them that doesn't have its own website and sells directly from those sites.  Why would I need to wade through all the asian junk on Ebay?  

When I shop for an individual item there's a good and valid reason why I go to Amazon first then a retail seller's site second and Ebay dead last...if I get that far!

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: ebay refugee camp This user has validated their user name.

Tue Sep 4 12:26:03 2012

@digimen1
Sorry digimen1 the actual ebay marketplace is in real trouble. The other profitable entities of Ebay Inc. are holding it up.
The businesses that Donahoe acquired and Paypal could not be screwed up by him.
The diamond power sellers have been given perks by ebay  the result is "no level playing field".
Has anyone noticed that the TRS status has all but disappeared in the categories that cannot possibly ship in one day?
Small business on ebay is being squeezed out by a one size fits all policy which enables and empowers big business only.
How many sellers have left?
Those sellers should have been embraced and the site enhanced to fit all categories and all sizes of business. Instead you have a weakened marketplace that could have been awesome with changes that made sense.
I have said it many times, the loss of the final value fees that ebay has lost due the clubbing of small business on ebay has to be a staggering figure, those sellers have left in droves.
How much would those stock dividends be if the actual Ebay marketplace would have managed in a fair, honest and sensible way?
Instead ebay has been wall streeted and the little guy suffers when that happens.
The changes make no sense to small business and are clearly unfair to small business but the diamonds have to be coddled to get them to USE PAYPAL IN THE STORES AND ONLINE!
Ebay's president stated well the policy cannot work for everyone. My question is why not?
I cannot help but wonder when I see the feedback ratings and TRS ratings for diamonds. They certainly have a tremendous amount of negatives and the TRS ratings do not reflect that it does not average out. This makes it harder for small businesses to compete and that is what ebay wants, you gone!
So the answer is yes the diamonds are hurting ebay because it shows the deceptive, dishonest and wall street manipulation of ebay by a group of greedy executives and attorney's.
The changes went to far for the fall update and many sellers lost their discount because of the 1 day handling time. This was done for the diamonds to give them more of an advantage in the search.
The ebay serach has become a joke for the little guy. You enter what you want in the ebay search and most of the time you get a page that states no results,underneath are the paid ads by sponsors then at the bottom of the page are search results that ebay clamied at the to of the page there were no results for.
This is happening contionously when searching in antiques, collectibles, categories with custom and personalized items. I did not search in electronics this time but I know that answer the diamonds always come up!
Are diamonds responsible, I say yes, they made a evil deal with Donahoe and now small business is being hurt.
Years ago mom and opo stores ran retail and the huge brick and mortar stores came in and closed them down.
These are the diamonds on ebay now who are assaulting small business online.
The level playing fiels is gone due to Donahoe and his wall street diamonds.
That is why we have the new policy of no class action suits, the fall update left ebay wide open for a class action which I expect will be filed by someone very soon.
Complain to your stse attorney general, comp[lain to the justice department, complain to the bar acssociation as ebay attorneys know this is unethical.
I wouls love to see the US Small Business Adminstration get involved and put a warning out about ebay's clubbing of small business.
This country needs to take wall street the wood shed and give them a beating.
If Wall Street were regulated properly and the huge bonuses for the executives curbed we would see improvements, but our lawmakers ARE CORRUPT so you guys like Donahoe making diamonds his priority and small business his enemy.
Diamonds have hurt a lot of people and ebay marketplace is just ruined in my opinion.  
By the way please stop giving free listings to further clutter the site that your technicians cannot operate properly. I anm convinced that the glitches are caused by too many listings, and too many listings that do not sell. I know you want to show wall street all those listings but those of us who matter know it is all a farse.
What is the actual true sell through rate on ebay?
That is another problem with the diamonds, how many listings do they have? Thier perks are giving them a advantage in the search and everyone else is buried, that is if you can actually get a result!

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: Digmen1 This user has validated their user name.
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Tue Sep 4 14:47:30 2012

@ebay Refugeecamp
Great post, I read the whole thing.
I read that they have 400 engineers working on a new search program that can handle 300 million listings.
We have a phrase in New Zealand - Yeah, right!
Yes it would be good to know some of the sell through rates.


Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: ttfm1966 This user has validated their user name.

Tue Sep 4 15:07:23 2012

Here is the real issue with Diamond Sellers and it should really scare the pants off of the small businesses on ebay. They are not coming to ebay for immediate profit.  Intead they are hoarding customer information on a spectacular level.  Almost unimaginable.  At some point in the future they'll use data mining and convert ebay buyers into online buyers on there own site. With the buyers email and mailing address they'll be able to send offers that will blow buyers mind and send them running from ebay.  Watch and see.

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: Bloggo This user has validated their user name.

Tue Sep 4 15:10:58 2012

It's too bad the amount of money that eBay has NOT made due to John Donahoe's policies can't be calculated. The sum would be staggering.

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

by: uncle rico This user has validated their user name.

Tue Sep 4 15:38:29 2012

ttfm1966, you're repeating what others have said...nothing new here. Yes, of course they are harvesting the customer info.  

Perminate Link for Are Diamond Sellers Helping or Hurting the eBay Marketplace?   Are Diamond Sellers Helping or Hurting the eBay Marketplace?

This user has validated their user name. by: Rexford

Wed Sep 5 07:43:57 2012

Ebay is clearly becoming a site which markets large retailers.  It is likely Donahoe's consultants' vision, because as we all know, Donahoe had never had any vision.   When you kill your Markeplace sales by your "innovative disruption", how else will you make money?   If it weren't for PayPal I feel that this company would have filed for bankruptcy already.

Look for other "Sonys" to emerge.  I'll be clearly noting who they are and I will not be shopping with them.

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