|Sun Jan 27 2013 21:58:58|
Mulling over eBay Fees and Platform Changes
By: Ina Steiner
eBay used to raise fees every year like clockwork. Sellers would protest the higher fees, and Meg Whitman would tell the media the "passion" of the community was a positive phenomenon. The hike in listing and commission fees for Store inventory in August 2006 was a classic example - it was something the mainstream press could easily understand and write about.
But something interesting has happened over the past few years. Rather than announcing annual fee increases and dealing with the accompanying drama, eBay has been raising fee through policy changes. That's something much harder for reporters to understand and harder for sellers to rally around.
For example, in 2011, eBay began including S&H costs in the commission fees. But that was not a one-time fee increase. Each January, shipping carriers raise rates. Because both eBay and PayPal take a percentage of the shipping costs in their commissions, eBay sees an automatic increase in revenue from fees each year.
For example, if I sell a jacket that fits in a medium Priority Mail flat rate box, the USPS now charges me $12.35 instead of $11.35 thanks to rate hike that went into effect today. eBay charges a 10% commission (FVF) in the Clothing Shoes and Accessories category; 10% of the extra $1 in shipping charges is 10 cents. PayPal charges 2.9%, so they get an extra 3 cents.
That means I pay eBay an extra 13 cents for my jacket transaction, simply because the U.S. Postal Service raised its rates.
As I outlined last month, USPS Priority Mail service will increase overall an average of 6.3%; UPS is increasing Ground services by 4.9 percent net in 2013; FedEx Ground and FedEx Home Delivery rates will increase an average of 5.9%.
Another example of a fee increase disguised as a policy change was in 2012 when eBay changed the criteria for receiving the 20% Top Rated Seller discount. You can still be a Top Rated Seller, but you have to meet stricter guidelines in order to qualify for the discount.
Will eBay figure out another way to increase fees through policy changes?
And speaking of changes, the head of eBay Marketplaces Devin Wenig tweeted on Friday afternoon, "our job is to give ebay sellers the best platform to expose not just their products but who they are-their brand, style, story. Stay Tuned."
Sellers are currently limited in how much self promotion they can do on eBay - the About Me page is the primary platform for introducing themselves to shoppers.
Any guesses as to what eBay has up its sleeve with regard to sellers being able to share more about their brands?