|Sun June 23 2013 13:19:33|
eBay Opens Wallet to Attract New Sellers
By: Ina Steiner
If only one was privy to the results of the promotions eBay runs, because it would be really interesting to see what kind of results its newest promo generates. eBay is opening its wallet to pay for new sellers, but there are several things that stand out as sticking points. The real question is, will sellers refer other sellers to eBay for ten bucks a pop?
Here's how it works: eBay is offering a $10 bounty for referring new sellers in a special 1-month promotion - only those sellers who receive an invitation are eligible to participate, and they can earn up to $200 if they refer 20 new users who then go to eBay and sell something.
The first sticking point is whether eBay should really have to fork out $10 to attract sellers to the site, assuming it's a vibrant marketplace attractive to sellers. PayPal ran a similar promotion when it launched, but that was before it gained traction. It's unusual for an established site to pay for new users - and who hasn't heard of eBay already?
It's interesting that eBay hasn't tied the new promotion into a social networking campaign, but that is likely due to the fact the promotion is not open to all users. Reading the email invitation readers received begs the question, just how difficult is it for eBay to attract sellers, "new" or otherwise, to the site?
On the other hand, if eBay has more demand (buyers) than supply (sellers), that might be a nice problem to have. But it comes back to the fact that sellers go where the buyers are, they're quick to identify opportunities. And given the number of seller reports about declining sales, it seems unlikely the balance is titled that way. In fact, it's a wonder eBay isn't paying for buyer referrals (aside from its affiliate program).
eBay is sending the invitation to "our most loyal sellers" - but what seller would trade the threat of increased competition for $10? Having more sellers on a marketplace makes it harder for their own items to rank highly in search results, and it drives down prices.
eBay has been trying to drive up its active user metric, and has said that users who sell on the site are also more engaged buyers. In the first quarter of this year, all eBay Marketplaces gained 3.9 million active users and ended the quarter with 116 million, a 13% increase; unfortunately it's difficult to get metrics about the number of active sellers on the site - and even if it did, it would be difficult to know how many "serious" sellers that encompassed.
If you received this invitation, would you refer new seller to eBay? Would you refer buyers to eBay? Why or why not? And would it make a difference if eBay paid more for the referrals?