EcommerceBytes-NewsFlash, Number 1815 - June 19, 2008     0 of 8

eBay Phasing Out Third Party Checkout

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eBay announced it would phase out third-party checkout by this time next year. Third-party vendors help sellers list on eBay, and some offer sellers use of checkout systems to up-sell and cross-sell items to buyers. For example, a buyer who purchases a laptop computer from a seller and is taken to Checkout to pay for the item might be exposed to offers to buy a laptop case or other accessories to increase the size of the order.

Jon Jessup, Technical Evangelist for Infopia, said research his company has done has shown that "branding and upselling isn't as beneficial as people think." He said vendors such as Infopia had to jump through hoops to use eBay's Checkout Redirect, and didn't seem upset at the news. "We'd be up in arms if cross sell really worked well, but it doesn't. That's the eBay buyer," he said, reporting that very seldom do eBay buyers actually buy accessories through the cross-sell process.

eBay's checkout has a 92% completed purchase record, Jessup said. Doing the math, that translates into a non-paying buyer rate of 8%.

Thierry Nihill of Kyozou, another vendor, said the news was inevitable. "No one in this industry should be surprised. Be prepared to work with your business partners when they make changes that they think are best for their business," he said.

"If we want to continue to prosper and help our customers, we, rather than complaining about it, we'll find a way to make it work."

Neither Jessup nor Nihill knew of specific features eBay planned to add to its own Checkout system. Asked whether eBay was giving vendors enough notice, Nihill said, "There's never enough time in development. That said, we've always made our deadlines, and I'm confident in saying we will adapt within the timeframe eBay has given us."

During a press briefing, the question was asked what would happen if a vendor's Checkout had features that eBay would not add to its own Checkout. eBay said it would not matter, all vendors would have to migrate to eBay's Checkout.

eBay made a somewhat related anouncement at the Developers Conference on Monday, revealing that third-party vendors would be allowed to host their applications on the eBay platform through Project Echo.


About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to ina@ecommercebytes.com.


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