Levers that eBay can pull
eBay is a bit of a beast, and most of the time pretty uncontrollable by those that run the company. It must have seemed such a neat idea when Pierre set up a person to person auction site, but today’s marketplace bears little or no resemblance to the eBay of the 1990s.
It’s a bit like steering a boat. If you’re in a little motor launch it’s quite easy to change direction and steer where you want to go, but if you’re in a massive oil tanker or container ship it can take several miles to change direction and as much as five miles to come to a stop.
With the latest seller release we’ve heard, read and listened to a lot of viewpoints, it’s good for some sellers, it’s disastrous for others, so today we thought we’d take a look at how eBay can control the marketplace.
Fees are the obvious one and free listing days and other promotions are one way they can attract inventory to the site. With the latest seller release eBay have effectively given sellers free listings for eBay UK with any eBay Shop subscription but it doesn’t stop there.
eBay are constantly being accused of turning their backs on auctions, but the latest seller release aims to encourage more high value auctions by dropping the insertion fee price from £1.30 down to as little as 15p per listing.
How products are presented in search results is another of eBay’s levers. It makes sense to put the fastest selling lines at the top of search results which is what the recent sales aspect of Best Match does. However eBay also use seller status, price and a whole load of other attributes to try and surface the best possible deals and ideally the one deal that the buyer won’t be able to resist.
eBay Feedback was always a great idea, but it doesn’t really work for today’s marketplace. Postive/Neutral/Negative’s weren’t good enough so we got Detailed Seller Ratings (DSRs). Measuring the best DSRs didn’t work so eBay started to measure low DSRs. Then they measured open and unresolved cases and even here they failed to differentiate the very best sellers from the simply good sellers. eBay have virtually given up on feedback as a way to influence behaviour, not that it’s been abandoned, but they’re starting to mandate behaviour instead.
Expect more of this in the future, eBay have just mandated that all sellers will offer 14 day returns on all listings (Fixed price and auction) and that sellers will specify who pays the returns costs. Businesses are supposed to follow the law but so many weren’t that eBay have made it compulsory to do so for returns.
Let’s face it eBay never cracked the fee avoidance trick of loading the item price into the postage. That’s why it’s no surprise to see fees charged on postage as well as the item price. This change also makes it more attractive to offer free postage where possible as you’re paying fees either way.
Cross Border Trade
eBay want you to sell overseas and they’re going to make it more attractive to list on overseas eBay sites than to list on eBay UK with international availability. Even with a Featured Shop eBay are giving a ton of free cross border insertion fees and discounted EU listings and the whole lot are free with an Anchor Shop.
I’ve heard a fair amount of reluctance to list on foreign eBay sites, but it’s time to grasp the opportunity and start using those free listings. Yes it’ll mean time and possible cost investment in channel management software, but that in itself will streamline your business and save time and money for your UK sales.
Cross border trade is a lever that eBay are pulling hard, the UK isn’t exactly washed up as far as sales go, but there’s most certainly a lot of competition. Selling in other territories with much lower competition not only gives easy expansion for your sales but potentially greater margins as well.
Understanding the levers
We don’t like everything that eBay do. Some may vociferously disagree with changes that they make. On Tamebay we tend to set aside what we like and don’t like in favour of figuring out how to work best with the changes and offer strategies to maximise profit.
It’s important to look beyond the changes themselves to understand why eBay are pulling the levers that they’re using. eBay have access to all the data and know through rigorous testing the effect changes will have. Look at the overall seller update and you’ll see without a doubt that it’s is all about encouraging more listings and especially more listings on overseas eBay sites.
Are you rolling with the changes or fighting the changes? If you’re not prepared and ready to take advantage of listing overseas is it time to change strategy and work with eBay rather than fight against them?