With the Pilot once a purchase has been made eBay will request payment from the buyer and once eBay has the funds they’ll notify the seller that the item should be despatched. The seller then needs to ship the product and when they mark it as despatched this triggers the payment from eBay to the seller.

The big deal on this test is Buyer Protection. Currently buyers are protected for their purchases if they pay with PayPal. Under the pilot with eBay collecting the funds all acceptable payment methods will be covered under Buyer Protection. Buyers have the option to pay with Bank Transfer, PayPal, Skrill (the new name of Moneybookers) or credit card/debit card through either PayPal or Skrill.

As a side benefit the pilot will also ensure that a wider range of payment options are available to buyers on a consistent basis. All sellers participating in the pilot will have the same set of payment options offered on their items so buyers will always have the choice of using their favoured payment method.

All newly registered sellers on eBay.de and eBay.at will be included in the payments pilot. All of their items listed on eBay will have direct payment options to eBay which means buyers around the world buying from these sellers will see the range of eBay payment options.

Payments from eBay to the seller can be either through PayPal or bank transfer, and similar to current PayPal holds the frequency will be dependent on the seller status including if they are a business seller with an established trading history (immediate payout) or Business seller without a trading history or who are below standard (7 day payout) or Private sellers (14 day payout).

eBay say that it’s too early to say if the pilot will be rolled out to more sellers or in more eBay territories. They will of course thoroughly analyse the results of the pilot to determine if it has the desired effect of increasing trust on eBay, particularly for higher value purchases from newly registered sellers.

I do like the way the new payment model offers choice of payment methods to buyers and increases buyer protection. I’m not so sure that sellers with their own merchant banking facilities for accepting credit/debit cards or those who already accept bank transfer will welcome delays in receiving their funds.

However the most important data point from the pilot will be to see if it increase the frequency and value of purchases from buyers. If sales volume and value increase than any change in payment options is likely to be a secondary consideration and something we’ll all just have to live with.

Cases that will count against sellers are item not received or significantly not as described (opened cases) and cases that were not resolved by the seller, and either eBay or PayPal have issued a refund under the buyer protection policy (unresolved cases).

What won’t be counted are cases opened to return an item or to cancel a transaction. In addition eBay say that they won’t count cases where the buyer abused or misused the eBay or PayPal buyer protection process.

What still infuriates me is the order of options in the drop down a buyer sees in My eBay. This still has “Resolve a problem” as the third option (which pretty much ensures any opened cases will count against the seller), whilst “Return this item is 9th, right down at the bottom of the list of 12 options.

Seeing as cases where a buyer merely wishing to return an item aren’t counted against the seller (and seeing as the Distance Selling Regulation proscribe no fault returns as mandatory) why isn’t this option right at the top of the list? Offering the option to resolve a problem can lead to buyers claiming items are “Not as described” instead of simply requesting a return.

eBay still need to make the process of selling, buying, customer service and returns as simple and straight forward as it is buying from big retailers such as Next and Littlewoods. Whilst responsible sellers do their best to fulfil their responsibilities simply moving the “Return this item” link towards the top of the list and above “Resolve a problem” would go a long way in avoiding unnecessary opened buyer protection cases.

Prior to this change, buyers had limited protection in off-eBay transactions which covered them for non-receipt but not for SNAD claims. PayPal UK’s MD, Carl Scheible, says “over half of all PayPal payments by value are now made on non-eBay websites, so we’re pleased to respond to calls from customers and consumer groups to strengthen buyer protection for non-eBay purchases.”

I’m delighted by this. I know that some sellers complain that PayPal “side with the buyer” too often – but as far as I’m concerned, anything that gives online shoppers more confidence that they’ll be satisfied by their transaction has to be a good thing for all ecommerce merchants. The old distinction where SNAD was allowed on-eBay but not offsite was just ridiculous, and buyers (mostly) have the right in law anyway to return goods they’re not happy with, so this is really just underlining that right and, perhaps, encouraging more sellers to honour it.

Buyers should note that PayPal buyer protection does not cover intangible goods, services, custom made items, airline flight tickets, eBay classified advertisements and items prohibited under eBay’s acceptable use policy. Only items paid for in full with a single PayPal payment are covered.

Firstly what is an “Opened” case? The good news is that if a buyer clicks on the “Return this item” link it doesn’t count as an open (or unresolved) case. No matter what the reason for the return it won’t be included in the count for seller performance.

What will be counted are any opened PayPal disputes or any cases opened on eBay for item not received or item not as described. Cases opened on eBay are typically where a buyer clicks the “Resolve a problem” link. If you can encourage buyers to click the “Return this item” link (which is unfortunately 3rd from the bottom of the list, instead of 2nd from the top) then cases won’t count against you. It would be helpful if eBay moved the “Return this item” link up the list to be more prominent for buyers.

Other things you can do are to send items with tracking and enter the tracking number on eBay, respond to all communications from buyers promptly and include your contact details and returns procedure information with every item you send out.

eBay are actively encouraging buyers to communicate with sellers prior to opening a dispute. When a buyer goes to file a complaint they are asked whether they have been in contact with the seller before they can continue with the process. Unfortunately not all buyers contact the seller and that’s where the biggest problem with open cases arise.

If you check your Seller Dashboard you can now view your Seller Performance in relation to Opened and Unresolved cases, although by the time eBay starts actively measuring the new criteria any current cases will be outside the 3 month evaluation period for high volume sellers.

Seller Dashboard Buyer Protection cases

The major change coming to eBay UK is similar to eBay.com and is the introduction of opened buyer cases as a measurement in seller performance. For the UK there’s an allowance of 0.5% of transactions or two cases for Top Sellers and for all other sellers a maximum of 1% or 3 opened cases. There’s also the limit of 0.3% of transactions or 2 cases that the seller has failed to resolve which could also lead to sanctions including loss of seller status and listing restrictions.

Opened buyer cases in the resolution center will begin to be measured from the seller assessment on 20th September this year, and will be evaluated over either a 3 month or 12 month period depending whether the seller is high or low volume (more than 400 transactions per quarter).

eBay will also begin to actively protect sellers from buyers who attempt to threaten feedback extortion, feedback bomb, leave positive feedback but consistently leave low DSRs or leave abusive or inappropriate feedback.

Item Specifics: Condition

More descriptive item condition values will be introduced to expand the current “New” and “Used” which are the only options currently in many categories. There’s a look up table where you can check the item specifics for the categories you trade in.

Selling enhancements

Bulk editing functionality will be introduced in Selling Manager and Selling Manager Pro as well as a bulk edit in My eBay with spreadsheet type functionality to modify listings. You’ll also be able to preview changes before setting then live on the site.

From mid June business sellers will be automatically opted in to eBay Auto Answers (although you do have the option to opt out. Auto answers give the ability to have boiler plate responses to questions such as, item condition, postage & packaging information, if payment has been received (if the buyer paid with PayPal), tracking information (if the seller used eBay or PayPal postage labels) and if returns are accepted. It’s worth noting that once you’ve turned Auto Answers on you also have the option to block buyers from asking questions directly from the view item page forcing them to use the Auto Answers. If they want to message you they’ll have to do so directly from your user profile, not from view item pages.

eBay will also be updating some successful buyer and payment email templates. A new “order confirmation” email will display all transaction details, seller’s business contact information and, from July 2010, their return policy. A “payment reminder” email will be sent if the buyer hasn’t paid after 2 days although the seller can opt out of this and a compulsory reminder email will be sent to all buyers who haven’t left feedback.

There’s a reminder about the Unpaid Item Assistant which has been live for a few weeks now. Rather than manually opening unpaid items if a seller’s only acceptable payment method is PayPal eBay can automatically open and close unpaid item resolutions with an option for the seller on how many days to allow for the buyer to pay.

Testing of new options for leaving Feedback

eBay will be running more tests for new buyer feedback options. In place of the current DSR ratings are simple yes/no answers to topics such as “Was the item what you were expecting” along with a 0 – 10 Net Promoter type score.

eBay say that the tests are aimed at simplifying the Feedback process whilst obtaining more accurate and objective responses from buyers. If eBay roll out a revised feedback system on the back of the tests they’ll give advance notice well in advance.

Free subtitles for Product Photos in Catalogues

If your image is used as an eBay Catalogue photo then you’ll not only get a credit link but eBay will also give you five free subtitles as a thank you.

Update: The UK announcement is out as well with a few differences. Below refers to the eBay.com changes

Introduction of Seller Ratings on Buyer Protection Cases

In addition to feedback and detailed seller ratings sellers will now be rated on how many eBay buyer protection cases are opened against them. eBay say “The number of item not received or item not as described cases opened with eBay or PayPal is an important indication of overall buyer satisfaction on eBay. Many buyers who open cases never get to the point of leaving detailed seller ratings (DSRs). That’s why, starting in September, along with low DSRs (1s and 2s), these cases will be used in evaluating seller performance and determining seller status.”

Basically if you get more than 0.5% opened cases as a Top Rated Seller or more than 1% for all other sellers you could face sanctions including loss of sellers status and/or selling restrictions. For low volume sellers there is an allowance of up to 3 cases for eBay Top-rated sellers and at least 4 cases for other sellers before sanctions kick in.

There is an additional criteria for unresolved cases where the seller does not respond to resolve an issue with the buyer and eBay or PayPal issues the refund. No seller regardless of status can have more than 0.3% of transactions with the exception of low volume sellers where it will take a minimum of 3 cases before sanctions kick in.

I can’t see this one going down well with sellers in categories where buyers habitually buy to try. eBay are constantly talking about “retail” and how they want sellers to up the mark, however for mainstream online or catalogue retailers the rates of returns are high (for many mainstream retailers over 30%) and yet a request for return is not deemed a bad buyer experience, it’s considered great service and encourages buyers to continue shopping.

Even legislators (at least in the UK and Europe) recognise that with distance selling it’s impossible to examine goods in the same way as a retail store and across Europe the law provides for the right for buyers to change their mind. Unlike mainstream retail, on eBay hassle free returns will now be punitive unless you can persuade buyers to contact you directly and not open a resolution case.

Item Specifics: Condition

In May eBay are introducing a raft of new and more relevant item condition specifics to enable sellers to better describe their items. These will include conditions such as “For parts or not working” in computers, “New with defects” and “Pre-owned” in clothing and “Brand New”,”Like New”, “Very Good”, “Good” and “Acceptable” in DVDs.

The new item conditions specifics will start to appear on eBay.com from July

Email Communications

eBay will issue every user with an anonymous email address which will be used for all future communications between buyers and sellers. This means you’ll no longer have a buyers real email address even after a transaction. eBay will verify the address from which a user responds so to ensure delivery of your response you’ll need to respond to emails from your registered email address. This could cause issues for people with multiple eBay accounts to manage but you will be able add a single “from” address to your account so that you can respond from the same email address for all user ids.

eBay will also enable sellers more control with an opt out of the Payment Reminder email if they wish to send their own reminders to buyers.

Featured First to be retired

The Featured First listing enhancement is to be retired by July, this is the feature which could give a boost for a Top Rated Sellers listing and would rotate it in turn into the top two slots of search results under Best Match.

Bulk Editing Tools

Starting in June eBay will begin to make new bulk editing tools available, including the ability to download and edit active listings in Microsoft Excel.

Shared product pictures for eBay catalogue

If you opt to allow eBay to use your product pictures as catalogue images you’ll get five free subtitles if your images is selected for use.

If you’re looking for more details of exactly how things will work, check out the extensive FAQs on the program. One reassurance for sellers is that buyers are being actively encouraged to contact trading partners before they put in a claim, and eBay says “In some situations, we may tell the buyer to wait — if, for example, they haven’t allowed enough time for an item to arrive.” Both of these should be an improvement on the PayPal system.

Though eBay forums in recent months have inevitably thrown up a few odd cases (I seem to remember something from Q&A where the buyer got two refunds and a free TV – not bad work if you can get it), expanding this program has to be seen as a positive move from eBay. Reading the details of the policy, it seems clear that most of the “what if” scenarios have been thought about, and covered. The uncontrollable refunds that some sellers worried about don’t, by and large, seem to have happened, and the “no fault” refund where eBay itself pays out can only be good for both buyers and sellers.

How’s it been for you? If you’ve had experience of the new buyer protection program, either as buyer or seller, leave us a comment.

In the past if you claimed for non-receipt of goods from a website transaction you would only have got a refund if the seller had sufficient funds to cover it in their PayPal account. If PayPal couldn’t recover the funds then you lost out. PayPal have removed that requirement for transactions taking place after the 1st November 2009 and buyers who win their claim for items not received will get their money back for the full value of the item, in the same way they already do when they use PayPal to pay for eBay purchases.

A huge number of websites now accept PayPal, including many of Britain’s biggest brands. This improvement to our buyer protection will give extra reassurance to over 20 million PayPal customers in Britain when they shop online at these sites. We regularly review and improve the protection we offer customers, as we recognise that it’s an important extra benefit of using PayPal.
– Carl Scheible, Managing Director of PayPal UK

There are still some notable exceptions, intangibles, services, custom made items, airline flight tickets, items prohibited under PayPal’s Acceptable Use Policy and digital content, cars are also excluded. To qualify for off-eBay buyer protection the buyer must pay the full amount of the eligible item on one payment and disputes need to be opened within 45 days of making the payment. Claims for items that are “Significantly not as described” are not covered when the items were not purchased on eBay.

This is a great move and can only increase consumer confidence when buying online and paying with PayPal. Consumers can now purchase from your own website with the same guarantee that they’ll receive their goods as they can when buying from eBay.

Firstly, we see the process in action. I heard this week from a TameBay reader we’ll call Bob, who bought a mechanical item through eBay which arrived with an important component missing. Bob had checked with the seller before purchase that the part was included, and so was extremely frustrated when the seller failed to put things right. He’d opened a SNAD claim with PayPal, but was contacted by eBay and offered a full refund if he closed the PayPal claim.

I asked Bob what eBay had done to verify his claim. He told me: “I contacted the seller through eBay messages. All contact with him was through eBay messages and I had the impression that eBay customer services had access to all this when I was talking to them. I was asked if I was able to buy a replacement part, but in this case I have been unable to identify the machine maker to source one.”

And what had they asked him to do with the goods? “I still have the machine, and nothing was said about what I should do with it.” This is significantly different to PayPal’s policy, which did require buyers to return the item to the seller.

Changes to eBay UK user agreement

Yesterday, eBay UK announced changes to their user agreement to make allowances for this new procedure.

Under eBay Buyer Protection … there may be instances where a seller doesn’t resolve a claim and we find in favour of the buyer, in which case eBay will pay the buyer and invoice the seller for the transaction amount. Where a seller fails to comply with the eBay Buyer Protection policy, eBay may also remove any special status associated with the account … and/or restrict or suspend the seller’s account.

The threat of negative feedback used to worry eBay sellers, but the threat of losing your money, your goods *and* your seller account under this new policy is a very real one. My advice to sellers in dealing with unhappy buyers has always been “don’t let it get as far as a PayPal dispute”: this now goes double under eBay’s new dispute procedure.

The best advice for sellers now is to be upfront about your own dispute resolution procedures: dispatch emails, packing slips and/or invoices should carry at least your contact details and advice on what to do in case of any problem. And if buyers have a problem, deal with that problem: if someone contacts you with an issue post-sale, don’t fob them off. Most buyers, most of the time, will go to the seller before they go to eBay – make sure you take that chance to put things right.

The new UA is effective from 8th July for existing eBay UK members. If you don’t want to accept it, you can, of course, close your eBay account.

Buyers will now be covered for items not received or significantly not as described for the full amount of their purchase; the current limit is £500.

Expanded seller protection will now be available for all sellers, not just PowerSellers. The current annual limit of £3,250 will be removed, so that sellers will have unlimited against chargebacks and reversals for unauthorised card use or non-delivery. Coverage is valid for the 190 countries in which PayPal operates, and there are no more “confirmed addresses”: sellers are covered so long as they post to the address provided on the eBay transaction page, and can provide a proof of delivery (with signature for transactions of £150 and above). There are more details for sellers in the expanded seller protection FAQs page.

The changes are effective from October 2008. This is the same announcement that was made for US customers back in June.

I’m guessing that either their account isn’t fully verified, or PayPal have put them on hold due to a security risk. I suppose I should be thankful to PayPal for protecting my money but I’m not – in reality they’re only protecting their own money leaving me to shoulder all of the risk.

None of the alternative payment options offered (credit card, cheque or postal order) qualify for buyer protection, buyers are only covered if they pay via PayPal. Buyer protection sounds great when bidding with a nice logo explaining you’re protected up to £500.00. It’s not quite so good when it comes to paying and you find that if you pay you won’t be covered at all.

I phoned PayPal and they definitely advised against giving out card details over the phone – their entire raison d’être is to keep my card details safe. Cheques and postal orders once cashed are pretty much impossible to reverse should the goods not arrive.

Faced with this situation what would you do? More importantly what kind of impression would this situation make on a new buyer who has been told countless times by eBay that PayPal is the safest way to pay online? Other forms of payment might be safe for the seller but with no buyer protection they sure don’t feel very safe as a buyer.

For US sellers on eBay.com, seller protection is being widened to include transactions in the 190 countries in which PayPal operates. Sellers will be covered against claims, chargebacks and reversals due to an unauthorised payment or an item that was not received. The coverage cap for this will also be removed.

The changes are due to be implemented this autumn.

When asked if PayPal in the UK would be increasing buyer protection cover upwards from the current £500 maximum he explained that the level of protection doesn’t influence buyers more buyers to use PayPal. Generally if a buyer is wary of spending online it doesn’t appear to make a difference if all or just part of their purchase is protected.

However the long term aim is to increase covereage, the first step will be to bring the £150 level up to match the £500 coverage, and from then on to increase the total coverage level which is expected to be between £2,000 and £10,000. We should see this in six – twelve months time.