Would you list more on eBay if fees were lowered?
Auctionbytes has some interesting screenshots of a survey eBay is currently running, asking members if they would list more if fees were lower. Respondents were asked to consider selling items of values between $25 and $1000 on eBay, and to assess whether they would sell as fixed price, auction or not sell at all, based on different fee schedules. The survey also asked sellers to indicate their preferred balance between insertion and final value fees, and to rate different fee schedules according to how confusing they were.
eBay surveys are often a good indicator of future changes the company is considering, and this survey’s final question seems to be particularly telling: “If there was one thing that eBay could do to get you to sell more on their website, what would that one thing be and why?”
We might guess from all this that eBay is considering a “rebalancing” of fees some time next year. My bet would be that the lower insertion fee, higher FVF model we’ve been seeing this year will be expanded. I think we’ll see more free listings for private sellers; not just for low-start auctions as we have now, but fixed price too. Some whole categories may go insertion fee-free (media, for one). And the UK stores subscription model, where the higher your shop subscription, the lower your insertion fees are, will surely be rolled out to other eBay sites.
On the flip side, I think we’ll see a “rationalisation” of FVFs. eBay is looking to label the current system “too confusing”, and we’re likely to see a single percentage rate for FVFs, whatever the actual sale price. Hopefully this will be capped too, but it’s likely to be pitched at a level where sellers of more expensive items feel like they’re getting a bargain, whereas sellers of lower-priced items will complain (again) that they’re being charged an exhorbitant rate.
And my feeling on this is that it won’t make any difference whatsoever to what people list on eBay. Business sellers have – by and large – moved beyond the days when we threatened to go on strike if Meg put IFs up 5c. We’ve learned how to set our prices to take eBay fees into account, and the current push towards “success-based” eBay fees suits us nicely. We see eBay as a customer acquisition tool for our off-eBay businesses, and count eBay fees in with our marketing budget, just like Google Adwords.
No, if we’re not listing on eBay, there are reasons for that. There are lots of reasons – reasons we’ve repeatedly told eBay – and they’re not about fees. They’re about feeling in control, not having our accounts closed down because one buyer is cross. They’re about regulation and over-regulation and the way that eBay has, at a stroke and without warning, wiped out businesses that relied upon that platform. They’re about inventory management, and us not having the (free) tools to manage our stock across eBay and Amazon and our own sites. They’re all good business decisions, and if eBay thinks that sellers are only concerned about fees, then that just shows how out of touch with their sellers they are.
So for a bit of mid-week fun, our own, totally unscientific poll. Would you list more on eBay if fees were lowered? If the answer you like isn’t in my selection, then do feel free to leave it in the comments.
its a shame no one at ebay thought the FVF structure was “too confusing” BEFORE they lumped it on us.
It will be a fee rise anyway.
The decision to raise fee’s has already been made, they just chuck these surveys around to get a general feel for how much moaning is going to take place when they announce the next fee hike.
a general feel for how much moaning is going to take place
Yup, I fear that is true.
eBay has already hit the peak with regard to fees charged to small sellers.
Given eBay’s constant declining market share, eBay should no longer be operating under the assumption that ‘they have all the eyes’. The facts tell a different story.
eBay listing volume has quadrupled over the last couple of years. Despite having 4 times as many listings, eBay GMV has been in steady decline over the past year.
It is obvious then that ‘all they eyes’ are no longer focused on eBay.
Given the current fee structure and the fact that unique visits to eBay have hit a 5 year low, there is nothing to justify a fee increase on eBay as the traffic is simply no longer there.
If eBay needs more revenue they should reexamine the deals they made with Diamond Sellers. Diamond sellers are draining the blood out of eBay’s veins.
Diamond Sellers listings number in the tens of millions, eating up massive amounts of bandwith and represent a significant cost to eBay.
Diamond sellers list for free in most cases, and they also can negotiate lower Final Value Fees. The end result is that Diamond Sellers have no skin in the game.
eBay is looking to increase revenue even though sales and traffic are lower. eBay needs to stop squeezing down on small sellers. eBay needs to stop expecting small sellers to subsidize the millions of free listings of Diamond Sellers.
eBay needs to look at the Diamond Sellers as the target for the next few rounds of fee increases and give smaller sellers a reduction in fees in recognition of the fact that eBay traffic no longer justifies the rates presently charged.
Pretty much agrees with everything Ric says above. Not so long ago we were told that ebay would not go to a free insertion free/very low insertion fee model as it just fills the site up with stuff that doesn’t sell. Over the last year or so that’s exactly what they have done. The Free insertion for 99p start auctions for private sellers only was/is also a huge disaster. Free P&P in media seems to have got rid of a lot of that stuff now and numbers are falling rapidly, but IMHO was entirely the wrong way to go about it.
Personally I’d like to see a shift back to higher insertion fees and lower FVF’s, it keeps the stuff on eBay that sells and discourages people listing junk over and over that doesn’t sell. Perhaps they will as it would make more sense from eBay’s point of view in having more money upfront and less relying on if items sell.
After Xmas I will be reducing my eBay listings as it’s getting poor value for money because of all the reasons mentioned above.
I personally would like to see them move to the same fee for auctions that they operate for BINS.
And please get rid of all the little “add ons” that just add in price:
Scheduling on Ebay.com.
10 day auctions on Ebay.com.
We are very careful about what we list on auction now as it is too expensive considering the sell through rate is sometimes less than 10% these days.
Get rid of all the little add ons.
Charge the same rate as bins.
That would be our preferred fee model.
(We sell mid range antiques).
I agree with Mark, I would list more auctions if insertion fees were the same as BINs – and they sorted out the ‘private’ sellers listing free auctions!
I couldn’t complete the survey as it crashed after 2 pages!
If this was the last question – “If there was one thing that eBay could do to get you to sell more on their website, what would that one thing be and why?”
I could sell more on eBay if they 1) allowed <9p BINs again, and 2)ditched TRS system that reduces visibility of listings for perfectly good sellers based on anonymous ratings for criteria beyond seller's control.
I really don’t mind what fees ebay charge, there are pro’s and con’s against raising or lowering. What I really object to is the constant changing.
Every time I prepare a business plan with listing, selling fees, post, packing, labelling and stamps all taken into consideration the rules change yet again.
When I started to sell full time last year (As a media seller) I had a selling strategy that I would seek to obtain multiple purchases by offering postal discount and cross promoting within every listing. It actually worked really well. Then came along Free postage on dvd, followed by CD’s. Well the supposed Bulk editing tool doesn’t work, so I have spent hours manually changing over 1,000+ listings. Guess what we don’t get multiple purchase orders any more – what a surprise!
I like many sellers have opened a ‘Bog Standard shop’ as kindly pointed out (No offence taken radams – appreciate your honesty and advice).
Within my own shop I have complete control, which I have to say is incredibly refreshing.
I like many others are feed up with ebays fiddling and fluffing, but put up with it because it brings in the cash. But I’m rapidly reaching the point were I will select my top 100 products and list those and those only on ebay, and list everything else on other platforms.
At this stage of the game I don’t really care if a New change will save me money.
I just want a bit of stability. – Is that so much to ask?
Each seller is individual with individual needs. I tried my own website but found it easier and more profitable to sell on eBay. I have substantially greater sales on eBay, all my SEO is done for me, listing is much quicker than writing my website, all told I am happy.
It is just an ancilliary business expense like any other.
“There are lots of reasons…They’re about feeling in control, not having our accounts closed down because one buyer is cross. They’re about regulation and over-regulation and the way that eBay has, at a stroke and without warning, wiped out businesses that relied upon that platform.”
This pretty much sums up why I scaled down my ebay presence, fees don’t really come into it at all. I won’t be selling anything again on ebay until the postal disputes have been resolved, but after then I will only have at most a small number of listings, as a customer acquisition tool.
Amazon as a platform is very exacting on behalf of the end customers too, but I much prefer it these days. I know where I stand, it doesn’t constantly chop and change and is very easy to maintain (and to put listings on holiday if necessary too).
Frankly, I sold a lot more when listing fees were higher and FVF’s were lower. The higher listing fee eliminated a lot of the junk on the site. I would be a LOT happier if Ebay stopped manipulating sellers – evened the playing field and got rid of that stupid stupid best match search!! What’s it gonna take to lose that big fat loser? Unclutter the site from all the drop down pop out menus and images. As a buyer, they are downright annoying! Who is running the show over there these days…Bubbles the Chimp?
Ebay needs to learn that fees from a sale is the same whether it comes from a diamond seller or a small seller. They need to grow up and run the site like a business – not some kind of weird competition.
Fascinating poll, well phrased questions and the vote is of interest. No I didn’t vote, I am conspicuously gone so it would be dishonest.
I made imperfect spreadsheets (linked above) of the ‘scenarios’, imperfect because FP vs auction fee comparisons require ‘assumptions’ one of which is that the list price is the sale price. i.e. one bid
As for the rest of it, what Gill said including her quote from Sue. Yeah.
Many of us pay ebay several thousand pounds a year in fees, and because of that we seem to think ebay wants our business.
Ridiculous as it might initially sound they don’t want small and medium sellers.
They only want your customers.
I suspect that most of us use ebay as a customer acquisition tool. That once we have a customer’s email address we are going to try and cultivate that customer to shop at our own online shop.
This is exactly what ebay are doing, but on a much larger scale. Your potential customer is bombarded with advertisements (source of revenue) and through best match, TSR’s and other manipulation directed towards ebays favoured few.
ebay are more than happy to loose sellers, its buyers they want to keep. The whole inequality of Feedback is solely to maintain a happy customer base which ebay can tap into once all the small and medium sellers are gone.
Imagine you are a small to medium sized media seller, selling 100 products every day.
A). Prefer to sell 1 product to 100 customers?
B). Sell 100 products to 1 customer?
OK if you were using option A as a means to acquire customer emails for cultivation. However option B is going to save you a whole lot of money.
Paypay fees will be reduced by 99 x 20 pence transaction fees for a start = £19.80 saving
Post and packing is going to save a bundle and your accounts are going to be much easier to manage.
If I had a Customer B, I am going to give this customer my ‘Diamond’ service. They are top of my Christmas card list.
Now if I take a holiday or get suspended what will happen to my expected daily sales of 100 products?
There will go elsewhere, they will pick another seller. Ebay isn’t going to miss me by a dot.
Now the accountants and mathematicians at ebay generally know how many media products are going to sell on any particular day. Increasing the number of sellers offering the same products is not going to increase the number of sales.
So if you were ebay management would you rather have:-
A) 10 Diamond sellers selling 1000 items a day
B) 100 Medium sellers selling 1000 between them
If I was ebay I would pick A – and guess what that’s exactly what they are doing.
Why do you think ebay are bending over backwards cultivating the ‘Big Boys’, and couldn’t give a hoot about small to medium sellers.
I hate to say it but the days of the small to medium seller are coming to an end. It actually makes better business for ebay to have less sellers selling to the market place than many sellers selling to the same number of potential buyers.
If small and medium sellers were actually important to ebay do you not think they might actually employ people as PS support who know what they are doing, and be less keen to suspend sellers.
Which one of us hasn’t blocked a potential buyer because they are potential grief?
It’s all a matter of scale – Get ready to be Blocked
Have a nice day!
“So if you were ebay management would you rather have:-
A) 10 Diamond sellers selling 1000 items a day
B) 100 Medium sellers selling 1000 between them”
Of course the sensible answer to this question is “I’d rather have both”
If ebay continue down the line of that risky strategy (shedding small/medium sellers in favour of very large ones) I forsee a day when it’s ebay bending over and taking it right up the a$$
ebay could end up being at the mercy of the diamonds who will dictate terms.
A poster on one of the other threads on Tamebay speculated that what the ebay corp are actually trying to do is get more diamonds used to Paypal purchases to increase Paypal’s revenue. They are indifferent towards ebay’s long term future at best.
The way they are seemingly, dogmatically pursuing their current stance towards ebay’s marketplace this theory makes sense to me.
As long as small and medium sellers continue to diversify – by selling on different venues – and gradually decreasing their presence on eBay (or quickly if they aren’t making as much money anymore) they should be ok. If you really want to be vengeful – shun Paypal on your on your website in favour of Moneybookers or Googlecheckout 😈
Shedding small and medium sellers is the reason eBay is seeing declining sales for the past year.
eBay fails to look at their own registration information and analyze the information they already possess.
It is no secret that many small & medium sellers maintain separate buying ID’s as well as multiple ID’s. As such, S/M sellers ranked among eBay’s most frequent buyers, with many buying more than they sold through the site.
eBay consistently shoots themselves in both feet by turning the cold shoulder to S/M sellers.
As eBay management has continued to insult and assault S/M sellers, those sellers have left eBay, taking their buying volume with them.
How much do the Diamond Sellers purchase on eBay? Nothing, nada, zip, zero zilch.
Diamond sellers simply use eBay to poach buyers to their own websites. Example, one of the first Diamond sellers maintains their own website. They made the deal with Donahoe to sell on eBay and flooded eBay with listings.
Problem for eBay is that the majority of this Diamond Sellers listings are sold for less through the seller’s own website. Items selling with shipping fees on eBay many times ship free on the sellers own website. The listings show the SKU number which when entered on the sellers own site takes buyers to the exact same item, but at a lower price.
eBay is bending over for these Diamond Sellers, charging them nothing to list, and cutting huge discounts on Final Value fees. Remaining S/M sellers are subsidizing the Diamond Sellers with the high fees they are forced to pay.
What eBay gets in return are sellers that are poaching eBay’s remaining buyers while at the same time, helping eBay drive fee paying S/M out of the marketplace.
In 2 years time, eBay will have succeeded in running off the majority of S/M sellers .
Sales will continue to decline as the ranks of S/M sellers continues to thin out. In no time, eBay will be left with the millions of listings placed by Diamond Sellers, and a handful of buyers.
John Donahoe is executing his plan which is designed to make the eBay marketplace extinct.
Of course you would – we all would.
I used the figure of 1000 to represent the fact there will only be X number of sales in any given day.
No matter how many sellers there are the volume of sales will only ever be X
Adding more sellers will not increase sales
Ah, now there’s an interesting thought. I’m not at all sure that number of sales is a zero sum. Arguably, small sellers and the huge breadth of inventory they bring to eBay, bring in a LOT of long-tail traffic – so smaller sellers increase sales on the site.
There’s also evidence that getting buyers to sell a couple of things increases their loyalty to the site *as buyers* – so all those “free 99p private-seller auction” listings could also be increasing sales.
The argument about long-tail traffic works at the moment. Many of our buyers enter our shop via one product line and end up buying one of our long-tail products. Possible a product they would never have thought to search for, but having stumbled across it end up making an impulse purchase.
I have always liked the idea of building in long-tail products into my selling strategies. It the weird and wonderful which made ebay the interesting place it once was.
My concerns are that unless small and medium sellers can compete with ‘The Big Boys’, they wouldn’t be making front end sales and as such long-tail traffic will drop off.
But there again if I really knew what I was talking about I’d be up there with the ‘Big Boys’
if I really knew what I was talking about I’d be up there with the ‘Big Boys’
Well, not necessarily – being a one-person-band is a perfectly valid business decision (goodness knows, I’ve got no desire to “manage people” ever again), so to push for astronomical growth isn’t necessarily the right plan for everyone. Perhaps you can excel in a tiny but utterly specialised niche, which won’t make a huge company but would make a nice living for you.
Is eBay the place for that? It used to be. These days, you’re right, they are certainly more interested in the big business, the outlet seller, the high street chain and its clearance items. I still think that there is room for smaller sellers within that. We may not be able to compete on price, but we can compete on specialism, on personality and on customer service.
eBay buyers are a funny lot: they want to be able to buy from Argos at reduced-from-Argos-catalogue prices, AND at the same time get a one hour response to their email. We can’t offer them the first, but we can offer the second and for some of them, that’s more important.
We live in a society that knows the price of everything and the value of nothing.
One day it will come back to haunt the entire retail industry.
If you have a spare few minutes take a read of this article.
The Wal-Mart You Don’t Know
*steps off soap box*
I’m with you on the no desire to “manage people” ever again.
Also agree that astronomical growth isn’t necessarily the right plan for everyone. I sell on ebay, Amazon and my own shop. Because of age, health and other factors I have no desire to have a turnover above the current VAT threshold of £68,000
Trading brings in enough to top up other income and I live a comfortable – not luxurious but a comfortable life.
The VAT threshold is my maximum trading limit and as such I look to get the best return on my investment whilst staying below that figure. I used to enjoy the personal one to one exchange with customers and still do, but the number of fraudsters and complainers seems to have increased way beyond sales. Whenever I open an email with the first line “Before I leave feedback…..” my heart sinks, and I think here I go again.
I have a regular returning customer base of around 5 to 10%, who are now being invited to my own online shop. These are good old trusted customers – exactly the sort of people I enjoy trading with.
Just finding it hard and harder to work up the enthusiasm to list on ebay, when every new policy change or fee restructure creates hassle.
Ebay may well still want to keep small and medium sellers, but it sure doesn’t feel like it.
I got so aggravated midway though the eBay survey that I just quit. After 10+ years selling on the platform, I got the gist of where they were going right away.
I don’t want to be one of those “eBay used to be…” people, but eBay used to be…
1. a platform that was egalitarian for all entrants.
2. a platform where one could effectively analyze performance and make calculated decisions about moving a business forward (without having the boundaries revised constantly)
3. where search was straightforward for both buyers and sellers
4. where feedback had its flaws, but was balanced and allowed both buyers and sellers to make decisions on interacting
5. where the level playing field allowed consumers choice, and a motivated seller could create a meaningful business
6. where sell-through didn’t bounce around based on changing search algorithms
/Off soap box and on to the topic at hand.
Fees had never been an issue for my business; I always worked them into my prices. Sell-through is the key, and I can’t compete if potential customers can’t see my items.
My sell-through was a consistent 66-77% for years (with excellent customer feedback); and when Best Match and other changes came around, it now hovers around 17-20%. Same seller, same policies and procedures.
I offer about 35% of my items on eBay now; with better sell-through I would offer lots more and fees would be a non-issue. I used to have an active Trading Assistant business – labor intensive, but profitable. I’ve closed it entirely.
Bottom line: if fees were lower I would list more as a test. But it’s all predicated on sell-through, and that’s based on search.
The “cost of doing business” on eBay is much more than just the insertion and final value fees. The cost also includes the time and trouble to deal with the difficult eBay customers and the glitchy eBay system. And having to constantly change your selling strategy every time eBay makes changes to search or fees or implements policy changes is rather expensive.
It’s a very good point, TBN – *time* is a thing that eBay sellers very often forget to cost in, and eBay take for granted. It’s worth taking stock every so often just what you’re earning per hour you put in.
About a £100 at the last count 😀
Sue, what gets me is that eBay specifically tells sellers that they cannot include the cost of their time, or their employees’ time in terms of wages, in the shipping and handling charge billed to the customer. So, eBay expects sellers to ship “in their spare time” … and to do so VERY QUICKLY?
I copied from the eBay.com website the following
“Related fees: Things like gas, mileage, time spent at a carrier, employee wages, or eBay and PayPal fees should not be added [to shipping and handling costs].”
Not only do most eBay sellers forget to include the cost of their time in any calculation for the true costs to sell on eBay but there is an opportunity cost incurred. Every time a seller has to change the wording in their listings to comply with new policies or change any number of things as part of a strategy change necessary to remain competitive on eBay, the seller loses the opportunity to develop their business outside of eBay which then puts the seller in a weaker position, even more dependent on eBay and subject to the effect of eBay’s whims.
“Every time a seller has to change the wording in their listings to comply with new policies….”
Sadly that is something that sellers have largely bought upon themselves. In my view an item description should be – well an item description. It’s not the place for things like shipping costs and never has been. It’s also not the place for terms and conditions or additional information.
Firstly buyers never read that stuff anyway. Secondly more sellers have quite frankly rude and obnoxious T’s and C’s than have reasonable ones, largely caused by trying to prevent a reoccurred of every customer service problem they’ve ever had.
Finally if you leave a description as product info only and use the boxes eBay provide for shipping, returns policy, additional information and of course if those spaces aren’t enough the Business Seller inserts then you’ll never have a problem bulk editing listings in seconds.
Sadly that is something that sellers have largely bought upon themselves. In my view an item description should be – well an item description.
Unfortunately eBay does not share the same view. See announcement http://www2.ebay.com/aw/core/200901081220082.html :
“The following text, or very similar wording, must be included in the listing and be prominently displayed (in the upper half of the description, free-standing, etc.)”
That in no way describes the item. But if sellers followed that rule and eBay later does decide descriptions are just that (surveys have shown this was once on the table), can you really blame sellers for that one?
Interestingly I experimented listing an item with no description (only using pre-filled info) two weeks ago. The item sold for over double what everyone else was asking and after only 8 pageviews. I tried to sell exactly the same thing years ago and failed many times.
The killer with eBay is the final value fee and the paypal fee as a seller. These are why I stopped selling. The insertion fee is nothing. I used to always start an auction at 99 cents. The fee is lower.