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eBay: “38% of sales come from a few top sellers”

By Dan Wilson August 30, 2011 - 8:22 am

eBay’s “level playing field” is now officially dead. Big retailers, sellers with a £1m turnover and those who form part of the “few top sellers” who deliver 38% of eBay sales are now priority, according to eBay executives.

Many eBay sellers will say that this is hardly news. And they’d be right. But finally, in the past few days, interviews and press releases from eBay have clearly confirmed a strategic focus on the very biggest of eBay sellers.

Clare Gilmartin, the Vice President of eBay Marketplaces is reported as saying: “Figures show that 38 per cent of sales come via a few top sellers. We work closely with these firms to ensure they have the support they need, for example, dedicated account managers and other help.”

For the vast majority of serious eBay sellers, even those who sell several hundreds, or even thousands, of pounds worth of goods every week, this committment may be surprising. No Gold and Silver Powersellers have account managers at eBay. And of those we’ve spoken to lately, few Platinum Powersellers even enjoy the rather meagre privilege of access to a dedicated, knowledgeable, named eBay account manager either.

I have personally spoken to eBay sellers in recent months who spend thousands of pounds in fees every year but don’t have access to a dedicated account manager at eBay who is willing to speak to them and help them solve a problem.

Any business turning over a few hundred quid’s worth of trade on eBay should be not ignored. But all the anecdotal evidence I see shows that such businesspeople, the lifeblood of eBay, receive (at best) cursory care from the the very people who take their fees.

Further proof of the focus on uber-business sellers was clear last week when eBay executives celebrated the 159 eBay sellers with a turnover of one million pounds annually. eBay director Angus McCarey provides glad words in his interview, but anyone with experience as an eBay seller of late, especially below that now all important £1m level, will certainly wish to beg to differ with him.

The tragedy of eBay’s love affair with the biggest sellers (and often the worst), is so ironic, as to be comedic. Amazon do it better. There should be room for everyone in the world’s biggest marketplace but to worship big retailers is to forget what smaller retailers deliver better than a faceless giant.

What price personal service, great prices and sheer swiftness? These are all things that Britain’s small businesses all provide on eBay. And which many buyers, such as myself, are now finding more easily on Amazon and direct from sellers’ own ecommerce sites.

eBay will die if it ignores the small sellers that built it. And one question is still begging: “who are the ‘38%’ sellers?” We should be told who eBay favours the most.

Update: 31/08/2001, 11:00am eBay have asked us to point out that the original quotation from Clare Gilmartin regarding eBay has been changed on the FMWF. It now reads: “Figures show that 38 per cent of sales come via our Top Rated Sellers. This is an eBay term which is given to those sellers, whether tiny or larger, which have achieved the gold standard for customer service.”

  • Glenn
    10 years ago

    Ebay really are incredibly stupid.
    38 % of sales comes from a few top sellers = 62% of sales comes from the rest of us and we are getting well and truly cheesed off.

    38% will almost certainly increase as the rest of us look at other market places

    Those of us that form the 62% have made ebay the success it is. If we start leaving I’m sure that buyers will follow.

    By way of example when I started trading I sold approx 90% on ebay and 10% on Amazon. That ration is now closer to 70 / 30 and I’m trending more and more to Amazon.

  • 10 years ago

    It has been apparent for several years that eBay are no longer interested in the small or medium entrepreneurs (SME’s) Even prior to the departure of Meg Whitman the move was away from those that helped build eBay to the large national and International company it has become.

    Even in the early days of eBay.co uk the company never placed any significance on its customer service. It was quite happy to send out press releases publicising small one man or woman eBay success stories but did little else to help them.

    There was a time when you could not go into any post office without finding yourself behind an eBayer with parcels galore to dispatch. Now it is a rare site. I personally doubt if it is possible today for anyone to start a small home based business just selling on eBay and succeed.

    Further to Dan’s comments I would question how long eBay will retain the auction format as an option. I can see the day when it will be all Buy it Now. If this does happen I suspect eBay will be played off the park by Amazon

  • 10 years ago

    I have an account manager who..

    never answers the phone

    responds to emails as she is leaving the office so conversations are never fluid

    deliberately side steps the actual question if it’s in anyway anti-eBay

    all in all, for those that don’t have one I wouldn’t waste much sleep worrying about it.

    • 10 years ago

      Spot on. I rarely got an aray of account managers to understand a question let alone come up with an answer

      The quickest and fullest answer I ever had was when I sent my last question and got a swift and detailed reply explaining that I no longer qualified for an Account Manager…

      Having said that I will never be able to truly criticise ebay as without them I would never have had my own business which thus far has kept me with a good supply of beer tokens for almost a decade

      Bryn

  • Mark T
    10 years ago

    This comes from the very top.

    It will not change unless the leadership changes.

  • Gary
    10 years ago

    And what percentage of ebays earnings are generated by the 38%?

    Under 20% maybe?

    Surely its about earnings not turnover or am I missing something?

    ebay surely earn more from the 62% but appear to reward them with little by way of service in return.

    • Terry
      10 years ago

      Sorry to says its about turnover, If you sell on ebay, you will never make decent profit margins unlike ur own website.

      Ebay buyers buy on ebay as its cheap, its all about the race to be be the cheapest which is so very wrong, you can turnover a millon and make very little profit, whats the point?

      Ebay and profits dont fit very well.

      Theres an old saying “you get what you pay for” – buy cheap and get cheap products and poor service.

  • malclolm
    10 years ago

    The time will come when a site is set up to compete with ebay. When this happens, the value of ebay will tumble around their ears.Once the value of their shares start to fall, investors leave and they wonder what have we done wrong.To late the small mans long gone else where.

  • 10 years ago

    What I find interesting is that eBay have been traditionally secretive about how many PowerSellers there are at each level.

    Sellers with a turnover of £1m annually or more roughly equates to the Titanium PowerSeller level of £95k sales per month.

    We now know that there are roughly around 159 Titanium PowerSellers in the UK based on sales value. (There are probably more based on the relatively newer criteria of 5000 items/month)

  • 10 years ago

    To me a customer is a customer, no matter how much they spend. If you treat them right they will come back, as its easier to bring back a returning customer than it is to find them in the first place.

    I’ve noticed that eBay think very differently. Last Christmas I was supprised to see that eBay sellers who have had the same listings live for months or even years get more feedback than me. So going by the feedback score they would have had more overall sales.

    As I was relisting every 30 days I was very disappointed, but what I’m trying to say is going by my point above, eBay seem to fix everything anyway and are a con. I sell on eBay so I can promote by website my adding a flyer in every delivery. To me eBay are a good way to source customers and promote my website.

    Do I care if eBay survive, what do you think?

  • Chris
    10 years ago

    It is an undeniable Law. Todays biggest Sellers were themselves once small sellers. The biggest Oak Tree started life as an Acorn. Several of the UKs biggest retailers started life as a Market Stall. So while it may look attractive to the current ebay Management to give the biggest, over £1 million per annum, Sellers All and the rest nothing it might not be sensible in the long term.

    There is another point The biggest sellers do not themselves stay at the top for ever. On just about every High Street there is a hole that was once occupied by Woolworths. They went bust. In the long term there is no guarantee that todays biggest sellers may not follow them at some time in the future.

    What ebay should be doing is to give every seller a fair crack of the whip. Obviously the largest sellers generate the greatest income for ebay. But as has been pointed out they generate 38% which leaves 62% from the rest. It should be possible for ebay to arrange itself that it gives a reasonable service to all the sellers and not just the selected few.

    • rooftop
      10 years ago

      Ebay needs buyers beside sellers , from a buying perspective , is it better to have a customer who sell 1,000 items a day and only buys one item a day or a 1,000 customers who only sells one item a day but each of the 1,000 customers also buys one item a day ?.
      In the longer term for sales , it is better to have millions of small sellers who also buy than having a few really larger sellers who hardly ever buy anything .

  • Glenn
    10 years ago

    According to my Omniture traffic data many of my customers purchase a different product to the one they first looked at when entering my shop. The data also suggests that many customers spend 5 or more minutes viewing my products before making any purchase and return regularly.

    The point I make is that many potential buyers like to browse before making any purchase. Now it may well be that one of my potential customer’s looks at one of my products but buys from one of my competitors and vice versa.

    By following this chain of logic it is highly probably that potential buyers enter eBay looking at the products of a SME but buy from one of eBay’s chosen 38%

    Now if eBay fails to support the SME’s and they take their business elsewhere it’s highly probable that potential buyers will also take the browsing and purchasing habits elsewhere.

    Ebay as a whole needs to appeal to all. Focusing on the 38% and their fast sell products will reduce the appeal to many buyers who like to browse the site and purchase on impulse.

    Ebay needs SME’s and their long tail products to retain interest in the site.

  • joe small
    10 years ago

    Ebay has kicked me in the teeth for the last time!!Yes I am Joe Small the guy who built Ebay !! In this time of economic disaster Ebay should be helping the world instead of tearing it down!! President Obama should rink Ebay and Paypals neck!Stop spending your hard earned $$$$ at Ebay NOW !!!!!

  • 10 years ago

    Great news for niche marketplaces then?

    🙂

  • 10 years ago

    A quick ‘strawpoll’ here, says that many people deliberately buy from SMEs and actively search out the ‘little guy’

    I would think this is a growing trend as, counter-intuitively, alongside lower disposable incomes, exists a thoughtful consumer for whom price is not the be all and end all. This is particularly obvious in the burgeoning craft sector and I could also cite fresh produce as another example where quality & provenance is more important than saving 5p (to some consumers)

    I know this sounds strange at first thinking – we have less money than ever, but we are deliberately choosing a supplier that seems more ‘valid’ and more expensive? Perhaps it is to do with control: ‘We can still choose where to spend it’

    I can’t validate these observations, beyond a very small sample, but I do feel this is the way the wind is blowing 🙂

    eBay, with all their amazing trend forecasting, evidently know better!

    Georgie

  • Trouble with “big” sellers is it’s all so much “more of the same”. They basically sell the same tat that you can buy on the High Street. That 62% is where the “variety”, the “different” and the more “obscure” is. Trouble with mainstream is you have to compete with some very very big boys, and we all know what that leads to: price wars. Good for consumers maybe, but not good economically and in the long term for all concerned.

    In some ways I blame the likes of myself (in part) who was one of the people who brought a mass market “new” product to eBay, the High Street (and other online venues) noticed it happening and thought “we should maybe have some of that”. Took a long time to get to where it is now but that’s another story.

    When I was a kid I used to love to poking in the secondhand shops of Brighton, you could take in a load of books, get credit against them, buy another load of books …. There were unusual record shops, junk shops, market stalls …. A large part of the experience was the “looking”, you always ended up buying something, but it’s all gone now, it’s replaced by sterile looking chain stores all selling the same old “tat”, and of course that’s what happening to eBay. eBay is a place to find something different, but it’s going the same way as those shops I mentioned in Brighton ….

    • 10 years ago

      I would dispute that all the weird and wonderful shops in Brighton have ‘gone’!

      Bryn

  • Richard Lane
    10 years ago

    eBay have and always will do what they believe is best for eBay and it’s shareholders. There is no emotion, no community, they don’t care about individual sellers, and quite frankly anyone who thinks they do must be living on another planet.

    Tbe good old days of eBay aren’t coming back anytime soon, get use to it. eBay has for the last few years gradually turned into little more than another shopping portal for big players, and it’s going to get worse. The introduction of the Catalogue system will be the final straw that breaks the vast majority of it’s smaller sellers. If you’re not the cheapest offering the best service you’ll die on eBay within the next few years. You can’t fight it so don’t even try.

    If eBay is your main venue start looking elsewhere NOW! before it’s too late. The most obvious move is having your own site, blog, mailing list, facebook, etc.

    Don’t believe me. Take a real step back and look at how eBay is doing things now compared to just a year or two ago and you’ll hopefully see eBay for what it has evolved into and the way it’s going, open your eyes a bit. Start working for yourself again rather than being dangled like a puppet dancing to eBay’s tune.

    • Chris
      10 years ago

      I have a horrible feeling that you are right. But I also thought about one very serious critisism of Politicians. That is Short Termism. In the Politicians case its whats going to have an effect by the Next General Election. Anything that involves planning for the Long Term is out of the question.

      I find myself wondering if that is a large part of the problem with ebay today. Ebay and the Big Players are only looking at the bottom line for the next quarter or half years figures. When I mentioned above that the small sellers(the acorns) can in a few cases grow into the Big Players(The Oak Trees) of the future.

      But there have to be policies that is sympathetic to that happening. Of course the current Big Players do not really want the current small and medium sellers to grow into tomorrows big players because it could very well be achieved by taking volume of the current big sellers. In ebays case they are just happy to take the fees and percentages and are not really that interested which name is providing them as long as ebay gets the benefit.

    • Richard Lane
      10 years ago

      Chris, ebay have stumbled from one quarter to the next for many years. You only have to look at the timeline for the various changes to see that. Too many folk trying to justify their jobs and coming up with all the various changes and crackpot ideas.

      With perhaps the exception of some of the collectables/antiques sellers, most on eBay are really struggling on price, I wonder how many people are selling at a loss in a fairly big way just to get cashflow? I suspect it’s quite a high figure.

      Never has the advice to not have all your eggs in one basket been more apt. If you’e struggling on eBay now, it’s only going to get worse, do something before it’s too late.

    • Chris
      10 years ago

      Of course you are right. The very same problems exist right through Britain and ebay. Short termism at its very worst. Nobody really interested in planning for the long term future only trying to come up with justifications for their own job and often items to put on their CV because they do not expect to be round long enough for the brown and smelly to hit the fan because they have not though through properly the effects of their actions.

      In my case I have a long term ambition to sell my accumulated stock and to retire. So your good advice about “not putting all my eggs in one basket” do not really apply to me. As soon as I get to the stage where all or most of my stock has gone I’m out of here. I have ideas for the rest of my life and you will not be surprised to learn that ebay actually forms no part of it.

  • Cassie
    10 years ago

    I am only a private seller on ebay now – I closed my shop and business account on eBay in 2009 and moved to Amazon and my own website. There are some problems with selling on Amazon, but on the whole they are much easier to deal with and I get far better sales.

    However when I stopped selling on eBay I also for the main part stopped buying too. Now I only go on eBay if I can’t find it on Amazon! Usually for products that have been discontinued, but smaller sellers still have in stock, so I snap up all I can find. This wasn’t a concious choice but I got fed up with trawling through pages of “BIN new” items, which are basically the tat the chains couldn’t shift on the high street.

  • hawkwind
    10 years ago

    It was on the wall when they tried to bring in ebay express and when this failed they thought they could bring it in through the back door.

    And that is what they are doing in my opinion slowly but surely

    fees, my ebay changes and now the motors category is getting it and all the smaller sellers are up in arms.

    All this catalogue stuff is either to do with Google placement or geared towards the biggest sellers and my bet is its the second one.

  • Jimbo
    10 years ago

    Thr clip from the BBC is worth a watch; It would be interesting to see a “where are the now” feature on all the rising eBay supperstars from the last 15 years. I wonder how many companies have been doing million pound eBay turnover for more than five years?

    • 10 years ago

      Give us a couple more years to get to five – we’ve got three in a row so far! 🙂

    • Jimbo
      10 years ago

      And I’m sure you will make it. Well done David 🙂

  • 10 years ago

    Thanks for the vote of confidence!

  • samsmith
    10 years ago

    i just cannot wait untill this basket of eggs fall.

  • Glenn
    10 years ago

    Am I alone in thinking that eBay has had its time and is now on the decline?

    • Jimbo
      10 years ago

      No your not alone. People have been thinking that for as long as I can remember.

    • Chris
      10 years ago

      If you go into the archive and look back over the months and years you will find that many agree with you. What is so frustrating is that the underlying causes of the decline are almost always self inflicted. ebay and its continuous policy of shooting itself in the foot.

      I suspect that if the powers that be within ebay were to listen and act upon the opinions of so many within ebay land that they could still turn it around. Although like trying to steer a Super Tanker it will take time to change direction. But I believe that there still is time but it is certainly running out. If they want to take ebay forward rather than kill it over time they have to start soon.

    • Old Hand
      10 years ago

      eBay has a continuous policy of shooting smaller sellers in the head. Go look up Bain & Co, their origins, their motivations, dig deep. Bain & Co supply the top management for eBay.

      There is a move all over the world to concentrate all kinds of power in to fewer and fewer hands. This isn’t new, it’s been going on since time immemorial but it’s accelerating as technology can be bent to its purpose.

      I’ve been saying for years that eBay is moving to shift profits to corporates in place of small traders, I’m amazed that it need saying and that it still does because it has been so blindingly obvious. Still lots of people who consider themselves business people fail to recognise trends and investigate their cause.

  • Damien
    10 years ago

    I have been a seller on ebay for 5 years plus ..I have 1000 auctions a week and and my sell through has gone from 20% to under 10% in the last 18 month ..my items are increasing and I am offering free shipping and selling at the same price as last year ..still no sales …why ???????

    • Old Hand
      10 years ago

      You need to inform yourself, spend some time, dig deep and find the evidence. No one else can tell you for if they did you would call what they say preposterous.

    • Gary
      10 years ago

      Even allowing for a reduction in consumer disposable income it is claimed that internet sales have risen. Maybe you have to review your business model, marketing, and the competition?

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