Wednesday, August 27, 2008

eBay Scores Twofer on Doughnuts

That's a negatory good buddy
Just when you think eBay has scored an own goal so many times that the game is over they pull the rabbit out of the hat and do it again.

This time eBay has managed to alienate two completely different groups of sellers, at one stroke. Way to go guys! Doughnuts all round from media and clothing sellers.

What is the cause of the kerfuffle and precisely who is in a state of discombobulation? Remember the listing insertion fee decreases in February with the concurrent adjustments to the Final Value Fee? This is the same play.

There are some differences. The changes are deeper, deeper is Bayspeak for 'more'. We have the decrease in insertion fees and extension of listing duration which could be beneficial if it were not tied to a 'rebalancing' of the Final Value Fee.

Back in February it was an adjustment, that didn't fly. Six months later we are calling it rebalancing and that will not fly either. Its an increase.

Once again it is take it or leave it time for sellers in the USA. eBay said earlier this year that the USA would never be PayPal only. When eBay moves to an all electronic payment marketplace later this year it will effectively be PayPal only because the only alternative offered is not a viable alternative. Propay carries an annual subscription and a higher rate. I covered this back in May.

Here is the official word from the 8/20 Announcements workshop discussion thread.

"eBay will offer several other electronic payment options in addition to PayPal, namely ProPay to start, with more electronic payment providers to be added in coming months. Google's and Amazon's products and services compete with eBay on a number of levels, so we are not going to allow them on eBay."
Take that Google Checkout!

Y'all come back!

Bonanzle blog


Kevin_T said...

Isn't that revealing:
"Google's and Amazon's products and services compete with eBay on a number of levels, so we are not going to allow them on eBay"

The spin from Ebay since the introduction of Google Checkout, has been that the Google product is unproven, and that Ebay wants to only offer protection to their customers (sic). They have finally admitted that it is all about competition, go figure.

Of course the changes for the media categories don't end with mere price increases. Take a look at the page titled "Maximum Shipping and Handling Costs,
Limits on shipping and handling charges for select categories" ( - while most of these prices are unviable for sellers who want to promptly deliver their items , such as a leather bound antiquarian book which must be shipped for $4.00 or less within the United States (media mail may be viable in many cases but shipping time DSR's will take a hit, and sellers will be punished for complying with this arbitrary pricing) - international sellers listing items in US dollars must also comply with these ridiculous prices as well. I can not ship a book that is thicker than a large letter within Australia under $4.50, most hardcover books I send to the USA cost $15.00 to $25.00 to send - and some heavy antiquarian books MUCH more, but I am limited to offering a shipping option to US buyers at $4.00 or less.

Bizzarrely Ebay thinks that CD's are heavier than books and a CD seller can charge $60.00 to send a lot of 500 or more CD's, while a book seller clearing stock after what Ebay has done to them, is only allowed to charge an incredible $30.00 to ship a group lot of 500 or more books.

Of course Ebay helpfully offers solutions ( :
"What can I do if the maximum shipping and handling costs do not cover my expenses for packaging and shipping?"
Among Ebay's solutions:
"When selling via fixed price, include all or part of the shipping cost in the item price."
"When selling via auction:
* Continue to list your item with the same start price and a shipping price at or below the maximum shipping cost. Many of our sellers have success with auctions, even at free shipping, because their item looks more competitive to their buyers.
* If your actual shipping costs are higher than the maximum shipping & handling cost, start the item price higher to cover your shipping cost. This technique will minimize risk that you will lose money on shipping.
* Move your item to fixed price and include all or part of the shipping cost in the item price.

So Ebay, the consumer's friend, in an effort to contain rampant shipping costs, and while "incenting" sellers to trim their own profits for the health of the marketplace, gives advice that encourages sellers to add their shipping costs into the item price which allows Ebay to simply take a larger slice of fees and receive a commission on the actual shipping costs, a part of the transaction that they do NOT earn a commission on.

The company continues to trash it's own goodwill, as quickly as it trashes the viability of it's customers businesses.


Cliff said...

Hi Henrietta,

I don't think you mentioned the further option of seller's integrating their own merchant accounts into the checkout stream--yes, I realize that doesn't help the smaller and/or part-time sellers, but it is a reasonable option.

I'm going to look into ProPay myself and probably hitch to them if it smells okay. I want buyers to have some options, because I know there are plenty of buyers who won't use PayPal, no way, no matter what.

I can't fault them for not accepting Google Checkout or Amazon Payments (I mean, Amazon isn't taking PayPal) and actually applaud them for admitting the real reason why. This adds to their credibility a little more than saying the competition is unsafe.

Brandon - Thanks for the ProPay link, I hadn't seen that one!

Henrietta, thanks for the post!

Henrietta said...

Brandon said ...
With all of the concerns going around since the announcements of changes at eBay, we are trying to get some valid information out there about our company ProPay.

ProPay will be a new payment option in October. Right now we only offer a merchant account but at the end of September we will be announcing a new special account for our eBay customers. ProPay will charge a small yearly fee, but will provide several services and we will help our customers fight against fraud. We are excited for these changes and encourage you to keep watch for upcoming news. To learn more about features of propay's ebay payment option you can check out this link.

(Link removed Ed.)

August 28, 2008 12:20 PM

Kathleen Harper, Lady Rustmonger a.k.a RustyRosieRiveter said...

Nice. (irony, sarcasm)...

The "venti" (using another euphemism from a marketing-lingo-happy giant corporation) changes are not making my customers happy... the upcoming (if it makes the legal cut) change to PayPal or Credit Cards only has my best customer riled. He closed his PP account when he took exception to having to enter banking information in addition to his credit card number... one has to wonder if perhaps eB-PP are not attempting to control the world's currency altogether.

(well, that is hyperbole but I think the idea of max control is clear)