EBay (EBAY)

eBay sellers have shown a certain amount of unhappiness. Ebay's rivals have had an increase in the number of sellers in recent times. Overstock.com (OSTK), Google (GOOG), Yahoo Store, Onlineauction.com have all reported such increases. While such trends are not fatal, but cumulatively they could do some damage to eBay. <ref>eBays Death by a thousand cuts</ref>

eBay's constant system and policy changes imposed by neophyte CEO John Donahoe are responsible for the steady year/year sales decline the company has been experiencing over the last two years.

With a first time CEO who has essentially no experience as a company leader or as an eBay buyer or seller, changes imposed by Mr Donahoe miss the mark and are driving small and medium sized sellers from the marketplace.

To build a successful business, sellers need a platform that is solid, stable and successful. Under CEO Donahoe, eBay has become anything but. Constant changes to policy, systems, and search, coupled with fee increases serve to make the eBay platform uniquely unstable and inconsistent. The result is an ever increasing numbers leaving eBay.

The problem is compounded by Mr Donahoe's ignorance and disregard for eBay's past. History proves that eBay's most active buyers also happened to be eBay sellers. Constant policy and system changes continue to alienate sellers and as those disgruntled sellers leave, they also cease buying as well.

Mr Donahoe once publicly dismissed unhappy eBay sellers as "noise". The statement fully illustrates the disregard and disdain Mr Donahoe holds for his own fee paying customers.

This alienation and erosion of sellers fully explains why eBay sales are steadily declining while other sites like Amazon have seen consistent and significant increases. Previously Mr Donahoe has dismissed eBay's declining sales on the state of the economy. Mr Donahoe's excuse is no longer valid as eBay seems to be the only online retailer that is seeing traffic statistics decline and gross sales shrink.

The problems at eBay have been created from within eBay and come from the top. The problems at eBay continue because eBay fails to see the site's issues have been self created by a CEO that grossly disregards the essential fundamentals that enabled eBay to become the one time online sales leader.

The company is in desperate need of new leadership and management.

eBay faces increasing competition from Amazon.com (AMZN) and Google (GOOG), with both other companies leveraging their branding and operations to create compelling alternatives to eBay's current model.

By allowing new sellers to list 50 items freely as auctions and not providing the same to store sellers eBay management has again shown how silly MBA school managers at eBay are ruining ebay's best assets ... namely its powersellers and store owners who bring huge value to eBay.

By creating excessive competition for established sellers eBay has effectively destroyed their sales while allowing every Tom , Dick and Harry to list upto 50 free auctions to compete with the established seller.

This has reduced eBay to a dumping ground for retail stock and forced eBay's niche sellers to go out of business in the face of such excessive "free for all" dumping by new sellers.

eBay , I wish you good luck with such brain dead changes. You are going to need it in the near future.

EBay is so intent on mimicing Amazon that they have forgotten who made them successful...the little one person seller. The new l day turnaround rule with a l4 day return privilege is rediculous and just won't work for the majority of sellers. It might be fine for big operations and companys selling, but for the individual persons selling it would be a disaster to have to wait l4 days to have an item returned. Soon the new regulations, rewarding the "big" seller companies over individuals, the total lack of understanding their own strengths are going to encourage their sellers to go to ETSY and other emerging venues. The worst thing is that they don't care.

As a E-bay trader for over 10 years I thought I had seen everything. The first nine years saw very few items not reaching their buyer, but in the last 12 months I have seen over 70 buyers 'claiming they have not received their purchase. Rather than any problem with the postal service I suggest it is greedy dishonest people who pay for the item, claim it hasn't arrived then look for a full refund. They then have the item for free, and despite proof of posting e-bay merely take the word of the buyer resulting in the seller losing the item and the money. I pray for a viable alternative to E-bay.

I was, just 30 days ago, a Power Seller,and a Top Rated Seller. with 4.9 DSR's and a 99.6% feedback score on 1890 sales. In less than 30 days I was down to 99.0% and still 4.9 DSR's across the board. In those same 30 days I was told that I was a Below Standard seller, and would be limited in collecting my funds (temporary hold) 15 days after that I was limited to ZERO sales a month...I was told I was being kicked off ebay and would never be allowed to sell again. (I am still a 99% and 4.9 dsr's Over 50,000 sellers were booted off ebay that week alone An interesting memo leaked out from ebay headquartes telling how ebay had planned to eventually limit ALL non-branded items..if you did not sell "Sony, Panasonic, Nike, Puma, Hewlett Packard, etc." (major brands) ebay would find ways to limit your sales, or find ways to kick you off.....it seems to be working. Donohue is an idiot that needs to go. feebay is a sinking ship and their stock started showing it this week....(4% drop against the dow's record highs, and the Nasdaqs 2% rise. What goes around, comes around. What feebay failes to realize is that if you tick off a seller, or KICK off a seller....chances are pretty high that you have also lost a buyer....I will never buy anything on feebay again...I don't care how much more it costs me elsewhere....Goodbye ebay.....PLEASE make Donuhue go down with the sinking ship,....by his claims....he is the Captain.

They don't care! Smart connect is out of control.

Recent actions against WikiLeaks via PayPal demonstrate bad business judgement and very poor political acumen of EBay. Consumer advocates don't support the pseudo-political activities demonstrated by EBay.

The unique aspect of eBay’s business model that has allowed it to consistently offer security to investors is a pricing model that relies on listing fees.

Listing fees are upfront commissions that a seller must pay in order to have his/her item appear on eBay’s website. As a component of a single sale, listing fees typically account for 50% of the cost to a seller.

However, if an item doesn’t sell on the first auction, online merchants must pay this fee a second time, making listing fees a much bigger factor in the calculation for eBay’s cost.

In categories where eBay has a high sell-through rate, this has less of an impact on its profits. But in categories where the sell-through rates are low, it dramatically drives up the cost.

And a possible change to eBay’s pricing model may force a 20% drop for its shares. De-Duplication And The Buy.com Developments

Recently, two developments have exacerbated the pain of having to pay eBay multiple listing fees:

• Searches now limit the number of items that can be seen by an individual seller.
• Buy.com recently started marketing through eBay’s platform and is not paying listing fees.

Let’s look at each one…

Limited Exposure & Listing De-Duplication: eBay now limits the number of items visible in a search by a given seller to 10. This prevents one seller from flooding the market with his/her items and eroding his/her competitors’ visibility. This category ownership is a strategy employed by eBay powersellers.

But the introduction of Buy.com to the platform forced a rule change, since Buy.com’s business is considerably larger than the $5 million per month power seller who owns a niche category.

With de-duplication, eBay removes items from the same seller that it believes are duplicates. However, this can present confusion in instances when items are similar, but not exactly the same. While de-duplication represents less of an impact to online merchants, it has sellers scratching their heads, asking why they’re paying listing fees for items that aren’t getting immediate visibility.

Buy.com: eBay’s agreement with Buy.com aims to dramatically increase the number of listings on the eBay platform.

This would be great if Buy.com was paying listing fees. But it isn’t - and it’s a fact that initially caused much concern. Since then, it’s come to light that Buy.com is not the low cost provider of goods that results in limited impact on other sellers. In fact, I’ve heard estimates that its sell-through rate is as low as 2%.

This represents the first extremely large seller on the platform and likely also represents the first noticeable point of a change in strategy, where eBay uses one large vendor in a given category to act as an anchor tenant.

Even though Buy.com is not having a material impact on many merchants, the mom and pop sellers are asking themselves why the vendors who helped eBay build its business over the last 13 years are paying upfront listing fees while new large sellers don’t seem to have to.

Real and perceived fraud on eBay is discouraging both buyers and sellers from the service, and has generated legal trouble for the company.