28 July 2006
Sellers can boost profits on eBay with high shipping
If you are currently a seller on eBay, for certain categorires (e.g. computers, electronics) building your profit in to the item cost can be dangerous on common goods. Your sell through rate will plummet. Many sellers utilize the strategy of low item price and high shipping. The eBay reprot out of Berkeley supports the idea that a buyer will look at an item with lower starting price more. More eyeballs = more sales. Many sellers engage in excessive shipping mostly to compete in a crowded marketplace like eBay. The savings on listing and finaly value fees is mostly a side benefit that helps, but is not the main motivator.
Labels: eBay
23 July 2006
Trust & Safety: Excessive Shipping Policy Update
eBay is going after items that fall under "egregious" shipping. The next step is to define the "grey" area -- what is black vs white? Since eBay has not stretched the definition of "excessive" yet, eBay can not be proactive in ending listings that violate policy. The first issue is that eBay no longer is a "venue" status if they proactively end listings. It'll be interesting to see if eBay will be proactive in this way.
In my opinion, "excessive shipping" is unique to each category and subcategories. If eBay wants to enforce this policy, perhaps eBay could sysmetically analyze the top 10% of items that meet the "excessive shipping" policy. Take a look at the shipping calculator figures (e.g. weigh & handling amount). While this data is not complete, eBay could use this data to determine what is "excessive" for that subcategory. The dollar value would be a rolling average, say over 6 months. eBay could diligently work to bring this average down over time. If the average decreases, then they know they have effectively reduced "excessive" shipping in the category. I like this idea because the "excessive shipping" value is unique to each subcategory. This also provides customer service a concrete dollar value to determine if an item is considered "excessive". Of course, all a seller has to do is increase the "weight" of their item to avoid this loophole, but let's see if eBay will have a clever counter for this.
In my opinion, "excessive shipping" is unique to each category and subcategories. If eBay wants to enforce this policy, perhaps eBay could sysmetically analyze the top 10% of items that meet the "excessive shipping" policy. Take a look at the shipping calculator figures (e.g. weigh & handling amount). While this data is not complete, eBay could use this data to determine what is "excessive" for that subcategory. The dollar value would be a rolling average, say over 6 months. eBay could diligently work to bring this average down over time. If the average decreases, then they know they have effectively reduced "excessive" shipping in the category. I like this idea because the "excessive shipping" value is unique to each subcategory. This also provides customer service a concrete dollar value to determine if an item is considered "excessive". Of course, all a seller has to do is increase the "weight" of their item to avoid this loophole, but let's see if eBay will have a clever counter for this.
Labels: eBay
20 July 2006
A Message from Bill Cobb: Resetting the Balance of the eBay Marketplace
Bill Cobb, President of eBay North America, announced last night that the eBay list fee for Stores and Final Value Fee (FVF) will increase. Final Value Fee will be 10% effective August 22, 2006 for items $0.01 to $25 with a lower FVF as the selling price increases. According to eBay, a seller "will experience an overall fee increase of less than six percent, based on our analysis of all June [2006] selling activity."
I would not be surprised if eBay in 2007, raised their fees again to bring them closer to Amazon's 15% Marketplace commission. But that will take at least two years I think.
eBay wants to encourage the use of core features (auctions, auctions with buy it now, and fixed priced listings) with this change. But all this change will do is reduce the number of Stores items listed. If eBay wants to increase core listings, reduce the listing fee.
Our strategy going forward is to remove Store listings that have not performed well. If we can remove 60% of our total inventory, we will break even on the new insertion fee. We will also have to increase our prices to reflect the new FVF.
Its getting to a point where eBay is pricing itself out of the online marketplace and buyers can find a better deal elsewhere.
I would not be surprised if eBay in 2007, raised their fees again to bring them closer to Amazon's 15% Marketplace commission. But that will take at least two years I think.
eBay wants to encourage the use of core features (auctions, auctions with buy it now, and fixed priced listings) with this change. But all this change will do is reduce the number of Stores items listed. If eBay wants to increase core listings, reduce the listing fee.
Our strategy going forward is to remove Store listings that have not performed well. If we can remove 60% of our total inventory, we will break even on the new insertion fee. We will also have to increase our prices to reflect the new FVF.
Its getting to a point where eBay is pricing itself out of the online marketplace and buyers can find a better deal elsewhere.
Labels: eBay
05 July 2006
Summer Slowdown Is Time To Recharge Your Business | Jun 5, 2006 | Small Biz Resource
Our business will not pick up until August/September. Until then, I have utilized some of the tips in this article to improve the business. Reviewing inventory is a big task for us so that will be where most of our time will be spent. Hope you find the article useful.
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