Friday, March 14, 2008

Are eBay's Changes Working?

It is really too soon to tell if eBay's changes will improve things over the long-term but Scot Wingo of ChannelAdvisor has been looking at the data and he says it looks good. "The results have been very profound, measurable and positive." says Wingo.

"First on Feb 20, conversion rates started a nice climb - especially for those sellers in the media categories that previously couldn't justify gallery. By our calculations many media sellers saw conversions increase 2-5%.

Then the media+fixed priced sellers started listing a little bit more. That saw some increased sales, and then sellers increased listings some more and that cycle is still continuing.

Then on March 3rd when eBay rolled BestMatch we saw an even larger and more across-the-board conversion bump. We've got some sellers seeing a 10-20% increase in conversions. I haven't seen anything this dramatically positive on eBay in a LOOOOOONGGGG time."


This is a huge bit of information coming from someone who has access to the data.

A healthy eBay marketplace is beneficial for all involved, so if these positive signs, that Wingo is seeing, become a reality long-term, then sellers should be very happy. If eBay's changes improve the marketplace, how could that be a bad thing?

eBay announces Q1 08 earnings in mid April so it will be interesting to see if their data shows the same improvement.

6 comments:

Tony P. said...

Thanks for sharing this, Randy. If Wingo's figures are correct, it confirms which arena benefits from Best Match - Commodities.

"If eBay's changes improve the marketplace, how could that be a bad thing?"

If I was to state, 'Collectibles be damned!', it would convey what many sellers feel are the downside to all the changes. The marketplace may prosper with these changes, but it does so at the expense of the "Fun and Magic" items.

Take a look at Medved's March STR and you'll notice a barely perceptible increase around the 3rd - perhaps 7%. From that point, for the next 3 days, the STR fell approx. 21%. I'd say that is one step forward and three steps backward.

However, during all of that time the Media/Commodity items may have been selling at 10% better, for each and every day! Hells-bells, they may be at 100% STR right now. So what? The ebay of the future may be a media-only Amazon look-alike, that's what.

I suspect that most of those media sellers have the same frame of mind as Donahoe - push the 'crappy flea market' items off the site. Those items don't bring in the 'real customers' to ebay. A buyer that purchases an old piece of chit (antique, ugh!) isn't interested in a DVD of a 2007 movie. etc etc

There are no large data points for those Collectible items - most are sold by a multitude of sellers and therefore no single, BIG seller can point at their metrics and say "Hey, antique buyers also buy DVDs, CDs, etc." Of course, ebay has that data, which makes some folks wonder just what the heck they are thinking.

sumthin' to tink about, man... all of the mega-sellers make up one-fourth to one-third of ebay's entire revenue, the rest comes from the sellers that experienced that 21% drop in STR. We may not have anywhere (viable) to go, and we certainly don't have a central voice like the mega-sellers, buy we can't keep throwing money away.

On the bright side... as we leave, taking our Best-Matched-hidden crap with us, those hot-cake-selling media items should make for an impressive STR for ebay to flaunt!


(not a rant @ you, Randy. just a pissant screaming at the deaf ones.)

Anonymous said...

If one seller sees a 10-20% increase in sales, some other seller is selling 10-20% less.....

Randy Smythe said...

Tony,

You make some very valid points and also indirectly promote my eBay Classic idea.

Commodities are the growth area for eBay, they realize it and are moving in that direction but they don't have to throw the baby out with the bath water.

I've complained for years that they need to look at each vertical on the platform in regards to fees, well it is now time for them to look at each vertical in regards to platform.

The problem is they are aggregators and don't want to micromanage verticals.

I think there are solutions to solve these many problems without killing of any one segment of the site. Unfortunately, they don't listen to me.

So if you are correct, they will sacrifice one segment of the marketplace to make the other segment healthy.

I think that is shortsighted.

Randy Smythe said...

Anonymous,

I eBay's mind the seller who is seeing the decrease is a bad seller so they don't care.

Unfortunately that is not the case so once again the dolphins get caught in the net.

Anonymous said...

"Anonymous said...

If one seller sees a 10-20% increase in sales, some other seller is selling 10-20% less....."

This would be true if every single buyer had a fixed amount they're able to spend, and there's no such thing as impulse buys.

If Best match is working, then more shoppers will find what they're looking for, and quickly, instead of going to another venue. Shoppers may purchase more than they previously would if they're presented with multiple appealing options.

That said, if you aren't optimizing your titles for best match, be prepared to see a decrease in conversion rate as the sellers who do eat up your potential sales

Billoment said...

To Tony et al.
I deal in hobby items only and the following I left for Scot on his Blog:

Well Scot, so far it has been an interesting Q1. So far for this year January sales were up 15%, February were down 9% but March is blowing everything away. I passed the sales total for March of last year on the 10th. Right now for March I am up over 32% and it is only the 14th. Is this because of the changes? That could very well be the cause but I am also getting a lot more International sales than usual obviously because of the great exchange rates. People overseas are finally waking up to the fact that their Euro, or whatever they use, is buying a lot more regardless of the shipping cost. That is also another factor that you have to put into the equation. As always a little blip does not make a trend. We will have to see how this plays out in the next few months. I feel though that the Best Match definately has something to do with it.

Bill