Sunday, June 22, 2008

Break-up eBay Now!

No, its not what you are thinking. I'm not going to write about spinning off PayPal and Skype ... though selling Skype might not be a bad idea. When I say break-up eBay now, I mean the marketplace business.

I'm not going to go into a long dissertation on why this needs to happen, it just does. We all know it, but eBay managers aren't willing to admit it. The gist of the idea is this:
  • eBay Stores have been the red-headed step child of eBay because they aren't as profitable as other segments of the business, yet there are over 500,000 stores/shops worldwide. eBay should set them free --empower eBay store owners and get out of the way.
  • Auctions: I contend that Auctions are dying because of Fixed price being in the same marketplace, many of you disagree. Auctions need scarcity and uniqueness of product to thrive and the concept of auctions is 100's of years old -- It just isn't a high growth business any longer. eBay should set them free -- empower auction sellers and get out of the way.
  • Fixed-Price: A fixed price retail environment is the growth engine for ecommerce and eBay needs to maximize this business, but they can't do it on the same platform as Auctions and they can't do it without spending money. eBay Express was a good idea that was poorly executed from a business and marketing standpoint. It always need to be a separate platform with separate inventory and a huge, well thought out advertising campaign without one mention of the name eBay.

eBay has precious few months, if not weeks to turn this ship around or it will be a painful experience for all involved (employees, investors, sellers and buyers).

eBay Should .... empower sellers and get out of the way!

Just my 12%

11 comments:

Aaron said...

And if eBay was really smart, they would hire YOU as an independent consultant.

Not likely perhaps, but if they did, don't take the job. After all, the only thing less steady than having an eBay business these days would be working for them!

Anonymous said...

OMG they would Griff-ify that boy so fast youd think he was Richard Brewer Hay. No one can resist the power of the dark side.

Plus the $120K don't hurt, either...

ms.pat said...

I have to agree. I deal only in the arts category and that category begs to be auctioned - but in the right way. Sales will slump there when ebay beats the arts listings into its new dead and dry catalog listings. Its already causing the category harm and lost sales with stupid best match...how in the world one can apply it to a group of paintings is kind of beyond me. Result is a few of the big powerseller artists are doing better than ever - but they never needed the push they get from best match. Each has a following they can't completely serve now. The small fry - as with other categories - are pushed to the back. I should get a nickel for each time a buyer has said "I stumbled over your listing - do you list regularly?" No...only every day for the past 10 years :-( So, yes, I agree some auctions are needed....but levi jeans T-shirts, etc. can all be fixed price far as I'm concerned.

www.ACEOart.net

Randy Smythe said...

Aaron,

You don't have to worry about them offering me a job. I just hope they take my suggestion for the sake of the sellers who are left.

Anonymous, I am resistant to the Dark Side!

John said...

Your suggestion is to separate the fixed price format entirely, and give up the 10+ years of branding behind the eBay name and set this up on a new site?

That would be trying to "out-amazon Amazon". That's a terrible idea.

roo said...

Randy,

I agree with you, but you left out some of the other ill-fitted stuff like Motors, classifieds, and real estate. Frankenbay needs to be divided up into it's logical parts.

There was a time when the single platform strategy had synergy. You came to the site for a car part, but found something for your kitty - and then toyed with a time share in Mexico.

But, the one-platform issues are having a strangling effect on Stores and Fixed Price in the face of competition. What is ironic about this is that despite the superior buyer experience on Amazon, the seller experience on Amazon is certainly not advanced or optimal. Amazon is winning the Indy 500 on a tricycle!

Did anyone from eBay respond favorably to the idea of breaking up the site when you spoke to them?

roo

Randy Smythe said...

John, the eBay brand is the problem. Buyers hear eBay and they think of fraud, collectibles and garage sale product. How are you going to really grow a retail site with the name eBay attached to it.

I think they would be better off buying an existing site like Buy.com and turning it into their Fixed price platform.

Roo, eBay mangers don't believe you can separate the elements without killing some business. They are of the same belief as John that it is a dumb idea.

Randy Smythe said...

John,

One more thing about the new Fixed Price Marketplace. The choice they have made now will just end up marginalizing the whole eBay marketplace.

There are ways to make this work, but first they need to be willing to consider them.

eBay's brand is and always will be about the unique, hard-to-find, collectible, or vintage item. They are fighting a losing battle trying to morph it into something else.

permacrisis said...

Remember the 1995 Microsoft campaign, "Where do you want to Go?"

Why not have a splash page at ebay login, asking exactly the same thing.

Or, do like Google's "Im feeling lucky"... two 'Go' buttons next to one search box- one for retail, one for auctions.

Then the Johns AND Randys can both be happy.

"If pressed" I opt for the Randy perception of eBay. Nobody ever said "I'm gonna eBay this" and then put it up fixed price at retail. To 'ebay' means, to Auction!

ms.pat said...

Why can't it be split up but still under one roof....like Overstock?

Tony P. said...

ebay.com
ebuy.com
estores.com


And don't go telling me how the domain is already registered elsewhere! Money bought Skype, less money can buy whatever is needed.

Also, you didn't ask for it, but here's my opinion about the one thing that ebay would STILL need even if they broke-out the divisions:

contract out to Google to design a search engine for the sites. It would be awesome! and if it sucked, we'd be no worse off than we are today.