Tuesday, October 28, 2008

Just One of Those Days!

One very important rule in blogging is to post regularly. If you only post occasionally you won't develop a loyal readership. I try and write at least one post every day, but sometimes I just can't find anything I'm interested in enough to give you my 15%. In fact, today I've started 3 separate posts and lost interest half-way through each of them. Nothing overly exciting. 

So, I thought I would try something different today -- I want to hear your 15%

I'm going out on a limb here asking for comments, so if you don't post anything I'm going to be a little embarrassed. 

Here is the topic of the day: eBay announces holiday marketing plans.

Every year since 2002, eBay has had a coordinated holiday marketing campaign that included television -- some good, some bad -- at least they were trying. This year there is no television campaign, in fact I've not even heard of catalogs or direct mail this year. It appears the extent of eBay's holiday marketing efforts are what is listed in the press release.

If eBay is the place to find new in-season product at 30% or more off of MSRP, shouldn't they be shouting it from the mountain top? Or have they just written off this holiday season.

I'm interested in your 15%! If you think this is the correct approach, tell me why. I you think this is the wrong approach, I'm sure you will tell me why. Please read the press release and give me your 15% on their holiday plans. 

I'll respond to your comments and we can have a nice little discussion.

Update: As a point of comparison here are Etsy.com's marketing plans for this holiday season.

Just my 15%

31 comments:

ms.pat said...

I vaguely heard about something they're going to be starting on Nov. 3. where they will feature items on their front page that offer free shipping and at leat 30 percent below retail. I guess this is between them and buy.com or one of those sellers. They have nothing going for small sellers so I don't have a thing listed with them. As much as they said they love the small sellers - it was yet another outright lie as far as I can see. So, I leave the iPods and X boxes to them...

My opinion on this is....it won't work (yet again). Do they think the retail stores are going to chug along at regular prices while they feature a few sellers who are selling for way less? Nope, I've heard Walmart will be slashing prices and its going to be one big sale after another...and I'm sure the others will follow suit. My humble opinion.

Oh...spent almost a hundred at Amazon just yesterday. Bought direct from them and got free shipping and a 20.00 rebate too. I can't see how Ebay can compete - your opinion on that Randy? :-)

Randy Smythe said...

Pat,

I agree! Amazon is selling stuff at 50% off and you don't have to search for it on Microsoft Live.

There doesn't seem to be any focus. Buyers come to eBay for deal, this is true, but they don't come for new in-season product.

If you want them to do that you have to tell them that eBay has new in-season product. (TV campaign)

Dave White said...

Randy

I think eBay has decided that promotion is the responsibility of the sellers. With much of the marketing and Community departments reduced to mere skeletons, there is no effort at all on eBay's part except for email campaigns. I feel this is the reason for the adcommerce campaign.

Big Box sellers will be doing their own promotions, and the rest of the eBay sellers will be seeing RED this holiday season.

ms.pat said...

Wish I could be a fly on the wall in Donahoe's office. For once I'd love to understand the mentality behind all these changes. I'm afraid the truth would be frightening!

Anonymous said...

Any news on GoAntiques.com, and since they just merged with Worthpoint...there was a blurb GoAntiques.com was starting an antique/collectible internet auctions?
blu

David said...

I haven't seen any proof that FP30 has been a success. If eBay is expecting less revenue this quarter than last, then that means that FP30 has been a complete failure.

Any eBay veteren knows that the items sold in stores were always more expensive than the items in core. The reason for this is because of the high fees.

Now those high priced stores items are cluttering up the core listings, and sellers are forced to raise prices to compensate for the high fees.

btw: eBay has been sending out lots of coupons this month. The old management team never sent out as many coupons.

Randy Smythe said...

Dave,

You have to wonder what all those fees are for then? They don't have enough demand on the site.

David,

Coupons are eBay' preferred marketing approach. The problem with coupons, is that people learn, not to buy unless there is a coupon.

ms.pat said...

Ebay seems to be trying to run its business on the present crop of sellers' fees alone. Its not going to work. They haven't enticed one new buyer on the site and the pool of sellers is getting smaller and smaller...which means less and less revenue for them. FP30 was obviously a desperate measure.

Bob JCS said...

Hi Randy,

I believe that JD is trying so hard to seperate eBay from the rest of the eCommerce pack, that he's forgetting that eBay's original core vision was what set them apart; a venue to find the "hart-to-find" item at low cost; in a manner that was "fun" for the buyer, and more profitable for the seller.

His current vision seems to be to turn eBay into Amazon 2.0, while somehow convincing the buyer that eBay is the better place.

At some point ALL large/big box eCommerce sites begin to look alike. They all begin sell the same new, retail items (IPod or MacBook anyone?), and in their zeal to set themselves apart, they all start to look the same (e.g., color-schemes, cheesy "sales" gimmicks, etc...).

What JD is doing now with the "coupons," etc...is (once again) trying to convince the tight-fisted consumer that eBay (although more and more a clone of Amazon), is THE better place to shop.

What JD needs to do, quite simply, is STOP trying to make eBay the cheapest marketplace on the planet, and make it the most innovative and/or fun place to shop; and stop following in Jeff Bezos footsteps.

The tried and true method of advertising is Television. My sales have been static these past 2 years, so I cannot complain. However, I do recall their "IT" campaign being a BIG sales booster for me. The commercials were quite well written, and I can say from experience, tugged at the heart-strings of many a customer (will anyone forget the little red boat commercial?).

That type of advertising innovation is what is needed. Not "coupons" internet advertising, and other "antiseptic," low-cost means of advertising.

Just my 12.5%

MagnumOpusMusic said...

Hi Randy. Had an intereasting marketing phone call from eBay here in the UK this afternoon. Just checking that I'm aware of their new policies, etc. and Free shipping on DVDs starts in January, do I have any feedback or comments. Oh yes. :-)

Totally against the forced so called free shipping of DVDs, as I've said before many times, eBay is not a retailer it's a service provider. As such and within limits it should not be interfering with how sellers price items. I was told that eBay is trying to beat Amazon (hah good one) by providing free shipping.

Well hang on a minute, who's providing this free shipping? Has the Post Office introduced a new special free service? Are Jiffy bags and labels, etc. being given away? 'cause someone's going to have to pay for it, and guess what it isn't going to be eBay.

If only eBay would to get itself together and do what it should be doing best, the rest would look after itself. A stable site that works right, no more constant changes in the run up to Xmas. outside eBay marketing, etc. Let eBay do what it should be doing the best it can, and let sellers get on with what they do best.

Right now the next two months on ebay look kinda depressing.

Randy Smythe said...

Magnum, you are 100% correct, eBay should enable sellers and get out of the way. Give them options and let them sing or swim on their own. The concept that the eBay buyer is eBay's is actually their biggest mistake.

Forcing "Free Shipping" for DVD's in the UK is also a way to compete with Play.com in the UK but Play doesn't charge as much FVF.

Bob,

I remember those early ads and they worked very well. eBay's drive to become Amazon will just mean that they suck at being Amazon and at eBay as well.

nadine said...

I remember the "IT" campaign because it was the only eBay ad campaign that I didn't find cringe-inducing. It actually highlighted eBay's real strength - the variety of goods on the site.

For many years, I wondered why eBay never ran a commercial showing a husband smashing a mixing bowl, his wife lamenting that it had been her mother's and she could never replace it, and the husband finding the replacement on eBay and triumphantly presenting it? But even when they were trying to be eBay and not Amazon, they never did. The short-lived "IT" campaign was the closest they ever came.

They have certainly never told the buyer about the virtues of the "new eBay," whatever they are supposed to be.

I regard the lack of advertising as proof that eBay management has no confidence in its own strategy.

nadine said...

I checked out the unique visitor numbers at Compete.com yesterday. Amazon is up 13% YoY. eBay is down 11%.

Lisa Suttora said...

Of the 7 different types of customers, the Price Driven Customer exhibits the least amount of loyalty. They will go anywhere for the best price.

Today it's eBay tomorrow it's Amazon, Walmart, Kmart.

Compare that to the Experience Shopper, the Leading Edge Shopper, or the Socially Conscious Shopper who buy for more than just price - they are buying on the experience, the added value, and many things that have nothing to do with price.

Turning eBay into a price driven ONLY marketplace will not foster customer loyalty for sellers. Nor will it foster it for eBay.

All Walmart.com has to do is offer a slightly better discount than eBay and those buyers are 'outta there and on to the cheaper venue.

eBay is now forced to aquire another new group of price driven shoppers.

Acquiring a new customer is always significantly harder than making a repeat sale to a satisfied customer.

When eBay promoted "IT" there was loyalty, there was buyer engagement, as a buyer you KNEW that you really could only find this particular thing on eBay.

Those are the buyers that built eBay into the marketplace it is (or was).

For sellers - trying to be price driven goes against everything that a small, entrepreneurial seller needs to do to be successful and PROFITABLE.

As a niche seller, you should always center your business around adding unique value to your offering, not discounting on price.

Someone will always be cheaper. Of course that "someone" may go out of business the following week, but in the mean time the value added seller just lost a sale.

What grew eBay and what will save eBay is a focus on "IT". Finding things that you can't find anywhere else.

Finding sellers that you can't find anywhere else.

Finding a shopping experience that you can't find anywhere else.

That is what needs to be advertised this holiday season.

That is what needs to be in print, on TV, in magazines, on billboards.

Heck, you can run a time limited promotion and make it an event for "IT" products.

But the key is time limited. Not just one big sale after another.

Retail Merchandising 101 - you cannot compete on price ALONE. It never works.

Judy said...

Fantastic posts, especially loved Bob's, Magnum's and Nadine's. We sold an old Morphy Richards iron to a buyer whose mother had Alzheimer's and had dropped and broken her MR iron and apparently she did a lot of ironing! Where else would someone find a 1960s electric iron? That's what made eBay special.

I think eBay really needs to get away from the 'we're cheaper' mindset and focus on the huge range of items offered on the site.

And start looking after sellers - at the moment eBay AU is plagued with software glitches, plus upcoming big changes to postage charges in several categories which require a lot of listing revising, at exactly the wrong time of year - sellers should be concentrating on selling, not dealing with software glitches and massive editing of all listings.

Randy Smythe said...

Nadine,

To me, their marketing strategy say's we are just get by with organic traffic and existing customers until PayPal can lead the company.

Lisa,

Yep, eBay wants the world's best selection, lowest prices and service like Zappos and Nordstrom.

Ain't gonna happen.

Judy said...

Lisa, brilliant post!

Randy Smythe said...

I've updated the main post to include Etsy.com's marketing plans for comparison.

Anonymous said...

So, Randy, basically you're so out of material that you have to rehash a topic posted on AuctionBytes hours upon hours before your own? Lame.

Randy Smythe said...

Annoymous,

Let me know what you really think. Maybe next time you could sign your name.

Lisa Suttora said...

Here's another problem with this 'deep discount' holiday promotion.

Most sellers source their holiday merchandise months in advance.

In fact many people begin sourcing for the next holiday season immediately after the close of the current holiday season.

Let's say for example, I sourced one of this year's hottest toys at Toy Fair 2008. Toy Fair is held each year in February.

As an online retailer, I'm going to pay the supplier the standard wholesale price at the time the order is written.

I pay the supplier.

I'm now in possesion of the inventory.

I've done my trending research, so I have a good idea of what I will likely make on this product.

Now - I'm planning my own holiday promotions - I'm going to market my product at full price.

I'm going to market to my existing customers, give them first shot at this hot toy.

I have my upsells and cross-sells in place.

But wait! What's this?

eBay is now promoting that buyers can find MY item, that I paid a wholesale supplier full market value for - at a 30% discount!

What?!?!

I don't want offer the season's hottest toy at 30% off.

Heck, I was hoping that the law of supply and demand would drive the price of my product 30% higher.

But now my buyers are being told that they can find this season's hottest toys at 30% off on eBay.

Uh oh, here's an email from a customer, wanting to know why I am not offering this hot toy at 30% off.

Because I didn't KNOW that "I" would be offering this toy at 30% off over the holidays.

I was planning on selling it for full price.

Otherwise, I may not even have sourced this toy - because it was not cheap even at wholesale.

I now have money tied up in inventory - and if I don't discount the sale price - I lose sales.

If I discount, I lose profits.

Hey, who moved my holiday cheese?

This is another example of where eBay crosses the line from being a being a venue to controlling the way you market your products.

Every seller needs their own web presence - even if eBay is still your primary venue.

You have to have a place where YOU call the shots. Stay on eBay - sell on the other venues. Sell wherever people are buying.

But have a "home base" website that gives you a backup in the event of a situation like this.

rich said...

Somebody loan me $20. I'll pay you back Thursday. Promise...

Tony P. said...

It looks like 3 of the "specials" involve cheapo $1 deals, which leads me to a question. Is ebay gonna purchase those items at the seller's asking price and then ebay will offer 'em up at $1?

Now that would be a bargain! For seller and buyers!!!

All I see are... electronics, DVD, electronics, new toys, electronics and more electronics. I wish JD would sit on a sharpened iPod.

Total cavity entry. ahem...

I remember a couple/few years back when ebay announced a BIG pending Back To School marketing campaign, sometime around mid-summer. It finally took place sometime in September.

I know one-person operations with better marketing skills and TIMING! And now that ebay has NO marketing dept? Who can tell?

Tony P. said...

Oh, I'm not just about the negative, I can give praise when due!

My favorite IT commercial: the scene opens with just a wall visible, inside of a darkened room. Suddenly a loud noise is heard - it's a radio. Something bangs against the wall, rolls away and the noise stops. It's a clock radio in the shape of the letters "IT". The scene, still fixed upon the wall, reveals dozens of faint impressions of "ITs" on the wall.

I actually laughed out loud at that one. It was truly an "impressionable" ad.

Randy Smythe said...

Usually TV ads and display advertising is all about branding and eBay has a well defined brand.

The problem, they are trying to change their brand and they can't do that simply by association i.e. Buy.com and the other Diamonds.

As Nadine said, if JD was confident in his vision of the "new " eBay they would be spending money this year on real world advertising.

nadine said...

Yep, eBay wants the world's best selection, lowest prices and service like Zappos and Nordstrom.

eBay itself provides neither the selection, nor the prices, nor the service. But they think they can order them.

You know, when Socialist governments think they can order the deliver of goods and services, I kind of understand where they get their delusion. And governments do have the power of the gun, which aids very much in getting results.

But where does eBay get its delusions from? It's a public company, you would think it would understand capitalism.

eBay will just have to learn the hard way. At least, it should take a shorter time than it does for governments. Unlike a socialist government, eBay cannot order us not to sell elsewhere upon pain of imprisonment or exile.

tula said...

I've been waiting for some eBay TV commercials, but I guess there won't be any(?). I did get a catalog of sorts a few weeks ago. It was about 8-10 pages, pretty, colorful and glossy, and the items it showed made me want to go shopping. I thought it was a good effort and hope they do more of them like that. Now if only they'd slow down the whiplash-inducing changes so we can all get down to selling.

eBay seems to want to be the cheapest but without being the cheapest "flea market" kind of place. Ain't happening. eBay is having an identity crisis. Instead of focusing on bringing in the variety they're famous for (and hence, more competition among sellers, which will drive down prices) they're focusing on being Amazon.

I'm still making sales, but my sell-through sure isn't what it used to be and prices are way down. Some of that is just the economy, but I'm not even seeing the kind of views I used to get, and I'm a 100%, 5.0 DSR seller. Not a powerseller, though (almost but not quite) so that may be part of the reason :-)

Lisa is right. You can't put all your stuff on just eBay any more. Better to go multi-channel to get more exposure and increase your chances of making a decent profit.

ConcertPosters.biz said...

please forgive me, if this a double post

Regarding Ebay, there was an interesting post on genuineseller which highlighted a company called GlassDoor. The site lets a company's employee's give feedback and rate the management.

If you want to know what is really going inside ebay check it out

http://www.glassdoor.com/Reviews/eBay-Reviews-E7853.htm

It seems only 23% of ebay employees rate JD as performing well.

The employee posts there show a company in chaos, a directionless company with no morale.

I did quick compare on the site for CEO ratings.

Amazon - Bezos 66% - approve
Cisco - Chambers 78% approve
walmart - vasquez 61% approve

Remember this site is not disgruntled sellers it is EBAY employees.

Some of their comments

*
hy is management trying to kill the golden goose?”
Software QA Engineer in San Jose, CA (United States)

Pros: “salary, benefits, flexible hours, free bagels on wed.”

Read Full Review
*

Sep 8, 2008

11 found helpful | 1 comment
“One eBay insider's point of view”
Program Manager in San Jose, CA (United States)
*

Sep 27, 2008

8 found helpful
“Was a great place to work when it was eBay instead of Amazon Jr. or Walmart.com Lite”
Project Manager in San Jose, CA (United States)
*

Oct 16, 2008

6 found helpful | 1 comment
“eBay Execs - Stop drinking your own Kool-Aid. eBay used to be cool. Now, it's cool to HATE eBay. Your Fault.”
Senior Director in Campbell, CA (United States)
*

Sep 12, 2008

10 found helpful | 2 comments
“Nearly 5 years there - what was I thinking”
Senior Staff Software Engineer in San Jose, CA (United States)
*

Sep 21, 2008

8 found helpful
“Ebay needs to get back to what made it great, being a unique force in the online marketplace.”
Independent in San Jose, CA (United States)
*

Aug 22, 2008

11 found helpful
“eBay attracts a lot of great people, then the company culture beats them down and they leave within a couple of years.”
Senior Product Manager in San Jose, CA (United States)
*

Oct 9, 2008

6 found helpful
“Forgetting our roots”
Senior Manager in San Jose, CA (United States)
*

Oct 3, 2008

6 found helpful
“eBay truly sucks.”
Customer Support
*

Sep 11, 2008

8 found helpful
“Horrible for engineers.”
Senior Software Engineer in Campbell, CA (United States)
*

Sep 10, 2008

9 found helpful
“Used to be a good place to work....”
Program Manager in San Jose, CA (United States)
*

Sep 8, 2008

8 found helpful | 1 comment
“John J. Donahoe does NOT know how to run a company!”
Software Engineer in San Jose, CA (United States)
*

Sep 19, 2008

7 found helpful
“Great company, great purpose, no leadership, no willingness to admit mistakes”
Senior Manager in San Jose, CA (United States)
*

Oct 3, 2008

5 found helpful
“Listen to the little people they move mountains when they get together...”
Customer Support Representative
*

Oct 4, 2008

5 found helpful
“Milk the cow while you can, because that's all that management is doing.”
Senior Product Manager
*

Oct 7, 2008

4 found helpful
“Laid off”
Former Employee in San Jose, CA (United States)
*

Sep 16, 2008

6 found helpful
“ebay - not what it used to be!”
Senior Director in San Jose, CA (United States)
*

Oct 15, 2008

3 found helpful
“We don't approve of you Mr. Donahoe! Get back to the basics and stop ruining our company!”
CS in Vancouver (Canada)
*

Oct 4, 2008

“Focus on you customers and not change too quickly”
Architect in San Jose, CA (United States)


eBay Overview
Web
www.ebay.com
Industries
Internet Auctions
NASDAQ
EBAY
Size
5000+ Employees, $7+ Billion Revenue
HQ
San Jose, CA

Competitors
Yahoo!
Google
Amazon.com

name said...

concertposters,

Yes, Randy and his readers know about glassdoor.com. The comments get more interesting if you sort them by date and read them over the course of this year. JD's "disruptive innovation" is no more popular with the employees than the sellers.

MagnumOpusMusic said...

Randy, The big media players over here, Play, HMV and several others also have the advantage of avoiding paying VAT (Value Added Tax) of 17.5% by being based on the Channel Islands. You and I know the margins on media, you do the maths on that one. :-)

permacrisis said...

Taking the Suttora ball and running with it:

Why no "value for the money" star in the DSR's, if ebay is so price centric?

The fixed-price format has some great pricing potential, especially where the seller is out to make room or bump up their year-end numbers. And fixed-price is ebay's new focus.

So why, then, no Value For Money DSR?