Monday, December 22, 2008

Are eBay's Media Auctions Going Away in 2009?

Thanks to a comment from a reader, I took a look at the current mix (auctions to FP) in the media categories on eBay and here's what I came up with.
  • DVD's - Auctions make-up 15% of total listings
  • CD's  - Auctions make-up 10% of total listings
  • Books - Auctions make-up 10% of total listings
  • Video Games - are more difficult to figure out because game systems get included in the games category, but auctions still make up close to 50%
So in the three major categories auctions have lost favor with media sellers and are dangerously close to no longer being worth the effort for eBay, Sellers like JayandMarie may find their business model doesn't make any sense any longer. If eBay is going to go to FP only in the Media category and I have no knowledge that they are, then they should be reaching out to sellers like JayandMarie and giving them fair warning -- none of this "30-days" to convert your entire business model.

Just my 15%

8 comments:

Rich said...

Any media items have gone "elsewhere" on this end which is usually Amazon.

A collectibles site needs to somehow rise out of the mess of potential yet useless alternatives. Amazon is the obvious choice but appears to have no intention of doing so.

[Save yourselves the trouble---we KNOW all the alternatives].

2009 or Bust! said...

Of course the will only give 30 days warning in a terribly worded Announcement with vague explanations and hazy guidelines, which later they will attempt to clarify and half of which the will change or drop all-together before, during or after implementation.

Isn't that Standard form most multi-billion dollar companies?

It ins't?? Hmmmmm......

I actually have thought if I had the time (yeah right) it would be a blast to take the last couple years of policy changes and reversals, summarize the chronologically and put them into one paragraph. Then have Eric Idle or John Cleese read it.

Media said...

eBay is getting rid of Half.com... and this time the REALLY mean it! ;)

nadine said...

Today's (Dec 23) WSJ has an article on eBay titled "A Not So Jolly Season for eBay". Excerpt:

EBay performance this quarter could be a referendum on the changes Mr. Donahoe has made this year. Since taking over for former CEO Meg Whitman in March, Mr. Donahoe has sought to rev up growth and reclaim buyers who had stopped visiting the Web site.

His most significant move has been to make eBay less of an auction house and more like Amazon, Walmart.com and Sears.com, selling fixed-priced goods, which consumers now prefer for speed and convenience. Among other changes, Mr. Donahoe has cut the fee to list fixed-price items on eBay and boosted the fee charged when an item sells, a model that helps fixed-price sellers better set profits.

Yet the changes have so far had little financial impact -- and have angered many loyalists. Transaction revenue per listing between October and the end of November plunged 28% from a year ago to $1.44, according to Majestic Research. Wall Street analysts now estimate the San Jose, Calif., company will post its first year-over-year revenue decline when it reports fourth quarter earnings next month. Seattle-based Amazon has forecast an at least 6% increase in fourth quarter revenue over last year.


http://online.wsj.com/article/SB122999355966028743.html?mod=wsjcrmain

Yup, Q4 earnings - and the story Mr. Donahoe tries to tell about them - are going to be very interesting. The Street is no longer buying stories about happy unicorns in the magic eBay forest, as they were this time last year. The "noise" has been heard.

Anonymous said...

Hi, Randy! Starting a JayAndMarie dead pool, are we?

I think 2009 will see the folding of half.com into eBay and the elimination of listing fees for fixed price Media items on eBay. I doubt they'll offer the same pricing to Auction sellers, which is OK if we receive some sort of incremental value for our paid listing fees.

I think the listings ratios you are seeing are somewhat misleading. You've got dealers like Buy and who knows how many others that are already getting free listings on EBay. That would swell the number of fixed-price listings, skewing the ratio of auction listings to Fixed Price listings. I'm sure auction sellers have a much better sell-through rate than fixed price sellers.

Moreover, that shipping cap is effectively below actual shipping cost for most EBay Sellers. The killer for a business model like ours, in theory, is our inability to pile our EBay fees into the shipping-and-handling, or into the starting bid price. If this were a concern or ours we would start the bidding at $1.00 or so just to cover our fees and costs, which would not necessarily help our final bid price out a bit. We have only been able to keep selling because we have increased the cost of our Second and Third and Fourth CDs, which we were reluctant to do, but we really had no choice.

I don't think EBay will kill auctions. I think the only reason they would do this would be if Buy or someone came to them and said those darn 1c Auction guys like JayAndMarie are making it hard for me to sell full-priced Media items on EBay, could you do something about kicking them off the site? I'd like to think that won't happen.

As for business models, I don't have another one up my sleeve, so if 1c-no-reserve-auctions go away I would leave EBay completely. I have never expanded my selling on EBay or used a different model there since I have never figued out a viable way to make any other model work.

Thanks for the call-out. Happy holidays to you and yours.

JAY

Randy Smythe said...

Jay,

Thanks for stopping by. I can't see eBay getting rid of auctions in Media, but I don't know how they will display them under the new halfesque layout.

Hopefully they find a way to make them both work.

When they added the CAP to media I was happy because it brought the sell prices back to normal but that certainly affected you and other 1 cent NR sellers.

Thanks for waying in on the topic. Always enjoy your perspective.

Happy Holidays to you and Marie.

Imogene said...

Randy,

Have you heard of Wigix (Want It, Got It eXchange)? I buy my CDs, DVDs, video games for my kids and other things from this site. I prefer doing business at Wigix than with other sites like Amazon because I found the sellers there to be forthcoming, helpful, honorable (so far) and the selection to be quite large. I get to talk to the sellers like when I go to a neighborhood store without actually going to a physical store. I get to find out if the video game I'm about to buy is appropriate for my kids' age group, etc. I get really good recommendations! Of course, if you don't want to talk to the sellers, you don't have to; but, for me I prefer to be able to talk to someone prior to purchasing since I'm counting my pennies.

Randy Smythe said...

Hi Imogene,

I haven't taken a hard look at Wigix.com. Just went over and browsed a little.

I'm glad you have found it to be valuable for you. I'll take a harder look at it over the holidays.