posted on May 10, 2001 02:39:52 PM
Hello AW users-
I would appreciate your comments for an article I'm writing for AW. If I use your response, I will quote you by your AW user name.
According to eBay's most recent financial results, over 50 percent of its gross merchandise sales are now "practical" items such as clothes and electronics rather than unique collectibles like Beanie Babies and Pez dispensers. Additionally, liquidators like Overstock.com and large retailers such as Ritz Camera are now selling merchandise on eBay, presumably attracting more buyers, who attract more sellers, and so on.
- First, can I get your thoughts on these trends. Is 1) eBay's new identity as a marketplace for all items sold in all pricing formats rather than a collectibles auction site and 2) the entry of large retailers and liquidators a good or bad thing and why?
- For sellers: Are you concerned about your ability to compete with liquidators and other sources or are you excited to have the increased buyers pool their presence will likely bring to eBay?
- How are these trends changing your selling methods?
- What words of advice would you give to eBay--how can it serve these larger sellers and still serve small businesses and individuals, e.g. "the little guys."
I would appreciate it if you could include a description of how you use eBay--as a buyer or seller and if the latter, what items do you sell?
posted on May 10, 2001 02:59:02 PM
As a buyer, I see more variety and more competitive prices. I mostly buy collectible items...still. I like the convenience and chance at a below retail price eBay offers.
As a new seller, I just sell or try to sell variety items and rarely have more than one of anything to sell, also I would probably be classified as a "hobby" seller because I don't depend on eBay for my lively hood.
posted on May 10, 2001 04:07:24 PM
So far in my speciality I haven't noticed a direct presence by "liquidators"...unless you count the relentless ads for half.com on the ebay web site. I sell books and certainly there is a presence on half.com of big sellers of various kinds.
Personally, I feel the "killer ap" of ebay is the opportunity for consumers to choose, if they wish, to save money by buying secondhand or from discounters. If a seller has the energy, he can tap into this by finding supplies of low-cost items to sell for more than one would get at yard sales or whatever. I build my business on selling $1 books for many times that amount.
I don't feel that ebay is interested in me as a small seller, but so far I can still survive. It's the increased fees by ancillary services like auction and photo hosting, postal service, payment services, that eat away the profits to be made on ebay.
posted on May 10, 2001 09:20:28 PM
I'll give you my comments, but if you use any of it, NO NAME at all, else don't.
I buy and sell, tho currently I'm on a bit of a vacation from both and seriously re-thinking EVERYthing about ebay in the meantime (tho I'm in no hurry to do so). Today's announcement is most interesting and IMO just continues the trend of ignoring/stepping on the non-corporate sellers who built ebay.
I'd like to say it's a mistake for ebay to so completely ignore the non-corporate sellers, but they're on a roll, they're invincible (or so they think), they want the brass ring and are damned intent on getting it. More, more, more -- never is there such a thing as "enough." I personally think it's a shame, but that's capitalism at its finest.
But ebay isn't fun anymore. I've sensed since December or so in the categories I like to buy in that listings were being raked through (by other buyers) in a methodical, almost robotic or mechanical way, so that it's harder (if not impossible) to find the hidden jewels. I found it eerie.
At the same time, in the categories in which I sell, prices are off (IMO) and before my vacation my sell-through rate had fallen to about 30 - 40%, which makes it very expensive to list.
IMO their de facto abandonment of collectibles -- at least as you describe it -- is GREAT! Why? Because it makes it much more likely that some of the other sites which would hope to compete with ebay will be able to. I personally would LOVE to see some one or more sites take us back to a place ebay has moved itself away from. And I've got enough animus and resentment toward ebay built up (for their arrogance ALONE, but for all their greediness too -- as well as for their sheer inability to provide anything near a stable site) that I'd love to see that happpen to them.
Pride goeth before a fall (and often causes it). Ebay may be a super-successful dot-com in an era when so many of other dot-coms have crashed, but they're simply deluded if they think it can't happen to them. It can. The entire computer industry (including the internet) is an extremely volatile one. The ups and downs can be breathtaking, completely unpredictable, and lightning-quick. My prediction: it's just a matter of time for ebay. Maybe years, maybe much, much less. But they WILL see some downside, and IMO they keep tempting fate with their overtly greed-inspired policies.
I for one will NEVER buy merchandise from large retailers, liquidators, etc. on ebay. As a matter of principle if nothing else. For that matter, during my extended vacation I'm beginning to think that ebay is going to have to work a little harder to get much more of my money for anything -- sales OR purchases -- and they're moving in precisely the wrong direction for that.
Will ebay care? Heck no. Nor even notice. But how many others are feeling the way I do? And how many more WILL?
And IF the big retailers et. al. DO bring in a larger buying pool (and I have my doubts), they won't likely be ambling over to my categories. I can't even check out my own favorite categories thoroughly on anything like a routine basis -- let alone go surfing in new territory. Why would the person looking for a toaster oven bargain look at any of the collectibles categories? Would rarely happen.
posted on May 10, 2001 09:35:53 PM
Meg's dream is for eBay to become a be-all end-all to buy anything. Sort of like the Amazon that never was. I believe this is a hopeless quest for a simple reason.
There is a portion of the population that does not possess enough trust to buy things under the eBay model - that is, send your money to a stranger and hope it all works out.
Meg's answer to this seems to be to bring on the Ritz Cameras of the world. But by alienating, and eventually eliminating your small sellers, eBay will then be no different from amazon or wal-mart.com.
It's the depth and breadth of items that make eBay fun, at least in my opinion. Sure, being able to buy a digital camera cheaper than buy.com is great, but what if I decided I want to buy a Speak and Spell or a Big Trak? I can search every garage sale in the world, or I can get it off of eBay.
The more that Meg tries to get in bed with these big corporate sellers, the less of a garage sale quality you will have. This will drive away bidders, which will drive away sellers. It is at this point in time that someone will form an alternative to eBay and it will be accepted and viable.
posted on May 10, 2001 09:42:48 PM
Hi,
I'm not worried much about competing with larger businesses. I'm a micro-business, and I can run circles around the big guys. They're paying overhead on things that I don't; rent, payroll, utilities and others. Some stuff I sell, like gold bullion for example, always sells for razor thin margins. I can make the thin margins work, because I don't have much overhead.
What does worry me is that eBay seems to be trying to kill the goose that laid the golden egg (sorry for the pun). If eBay makes it too onerous to do business on their website, I'll go elsewhere. The web is a big place. In 1999, eBay was about 75% of my sales. In 2000, eBay was about 50% of my sales. I don't see this trend reversing. I've got a customer list of several thousand people now, when eBay makes it cheaper to do direct marketing, that's what I'll do.
posted on May 10, 2001 10:00:54 PM
I am largely a seller of Asian antiques and collectibles and am on the verge of expanding my internet horizons to other venues which focus more on these types of items (Ruby Lane, for one). I am in the hope that buyers of my type of item are also seeking more focused avenues to find those treasures that they seek.
While it is true that eBay has the greatest exposure of any such venue for the small, independent entrepreneur such as myself, they ARE NOT the be all and end all. Even McDonald's, the indisputable fast food king is overshadowed in Asia by KFC, who doesn't compete in the same league in the U.S.
We are in era of ever increasing specialization. A great collectible-only site will surface again, perhaps even has already. A well thought out and well run site can be successful but it will come into its' own through perseverance and patience. eBay will carry the lion's share for the time to be but there is always room for successful competition.
I love the field I sell in and will continue to seek venues in which to promote my business, but for now, eBay is a must have for survival. Now, but not forever!
posted on May 10, 2001 10:04:58 PM
The reason eBay will no longer be a place for the small vendor is the same reason the small vendor is absent wherever big vendors show up.
It is not just price of goods competition, it will also be competition for space and eyeballs on the site. The big vendors will drive prices out of the reach of small vendors. Large vendors using eBay as a secondary market can have razor thin margins and can conceivably sell at a loss, so price competition is a pipe dream as they come on board.
Any small vendor depending on a wholesale supplier may be in trouble if big vendors are successful on eBay. The wholesaler will just list on eBay.
Whether the challenge is price competition or site real estate competition, large vendors coming to eBay bodes ill for small sellers of collectables or anything else.
Why do I sell on eBay rather than at the local mega mall ? The storefronts are cost prohibitive, and I have neither the volume or margins to support it. Why is the fleamarket at the defunct drive-in theatre instead of at the mall or beside Wal-Mart?
eBay can not have two masters. Whatever type of seller at eBay brings in the most revenue at the least cost will dictate who eBay caters to. Large vendors have the cost and revenue efficiency eBay desires. Large vendors can produce a revenue stream for eBay for an indefinite period of time. Antiques and collectables are self limiting by definition and have already reached saturation at eBay.
Even if large vendors bring in more buyers, what will it cost a small vendor to even have a chance to be seen by these buyers ? Do you think a large vendor or eBay will permit your item to be listed for 50 cents in the same vicintity as their merchandise? You don't need an MBA to figure this out.
This trend is the equivalant of urban gentryfication ?sp.
posted on May 10, 2001 10:07:40 PM
Yes the eBay charm is gone.... but
for every one ebay buyer who has removed eBay from their bookmarks because
the cant find a limited edition slat and pepper shaker from the 1900 World Fair..
There are one thousand Newbie’s who have logged on to save $3.00 on the lasted
Tom Hanks DVD.
Whats ya gona doo....???
[ edited by jumpinjacko on May 10, 2001 10:19 PM ]
[ edited by jumpinjacko on May 10, 2001 10:22 PM ]
posted on May 11, 2001 04:42:42 AM
we buy and sell on eBay - collectibles and antiques.
As with any business, eBay is protecting their turf.
They are not more greedy than any other seller.
Re: the ads that pop-up; we use adsubtract and never see them.
I believe eBay will continue to grow, and probably continue to make some mistakes - that also comes with the territory.
Re: pushing out the small seller.
I don't think so. The dumb small seller - yes. We attend many live auctions every month. The amount of naive money chasing items is unreal. Much of the time, when I sidle over to chat with the buyer, I learn they are new people selling on eBay who have not done their homework.
Yes, those people will be crushed; unless, they get burned and learn.
With the new 'eyeballs' coming on eBay, I believe it is for the good of all of us.
If one is selling newer items, or those bought from a wholesaler and not unique, yes, they'll probably face some serious challenges.
For us, we put a cap on the amount we spend on a monthly basis with eBay; it's infrequent when we use the gallery or any other gimmicks and start most items below $10.00.
We don't use sellers assistant - have learned how-to write html.
We've quite profitable, have high feedback, many repeat and new customers daily.
I support most of what eBay does; when I don't like it or understand the whys, I send an email. They respond quickly.
There are frustrations with eBay, but that is the same with any company. Try lugging stuff to shows, various booths at malls, or run a b&m location.
posted on May 11, 2001 05:02:35 AM
Here are some real numbers that reflect how the market in collectibles has changed over the past 1-1/2 years:
=================
5/00-GI JOE-1496 closed auctions, avg selling price 26.93
5/01-GI JOE-14007 closed auction, avg selling price $18.95
=================
5/00 - Swarovski Crystal - 1314 closed auctions, $51.61 avg selling price
5/01 - Swarovski Crystal - 8023 closed auctions, $38.03 avg selling price
=================
12/99 - Bennington Pottery. 79 closed auctions, $18.99 avg selling price
5/01 - Bennington Pottery. 196 closed auctions, $15.06 avg selling price
===================
Just three examples, but we collected many more. It shows a dramatic increase in # of items listed (no surprise) and an average 25% drop in closing price across all the categories we had data on.
Basically, sellers of consumer collectibles-where eBay built their business-are working harder now, for less profit. These numbers don't even reflect the increase in USPS costs, PayPal fees, eBay fees, etc.
posted on May 11, 2001 05:12:05 AM
thanks for those numbers... good insights and the results are correct also.
We do list more, but are also making more. Just dropping our own merchant card saved bundles.
Competition, tons more. Buyers - also tons more.
Still, for us, we now have three people working it with the anticipation of a fourth, eBay provides a nice living for us in the antiques and collectibles arena.
posted on May 11, 2001 05:46:51 AM
I have always looked at ebay as a online Flea
Market. Using this anaology look at large flea markets today primarly new practical's
hard to find much in the way of antique and collectibles.
Used Practicals will still do well ,It will be hard if not impossible for individuals to compete with the large retailers but this is no differnt than what happens in the real world
Is it a good or bad thing ?? I think it is good as ebay grows opurtunity will also grow If pez's and beane's don't make it online venors will switch to niche practicals or move to another venue
posted on May 11, 2001 06:25:02 AM
It IS getting harder to sell on ebay, there ARE more competitors but if people thought it was going to stay some undiscovered gem, they thought wrong.
The influx of bigger competitors, wholesalers & liquidaters don't really bother me too much at this point because they bring people to the market. And those people start to look around & discover all the other things ebay has to offer.
I agree with petertdavis. I can generally sell rings around my competitors because I can move faster, offer more personal service & am willing to settle for a bit lower margin which makes my prices more attractive. That lower margin is more than offset by my customers then looking at other things I offer.
To borrow a bit from "Survivor", it's Outwit, Outplay, Outsmart...
ebay would be stupid to force out the small seller. For now, despite the influx of larger companies, people come to ebay to search for things they can't find elsewhere, get bargains, have fun.
Survival in any business depends on the ability to adapt to changing markets & conditions. As thepriest said, the dumb small seller will probably eventunally disappear but the smart small seller will still find ebay a worthwhile and profitable place.
posted on May 11, 2001 06:37:43 AM
What's interesting about the numbers is that, on a small scale, they quantify what we've been hearing for quite a while from sellers - that their collectible items aren't realizing the prices they were 1-2 years ago.
It's hard to blame eBay for this one, though. They've done a masterful job of marketing and branding their name. Buyers and sellers-especially new ones-are not going to go looking for the Bidvilles and Epiers on the net. They're going to check out the site that's in the conscious mainstream: eBay.
The initial conclusion that can be drawn from the statistics is that prices are down because supply has more than matched demand. As a buyer, if I miss an auction for a collectible widget, there are another 50 in queue that I can bid on. There's no incentive to begin a bidding war.
That being said, the rare collectible will still do extremely well on eBay.
posted on May 11, 2001 06:54:29 AMThat being said, the rare collectible will still do extremely well on eBay.
Bingo
The key to surviving on eBay is to NOT sell the common easy to find items, unless you can afford to sell them for far less than what the average seller on eBay can.
One has to also keep in mind that prices can fluctuate plus or minus 100% from week to week. Prices fluctuate depending on the sellers feedback, the quality of the pics, the details in the description, the sellers TOS, and most importantly, how many buyers are looking for that particular item on any given week.
I've had items fizzle at less than $50 one week, re-list 2 weeks later, and go for over $150. Nothing is black & white, but overall the final bid prices have indeed dropped over the past 3 years.
My solution was to diversify, and it's been working very well. I try & find items that I know will stand out in the crowd, and so far so good.
For myself, the prices realized on eBay today are still far better than what those same items were selling for on an online mall I was dealing on 5 years ago.
posted on May 11, 2001 07:14:05 AMreddeer if a person is selling collectibles it's essential that they stay "ahead of the curve". That means that they have to do research into what's selling well, what's peaked, and what will be hot in the future.
A quick example: Early last year I ran across a 50's toy at a yard sale for $8 called a "Bongo Board". The person selling it didn't know what it was...I didn't know what it was. When I got home, I was amazed at what they were selling for on eBay: $225-$275.
A year later, I run across another yard sale, another Bongo Board. This time the person wants $75 for it because "It's a collectible and will do great on eBay".
If you put a Bongo Board up on eBay today, you'll be lucky to realize $100.
What I'm trying to illustrate is that the perception at auctions, yard sales, estate sales, etc., is that they can price their item higher, because whoever buys it will make a KILLING re-selling it on eBay. That just doesn't hold water anymore. But...the reality is, inventory prices are going up, selling prices (on collectibles) is going down, and profit margins are shrinking.
As you said, a key is diversification. Unfortunately, not many part-time sellers have the space to store items until they become hot again, or have the time to do research into what items are realizing the best prices.
Sorry for the long post...this is a pretty ripe subject for me.
posted on May 11, 2001 07:16:40 AM
I'm a high volume sunglass seller on eBay with over 15,000 completed transactions and understand the need for the changes that are taking place.
Being a publically traded company, eBay now has accountability to it's investors. It must build its business and revenue stream to the best of its ability. The move to attract large liquidators and other consumer oriented retailers to its website is just part of a natural progression taking place in online selling. I liken the trend to a consolidation of the business.
Like eBay, I too am growing my online selling business by exploring new avenues and partnerships to sell our products. The old saying holds true, "If you can't beat 'em, join 'em holds true. If its large volume sellers that eBay is looking to attract and support on their website, then that's what I will work to become. It's all part of the entrepreneurial spirit of being in business for yourself! I welcome the challenge and all these large retailers, but must warn them to expect strong competition from my company. We're a customer service oriented operation and they better be prepared to offer similar services to customers in order to complete with us. If these companies think they can just throw up a ton of listings and collect their money with little or no effort, they're mistaken. ebay customers are discerning and expect the highest levels of customer service. If these retailers are unwilling or unable to offer these services, they will be unsuccessful in their eBay online selling efforts.
We're going to survive and flourish with these new eBay changes that are being implimented, just as we have in the past. We welcome change and look forward to the great possibilities that the future and progress in this business is going to bring.
What I'm trying to illustrate is that the perception at auctions, yard sales, estate sales, etc., is that they can price their item higher, because whoever buys it will make a KILLING re-selling it on eBay
I guess that depends on where one lives?
Up here eBay is NEVER mentioned at yard sales, and I've yet to hear it mentioned at any auctions either.
My best selling items in the past 6 months are something that most people up here walk right past at yard sales, and there is seldom much competition at the auctions either.
I know, that too shall soon pass.
I hear eBay being discussed at shows & shops by fellow antique dealers, but most of them are still scratching their heads dreaming about how they should be selling online where "everything sells for top $$$" LOL
The locals that have tried found out real quick how hard it it to make a go of online selling.
I can honestly say that lately my supply cannot keep up with the demand. In the past 30 days my sales are reaching the 6 K mark, and if I had 3 times as much product to list, I'd be making 3 times that amount.
I normally only list approx 100 items per month, and for me that's more than enough to keep me happy.
I feel sorry for the sellers that deal in retail merchandise, or depend soley on ebay to cover their entire families needs.
It's gonna be a rough road ahead for some people, but I think I'll be doing just fine.
posted on May 11, 2001 07:37:24 AM
I'm a relatively small seller in a niche market - Pokemon collectibles - mostly trading cards and plush toys. I find that when new ones come out, I get excellent prices and am able to immediately recoup my initial investment with little effort - and then eventually the market saturates, and the buyers disappear (I have a very loyal group of buyers though, that I know I can count on when a new set is released). My good months cover the slow months between releases.
I'm getting prices about what they were last year, maybe slightly less, but I'm dealing in low margin, high volume auctions (yes, I think I'm part of the Clutter that Meg wants to eliminate). What doesn't sell out of the trading cards usually is covered in my profits on the plushes so I'm still making a profit - and as long as I'm doing that, I'll stick with it.
I want to diversify into handmade craft projects, but its very hard to develop unique designs (I'm very conscious of not stepping on copyright toes). My goal by the end of the year is to have a line of doll clothes ready to list in time for Christmas. *fingers crossed*
With the new ban on website links, I'll spend less time on developping my website and more in the design process I guess. 8)
posted on May 11, 2001 07:49:03 AM
I guess nobody will find it a surprise then to know that within the past few days:
Jeffrey Skoll, eBay VP, registered with the SEC to sell 600,000 shares.
Pierre Omidyar, eBay founder, registered with the SEC to sell 550,000 shares.
Meg Whitman, eBay CEO, registered with the SEC to sell 600,000 shares.
Gary Bengier, eBay VP of Strategic Planning registered with the SEC to sell 200,000 shares.
Brian Swette, eBay COO, registered with the SEC to sell 600,000 shares.
Maynard Webb, President of eBay Technologies, registered with the SEC to sell 100,000 shares.
Mike Jacobsen, eBay General Council, registered with the SEC to sell 600,000 shares.
Rajiv Dutta, eBay CFO, registered with the SEC to sell 30,000 shares.
and numerous other senior level people registered to sell smaller amounts.
This is all public information, but what can we speculate about these facts. The price for eBay shares is up significantly over the past couple of months. There have been major changes to eBay policy recently, with more rumored to be in the works. Many of eBay's top people are selling off tens of millions of dollars worth of shares.
posted on May 11, 2001 07:59:02 AMreddeer I'm moving up there!
Anytime an item fails to draw an opening bid at a RL auction around here (Massachusetts), the auctioneer invariably says, "C'mon folks, this will do GREAT on eBay!"
I think there are dealers that have stayed away from online selling, mainly because (and my opinion only) you have to be somewhat computer literate to function. You and I and all of the sellers here have developed a set of skills that really didn't exist 5 or 6 years ago. Think about all of the effort that goes into selling an item:
Purchasing the inventory
Researching the item
Taking a picture & ULing to a server
Creating a description
Posting an auction
Customer Service
Billing
Packing & Shipping
I'm sure I've forgotten a few steps, too. It's not necessarily a bleak outlook, but as you implied, it's going to make sellers work harder and smarter in the future.
posted on May 11, 2001 09:36:45 AM
"According to eBay's most recent financial results, over 50 percent of its gross merchandise sales are now "practical" items such as clothes and electronics rather than unique collectibles..."
Compare this to B&M retailing - where collectibles is probably around 1-2%. Wake-up ebay, collectibles is your natural core business.
I noticed some big players entering my field ever since I started selling a little over two years, most of them haven't done to well.
Most charge too much for shipping, can't seem to make a profit(they flood the market with low margin product and wind up loosing money), are surprised by the havoc to inventory control that is created by a rash of deadbeat bidders, have lousy customer service, aren't flexible enough, the bigger they are the harder they fall it seems. E-bay takes a lot of work and dedication to succeed, not just money and cheap product. I find these big operators are easy targets.
posted on May 11, 2001 06:08:13 PM
I have been selling on ebay for 5 years - the big sellers have always been there. The problem with the big sellers is that they do not give good service and over price there items. If you do not give good service on ebay you will soon just be gone - bad comment files do not help sales! Over 5 years I have seen many, many sellers leave - big and small. I don't always like the changes ebay makes but can't make the same kind of money any where else (belive me, I have tried!). What company can you work for that will pay the same kind of money you can make on ebay???
posted on May 11, 2001 06:51:06 PM
Having over 3 years of ebay buying and selling experience, I see a trend that started about a year and a half ago.
As many of your post replies have expressed, ebay is at its zenith, and I predict it will change dramatically within another couple of years morphing into a waste dump for overstocked crap.
I suspect ebay will find success for a while longer, but with moves to ban certain objects, and vigilantly watch and punish sellers of copyright infringing items and other goods without recourse, it leaves fewer and fewer sellers wanting to get in the game.
As a buyer, I have nearly ceased - too much stuff to wade through, too many poor descriptions, too many disappointments on the receiving end and too much competition for deals. On the selling side, there are too many categories, too many loose canon buyers, not enough protection from neg retaliations and too much competition. Is it sour grapes - sure it is! I was one of the early buyers and sellers and I got to know a lot of great fellow ebayers, but it gets more corporate and regimented all the time. I suspect I have another year left in me for ebay, and that will be about it...
