Here is an article I put together about eBay. Its an opinion piece and I welcome your comments...
________________________________
eBay aBout Face?
A Modest Proposal for What Used to be the
World’s Greatest Internet Auction Site
By John Seed
During the last week of April, eBay founder Pierre Omidyar sold 5,550,000 shares of stock in the phenomenal company he founded to sell his girlfriends PEZ dispensers, and found himself with an extra quarter billion dollars to line his checking account. The same week, eBay CEO Meg Whitman, also a billionaire on paper, cashed in 600,000 shares to improve her personal liquidity to the tune of more than 25 million dollars. It must have been tough for these two to then see eBay stock rise up another 20 percent in the following weeks, and know that a little patience would have paid of in the millions. But please, you don’t have to feel bad for Pierre or Meg: they both have plenty of stock left, and Wall Street likes eBay better every day.
Why does Wall Street like eBay so well, even in an otherwise dreary market? Part of the answer must be that Wall Street likes the attitude of the new eBay. The new eBay has increasingly become the Wal-Mart of the net, with over half of it’s sales, according to AuctionWatch.com, coming from the sale of “practical consumer items, not collectibles.” Wall Street must also like that eBay no longer allows sellers to create links to their own websites, and thereby opening up the dreaded potential for “off eBay” transactions. Wall Street seems to admire the new eBay Storefronts, which are each tiny cash calves bringing in a constant $9.95 per month revenue stream. Did I forget to mention the increased security of credit checks for new sellers? That is another plus for stockholders to consider.
Yes, eBay and Wall Street are having a love affair. Given the current situation, I guess it is more than a little contrarian for me to say that I think eBay is doing nearly everything wrong. In the view of this eBay seller, eBay is bungling it’s business plan badly, and creating badwill right and left. I am just about ready for a divorce myself.
Here is a bit of background to give context to my arrogance. I have been buying and selling on eBay for about a year and a half, first selling some old books, then selling my sister-in-laws car, and most recently buying and selling fine art. May I mention that am quite proud of my spotless “117” feedback rating, with no negative comments?I am an eBay good citizen, even if I am feeling unappreciated at the moment.
The fine art area on eBay has really been my hangout, and my proudest achievement has been organizing the “ebsq” group, a consortium of artists which over 300 artist sellers have used, and which now sells in excess of $50,000.00 worth of art monthly. One of our big achievements, before the new eBay policies on linking took effect, is that by using links that urged our bidders to “Search eBay for ebsq”, and to visit our homepage to find out who we were, our group completed its sales at roughly twice the rate of the eBay Fine Art section as a whole.
It is a loose group, with people coming and going constantly, but our message board has over 7,000 messages, and a steady stream of e-mail has given me a way to understand the concerns of a cross-section of eBay’s artist sellers.
Given that perspective, I am seeing lots of red flags waving. Here are the three main issues that I and others in my group have been discussing.
1) eBay has forgotten its roots
In my view, the greatness of eBay has been its identity as the world’s greatest Flea Market. In my fantasies, Founder Pierre Omidyar is off today, spending some of that new cash of his combing the Paris Flea Market, which represents what eBay should be: a flux of history, antiques, art, collectibles, junk and unique items. America is drowning in mass-produced, mass-marketed items made by people enduring conditions and wages that we don’t care to think about: let those mundane items be sold by mundane merchandisers.
Aren’t these products the ones we buy in Malls? Can we please buy them at Wal-Mart, and K-Mart? Isn’t half.com (owned by eBay) the site where the “Pic and Save” ethos is meant to reside online? Why doesn’t eBay just buy out buy.com and pump some profits out of that site? They could do a great job, and maybe Amazon.com is for sale?
In my view, the greatness and the profitability of eBay stem from the uniqueness of what can be found there. Why is management forgetting this? With these items now declining as a share of eBay’s offerings I now see the eBay glass (formerly a leaded crystal antique glass, now a tinted plastic one) as half-empty and draining fast.
2) Who is most important to eBay’s success? It’s the Sellers, Stupid!
Sellers are the most important people on eBay. Period, the end. If sellers are not happy, they will not make the effort to create, present and promote unique merchandise to draw in buyers. Motivated sellers strive for quality interactions and give their buyers quick service and great items. In my view, happy sellers make happy buyers who make happy stockholders.
eBay management needs to remember that eBay facilitates sellers: they do it in a revolutionary way, but ultimately eBay is just a huge information network with no content. The sellers provide the content. Note to eBay: pay more attention to your sellers.
3) eBay is guilty of excessive hubris
Did you read about the “bug” that changed seller’s preferences not long ago? This “bug” apparently took out the “PayPal” preference that many sellers wanted listed with their auctions, and put “Billpoint”, an eBay product in its place. Does this sound like Microsoft trying to muscle Netscape out of the way to you? I hear echoes.
Does the new ebay policy of “no links” from auction listings (except of course to big-time “Third Party” service providers) sound a little harsh to you? It does to me, because each time I paid for an ebay listing in the past I knew that even if I did not sell my item, I had at least posted my online business card.
Does it worry you that the Safe Harbor staff at eBay only respond to violations of eBay listing rules that are sent by eBay users? That’s right: if you are “reported” you know for sure that someone, probably another seller, has ratted on you. What an effective way to create suspicion and loathing among eBay sellers. eBay is not worried about sellers getting along. After all, in the view of the new eBay, if a seller does not like the atmosphere, there is no where else to go, so why worry?
eBay is now too successful, and by that I mean that its management is
acting as if they have a monopoly on the auction market. Practically speaking, they do, but their arrogance will not lead to any good. A few months ago I found that if I searched Google for the phrase “More evil than Satan” the Microsoft homepage would come up, since so many websites were plastered with negative references to Microsoft. With eBay alienating so many sellers with it’s new policies, I am already coming across sites like the guerilla site “Stop ebay Now” that speak in equally harsh tones. If I search Google for “arrognant” next Spring, will I be taken to the ebay homepage?
At this point, it seems possible.
Is there hope? If eBay Adopts my Modest Proposals, yes.
1) eBay needs to cajole, support, and nurture communities of sellers who present unique, handmade, and collectible items. An executive with intimate knowledge of an area (let’s say, rare coins) needs to be assigned
to maintain an e-zine, a message board, and do constant polling of the sellers to see how satisfied they are. Give each important section of eBay a human face, and watch seller safisfaction grow.
2) eBay needs to allow linking from auction listings. As the French say (Monsieur Omidyar, are you listening?) “Let 1,000 flowers bloom.” By this I mean that eBay can continue to be a hub for connection, communication and YES, off eBay selling, and find itself suddenly awash with goodwill.
Here is an idea to go along with this. People LIKE the fact that eBay transactions involve known sellers and buyers with feedback ratings and they LIKE the $200.00 of insurance on their eBay transactions. If eBay were set up a service along the lines of “pay a flat 1% fee and create an off-eBay transaction” can you imagine the volume? It is hard for business people to face this reality, as they want control, but off eBay transactions will always find a way to happen, and trying to control them is not realistic or productive. Instead, facilitate them, profit, and be loved.
You can bet that on eBay transactions would continue to grow at a phenomenal rate. eBay, remind yourself, you were a big success already, when links were allowed, so why are you fixing what was not broken?
3) eBay needs to listen to sellers. I have written to eBay via snail mail, I have sent e-mail to Safe Harbor, and least effectively I tried calling on the phone. My mail was not responded to, my e-mails received standardized and often conflicting messages, and the very kind man who answered the phone took a full three minutes to explain that there was NO possibility I could speak to anyone.
If anyone at eBay is listening now, I TRIED to let you know about how my group had become very successful, and how your new policies were creating obstacles, but you were too busy to listen.
Were you perhaps flying to Paris to comb the Flea Market and spend some of your stock profits?
John Seed is an artist, a professor of art, and the founder of the ebsq artists group
http://www.ebsqart.com
