Do You Think It's Time to Eliminate Auctions on eBay?

[jt-libra]

Sometimes the juxtaposition between how eBay sees itself in the marketplace and how it expects its sellers to operate, and buyers’ behaviour is so vastly different.  eBay wants to take its place alongside big retailers in the on-line marketplace but yet, in some ways, there’s very little progression since the time eBay began – from the buyers point of view.

Of course, eBay is unique in that it includes auctions on their site, which I believe should be a thing of the past.  I use them because in my selling category, my 50 + 50 free listings do not include fixed price.  And I pay for a certain number of fixed price listings. To use the auction with buy it now is not feasible any longer, with the 30% variance required.  With fixed price, you can stipulate immediate payment – no problem.  It leaves the buyer no room to negotiate shipping charges or the price itself after the fact, and if he attempts to, we can refund and claim the buyer changed his/her mind.  With auctions, after the purchase, the buyer can try to negotiate all sorts of terms and you’re not sure after your response to them, whether or not they’re still interested, so you wait and eventually file the unpaid item claim which takes your product off the market for 8 days.

What facilitated this post is the buyer who after winning the auction last night, said, I’ll pay you next payday (10 days from now) – not “is it okay if I pay you next week?”  A lot of sellers probably don’t think this is a big deal but, quite often, the 10 days goes by and there’s no payment, requiring more communication and often a delayed UID.  I know that I can respond that this isn’t acceptable and cancel the transaction ….. and I probably would if it was a big-ticket item.  In this case, the $25.00 is not a hardship but I think about items that sell for, say, $100+, with more than one bid.  The winning bidder delays payment and may not pay in the end, whereas the second highest bidder would have paid, the item would have shipped and the seller would have the money in his/her pocket.  It’s not hard for me to keep track of unpaid items, because on each of my selling accounts, I only have about 100 to 150 items for sale at any given time, but how about the sellers who have thousands.

I believe it was Pierre who said that he used to even accept Canadian Tire money from buyers in the early days.  Well, in many respects, that mindset of buyers has not changed much.  If eBay insists on keeping auction listings, then for efficiency purposes, buyers should be required to pay within 24 hours of an auction end and, if they don’t, the transaction is automatically cancelled.  Surely, with all sorts of mobile devices now, they can check to see if they’re the winner.  Sellers who have a long-standing, constant customer base are likely listing fixed-price only, so this wouldn't be an issue for them.

If eBay wants an efficient operation, doing away with auctions would go a long way to achieve this goal.

[pierrelebel]

"Do You Think It's Time to Eliminate Auctions on eBay?"

No.

While auction listings only represent about 20% of eBay listings at this time - and that percentage is getting smaller every year - they are still an important image for eBay, an important draw for new potential buyers/bidders.

Sellers do have the choice to sell as they see fit: auction, fixed price or both.

I do not see a need to change that flexibility.

[rose-dee]

You raise an interesting subject.  Personally I think eBay will ultimately phase out auctions, as they weed out independent sellers, either by attrition or force (defects, etc.) as time goes on.  I imagine the biggest retailers couldn't care less about auctions, as they take too much time and monitoring, and auctions (as you've pointed out) don't guarantee quick payment. 

I used to have quite good results with auctions, but not in the past year or two.  Then I started using an occasional spurt of a few auctions as "loss leaders", which was somewhat successful until this year.  Now they are a waste of my time if, as you say, the only bid ends up being the starting bid.  I'm sure there are categories and item types that still work well at auction, but not mine.  

I imagine OOAK or true collector pieces would still do well at auction, but otherwise I think people are becoming too impatient to wait several days to see if they've won something, only to lose it.  Some people don't find that fun, especially if they're really keen on an item and get bumped out at the last second by a sniper.  I would think that might turn a lot of buyers off eBay (or least to start looking for the same things at BIN).  

I know you say you tried a store for several months, but if your particular line of items isn't doing well with auctions anyway, and/or they are becoming a time-wasting source of UIDs, why not consider a store ("Basic") subscription (rather than month-to-month) and list all that inventory at fixed price?  Of course they lock you in for a year and punish you with monetary penalties if you cancel the subscription too early, so you have to be fairly clear it will work for you. 

You may not actually save money, but your time is valuable too, not to mention your mental health.  I think many sellers forget those aspects.  

In my opinion at least, the ancillary benefits of having a store are very valuable: Visibility and name recognition can be a very important thing in bringing buyers back.  I notice in my Omniture statistics that people do search by my store name.  There are several time-saving features, defect-saving features (like vacation settings), and promotional options offered to store owners that are included.

Personally (from a buyer's viewpoint), I find it's easier to navigate in stores, and quicker to find what I'm after.  All these things may not have specific monetary value, but I think they can add up to more sales in the long run. 

P.S.  I don't work for eBay. 

[jt-libra]

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@rose-dee wrote:

I know you say you tried a store for several months, but if your particular line of items isn't doing well with auctions anyway, and/or they are becoming a time-wasting source of UIDs, why not consider a store ("Basic") subscription (rather than month-to-month) and list all that inventory at fixed price?  Of course they lock you in for a year and punish you with monetary penalties if you cancel the subscription too early, so you have to be fairly clear it will work for you. 

You may not actually save money, but your time is valuable too, not to mention your mental health.  I think many sellers forget those aspects.  

In my opinion at least, the ancillary benefits of having a store are very valuable: Visibility and name recognition can be a very important thing in bringing buyers back.  I notice in my Omniture statistics that people do search by my store name.  There are several time-saving features, defect-saving features (like vacation settings), and promotional options offered to store owners that are included.

Personally (from a buyer's viewpoint), I find it's easier to navigate in stores, and quicker to find what I'm after.  All these things may not have specific monetary value, but I think they can add up to more sales in the long run. 

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I have, from time to time, given a little thought to re-opening a store, particularly after the free fixed priced listings were eliminated in certain categories.

On several occasions, I used the eBay fee illustrator to determine whether it would be cost beneficial.  By entering the number of listings I create each month, the number of items I sell, the average selling price and shipping cost, etc., the result always indicates that that there is no, or very little, cost benefit.  My sales have been better the last few months, so I entered my selling activity again and it shows that I would save approximately $3.00 a month by having a basic store.  Now if I added together the activity of both my selling accounts, it would certainly be beneficial, but not separately, and since the items I sell are so dissimilar, I've never wanted to combine them into one account.  I do recognize that there's more to consider than just the monetary advantages of having a store.  My time and energy, not to mention my mental health, are very valuable to me as well.

There's every possibility that my sales would increase with the added visibility of a store, and all fixed-price listings, but that's an unknown.  I know that opening and then closing a store is a simple process if I were to find that there was no advantage, as long as I didn't opt for the 12-month subscription.  I'm actually going to sleep on it and I may just decide to try it again for 2 or 3 months.  I'm just not sure at this point.

Thanks again for your always insightful comments, rose.

[recped]

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@pjcdn2005 wrote:

Does a buyer have to have a paypal account to pay with a credit card when the seller does not have a merchant account with a cc?

If they don't need to have one then you would be eliminating potential buyers by insisting that buyers have a Paypal account.

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In addition to losing guests users of PayPal you also lose buyers who share a PayPal account with someone else or anyone who does not have their PayPal account linked to the eBay account they are using.

Blocking buyers without a PayPal account is useful for high scam type goods like iphones, game consoles etc. that attract the usual bunch of fraudsters. It really does little against regular but slow to pay buyers where not having a PayPal account has nothing to do with paying slowly.

[recped]

Personally I think eBay will ultimately phase out auctions, as they weed out independent sellers

How do you define "independent sellers"? I don't see eBay getting rid of their largest sellers who by any definition I can think of are "independent sellers".

[lucitabby]

No,  I do quite well with auctions.

Sometimes I only get one bid but you never know - every now and then one goes through the roof with bids.  That makes ebay fun.

I quite often put a buy it now with my auctions.

I would not like to see the end of auctions - I still enjoy both buying and selling re auctions.

[dgour98]

Absolutely not. Keep auctions.

It's what makes ebay fun. If you are selling for example a PS3 video game, using a 'Buy it now" makes more sense as

all the games are the same.

But all unique items are fun to follow with auctions. It's also fun to see items skyrocket as the bidding ends.

Sunday nights seem to be the big night for comics, when you find a big selection of higher priced listings. I love sitting back and watching the last minute of all these auctions trying to figure out what the end price will be.

Auctions also set the actual marketplace, no matter what a Guide book says. It's my cheap entertainment and i'd like it to stay.

[rose-dee]

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@recped wrote:

Personally I think eBay will ultimately phase out auctions, as they weed out independent sellers

How do you define "independent sellers"? I don't see eBay getting rid of their largest sellers who by any definition I can think of are "independent sellers".

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Sorry, I wasn't being very clear there.  I meant small, independent sellers.  My word for them is "boutique" sellers, as opposed to bigger retail sellers.  The difference between your small town Mom and Dad general store and Wal-Mart. 

[recped]

Ok, now define "boutique" or "small independent" sellers.

[reallynicestamps]

The US Department of Commerce defines a 'small business' as one with fewer than 400 employees.

[rose-dee]

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@recped wrote:

Ok, now define "boutique" or "small independent" sellers.

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Good grief.  I'm thinking of those millions of individuals out there in eBay-land selling out of their homes, on their own, perhaps with the help of a partner/spouse/whatever, whose sales are generally below the transaction level eBay sets to permit a 3-month defect turnaround.  

Someone like Pierre Lebel, even though he may have been making a good full-time income on eBay, I would consider a "small independent" seller, even if he was running several venues at a time.  Unless he had a corporate office somewhere with several dozen employees (maybe he did, I don't know).  A person or couple running a business out of their home or from a single location is a different dynamic from a corporate entity with a cast of hundreds or thousands of people, property holdings, and a head office.  Your uncle's deli ain't Superstore. 

However I think we all know there isn't a specific line between "big" and "small" seller on eBay, nor between "small independent" and "big commercial" seller.  It's more akin to a continuum with a whole lot of individual people (like me) bunched up near the tail end, trying to make a meagre living, and a minority of massive sellers at the front end, with large-scale operations and a crowd of employees (probably more than 400).  

Interestingly, I can't recall eBay ever releasing figures on the number of sellers they have historically had at one end or the other of the spectrum.  That would be very illuminating (pun intended).  

There must be millions of individuals whose extra income every month, or whose economic survival itself, depends upon their selling on eBay.  If conditions become less favourable for those people (or if eBay continues to promote "big box" products by mainstream retailers), it's conceivable that eBay's boardroom decisions could have a direct effect on local economies.  

I'd be very interested to know how many individual sellers (not corporate retailers) have either left of their own accord or been chucked out of eBay during the past year in particular, in comparison to, say 5 years ago.  But I doubt we'd ever see those statistics. 

[bb_cool_stuff]

Ok, now define " boutique or independent Sellers."

Good Grief.

Right Rose, good grief indeed.

[berubegirl]

Auctions are needed on ebay and should never be phased out in our opinion.

We only list maybe ten items a year auction style but those are very important. To make our point please look at following listing number 291409211793 which has been live for less than 24 hours with over 100 views, 11 bids and over 20 watchers and going on 30 quickly.

Ebay needs to limit auction style listing to items that actually require such a method of selling, meaning rare and hard to find items.

Allowing auction on everyday item definitely ruins the whole experience and atmosphere but with the right item auctions can be a valuable tool for sellers of harder to find collectible.

So please do not eliminate auctions but rather tweak them to become an asset like they use to be in the good ole days..lol

[pocomocomputing]

The eBay 2015 Spring Seller Update came out today and part of it is to encourage auctions on eBay. So eBay does not have any plans to eliminate them.

http://pages.ebay.com/sellerinformation/news/springupdate2015/
 
http://pages.ebay.ca/sellerinformation/news/springupdate2015/

In this link on the link above

http://pages.ebay.ca/sellerinformation/news/springupdate2015/fees-and-features.html

WE’RE BRINGING THE EXCITEMENT BACK TO AUCTIONS

As one of the world’s largest marketplaces, eBay is always looking for ways to keep shoppers coming back. We want to make it easy for them to find and buy the items they’re looking for. To improve the visibility of sought-after merchandise—and help sellers increase their sales—eBay is updating fees and amending some listing features to encourage sellers to use the most effective listing format and durations.

Auction selling is a premium format that’s ideal for exclusive items, such as antiques, collectibles, limited items, or true one-of-a-kind merchandise. It’s a place where the market determines the price. With this update, we’re offering sellers unlimited insertion fee credits for listings that sell in auction (see details below). This will encourage sellers to list items that are more likely to sell in auctions, are more attractively priced, and listed long enough to drive buyer interest and engagement.

[jt-libra]

Thanks for posting this, pocomo.  I'm still digesting all the information in the updates, but I can see that I was way off-base with respect to the elimination of auctions ..... it does make sense that these continue for certain types of items.

Back to reading ......

[reallynicestamps]

Are there any 'general merchandise' online auctions besides eBay?

There's something like eBid that advertises on late night TV which tries to persuade viewers that they can buy a TV for a penny.

The major sites, Amazon, Etsy, Bonanza, Alibaba (which seems to be mostly wholesale) are all Fixed Price/Buy It Now.

So keeping auctions would be a branding exercise. Especially if eBay keeps encouraging naive newbies to start auctions at 99 cents.

[recped]

Alibaba (which seems to be mostly wholesale)

Just an FYI - Alibaba is Jack Ma's wholesale oriented site for International customers, Aliexpress is the consumer version for International customers. They have similar setups within China, one site for wholesale buyers and one for consumers.

Don't forget 11Main which is Alibaba's rip-off version of eBay (without the auctions).

While there are a couple of small general merchandise auction sites (not counting the bogus penny auction sites) they are all very small and remain mostly unknown to your average consumer.

I never did and still don't buy into the theory that eBay has been trying to kill off Auctions any more than I believe the theory that eBay are trying to eliminate "small" sellers. Of course there are still plenty of people who insist on claims like "eBay always sides with buyers" and other such nonsense.

[rose-dee]

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@berubegirl wrote:

Auctions are needed on ebay and should never be phased out in our opinion.

We only list maybe ten items a year auction style but those are very important. To make our point please look at following listing number 291409211793 which has been live for less than 24 hours with over 100 views, 11 bids and over 20 watchers and going on 30 quickly.

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Wow, maybe I should be digging out all my old teapots!    The trouble is, I'm rather nervous about shipping such breakables.  How do you manage to afford free shipping on an item like this (presumably the final price will be substantial enough)?

It appears from the Spring Seller Update that eBay is doing just what you've mentioned -- encouraging mainly the higher-end, or more desirable items to be put up at auction.  

This site has been just swamped with $0.99 auctions for stuff that nobody seems to want.  Once sellers have to start paying for listings that don't make a sale, they'll soon stop listing such stuff en masse.  I do think this is one of the few rational ideas eBay has come up with.  Maybe the new CEO has had something to do with that.  

[rose-dee]

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@recped wrote:

Don't forget 11Main which is Alibaba's rip-off version of eBay (without the auctions).

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I had no idea that was Alibaba too.  They're doing a very good job of promoting it as a North American style venue, touting quality, exclusivity and the caché of being one of the chosen ones to sell on "Main Street.  

[recped]

Check the Wikipedia entry for Alibaba for a complete list of their various operations. It's a pretty long list.