First Time in Over Five Years

[pierrelebel]

eBay shares are trading BELOW $20



We all know the economy is weak and retail sales (that would include eBay) are anemic. The question is: what will the management do to turn things around? To bring more buyers to the site?

Or will they simply wait for the recession to end... eventually? .

[pierrelebel]

Ebay Shares Tumble on Downgrade

The stock slipped 8.4% to $19.10.

Analyst David Joseph of Morgan Stanley chopped his rating on eBay to equal weight from overweight. He also slashed his third quarter earnings estimate to 40 cents a share from 42 cents a share. For 2009, Joseph expects earnings of $1.91 a share, down from his previous estimate of $2.04.

In his research, Joseph points to deterioration in eBay's core marketplace as well as "greater economic sensitivity and poor demand." He also expects this holiday season to be challenging for the online auction giant.

Thursday's steep stock drop-off indicates eBay's susceptibility to negative news, especially when added to existing investor fears over the larger economy.

Although Jeffries analyst Youssef Squali maintains a buy rating on eBay, even he offers some caution. In his latest research note, Squali points to an estimated growth in listings for eBay in the third quarter of 24% over last year in the same period.

But, he adds, "given the macro weakness, we believe that soft consumer demand will lead to lower conversion (and take) rate and lower average selling price."

The take rate is the percentage of revenue the company makes for each dollar of gross merchandise sales.

Squali also notes that with 54% of revenues derived from outside of the U.S., the strengthening of the dollar against the Euro could hurt foreign currency exchange, which could eat into eBay's profit and revenue. .

[magisterrex]

Too much negative buzz around eBay these days. They need to get some viral marketing going FOR them, not against.

[bare_bright]

They Should pump out those TV adds again, don't see much advertising going on anymore, they need to spend money to make money , just like almost every Bushiness has to advertise

[jeffglobal]

Or perhaps stop pissing off their sellers with the throwing of roadblocks at the way they're used to doing business!

Nothing new to my store or auctions for months, and nothing new to be added until all of my required updates are complete. It's lose-lose for everybody.

Way to kick your sellers while the economy is down!

[pierrelebel]

" and nothing new to be added until all of my required updates are complete. "

I have the same problem.

900 store listings have been revised (or ended and sell similar) and moved to core as fixed price with 30 day suration. So far the results are dismal.

Another 300 store listings revised (or ended and sell similar) to meet the new policies (including those taking place early next year).

1,350 more store listings still to revise (or end and list similar). :-( .

[ampurtle]

Oh, they emptied out the piggy bank and spent 900 million on that Pay Later company the other day. Call me when it gets to $7.50

[gifts_of_elegance]

If the economy is bad, then people will have less money to spend or will be more cautious where they spend it. Buying on eBay is cheaper than buying at your local mall, even with the addition of shipping. This is a perfect opportunity for eBay sellers to do well but eBay management has to come to their senses. Your average purchaser does not want to wait 7 days to see if they can afford an item, they want it NOW and that's when Fixed Priced listings are an asset. But eBay keeps burying Fixed Priced listings at the bottom of the list where buyers won't see it, so there is NO SALE. When an item that ends in 29 days shows up on top of the list, the usual reaction is "No need to buy now, there is lots of time, I'll put it on watch and see if something better/cheaper comes along" which means there will never be a sale.
eBay and its management should take a course in marketing because they don't know anything about selling or what motivates your average purchaser!

They paid $900 million to buy Pay Later. If we don't sell, then who is going to use their services or PayPal's?

Wake up eBay, SMELL THE COFFEE!

[gifts_of_elegance]

Pierre, you are lucky to have so many listings. You can spread them out over 30 days which means that lot of your listings will get exposure on a daily basis and hopefully bring attention to your other listings.

I usually like to be on top of things and would have slaved 18 hours a day to complete all the revisions. This time I didn't and I am glad. This way not all my listings go to the bottom of the list all at once.

I know that does not apply to eBay.ca but truthfully, how many purchasers even look on eBay.ca? Even I go to eBay.com when I want something.

[pierrelebel]

"you are lucky to have so many listings."

????

More listings simply mean I pay more eBay listing fees.

Stamps do not sell at this time of economic difficulties. Collectors (mostly mature and senior) are more concerned with meeting their financial obligations and planning their retirement than purchasing more stamps for their collections.

In fact, in the last three weeks I received more inquiries than in the last twelve months from collectors wanting to sell their collections.

Last time I checked, the "sell thru" rate for fixed price listings in the Stamps category was about half eBay's average.

And I do not expect the situation to correct itself for several years. Demand will get weaker and prices will fall. We had a similar downtrend in the early 1990's. .

[gifts_of_elegance]

Swarovski crystal has fallen a lot too. Seems we constanly have to re-think what we do and how we are going to do it because of constant change. I am the same age as you and have seen it all!

[craftycatsattic]

I started in retail at the floor level way back in the mid 80's then worked over 10 years as a Manufacturer's Rep and then as a Retail buyer for a chain of stores. I have seen a lot of things happen in the past 20+ years...seen a lot of major retailers come and go, restructure, sold items when they were hot, picked up the pieces when they were not. Retail is all about supply and demand and the ecomony and trends are always changing.

As sellers we have to constantly adapt. It's all part of the game, all part of what makes it fun---or not. The economy will pick up eventually. In the meantime, we all have to ride the wave. It could be a great opportunity to grab some finds and resell them in better days---or it could be time to stop stock piling and sell what you have.

In the end, it's not something we have control over. We just have to deal with it as best we can.

[gifts_of_elegance]

Thats right! Its exactly as you say!