Copyright © 2014 SYDNEY SCHUSTER – All Rights Reserved
Do you sell your book (or anything else) on eBay? If you’ve had more than zero sales, consider yourself lucky.
eBay sellers have seen catastrophic drop-offs in page views and sales this year, while eBay steals scads of their dough. WTF happened?
The easy blame is the new glitch-plagued search engine eBay rolled out last year (it’s called Cassini) at the same time sales started flatlining. Naturally everyone assumed a connection. And there is one, but the real answer is more complex.
In fact, eBay started doing other things recently that are way more awful than Cassini:
● eBay now gives preferential treatment to foreign mass marketers, while pushing aside smaller domestic sellers.
● eBay started selling postage to sellers, for which it gets a fat cut from carrier services.
● eBay launched its Global Shipping Program and then forced sellers to use it. Sellers mail their international packages to a domestic distribution center run by Pitney Bowes, who removes their packing materials to save money and then ships broken purchases to the wrong place, with exorbitant fees due to buyers.
● eBay deliberately hides many listings.
● eBay tasks its programmers with screwing sellers instead of improving security, resulting in broad downtime outages and the hacking in May by cyberthieves who stole the private data of many, if not all, of eBay’s 128 million users. As a direct result, many buyers abandoned the venue.
● eBay sellers suffered massive cutbacks in their listings on Google Shopping search after Google made the service pay-to-play and eBay didn’t want to so much. Google also launched a new search algorithm (Panda 4.0), with bid-based priority ranking in shopping results that don’t favor cheap-ass clients like eBay.
● eBay pirated YouTube tutorials, further antagonizing Google (who owns YouTube).
● Google minimized the presence of low-quality and/or thin content promotions, like eBay’s poorly thought out AdWords campaign.
● eBay’s unwillingness to upgrade its staff or infrastructure is a big mess of stupid, best exemplified by its newest market launch. On October 9 eBay began hosting live auctions for a consortium of major art auction houses. The highly publicized event crashed eBay’s American servers on the first day and its European ones the next. eBay shut down and/or rearranged its other marketing operations to free up bandwidth and server space for the live auctions. As a result, US buyers were blocked from making purchases from US sellers because, they were told, one party wasn’t in the US. eBay US sellers found their stores presented as Russian or Chinese ones. Many stores and regular auctions disappeared altogether. The purchase histories of eBay US members disappeared, too, and could only be accessed by logging into accounts via eBay Canada.
The upshot: eBay sales have tanked because eBay willfully thwarts sellers in pursuit of various ends, none of which benefits you. eBay revenues nosedived this year (including a $200 million loss due to the Google debacle alone). And, apparently, eBay recruits programmers from the local bus station. Not for nothing, but eBay has had 14 worldwide site crashes this year alone, plus the bonus site hacks resulting from inadequate security.
Here’s how and why eBay limits visibility of (your) listings:
● Rolling and regional blackouts. eBay’s file management system herds what it considers less-desirable listings into dead zones. It assigns server locations and listing numbers based on criteria like category and seller volume, allocated regionally, which eBay can manipulate discreetly. eBay won’t let you sell anything locally (where buyers can — horrors — pick it up for free!) because they can force you to sell it far away, and give themselves a whopping postage commission (58% from USPS). Plus eBay doesn’t want you competing in desirable markets against their mass-market darlings, unless eBay’s had a real slow quarter and its financial report to investors is due and shazam! just watch those floodgates open.
● eBay physically TURNS OFF listings, at will and randomly, without notification (including ending auctions early, often within one minute of the end, to block snipe bidding because it overtaxes eBay’s inadequate infrastructure and bandwidth; eBay uses other means to block sniping, too).
I have on numerous occasions checked my own eBay listings, only to see this:
I now invite you to share my horror upon discovering that my eBay listings are visible ONLY in Texas, Louisiana, Mississippi and South Carolina. They’re not big readers of cutting-edge literature there, so I gave up selling my novel Dead Spot on eBay.
eBay’s rationale is actually codified in their user agreement:
Still don’t believe eBay can control which listings are visible? Okay. See the listing below? Put it on your watch list … and watch it disappear!
What eBay doesn’t tell you is that eBay is jettisoning small and mid-sized sellers, in ways that aren’t transparent enough to start an avalanche of class actions. In the meantime, eBay doesn’t care if your listings never sell. Why?
First of all, when buyers can’t see listings, it forces sellers to relist perpetually and eBay makes more money. How? Fees. There’s a fee per listing. By way of example, eBay collects $7.20 in listing fees for one unsold $10 item relisted for two years, compared with $3.63 if it sells once. And if a seller ends an auction early for any reason, and there were bids on it, there’s a penalty fee for that. Multiply all that by millions of unsold listings to get the big picture.
Plus also, there’s this:
In the press, this was ebay’s year in review: 1) Ebay Purges of thousands of small sellers 2) Ebay granting itself permission to hide sellers’ listings from site visibiity 3) Holocaust souvenirs listed on ebay then yanked by ebay after bad press revealed it 4) the banning and reinstatement at ebay of “Charlie” 5) Feds investigating ebay’s Bill Me Later 6) ebay founder Pierre Omidyar launching off into investigative journalism yet unaware what his own company ebay is doing to small sellers 7) glitches, outages, rolling blackouts, Cassini nightmares at ebay 8) Ebay settles $4.75 Million class action lawsuit…Did I leave anything out? — , Former Ebay Sellers 2 Open Forum on Facebook
Yes, a couple more things:
● Bay unlawfully inflated the price of its stock (down this year by more than 4%) by planting acquisition/spinoff rumors in the media. (Google to buy eBay! Carl Icahn to buy eBay! eBay to sell off PayPal!) Board members and top execs sold their shares high, then bought them back low (or didn’t, if they grabbed the cash and bailed).
● If you call eBay customer service and the CS rep doesn’t like your attitude after you’ve been on hold for hours, watch out for damaging retribution.
● eBay secretly allows high-volume sellers to buy their way out of negative feedback (one reported payment: $150).
● eBay forces sellers to start auctions at 99 cents to attract buyers to the site, then shuts off the auctions from views and late bidding, forcing a sale at the opening bid or a relist.
Fun Fact: For books, eBay limits the shipping fee you can charge to $4 and then steals 13% of that in fees (10% to eBay + 3% to PayPal). Selling coffee table books? Good luck with that!
So caveat emptor, dogs. Sellers are already lining up to sue the crap out of eBay, if Icahn (who owns 40%) doesn’t rip it to shreds first. Three state attorneys general have started investigations, just as PayPal spinoff claims are surfacing again (coincidentally, just as eBay’s share price took a nosedive again). The SEC frowns on stock manipulation. And the FTC doesn’t look kindly upon Ponzi schemes, antitrust racketeering, blackmail, or outright theft, yo.
The most plausible reasons why eBay has dodged any kind of regulatory scrutiny thus far should make you think, and squirm:
1) Icahn makes extremely generous political contributions to Mitch McConnell, John Boehner, Mitt Romney, Orrin Hatch, John McCain, and other capitalism-before-constitution carpetbaggers who endlessly block cabinet appointments and kill meaningful regulatory legislation; plus, he has successfully evaded SEC investigations himself;
2) eBay is likely used by the government to spy on … well, everybody, the same way it conscripted Facebook and Google for the same purpose. eBay saves searches and purchase histories of users, and maintains an email system for them. Connect the dots, yo.
Fun Fact: According to eBay’s 2014 Q3 report, the company had $749 million net profit from 128 million users. Really? That’s $1.95 monthly profit per user. Who needs massive infrastructure for that? Bums make more money selling soda cans.
As for the seller purge that’s destroying small businesses nationwide, scuttlebutt is rampant in eBay forums and elsewhere concerning the real intent behind it. Pick your fave:
1) reduce payouts from upcoming lawsuits;
2) minimize claimants from a rumored bankruptcy filing;
3) easier reincorporation of eBay in the UK, where it paid a paltry £620,000 income tax for 2013 sales of over £1.3 billion (eBay US paid $6.1 million on $2.86 billion net revenues the same year — and would’ve paid 80% less in the UK);
4) prep eBay for sale to Alibaba and PayPal to Apple. On October 1, eBay assumed $7.5 billion of PayPal’s debt (ie, all of PayPal’s debt). Assume from that what you will.
It’s not much of a surprise that top eBay executives are fleeing, most recently CTO Mark Carges, VP of merchant development Michael Jones, and PayPal president David Marcus. On September 30 eBay announced the imminent departure of its much-despised CEO John Donahoe and CFO Bob Swan, accompanied by — wait for it — a PayPal spin-off announcement. Wow, what a coincidence — on September 30 Donahoe just happened to own 660,748 eBay shares that he no longer needed, the value of which shot up immediately by 7.5%. (And predictably sank 18% two weeks later, after savvy analysts downgraded eBay’s stock).
Few NASDAQ companies need to be investigated more than eBay does. In the meantime, eBay still laughably promises sellers better visibility in exchange for sellers providing 24-hour turnaround, free shipping, generous return policies, and of course lots of fees. But in reality seller compliance doesn’t buy blackout immunity, and eBay penalizes sellers for things they can’t control. The eBay Power Sellers forum is clogged with complaints from cooperative sellers whose stuff is still deadweight at the ass end of Best Match search results (when it’s visible at all) behind thousands of duplicate listings for Chinese designer counterfeits that don’t even have the search terms in the titles. And if you relied on buyers finding your listings via Google Shopping to pick up the slack, you can kiss that goodbye.
In other words, eBay’s new business model is you giving eBay money for nothing, not you selling stuff on eBay.
My advice: Don’t bother selling your book (or anything else) on eBay. Short of worldwide famine or collision with a comet, eBay is your worst nightmare.
Copyright © 2014 SYDNEY SCHUSTER – All Rights Reserved
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