Another eBay Band-Aid Fails to Fix the New Pricing Structure Flaws

Posted on October 18, 2008. Filed under: eBay | Tags: , , , |

About 24 hours ago (on September 17th), eBay publicly announced the following:

For multi-quantity listings, both research and the input we’ve received from sellers indicate that buyers tend to purchase less often when they see a large quantity of items available. This is most likely because they feel a lack of urgency to purchase, or they perceive that the item isn’t selling well.

For this reason, we’re changing the quantity displayed on multi-quantity listings that have more than 10 items for sale. Instead of displaying the actual quantity, such as “83 available,” we’re now displaying “more than 10 available.”

Of course, this was not news to us since we noticed this on some of our listings 3 days ago.  However, today we noticed that the listings are back to their original display – showing the actual number even when more than 10 items are available.

See Below for an example from eBay (NOTE this is the Seller Buy‘s listing, not ours) showing a quantity of 140 items available in the listing approximately 24 hours AFTER the announcement above was made:

First of all, eBay’s great idea of displaying “more than 10 available” is a reactionary attempt to correct a problem that should have been considered BEFORE the new pricing went into effect.  In an article I authored more than a month ago (Click HERE to read the full article) I wrote the following:

The Top Seller Rep then asked if I had considered listing multiple quantities in a single fixed price listing and I said that I had.  But then I pointed out to the Top Seller rep that if I employed that strategy, in an effort to lower overall eBay fees, that my sales would suffer.  Some of the items I sell are limited in nature – 1500 units or 5,000 units for example.  So if I list a quantity of one, I often get a sale quickly.  If I were to list a quantity of 48 and the item is limited to only 1,500 units worldwide, then how “rare” would the buyer think the item is and how likely would they be to purchase 1 of the 48 that I have to offer?  That listing strategy might work for someone selling ink toner cartridges because, hey, when you need a toner cartridge you need one and you don’t care whether the seller has 1 or 1,000 units available.  But a buyer who sees a seller offer 48 units of a rare item in one listing, to save on insertion fees, will delay purchasing.  Unfortunately, eBay doesn’t understand the “psychology” of the purchasing decision especially when it comes to certain types of items.

So, eBay is attempting to put yet another band-aid on a huge hemorrhage.  eBay creates new policies, such as this new Fixed Price 30 pricing structure, without considering all of the implications and then is forced to tweak other things to support the original flawed strategy.  Too much tweaking after the fact because of too little consideration beforehand. 

To further consider the implications, what happens when a customer wants to purchase more than 10 items in a listing?  Is a buyer limited to purchasing only 10?  And given that the customer does not know how many total items the seller has remaining, will the buyer then email the seller and find that the seller is more than happy to sell to them the quantity they desire and that the seller will gladly do so off-eBay for free shipping, perhaps?   We do have some items where buyers purchase 10 or 20 or more because we offer a flat-rate shipping in that category.  For one flat rate shipping fee, the buyer can purchase as many as they want and pay only the one amount for shipping.  So, it is possible that some buyers may want to purchase more than 10 of a particular item and under the new listing display, how would the buyer be able to do so through the eBay system?  Not possible.  So, off-site sales increase while eBay sales decrease which is probably not what eBay had in mind.

A recent article written by a former eBay Senior Manager, Alan Lewis, tells us what we already know — eBay decision makers and implementators are not users of the eBay system.  As a result of their ignorance of how the eBay system really works, not just the mechanics of it, those decision makers and implementators cannot produce the best results.  When I first learned of Fixed Price 30 pricing structure, I was disappointed because I immediately recognized the implications and how FP30 was not going to work well for my company and I realized right away that the new pricing was the second price increase for me in 2008 from eBay (see my article titled The Real Financial Effects of Two eBay Fee Decreases in 2008 ). 

Nevertheless, I worked within the new framework and made my decisions accordingly.  Today, I make the choice of whether to save the 35 insertion fee by listing a particular item one by one, instead of listing all the quantity I have available at one time, and I am frustrated that eBay is going to take the decision-making control away from me yet again by not showing the full quantity I have available in a listing when it was my decision to list the full quantity.  If I do not want potential buyers to see all the inventory I have on hand, then I can make that decision.  Why is there a need to tell me, with this new policy of not showing more than 10 items, that I am making a mistake by including more than 10 items in any one listing?  Does eBay really need to protect me from my own “poor” decision of including more than 10 items in a listing?

With every thing they do, especially with the mandatory free shipping for DVDs next year, eBay continues to tell me that they know better how to manage my business than I do.   Given that the Average Selling Price (ASP), the Sell-Through Rate, and the number of new buyers are all decreasing on eBay, I don’t feel particularly pleased with eBay trying to give me advice on how to run my business.  My suggestion to eBay is that if they want to be something more than a venue, making the business decisions that only sellers should be making, then they need to go out and procure their own inventory and sell on eBay themselves.  Now, that would be interesting and I would suspect we would have a whole different set of eBay policies and pricing structures announced if that were to happen. 


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4 Responses to “Another eBay Band-Aid Fails to Fix the New Pricing Structure Flaws”

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There are so many problems with eBay but the biggest is the ignorance of their own user base – all members not just those selling their products. They do not understand human behavior in any context and certainly not on eBay. This issue should have been seen from the start their continual needs to implement and then learn what for most people is commonsense is pathetic.

I always use to list only 2 because buyers tend to purchase 2 if there are not many available. However, I was consumed with constantly having to count my inventory to make sure I didn’t list something I ran out of. However, I think I need to go back to that method, because the watchers are piling up in my store and the products aren’t moving.

Anyway, yes just another example of their idiocy.

What they should do – of course they are not very competent ion the technology dept.- make a program that holds the exact quantity that the seller can program to always have 2 listed until the inventory is depleted. More than 10 is stupid and certainly doesn’t increase urgency- idiots!

My suggestion to eBay is that if they want to be something more than a venue, making the business decisions that only sellers should be making, then they need to go out and procure their own inventory and sell on eBay themselves.

Of course this idea has never occurred to them and would be dismissed out of hand. They are far too smart and elite to dirty their hands with such actual lowly work.

I’m with Brews, if I had more than one of something rare or unique, I would NEVER list them as a dutch or multi quality fixed auction. As soon as you reveal you have more than one, how unique has it become? Not very. I walys lited items like this individually, and with a few weeks space between them.

I posted 100 elctronic connectors (it shows “More than 10”, most buyers have a project that may require a certain quantity to be designed in to a project this has eliminated them as a buyer or created more emailed questions for the seller, A real pain and another way to eliminate another dwindeling sale, my sales have gone from thouasands to almost zero with all the new policies

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