Lessons We Can Learn from eBay: Three Simple Common-Sense Rules For Improving Your Company’s Public Image

Posted on September 14, 2009. Filed under: eBay, eBayInkBlog | Tags: , , , , , , , |

eBay is suffering from a poor company image and its bad reputation is directly the result of things that eBay has done and/or not done.  While eBay likes to blame its poor online reputation on third party sellers’ failings, I have outlined below the basic eBay failures as it relates to public relations efforts and company image. 

Of course, eBay’s bad image is a bit more complicated than the simplistic problems I have detailed below.  But I would still say that by following three simple common-sense rules, eBay could stop the biggest part of their public relations nightmare.


Problem One: Inherited Problems and Making Bad Decisions

There is really no way eBay can put a believable positive spin on the Skype acquisition and subsequent sale.   Not only did eBay overpay but they didn’t even get the core technology with the purchase price.  Meg Whitman made that blunder and John Donahoe is the one trying to clean up that mess.  Donahoe didn’t make the mistake but he is trying to put a good spin on it.

And it doesn’t take a rocket scientist to realize that if you just rake in the dough from sellers without setting any minimum standards and without concerning yourself with policing the sale of counterfeit items that only negative things can occur.  Buyers get tired of being ripped off and they go elsewhere to buy and manufacturers become outraged at the devaluation of their brand and they will take legal action.  And when those things occur, the company’s reputation suffers.  News stories about the lawsuits and horror stories of eBay customers being ripped off are impossible to refute because they are true.

And Donahoe inherited those problems, along with the bad publicity associated with the problems, and when he takes action to remedy the problems (by creating seller standards and discontinuing sellers’ ability to leave buyers’ negative feedback, for example) then he creates a whole other round of bad publicity as scorned sellers make lots of noise to express their displeasure.

And one example of a poor decision eBay made, with Donahoe at the helm, was to retroactively grade seller’s performance using a new measure whereby neutrals were calculated as negatives.  The sellers who were guilty of retaliatory feedback faired the best because whenever they had received a neutral rating, they left the buyer a negative rating and usually entered into a mutual withdrawal agreement with the buyer so that the neutral was removed from the seller’s rating.  A seller who left feedback first would not have given retaliatory feedback and, thus, when the rescoring was done these “good” sellers suffered a blow to their feedback rating since the neutral rating was still shown on their feedback.  Re-grading sellers retroactively on a new set of standards is never a good idea and there was a huge seller outcry when eBay did so.  It was a bad decision and the eBay community made sure to let everyone know it.  eBay did try to justify their actions but that was not possible because, well, simply stated — eBay’s actions were wrong and no matter what they said to the community, everyone knew eBay was wrong.

First rule: A good public relations campaign cannot erase past and current mistakes.  When a poor product or bad service is present at the company’s core then no amount of positive spin or blaming external factors can improve a company’s image.  So, stop trying to put a good spin on the bad things and, instead, fix the core problems within the company. 


Problem Two: Withholding Information (Non-transparency)

eBay was founded on the principle of creating a “level playing field” so when eBay began courting online companies to sell their wares on the eBay platform and offered these new sellers inducements, eBay had no intention of informing the community that the “level playing field” foundation had been abolished.  Some good investigative reporting by Randy Smythe uncovered what was occurring.  eBay tried to spin the news by saying that the “level playing field” concept was still intact but that eBay had just created a new class of Powersellers called Diamond Sellers.  The eBay spin didn’t resonate with members and there was a whole wave of bad publicity across the internet, primarily because members felt they had been deceived since eBay had not been forthcoming initially. 

Yesterday, I wrote a blog post titled eBay Provides GENERAL Phone Support to Everyone which detailed information that eBay had not communicated to its members.  Now, I could have titled the post something like “eBay Powersellers Lose their Dedicated Phone Support” or even “Only 1% of eBay Sellers are Given the Super-Secret Phone Number to Get Good Customer Service“.   Although the titles would have been true, those would have been inflammatory titles and I could easily have written the article with an inflammatory tone.  Because eBay failed to inform its members of important changes, I was the one who got to shape the message since I posted the information first.

In 2008, when eBay was implementing changes faster than they were making announcements (like removing electronically delivered items and finding sellers in violation of a policy before the policy had even been announced), I spoke with an eBay Powerseller representative who had an interesting comment.  I told her that I thought eBay needed to take more time and announce changes because I couldn’t run my business by only being able to plan day-by-day and be reactive rather than proactive.  Her response to me was that the online marketplace was changing rapidly and that eBay needed to spend all their time and energy making changes to better the eBay marketplace and, thus, eBay simply had little or no time to effectively communicate those changes to members.  Her message was that we (sellers) could adapt to eBay’s changes as they occurred or we could go away since eBay was not going to devote resources to communicating changes to us in advance.  And it was that specific non-communication philosophy from eBay in 2008 that was the impetus for many blogs such as mine.  eBay members are hungry for news that affects them and they will seek out that information from others if eBay doesn’t provide it.

Second rule: Avoidance isn’t a good PR strategy because when the information eventually comes to light then someone else gets to shape the tone  and direction of the message. 


Problem Three: Spinning Tall Tales

There is a whole host of Tall Tales that have been told by eBay.  I’ll detail only one — the “Fashion Deals Fiasco” where, among other things, Fashion Deals was allowed to directly link off eBay and to sign up eBay members for a newsletter that was offered directly by the company, off-eBay.  When other sellers pointed this out in the community forums, an eBay employee posted a response telling sellers that the Fashion Deal listings had been reviewed and that there was no violation.  This sent a huge howl up from community members.  And what was eBay’s response?  Donahoe went on the Griff radio show and said that allowing Fashion Deals to link off eBay was a “test” and that eBay was considering changing the links policy.  Now, we all know that ain’t gonna happen … ever.  So, nobody is buying that explanation.

Of course, eBay looks rather silly when they try to put a positive spin on the eBay-GM experiment.  And most eBay community members don’t believe eBay when they say that any particular problem is “just a glitch”.  The “just a glitch” issues are usually a precursor to a new policy that just hasn’t been announced yet.  So eBay members are always wary of the news coming out of eBay.

I find it rather telling that Richard Brewer-Hay of eBayInk blog, who hasn’t been around for the decade long history of eBay storytelling, wrote a post titled eBay Voices Keeping One Foot in the Present and One in the Future in which he had this to say:

“I saw something interesting over on AuctionBytes.com today regarding the changes made to the eBay Voices program earlier this week with the headline “Is eBay Phasing out ‘Voices’ Focus-Group Program?” to which my immediate, well thought out response was… “Huh?”” …

“I get that skepticism is necessary with every story and any reporter or blogger worth their salt has to ask all the necessary questions before drawing conclusions. However, to run a blog post with such an inflammatory headline, only to proceed it with comments and statements from eBay spokespeople ensuring the contrary, I don’t know what that accomplishes rather than create controversy where there really isn’t any.”

Rule Three: Companies who have a history of  telling Tall Tales are not believed even when what they say is the truth.  It’s a bit like crying Wolf too many times.  If you want to always be believed then always tell the truth even when you know the truth won’t be looked upon favorably.

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8 Responses to “Lessons We Can Learn from eBay: Three Simple Common-Sense Rules For Improving Your Company’s Public Image”

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Second Rule Corollary
Rule Four: When a company or organization embraces openness and supporting their Community, they should never resort to the tactic of “Killing The Messenger”.

Goodbye eBay Blogs

“Oops! Too much!”
Professor Weirdo, Milton the Monster (1965-1968)

I can’t help but to correlate this weekend’s Tea Party protest in DC with eBay sentiment. Here’s what we’ve learned.

1. People are sick of paying for corporate greed in the myriad of forms it takes on.

2. Information accessibility proves that no official opinion/statement is ever conclusive. Skepticism is backed up with solid data.

3. Mobilizing large groups of activists is easier today than ever before.

@BrewsNews- I think you need to add this picture to your sidebar:

OH! You’re my new favorite blogger fyi

Thanks, Jeff, for the compliment!

Ah, now I get it.
In our twitter convo on being “free help” I noted that problem two: was taken to heart.

I guess you are ( among others) the “someone else” mentioned in “someone else gets to shape the tone and direction of the message”

premptive is good, as is preventative.

Good lessons for any company to take to heart.
If I mess up, it would be nice to know some blogger is on my case quickly to fix things.
And I’d hope to be smart enough to take their (your) fruitful advice to heart quickly.


Vince, I was wondering if you would even read the blog post since it was about eBay 🙂

And I knew, though, that once you read the post (if you did), that you’d recognize it as a follow-up to our Twitter conversation.

You gave me the “spark” needed to write the post, especially since you jabbed and poked at me on Twitter for quite awhile the other night!

aww, broke my own challenge today, tweeted reply to something referred to eBay. oh well, i’ll start tomorrow 🙂

[…] Seite seine Probleme gerne auf das Versagen von Drittanbietern schiebt, hat sich der Autor von BrewsNews auf andere Tatsachen verlegt und diese auch in seinem Blog dargestellt. Klar, sagt er, sind die […]

[…] Marktplatz-Positionierung, so jedenfalls sieht es Skip McGrath. Für Randy Smythe, Autor von BrewsNews, jedoch gibt es zwar keinen Zweifel daran, dass eBay noch immer die dominante […]

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