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ebay Announces Sweeping Changes! Higher Fees and No Negative Feedback for Buyers!
Posted by David White at 1/29/2008 10:42 AM and is filed under uncategorized 
John Donahoe CEO elect of ebay and Bill Cobb outgoing President of ebay North America conducted the keynote address this morning at the Ecommerce Forum in Washington D.C. During the keynote John and Bill detailed the changes which was webcast as well.
Fee changes were on the top of the agenda. During the presentation, Bill Cobb announced insertion fee decreases ranging from 25% for the lowest starting price to a 17.5% decrease for the highest insertion fee item. This is welcome news for some, BUT, not so fast! The increases to the Final Value Fee actually increase the bottom line. Sites such as AuctionBytes have already done the math, so I won't rehash it.
Let's simply look at an item that starts at $0.99, with a final sale price of $15.00. The insertion fee will be $0.15 under the new pricing structure, a savings of 25% over the current $0.20 fee. Final value fee on this item currently will be $0.79 for a total of $0.99. Under the upcoming fee structure, this same item will cost the seller $1.46 according to my calculations. Now I am not a math major, but this sure looks like a total increase of just over 46%!
In addition, ebay is tossing sellers a bone by giving them free Gallery Images. In the example I just sited, it would be a wash.
Who is ebay trying to kid??????? This is totally outrageous! I sure hope that Bill Cobb and John Donahoe have great retirement packages, because no matter how you slice it, this is a huge increase!
Now for the knife I believe will be the death noll of ebay. Sellers will no longer be able to leave neutral or negative feedback for buyers. Buyers of course will be able to leave negative feedback for sellers, virtually holding the seller hostage for feedback. The only recourse sellers will have is to register a Non-Paying bidder alert for buyers that don't pay. The buyer has all of the leverage over the seller!
These are high points of the keynote address. To see all of the announced changes click HERE.
Listen to our radio program this Saturday at 10 AM as we will have seller reaction to this highly controversial move!
Fee changes were on the top of the agenda. During the presentation, Bill Cobb announced insertion fee decreases ranging from 25% for the lowest starting price to a 17.5% decrease for the highest insertion fee item. This is welcome news for some, BUT, not so fast! The increases to the Final Value Fee actually increase the bottom line. Sites such as AuctionBytes have already done the math, so I won't rehash it.
Let's simply look at an item that starts at $0.99, with a final sale price of $15.00. The insertion fee will be $0.15 under the new pricing structure, a savings of 25% over the current $0.20 fee. Final value fee on this item currently will be $0.79 for a total of $0.99. Under the upcoming fee structure, this same item will cost the seller $1.46 according to my calculations. Now I am not a math major, but this sure looks like a total increase of just over 46%!
In addition, ebay is tossing sellers a bone by giving them free Gallery Images. In the example I just sited, it would be a wash.
Who is ebay trying to kid??????? This is totally outrageous! I sure hope that Bill Cobb and John Donahoe have great retirement packages, because no matter how you slice it, this is a huge increase!
Now for the knife I believe will be the death noll of ebay. Sellers will no longer be able to leave neutral or negative feedback for buyers. Buyers of course will be able to leave negative feedback for sellers, virtually holding the seller hostage for feedback. The only recourse sellers will have is to register a Non-Paying bidder alert for buyers that don't pay. The buyer has all of the leverage over the seller!
These are high points of the keynote address. To see all of the announced changes click HERE.
Listen to our radio program this Saturday at 10 AM as we will have seller reaction to this highly controversial move!
Wow that is a huge increase--I hope it's not the death of eBay but it sure sounds like the changes are going to turn a lot of people off--or at least away to another online auction service.
The good news for some, is that I'm assuming that with the fee increase, affiliate commissions will be somewhat higher, unless they lowered those with the new fee increase. Thenagain, if nobody is going to be buying/selling on eBay anymore after the changes take place, what good is the affiliate program going to be?
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