eBay Is a Losing Bid - Barron's 71 comments
-
Font Size:
-
Print
- TweetThis
With a Friday closing price of $22.55, eBay (EBAY) is trading less than a dollar away from its 52-week low, and dangerously close to its lowest level in five years. Barron's Eric Savitz thinks the stock will drop further still.
eBay is facing sellers unhappy with recent changes to the fee structure of sales and auctions. Some of these sellers are sufficiently frustrated that they are leaving eBay and selling items through their own websites. A slowing economy is hitting eBay's profits, as is a strengthening dollar since over half of the company's revenue comes from outside the U.S.
However, some analysts believe the problems still to come will be even worse. Last week, Brian Blair and Ryan Hunter of investment-research firm Wedge Partners noted that eBay's business is "deteriorating," and that the company is preparing to fire as many as 10% of the company's 15,000 person workforce. Blair and Hunter also think that eBay is close to unveiling a new search platform it has been testing; a failure could be disastrous, as "the ability to search and find an item with accuracy is a key factor in eBay's success."
:::::::::::::::::::::::::::::::
- In August, eBay (EBAY) announced plans to focus on fixed-price sales rather than auctions. eBay is hoping the move will help it compete more effectively against online retailers like Amazon (AMZN).
- eBay (EBAY): Q2 EPS of $0.43 beats by $0.02. Revenue of $2.2B vs. consensus of $2.17B. Sees Q3 EPS of $0.39-$0.41, short of consensus of $0.41, and revenue of $2.10-2.15B vs. consensus of $2.18B. [PR]
Related Articles
|
Find People on SA
-
The Seeking Alpha 100
See allThe top 100 stock
market authors
selected for publication
Seeking Alpha 100 » -
Fastest Climbers
Authors with the largest
increase in followers
in the last 7 days-
1
David Fry
-
2
Philip Davis
-
3
Tyler Durden
-
4
Bill Gross
-
5
Peter Schiff
Fastest Climbers » -
1
-
Top Commenters
Top commenters,See all
as ranked by their peers
Top Commenters » -
Top Instabloggers
The 100 most activeSee all
Instabloggers.
Top Instabloggers » -
Top StockTalkers
TopSee all
StockTalkers.
Top StockTalkers »
This article has 71 comments:
I have a fast connection, and it still can be very painful to surf due to all the heavy code.
The space is ripe for an alternative player.
Sellers knew best match aka worst match would be a disaster from the word go because it was based on eBay Express (recently taken offline because best match was a complete failure).
Another huge issue is that with seller contentment way down, other factors like the worst economy since the Depression have Ebay taking the heat for all problems even though generated by less consumer spending in a bad economy.
While people do unload junk when the economy slows down there seems to be fewer reasons to unload it on ebay. Few if any bids, constantly changing direction etc. The fastest growing areas of the market (local trading and buy online pick up in person/store) were persued by Ebay as "Ebay Local" announced, then burried while Craigslist grew at 90% over the last few years.
The potential is here, I am not really sure what the problem is. You need people that understand why Ebay worked to replace the consultant types, or at least take them somewhere and hit em in the head with some water balloons! LOL
Marty
a) My last batch of sales including buy it nows, none of the 'winners' paid for the goods. As the threat of a buyer negative was removed.
b) It is no longer worthwhile, the sale price price of items is now about 1/3 of their original value. This coupled with the high Paypal and Ebay fees, ensures that it is cheaper to junk or throw the items than sell on ebay.
c) It became an increasing waste of time, hours spent taking pictures editing listings to comply with all the ebay policies. Answering questions, and then a big fat ebay bill with little chance of someone paying. It was more effective to concentrate on other much more effective ways of raising money.
Fees…totally ridicules
Terrible buyer extortion
No negative Feedback from sellers (even if buyer does not pay)
DSR’s effecting listing exposure ????..even tho you still pay to list
NO more cash/money order payments allowed
Ridicules new layout page
Mental 30 day listing duration …exposure calculated by previous sales ???
Algorithms for almost everything ???? WHY?
Fall in to bottom 1% due to your DSR’s and your suspended from selling for 30 days
And the wonderful Best Match............LOL
Complete madness
THAT was a no-brainer!
(Mr. Donahoe, as I've been saying for months - I still have my camera at the ready so I can get a picture of you leaving Ebay!)
Disgusted ex-10 year Ebay seller.
Ever since Meg left, the company and the stock has gone down the tubes. I dont see a come back any time soon for either.
The fees are way too high
and on 1 oct for music cd's a seller can't charge more than $3 for s&h
Paying for a package, POSTAGE POSTAGE POSTAGE AND
a trip to the PO, $3 is ridiculous. I'm losing money there.
I assume they will limit s&h on other items as well.
Then they canceled 3 of my listings because I put the words
"Like New" in the listing title.
They didn't tell me this was against their rules,
BUT THEY DID CHARGE ME FOR ALL 3 LISTINGS.
If I'm paying for the listing why can't I say it's Like New????
The major trouble is helping your buyers to break the Ebay habit. Reach out to them, tell them where you are listing, give them an incentive to try buying from you at a new place. I still carry Paypal because it makes buyers feel more comfortable buying elsewhere.
I feel Ebay is on its way out - it will be replaced by many new sites: Wigix, Bonanzle, iOffer, OnlineAuctions, eCrater...and so on - all up and running and mostly free to list - all they need is the buyers.
tinyurl.com/6zgyk4
Now lets look at it as a buyer. Hate it!!!!!! I am sick and tired of looking for something and getting nothing but what feebay wants me to see which is often irrelevant to what I was looking for. How do they think they can decide for me what I want or which seller I want to buy from. With there stupid best match I always wonder what I am missing but I am not going to spend endless time going through page after page.
No money orders or checks. That was it for me. Not because I don't have a credit card but because I won't use it there. You could pull the limbs from my body and I wouldn't use preypal. So no more buying from me.
Feebay wants to be like Amazon? They never will be. They wouldn't have to even try to emulate Amazone had they not sh*t on so many sellers and buyers alike. They could have cleaned house years ago but chose to sit back and collect the money.
As an aside, I was reading a blog and a woman stated her children are having to go without now because of feebays greed and now her children also HATE feebay. So, do we have a whole new generation that is going to hold feebay responsible as well? Interesting concept.
This is an interesting "aside" and needs to be brought more into the light. Glad you did. I, too, have read such items here, there, and on. This is a much larger blite ebay has creative than I think they realize.
From my own personal orbit of friends and family, the limited edition, mind you, is approximately 25 - 30 have ceased to use ebay altogether. There really ARE other places to shop now.
eBay has become the most HATED and despised company I think I've ever heard! Even those still clinging to selling hate the company.
That's pretty sad.
Although, ebay won't be around. But it IS worth pointing to the ebay trolls that haunt the boards.
- eBay was always so proud of its super-loyal community. There were far too many cases when effects of bad experiments or technical issues were mitigated by the loyal users.
- eBay keeps changing their mind - who is more important to empower - sellers or buyers?
- eBay upper management does not seem to use its customers or the lower-level employees for new ideas, many great ideas were buried for years only to reappear after steps of competitors
- eBay's philosophy for a while was - "we need to better retain our users", does not feels like a great plan for expanding a business
- Many employees have left the company during last 3 years. Did they want to work in a company that's deteriorating its own business?
- As internal processes and management chain become more and more sophisticated and elaborate, more and more smart employees left the bureaucracy
- Have you ever seen people that feel making career is their full time job? It hapens everywhere, but after a certain level it becomes a problem and the company will be very hard to fix
- As many noted, search relevancy plain sucks there
- As it seems, almost every change done in the past years would read like "we're making our site so much better for the users", and then you read between the lines "and we will collect more fees, by the way". Talking about feebay?
- IMO, eBay's marketing is pathetic - rosy pictures with lots of stuff and brave words, but nothing interesting after all. Where is the substance?
They still have great technology. They still have many great people working there. But the system becomes more inflexible.
eBay once was a great story...
Isn't it great! I really do think that is something nobody even thought of. But that seems to be par for the course for feebay. Like you, I have gotten friends and family to stop using feebay and switch to online payment methods that do not include preypal. I even make it a point to bring it up in casual conversations with aquantances and "teach" them about the evil of feebay and preypal.
I love the trickle down effect. I have a nephew who has a son. A son who will now NOT be brought up thinking feebay is a good place to buy.
NEW YORK (Reuters) - U.S. online auctioneer eBay Inc may cut 1,500 jobs, according to an article in Barron's weekly, citing a report published last week by investment-research firm Wedge Partners.
The Wedge report, according to Barron's, said eBay's business was "deteriorating" and the company was readying layoffs that could affect 10 percent of its 15,000 employees.
Wedge Partners and eBay could not immediately be reached for comment.
(Reporting by Martinne Geller; Editing by Ted Kerr)
Everyone sees charts and sometimes manipulate them so people like you get scared. So what it is under its 52w low? It can easily come out of the woods. I expect a GAP down tomorrow, will buy at the open.
Sellers are not the only ones leaving either. With the newest eBay change, buyers will no longer have a choice as to how they pay for their goods. They are being forced to use eBays 'better half', PayPal.
Sellers are doing more than just leaving and opening their own websites. For those who still want a viable auction format, they are signing up in droves at other eCommerce sites, like OnlineAuction.com (www.OLA.com). Sites like OLA offer better deals to sellers, who are then able to offer better deals to buyers. I've been at OLA since February of this year and am 100% happier than I ever was at eBay. I pay $8 a month and get to list anything and everything I can. I also pay no Final Value Fees AND I get to offer my customers many different ways to pay: PayPal, Google Checkout, RevolutionMoneyExchang... (which has no fees for transactions like PP and GCO), Money Orders, Personal and/or Business Checks, and several other choices.
eBay thought they were the only game in town... but they were wrong and their falling stock proves it.
For those looking for collectables, can I suggest a visit to specialistauctions.com... It is a still relatively small site and UK based, but has many US members, and auctions are monitored by experts to reduce the likelihood of fakes being listed or items listed in the wrong category.
I find it more difficult and depressing, and each time you list there is another thing to learn it's constantly making changes and is difficult to keep up, so I find myself more and more going to boards for help as their customer service seems to be automated and only selects key words to answer queries. Wasting more time.
I've now started my own website for selling our vast collection of cookery books, where the efforts and rewards are all mine.
In the defense of e.ay I would say that my international sales have increased recently, but due to my paying the enhanced fee for some of my items.
My personal feelings now is that eb.y is just to much hassle and restrictive. I may just use ebay for the more unusual items.
Finally it would seem that ebay is now following all the other physical stores, who have lost their own particularly unique identity. Now you can go to any town in any country in the world and all their malls have the same (clone) stores with the same stock. I'm ever hopeful that in time these large enterprises in towns and internet sites will give way to small individual shops where you can enjoy the pleasure once again of shopping, for different and unusual items.
Ebay was built on their auction site with people selling their own stuff from their own homes. Sadly, they've now lost their unique identity!
Most powersellers are small sellers. The large very large majority are only bronze and silver (1000 a month for bronze 3000 for silver) eBay doesn't give any priority to any one other than the diamond powerseller Buy.com and one other real eBay seller. No one else matters there is nothing special about powersellers. The only benefit and is only a result of the new change is the discount, which I believe all sellers should have the opportunity, and many people have expressed this on the eBay Ink blog. You should go to the blog and express your feelings too the more people maybe the more likely they make changes but I wouldn't bet on that.
Aside from that fill out my survey
[url]spreadsheets.google.co...[/url]
here are some links that you can use to file complaints with government institutions and authorities and I encourage all sellers to do so. I know it sounds crazy but officials don't actually spend their time monitoring eBay activity and unless a lot of people make it clear these policies are unacceptable and causing severe negative consequences nothing will change and that is an absolute reality.
Fill out the survey and pass it along to any other sellers you know. It is to support my arguments in a complaint I have been writing. I know the questions appear redundant but there is a reason why I ask the questions the way I do, so please just bare with it.
[url]docs.google.com/Doc?id...[/url]
On Sep 15 11:20 AM fedup Ebayer wrote:
> "Search" is to find true information, not censored or manipulated
> data as ebay is trying to do. All buyers will be frustrated and
> feel cheated with so-called "new search" platform on ebay. Can't
> believe that anyone at ebay will even think about doing it! Dump
> ebay stock NOW!
OLA is one MILBID is another. I am researching others. We have a local site called KSL.com that is free!! These sites will all serve me well as the christmas rush approaches. If I sell 20 items in the next year, I will be money ahead of the 200 I sold last year!!! How can that not appeal to any business man or woman???
Also, now that paypal is the only payment method (starting soon) you will see even more seller leave and go to the new sites that will soon take eBay over.
I was a seller for years on eBay and will never use them again as all they do is rip you off with fees and don't give a crap about the seller.
I hope they bring Meg back or all the workers at eBay should be getting their resume ready!
It's interesting to read about sellers' complaint, because as a seller, it's my perception that eBay has traditionally favored sellers or buyers in disputes. I avoid PayPal for that reason. My credit card company is going to much more objective than an eBay-owned PayPal in any dispute.
To the sellers here, if you are unhappy with eBay, then hit'em where it hurts. Leave the site. Set up shop elsewhere. I have nothing against trustworthy online sellers. It's eBay, that IMHO, is not sufficiently vigilent to root out fraud & unscrupulous buyers AND sellers from its website.
Bottom line, eBay has just gotten too big to be effective. It needs to be cut down to size.
For the investors.. Just like the companies that thought the mortgage boom would be around for ever or you invested in companies that offered these " Trick Mortgages " Interest Only, etc. If you are investing in eBay you are making the same mistake you made with them.. Don't take the "Market Analysts" or "Brokers" view on eBay take it from sellers on the eBay system, or simply do your own research.. Just start checking peoples feedback's.. See how many sellers are "No Longer A Registered Member" you find. These are sellers who are leaving the eBay system and selling elsewhere. In case you forgot or were unaware.. The sellers are the ones that make eBay money. Buyers on the eBay system have nothing to do with profits.. Simply put, get rid of sellers and what do you have? A company that will seeks a government bailout! Be wise, stay away from eBay!!
There is an absolutely EXCELLENT recent article here on Seeking Alpha which includes Amazon. I highly recommend reading it.
seekingalpha.com/artic...
ebay coulda-been-shoulda-be... on this list but the last few years, and particularly and spectacularly this year, has self-exterminated. And as another poster brilliantly pointed out, the perception is affecting the next generation. Their perceptions are now becoming fixed. An extraordinarily bad and unwise move!
Glad to see that you are reading articles. Maybe you should get your head out of the sand. Seller satisfaction is not up and listing are down, at least MY satisfaction is not up and MY listing are down. Seems like everybody here feels the same way.
Wake up, Brother, before your company looses everything.
Well ebay I have a little secret for you, the sellers pay the Fees, they pay pay the fees for listing, they pay the final valuation fees, they pay the paypal fees.
So please open your eyes, and stop implimenting fee hikes ofn the sellers.
The site should be fair to both sellers and buyers, for example the rediculous rule imposed that sellers can no longer leave negative comments about buyers.
So for example: A Buyer agrees to buy a product, the seller is then charged fees, the buyer does not pay, but leaves a negative feedback (Just for the hell of it). The seller cannot leave a negative to warn other sellers. Yes they can go through the proceedure to get back their fees. 2 weeks at least to do that.
Oh well, its only the seller and not the buyer so all is well!!
Yeh ebay, wake up and smell the coffee.
Get your house in order and then and only then will folk start to regain some of the trust in ebay itself.
Remember its the sellers paying for the shareholders profits not the buyers.
I don't want to knock the buyers as they are equally needed, reset things to a level playing field with sensible fees and you may just save ebay in the longrun.
Don't and I can't help but feel in the next 2 years ebay will be in its final death throws.
Decisions are made in an uncoordinated and impulsive manner at the site's structure, adding incomplete and ineffective software "improvements" that are actually crippling the listing power of all the sellers, including the ones who get to list free!
The order of listings was supposedly based on some hair-brained idea of rating sellers on a scale that is irrelevant to the actual sale transaction itself, by buyers who are "ebay cued" into checking off ratings that they don't even understand the meaning of, especially as non ebayers who are new registrants.
The search has been turned upside down over the last 3 days and sellers who have paid for their listings to show up, are not having that happen. This is not the first of the many mishaps that have been occurring over the last 6 months, in several, if not most, of the new "developer programming".
Ebay uses some entry level folks to code and enter the new programs instead of hiring staff that is highly trained and tech savvy. Most of their money is wasted on poorly defined ad campaigns featured by advertising showmen, such as the writer Mr Wingo, that are linked to other sites by ad words and links to other stores who affiliate themselves with ebay.
Ebay has become a commercial model of an advertising media site, and less of a search for the rarest and most unusual things anyone could ever find.Those days are gone. Ebay has no interest in the collectibles and antiques market, or in auctioning those sales on their site.
In spite of the fact that most buyers come to the ebay site to look for items like that in the first place, the new CEO's do not understand the significance of that fact, and that without the sellers of those goods, there will be very little attraction to the site for just ipods and refrigerators that could be purchased at Best Buy.
The largest groups of collectibles and antique sellers who sell the quality collectibles, are now joining the ranks of the online antique malls, opening stores at the high fee prices that now ebay charges it's smaller sellers. Why stay on ebay, for the same cost, when the seller can have a SECURE transaction with a customer who will be treated as no more than a customer of the seller, by the host site, and have the extra level playing field and support of the host site as an added bonus?
Ebay does not deliver a product to it's customers, the sellers, that is high enough quality, for what it costs. Their selling product is overpriced, unsupported, and overly marginalizing the seller's efforts.
Most of ebay's listings "numbers" are deceptively increased by having the entire contents of some new retailer's catalogs dumped into all the different core listings within the site, now meant to be sitting unsold for a month, and misleading the reports of increased value and listings, for investors to see. There are multiple member numbers also, since the encouragement of sellers and buyers to make up more ID's to avoid the negative comments that they had on their other ID's, were disadvantaging their listings preferences in order of rank.
All in all, ebay listing value is uncommon, unless the seller is a retail operation, and most of the individual sellers are unable to sell there any more due to the cost of business and the cost of losses incurred by the buyers who are able to run roughshod over the auction seller "victims".
Criminal activity with buyers who are able to take back their payments and keep merchandise is now a regular event, rendering the site unsafe for high end antiques dealers to list and sell on, if they do not sell in volume .
The only way this stock would be a buy would be if the entire CEO core was eliminated and the business started from scratch to rebuild.
This makes for a very run of the mill type of business that does not deserve the historic prices it once had.
What sellers and buyers have learned from all this eBay drama - They can sell and buy elsewhere for less- Etsy, CollectorsOnlineMall, OnlineAuctions, Ebid, etc. -- And thanks for the training on selling at fixed price eBay! Sellers have flocked to online malls and store hosting sites and, thanks to GoogleBase, buyers are following.
The question is... when all the small seller competition is gone will eBay's new favorites - the giant retailers like Sears and BUY - still need eBay?
Look out commenters, Dona"hoe" is watching you.
Wow, talk about "soretails"! Can't take it, can they? By the way, hope you post this comment again re frozen account.
Use both auction and fixed price listings and always earn more with auction listings. Fees between E-Bay listing and sales and Paypal are outrageous.
Management is should receive Enron award . Recent restrictive changes are driving thousands of sellers elsewhere. E-Bay was always good for a bargain, no longer!
Invariably can find on amazon, delcampe, Ioffer, Best Buy or other sites much cheaper.
E-Bay is becoming strictly a platform for large businesses.
This will probably be my last year selling on E-Bay unless positive seller changes are made.
As world recession deepens, disposable income will decrease driving E-Bay stock even lower.
E-Bay owns no inventory,they actually sell the platform use and the management of that platform. I consider the stock is presently vastly overpriced.
At ebay marketplace, Ebay is focusing hard on attracting and retaining larger, established businesses. Ironically, most of the larger sellers on ebay, ie...online retailers, manufacturers, wholesalers, mass merchandisers, and large volume sellers that have large inventories ALSO have their own websites, and they have their own merchant account to accept online credit card payments.
It has been my experience buying on ebay that the vast majority of larger volume sellers on ebay do in fact immediately begin promoting their website once the intial ebay sale has been made on ebay, and entice shoppers to shop their website rather than their ebay store by offering discount incentives or other forms of promotion.
Let's face it....As a website owner...the total fees associated with a sale is 3-4% transaction fees on a typical merchant account. The fees associated with an ebay sale is 12-15 percent on the sale, pluse a 3 percent paypal transaction fee, plus an additional 30 cent paypal and the listing fees. Not to mention all the red tape associated with ebay's feedback policies. Having more control over their busines coupled with all the extra ebay commssion lowering profit margins is a big incentive for online retailers to drive their ebay customers to their website.
Plus, there are 10s of 1000s of small businesses and mom & pop seller either setting up their own websites or establishing sales roots on one or more of the other lesses know sales venues that are all steadily growing. Any smart seller is contacting their previous ebay customer base and letting them know about their new online storefronts which collectively is also eroding some of ebay's existing buyer traffic.
Ebay claims new user growth was up 3%. I seriously doubt that. In my opinion...the majority of so-called new users are actually sellers registering for new ebay IDs so they can talk more openly about search, feedback, fees etc...in ebay's forum discussions. The forums on ebay are flooded with disatisfied ebay member, and a large percentage of them use a posting ID they created this year...SO...3% new user growth in my opinion is probably a gross exaggeration.
If anything....there has probably been a 20% decline in regular users using ebay for buying or selling in recent months.
Because of ebay's new 30 day fixed price fee structure, total listings may be up, BUT many of the listings are for serious junk that sellers otherwise would never list in core if they had to pay regular listing fees to list.
Since Donahoe took over as CEO and has been heavily favoring these larger businesses....unique, rar, one of a kind, eclectic, intersting products are steadily disappearing from the site, while more mass produced, cheaply made carp from asian based companies are now flooding the site.
If these trends continue...ebay had best foster growth in its other businesses because all ebay marketplace around the globe are declining fast.
With the knowledge that the site was still in its infancy I prepared myself to be patient and not get disillusioned.....it was a needless worry!!!.....Sales were immediate, okay the views were not that great but who cares if 500 people or 5 people look at your auctions provided someone bids on it?. I had items of a similar quality and price listed also on Ebay and the results were simple to understand. Over the one month period I had 50 items on Ebay which cost $29.75 to list and had 3 sales, final value fees added another $4.52 and then Paypal got their cut of my profit margin, whereas I had 70 auctions on OLA , had 20 + sell , had quick payments by all the payment methods and it cost me $8.00 max.....what else do I need to say here?
No matter where you sell online there are the pros and cons to each site, there are the sellers that wont sell no matter where they try , with try being the operative word here, sellers with 8 high dollar items listed who sit back and think they have done enough and wait for the payments to come in....lolol. If only life was that simple....selling online is a full time job, it can be fun but also frustrating, reputations dont just happen they have to be cultivated, respect from your peers has to be earned, your standards of service to your customers has to be superb, prices have to be affordable in a weak economy , but above all else you have to be committed. With all that said and now at 35 + sales at time of this posting and also a few treasures purchased at bottom dollar prices I now know where I want to sell and buy.....the online dinosaur is dying and has contributed to its own inevitable extinction.....people have choices and Ebay has forgotten that.....OLA offers those choices back with bonuses. One word of caution though.....If patience is not one of your virtues, go get a real job....there are always vacancies in fast food!!!
If you want to sell then come to OLA.................