leapingcat

U.K. E-Commerce Report: Thoughts from Catalyst U.K.

Hi Scott, thanks for such a good overview of the UK retail market from a short visit. A lot of High Street shops have closed down recently, some due to the collapse of large groups such as Woolworths and Zavvi (music, dvds), but a lot due to the competition fron large out-of-town (and our distances are much less than yours) shopping centres and supermarket chains such as Asda (part of Walmart) and Tesco, who are the UK's largest retailer. These larger stores do tend to open till midnight, sometimes 24 hours, and 10am to 4pm on Sundays (due to our peculiar licensing laws for alcohol)
Online shopping is growing steadily, perhaps due to us becoming more confident in giving our credit card details online, but the changes to Ebay, including free auction listings for items with a starting price of 99p for private sellers do not seem to have translated into higher sales, just more listings especially at the bottom end of the market. For some auctions, eg autos bidder identity is hidden, they become Bidder 1, Bidder 2, etc, which of course encourages shill bidding inthose categories where it is most likely to occur.
On the other hand Amazon is going from strength, although as you say it is still essentially in books and media, but the (largely) irrelevant sponsored links indicate that it is widening its horizons.

Why Advertising Is Failing on the Internet

If the sole purpose of advertising was to impart information about a product or service then the outlook for it would indeed be bleak. But much advertising is about something more, for example suggesting that you will have a higher status by using a company's products. Traditional advertising has achieved this by the choice of media, images portrayed, etc, but somehow this seems missing from on-line advertising. Perhaps a different model, looking at a target market rather than linking to content would be more effective, but I leave it better minds than mine to put the flesh on the bones.

Hello Cloud Storage, Goodbye Consumer Hard Disk Drives

At present cloud storage makes most sense for new or growing companies, where its scalability gives those companies the ability to easily cater for changes in storage needs without a large investment. For individual consumers, storage needs are generally more predictable and increasing local storage will remain the sensible option for some time to come.

What Will Become of eBay?

This article shows that merely analysing figures without trying to understand them is not a very good idea. Once you look a bit deeper it is no surprise that an increase in listings has been followed by a decrease in traffic. Ebay have discriminated against their traditional sellers in favour of the so-called Diamond Power Sellers with their inferior listings both in terms of income per item and desirability.
Let us look in a bit more detail at that allegation that auctions are falling out of favour and fixed price sales are booming. Auction sales may be down slightly, I'm quite happy to accept the 8% figure, but that is hardly surprising from the number of sellers who have left in disgust at Ebay's policies rather than there own downturn in sales. The Medved figures actually show that in the categories that are traditionally dominated by auctions, auction sell-through rates have remained consistently high, and in collectables have actually increased from approximately 40% to approximately 50% over the last three months. On the other hand the sell-through rates for fixed price listings for books, one of the categories that the likes of buy.com have moved into has plummeted from about 45% to about 15%.
These figures are not difficult to obtain, yet I have always found that an analysis based purely on numbers can never give a satisfactory answer to the question as to whether to invest in a company and if so at what price. On that basis I would not invest in Ebay at any price as long as the current policies and management are in place.

Amazon vs. EBay: Looking Beyond E-Commerce

I agree with everyone else that that is a very well-written article, and shows just where the two companies are heading.
Amazon charge lower final fees to large sellers (pro-merchants), charge higher fees than Ebay (although Paypal fees can level this out to a certain extent) and have drop-shippers listing hundreds of thousands of books that they don't have in stock and with feedback ratings in the low 90s. So, Ebay should have no trouble in seeing off Amazon as a competitor, yet they flounder while Amazon go from strength to strength. Perhaps ease of use and reputation count for more than meaningless figures when valuing a company; if so then investors are starting to get it right.