EBay changes turning off more customers?
Filed under: Shopping, Technology
Chalk up another public relations problem for eBay, the uber-successful company that can't seem to get it right anymore. Oh sure, eBay is still raking in money hand over fist, but who knows how long that will continue if the company keeps alienating its bread and butter.Last week eBay announced a fee change that could likely entice more sellers to the site: Sellers will now pay 35 cents to list as many of the same fixed price items as they want, instead of charging a fee to list each item separately. This sounds good, although critics say that this new move favors larger sellers and puts very small sellers at an economic disadvantage.
This change was paired with a nother controversial change that may turn off some sellers and buyers. Starting in mid-October, eBay will only allow sellers to accept electronic payments, including credit card, PayPal, or ProPay. Sellers will not be able to accept cash, check, or money orders.
Although eBay says those non-electronic transactions account for less than 10% of the sales made on eBay, it's still a shift that may upset some buyers and sellers. Why not offer the customers the choice? It's clear that not many users want that choice, yet it shouldn't matter to eBay if that's how they want to do business.
I suspect that this change may be an attempt to push more people toward using eBay-owned PayPal. Earlier this year the suggestion that eBay might go "PayPal only" brought consumers out in droves against the change. Maybe this is a not-so-subtle move in that direction, without technically "requiring" sellers to accept PayPal. After all, how many non-business owners do you know who have credit card processing capabilities? Those individual sellers will be all but forced to use PayPal since they don't have access to another electronic method of payment.
I've been a pretty big eBay fan in the past, but I'm afraid some of the recent changes aren't really going to endear the company to their existing customers... the ones who made eBay what it is. I'm waiting for someone to come up with the next big idea that will really challenge eBay's position as the dominant force in online consumer-to-consumer sales.
Tracy L. Coenen, CPA, MBA, CFE performs fraud examinations and financial investigations for her company Sequence Inc. Forensic Accounting, and is the author of Essentials of Corporate Fraud.



Reader Comments (Page 1 of 1)
8-25-2008 @ 9:40AM
Lisa said...
Paypal is one of the biggest rip offs I have ever seen since ebay bought them. I used them prior and they were more customer oriented. I was a very small seller on ebay and used paypal to accept payments. What they don't tell you is they can freeze your account for 120 days without cause or reason and you will not get your money. They froze mine because someone with my same address (I had bought a house and only lived there for three months) had a paypal account and they wanted to make sure I wasn't them. They asked for ID, Utility bill and other things. I complied and they still kept my money for 120 days. If you use paypal/ebay be careful. I contacted the Better Business Bureau and found that they (paypal) had literally thousands of complaints. I was trying to make a little extra money for my family and it just wasn't worth it.
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8-25-2008 @ 9:58AM
Libby said...
I was a seller and did quite well. I now find ebay a very negative arena for sellers since they stopped allowing sellers to leave feedback for the buyers. Buyers take advantage of that. I am also tired of going into my ebay summary page and constantly finding changes. There is no continuity. Fees for the sellers are extremely high and so is Paypal. Amazon is my new selling arena now. They are much more stable. Ebay has pushed everyone away that I knew.
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8-25-2008 @ 10:39AM
Donna said...
There is no way I will ever use pay pal again. They screwed me 2 times. Once there was an identity theft which the bank and western union.com from where the charges were made from asked me if I had pay pal when I said yes. They knew right away. They like to screw around and freeze your bank account. Which happened to me twice.
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8-25-2008 @ 12:01PM
Joanne said...
First and foremost, ebay would not have to worry about chasing Amazon had they cleaned up their site years ago but they chose not to because it would have taken effort and cut into their profit. They not only condoned bad behavior by sellers and buyers, they litterally encouraged it in order to make more profit. Is it any wonder sellers and buyers have left and will continue to leave?
Secondly, as a buyer, I will NOT use paypal. They have proven themselves as unreliable and dishonest as ebay (imagine that since they are owned by ebay). Nor will I use propay because as far as I am concerned, any company that ebay willingly promotes, can not be trusted. Individual merchant account? I am not wasting my time looking for a seller who is able to have one.
So............to sum it up. BYE-BYE ebay. I will look elsewhere for what I want and if I can't find it, I will do without. You have done a wonderful job in losing yet another buyer.
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8-25-2008 @ 12:22PM
Brenda said...
I really wish that you or some of the other folks who are reporting on this would discuss the whole picture. Yes, eBay is reducing listing fees. However, they RAISED the Final Value Fees significantly in most categories. The Clothing category was hardest hit, with an increase in FVF from 8.75% to 15%, but many other categories will be going up to 12%. None of the clothing sellers can get any answer as to why their category was impacted so severely, unless it's that they do not have any other place they can go (the second-handers can't sell on Amazon), so eBay can get away with it. The much-heralded May "price reduction" was the same thing-up-front fees reduced, FVFs increased so that overall there was a fee increase.
It would be refreshing if some of you financial gurus would spend some time on eBay's discussion forums and actually read the other side of the story-how the company's policies are driving sellers away-instead of just regurgitating eBay's press releases, which are all happy-happy-joy-joy. That Donoho wants to be Amazon is no secret to any of us who have been watching this, but that he wants to be Amazon without paying anything for any sort of meaningful customer service (and that's for his REAL customers, the SELLERS!) dooms his desire from the start.
An unstable platform with continual glitches. Non-existent customer service, with canned e-mail responses and live help who read from scripts and can't help you. Ever more punitive, demeaning policies directed towards the people who pay to keep the lights on-the sellers-capriciously enforced with no discernable rhyme or reason and no appeal. Policies and standards that keep rising to unrealistic levels so that sellers will all be tarred with the "underperforming" brush and be forced into the PayPal 21-day-hold. A very unlevel playing field were Diamond Power Seller Buy.com (with their 3% sell-through rate!) can list milllions of items for free, while single mothers, disabled folks and veterans have to pay full price to list theirs. A Detailed Seller Rating system which penalizes good, small sellers with customer service in eBay search in favor of large volume sellers with poorer customer service. A system which is probably legally actionable as fraud, since folks are paying money to list and receiving no exposure at all.
This company absolutely deserves the hatred it is harvesting for itself, and it deserves to fall into total irrelevancy and failure.
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8-25-2008 @ 11:55PM
ByebyeEbay said...
I am an individual ebay power seller. My total sale in the past 12 months was $700,000 selling art and antiques. I aceept check and wire transfer only. Accepting Paypal will only attract people who enjoy playing with the sysytem of forcing seller for a refund via Paypal. I always offer immediate refund for my buyers if they are not happy with the purchases, but I refuse to deal with buyers who has to rely on Payapl to force a return/refund. Since ebay has no intention of owning merchandises such as Amazon, it does not make sense to assume the role of a transaction enforcer. Ebay is digging its own grave by trying to make more money but at the same time assuming all liabilities of every transaction. This new change will attract more lawsuits directed at paypal/ebay from buyers, sellers, and copyright owners. I am done with ebay! I've just sold another item for $6,000 without ebay on my own website. Money in my account via wire transfer, no Paypal hold nor credit card charge back! Payapl/ebay, Eat your heart out! I am still selling a lot and not having to pay you a single cent again!
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8-26-2008 @ 8:59PM
Don said...
I quit PayPal as a buyer today (some of you may not be disappointed as a former(?) seller) over their demand that buyers link a bank account or debit card, after a cumulative total threshold of credit card payments is reached. This will hurt sellers, too, especially if eBay goes to a policy of "PayPal only" for sellers, as I've heard they're planning to do or considering now. I hope sellers will object for yourselves and your buyers. I believe a lot of buyers like me will not be willing to let anyone have a link to our bank accounts, directly or through a debit card, so eBay is likely hurting itself more than any added revenue from others will help it.
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8-27-2008 @ 4:35AM
Angel29 said...
I have been a seller/buyer on eBay for 11 years. It used to be a good way to make some extra income for my family since I cannot work outside my home. But the stress level associated with eBay, it's policies, and GREED are too much! They say they are just a "venue" but now they are dictating how sellers have to sell their items and how the buyers must pay for their items!
Since when is a USPS money order not safe? I have accepted checks and money orders for all 11 years with NO paypal and have only had 2 bounced checks that were both made good on by the buyers!
PayPal is not safe! eBay is trying so hard to make it look like a safe haven on the internet! Identity theft, links to bank accounts, frozen accounts and so many more nightmares! What is safe about that?!
I, like tons of others are quitting eBay and looking for greener pastures. eBay is a sinking ship and I refuse to go with it!
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8-28-2008 @ 10:29AM
Brandon Crotts said...
Starting in October eBay is going to add another payment option, a company called ProPay. Right now ProPay offers debit/credit card transactions through merchant accounts but we will be adding new special accounts for our eBay customers. ProPay is a credible company that has been around for 11 years and we will help our customers resolve charge backs and fraud. Don't make up your mind to quit using eBay until you check out ProPay.
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9-05-2008 @ 12:19AM
Ebayex said...
I have been using Ebay for over 8 years and have over 1300 positive feedbacks. 2 years ago I decided to open an ebay store and sell amazing decor and furniture. I had previously been a buyer and still continue to buy almost everything on ebay. My feedback score was 99.7%. in January 2008. Now with the new changes, my feedback score has gone to 97.6% due to people taking advantage of the system of this horrible horrible and unfair new policy. So, they change the feedback system, then they tell me my DSR's are well....just not good enough so they shut me down for 30 days until I bring the DSR's back up. I had 175 items listed on ebay with multiple quantites. If someone purchased one from a 30 day listing, then their listing was erased and they were sent a very alarming message from ebay telling them not to buy from me. THEY CANNOT EVEN LEAVE FEEDBACK FOR THE ITEM THEY BOUGHT AND I SENT BECAUSE IT HAS BEEN ERASED!!! BUT YET THEY WANT ME TO BRING MY FEEDBACK UP!!!! I have NEVER been so insulted and horrified by the way a business has treated it's "customers". SELLERS ARE NOW BASICALLY WORKING FOR EBAY AND BEING TREATED LIKE STORE MANAGERS FOR THE CORPORATE EBAY JERKS.
I pay $2,000 a month in Ebay fees!!! They treat me like DIRT and kick me in the teeth every time I turn around. They are holding large amounts of money in paypal now for 21 days or until I prove it is delivered. BUT if someone says there is something wrong with it, basically they are going to get the item for free and I will have given it to them because Paypal will not release MY MONEY. How DARE they! Ebay used to be so much fun. Up until this new complete idiot took over...he has made it a total disaster. It is so sad because it used to be such a great place to earn some extra money. Now, they want you to jump through hoops constantly and have NO APPRECIATION for the HARD WORK that sellers do to help their customers and MAKE ALL THAT MONEY FOR EBAY!!!!
I DO NOT WORK FOR YOU EBAY!!! I HAVE MY OWN BUSINESS AND WEBSITE AND WORK FOR MYSELF. I AM NOT YOUR EMPLOYEE.
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12-31-2008 @ 3:06PM
Cassandra said...
FeeBay not only has it wrong, they are "dead" wrong. For many people FeeBay was a daily household word, now your likely to get your mouthwashed out with soap just for uttering it. Doesn't matter whether you were a seller, buyer or in most cases both.
I am also a veteran FeeBay Power Seller. It is rare that I maintain any type of monthly discount because buyers love the feeling of "POWER & CONTROL" . It like whipping a dead horse. First you have FeeBay driving you nuts with their "POWER & CONTROL" trip and then the buyer has the same authority at the end of the sale. 7500 plus feedback and never a negative. However, if the buyer leaves anything less than a 5 in all categories, FeeBay views it as a negative for Power Seller Discounts.
Auctiva, who has been hosting FeeBay ads for some 7 plus years will be launching private web stores in January. There won't be auctions on the site at this time and perhaps never. When FeeBay stopped listening to their sellers, this really smart company "Auctiva" picked up the ball and will be running with it to the tune of "HUGE" success.
Their store hosting price is incredibly inexpensive $9.95 per month, with January & February being free. Their FVF none existent until you go over $299.00 a month in sales. Their cap for FVF is 5% or you can choose 8% if you would like them to market your website items for you. You can lock into the $9.95 per month.
There are numerous internet companies that will, for a small monthly fee, see that your website is crawled a specific number of times per month, getting you out there in the searches.
I currently pay FeeBay $74.95 monthly for my Pro Store. With Auctiva being $9.95, plus minimal FVF for sales over $299.00 per month for no matter how much I sell, I can take the other $65.00 and advertise my "OWN" Auctiva website.
It currently costs me $4.95 per month to have my FeeBay store crawled 4 times per month. The company is fully effective, I see the sales results and the hits to my store in FeeBay reports.
If I simply find six (6) more internet companies that are as effective as this site for $4.95 per month and spend the other $30.00 on adsense. I should be able to launch my store fairly quickly. I will of course agree with Auctiva to pay the 8% FVF to have them promote my store also. Its really inexpensive advertising as I see it.
Because I have become financially dependent on FeeBay over the last several years and have a "VALUED" clientele I haven't been able to just walk away. My New Years resolution is to have my hands fully washed clean of FeeBay and its "carnival" atmosphere by June 30th. Its hard to have to feel "DIRTY" just by signing into your FeeBay account.
I recently mailed out 1500 post cards to my regular FeeBay buyers informing them that my store would be closing on FeeBay on February 15th, which by the way is the beginning of my busiest time of the year. In comparison 400 sales in December 3000 in February, March, April and May. They have been provided with my new website for sales.
In the last year FeeBay has proven to me again and again that they don't need my puny store and auction listing fees or my FVF's. The have humilitated me, caused me to doubt my own self worth and demeaned my business eithics.
A year from now, Feebay will be left with the people that they are best qualified to deal with, "POND SCUM". One of my mothers favorite sayings was, "Remember, water seeks its own level".
In March of this year I owned roughly 2100 shares of FeeBay stock, when the changes started I dump it. Which netted me roughly $45,000.00 before tax dollars. Had I continued on with their stock it would have ended up just like my DSR's have. IN THE TOILET. In July of this year I predicted that FeeBay shares will drop to less than $3.00 per share by March of 2009. So far they are right on track to meet this goal.
Someone needs to cut the rip cord on the current CEO of FeeBay's "Golden Parachute".
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12-31-2008 @ 8:17PM
rob47nh said...
After 21,000+ sales, 773 purchases, my fiancee and I had two ebay stores, both were power sellers, both had 99.9 feedback ratings and DSRs well above the site average, we closed our stores and vowed to never shop or sell on ebay as long as Donahoe is Ebay's CEO.
Donahoe has done absolutely everything within his power to drive off virtually all small businesses and casual sellers through a combination of policies and search engine changes that make it virtually impossible for anyone but the largest volume businesses to succeed.
I totally concur what the other posters have already said.
My fiancee and I have vowed to NEVER shop or sell on ebay until the new CEO is replaced. The man is a disgrace to humanity in my opinion, and his greed and arrogance will be the downfall of ebay.
Things have been a total nightmare this year, and it just seems to be progressively worsening.
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1-05-2009 @ 10:04AM
Louise said...
Another disatisfied customer: I have bought and sold a good
number of things on Ebay and even took a course in how
to use the site more effectively. I only used money orders
as they are more reliable than personal checks (although as
a seller, I took personal checks and never got burned).
I will not have a PayPal account. I've heard of others' problems
and had my own with them. The fact that Ebay will no longer
allow checks and money orders means I will no longer buy
or sell on e-bay and will use Craig's List which cuts the shipping
problem and has proven much easier. Yes, there are scams
but if you follow the simple rule of using only cash, little items
are easy to sell. It's a shame - I loved Ebay.
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