How Amazon and Google are taking eBay's Business 289
prostoalex writes "Wall Street Journal says many online sellers who started on eBay are now going solo, being helped out by 'name-your-own-price' Amazon Marketplace and Google's and Yahoo's advertising programs, which allow small businesses to direct their ads to search engine users interested in specific items. The article discusses several companies where online sellers, being disappointed with eBay's falling profit margins, increasing fees, disruptions coming from PayPal account freezes and high fraud rate, are leaving eBay. Many start with setting up their own sites, continuing to do business on eBay, but then switching to solo e-commerce entirely after looking at profit margins."
I don't know about other people... (Score:5, Interesting)
A.ca takes 15% off the top, but they give you a generous shipping allowance so it doesn't cut into your profit margins (and it's actually fair, so if you *buy* from a seller, that reasonable price stays reasonable b/c the seller can't jack up the price). Win-win for both buyer and seller. The kicker is that every time I've sold something with A.ca, it's taken at the longest a week before somebody's bought it.
eBay? Never again. I'm willing to pay 15% just so I never have to *think* about Paypal.
Disclaimer: I work for neither Amazon nor Google. I'm not getting paid for this. The reason I'm saying all this is because Amazon is the only company I've dealt with over the past few years that has made me feel like a human instead of a problem.
Maybe over the long term this will hurt. (Score:5, Interesting)
With this sort of penetration any impact will be neglible for quite a while. There are still a ton of people trying to emulate the largest person to person for sale site.
eBay increases their fees because they can. If they thought these other places were such a direct threat yet they wouldn't do so. There will be a time this combination will be a large threat, but not yet.
None of them are worth it (Score:5, Interesting)
This is the way it should be (Score:5, Interesting)
People started selling so much they started businesses. Then Ebay started jacking up the fees because they saw businesses making money off their website. Ebay was supposed to be for used merchandise. Now everytime I do a search for used merchandise I can barely find any because I have to wade through businesses that post 20 ads a day because they have 500 units in stock. Ebay just isn't made for that.
The moral of the story is there is a progression that goes from being an individual seller to a company that sells on ebay. If you continue to grow...it just makes sense to get off ebay.
Re:What's wrong with PayPal? (Score:1, Interesting)
One word. (Score:5, Interesting)
I was a big fan of ebay back in the day. I still have an account that I use on very rare occasion. But today ebay seems to be nothing more than a portal for people who don't want / can't afford to setup physical shop. Ebay lost is greatest quality, IMO, a while back: the personal experience.
The last few things I sold a couple of months ago were random shirts from indie bands. Of the five people I contacted after winning, none of them ever replied to my emails. One of them left me negative feedback because she felt the shirt was in poor condition. I would've been glad to refund her the money and let her keep the shirt if she had contacted me, but apparently talking to another human (even by email) is a bit too much for ebayers these days.
Dear Seller (Score:5, Interesting)
It's true that Amazon takes 15% of your selling price. But did you realize that they also make money on shipping?
The amount they reimburse sellers is less than they charge buyers for shipping.
Sneaky.
Letter
eBay has it's share... (Score:3, Interesting)
Soon the story changed... the item wasn't was "as described"... I started getting explanations of and I quote, "Living in a trailer with a handicapped brother with a $10,000 plate in his head." I was going to need to send him $70 for the item to be returned...
Then he proceeded to file complaints with PayPal and try and get his funds frozen.
What merchant would ever let you buy a product, break it, and return it for more money than it is worth? And what crazy payment system allows you to raid a merchants bank account because you most likely zapped the product with your own hands?
Comment removed (Score:5, Interesting)
phishing (Score:3, Interesting)
Re:Why doesn't Google index eBay? (Score:3, Interesting)
However, Froogle doesn't seem to keep historical data and doesn't index auctions that aren't from eBay stores (with "buy it now" auctions). Or, if they do, they're keeping it an in-house secret - and what a cool database that would be to have around!
Re:curious.. (Score:3, Interesting)
Yes and no. It's news because eBay dominates the market, but it's not news if you look at it objectively. eBay has been on top for a while, but it's not a perfect system. New buyers are frustrated with snipers and crazy shipping prices that sneak up on them, sellers are irritated by Paypal issues and eBay constantly raising prices. Other sites are managing to catch up with eBay's technology so users are looking for some new places to do business. Perfectly natural.
Re:Ebay will still rule the online garage sale (Score:4, Interesting)
It took me about an hour total to start a new account and then list (apporx) a hundred books. Then I just sat back and watched the e-mails roll in. "Send this book to this person" "Send this book to that person" Zip! Schwip!
And I made several hundred dollars in the space of a few days by selling a fraction of the books.
With EBay, I would have had to spend an entire day listing listing items, dealing with PayPal, and then getting porked from behind for the fees.
Bah humbug.
I can easily see myself running a full-time used bookstore from Amazon. There's a number of brick-and-mortar companies getting rid of a lot of inventory and making money on Amazon. I can see why: it's so easy that you make up for your 15% commission in the time and labor costs you save.
eBay's biggest problem... (Score:4, Interesting)
Of course, the downside is that you have to pay more; amazon.de, for example, charges both a percentage (15%, I think) *and* a flat fee, so if you have something that you want to sell for less than a handful of bucks, you might actually even lose money - the shipping fees they charge the buyer wouldn't even be enough to cover actual shipping to start with, and they're usually more than eaten up by the fees, too, so you may well end up with a net earning of only one buck for a book that cost the buyer eight or nine bucks, including shipping (it's happened to me). The bulk of the money is, ultimately, shared between amazon and the postal services.
That's one reason I really hope Google gets into auctions - there definitely needs to be some competition in this area so prices will go down. And I trust that Google has both the financial and the technological strength to pull this off - not to mention the "do no evil" philosophy which would make me trust them to not rip me off *too* much at least.
Re:people vs businesses (Score:3, Interesting)
Re:I don't know about other people... (Score:5, Interesting)
I've never once, NOT ONCE, since 1998, had a problem with Paypal. The only issue I have with them is their practice of taking a couple extra days to credit my account, but this somewhat sneaky (it is only sneaky because I don't like it, they clearly state how long I might have to wait for my funds) practice is outweighed tremendously by the convenience of their service.
I've been mystified for years at all the complaints about how bad Paypal is...I've never experienced any evidence of it at all, and neither has anyone I know.
This makes me doubt the stories describing how bad Paypal is...I would think that in 7 years of use, me or someone I know would have experienced something bad if Paypal really was as bad as the stories describe.
Re:eBay will fail unless it... (Score:1, Interesting)
Right now, you cannot report problems, and no-one gets slapped for the following offences:-
Ebay looses squillions when you have to 'register' at sellers site to get goods shipped. After that buyers are on a list, and the rest are direct sales chopping ebay out of the loop - for good.
Nothing get done about 1 cent items with $20 postage. HK is really bad, but if everyone halves their sale price by shifting 'profit' onto the postage, then ebay has to double the commission to compensate.
Many would like to sell 'spare parts' but the cost of a 'no sale' is a real turn off. Selling a 'new mobile phone' vs selling 'recon engine head' means hard to get spares are no longer listed - ebay has drove useful obscure spare parts merchants off ebay and onto online forums. Ebay has failed when a phonebook outperforms an online search.
I don't think Ebay will fail, but its growth rate will stagnate, as google, amazon, and ex-buyers on lists go elsewhere after initial contact. Ebay is turning down certain market segments, and the fortunes of TradingPost and the like are going up, as fed up sellers are walking (or retain a token advertising presence).
As for paypal, well google is nipping at their heels. That is a lot of profit they are choosing to give up, whilst the reputation of same decreases.
Re:I don't know about other people... (Score:4, Interesting)
So, after signing over the naming rights to my backyard, I finally got a phone number to deal with them (note that all of the 10 or so real banks I currently have accounts with ALL have phone numbers readily available). Of course, Paypal's "dispute" resolution process is to lock all sides until *they* are satisfied that it was fraud. It actually took me nearly 6 months to convince them that, despite the fact that the most I'd moved around prior to that point was $400 and all of it domestic, I suddenly decided to transfer $12,000 to the Czech Republic at 3:00am on a Saturday. Once I finally convinced them that I wasn't the one who sent it, it took another 6 months to get the $150 or so I still had in the account.
Paypal wants to be treated like a real financial institution, but doesn't act like one.
Re:I don't know about other people... (Score:3, Interesting)
I opened an account using a card I got specifically for online purchases. I was a first time bidder on eBay and saw that the seller only took paypal. I opened the account, but never used it (didn't win the auction, never had occasion to use it).
Months later I got a cc bill with all kinds of charges from $50-$500 all to paypal over a couple weeks for a total of around $2,600. I called up the cc company and reported the fraud. They did not seem surprised/skeptical in the least and immediately canceled the card, credited the charges and issued a new card. They sent out a form for me to fill out and sign -- that was it.
Since then I've gotten all kinds of email from paypal telling me that my card is expired. I tried once or twice to contact them to have them cancel my account with no response. Eventually I got a new email address when Comcast took over ATTBI and I've obviously never heard from them again.
I still have no idea how someone was able to use my account, but they apparently bought a bunch of stuff online and the cc company must have ended up eating it.
My brother-in-law also had bad charges show up through paypal. He is the only other person I know who used paypal and in both cases we had problems.
This makes me doubt the stories of people who claim that they have used paypal and never had a problem, or even heard of anyone they know having a problem.