The eBay Sales Slump and Google

Last week I wrote about eBay’s potential response to Google’s changes to feed policy which will go into effect December 1st 2009.

It is difficult to gauge how much of the current search dysfunction and drop in sales is caused by eBay as opposed to impending actions by Google. I am inclined to discount Google’s contribution at the moment for the following reasons.

In August I wrote “Historically traffic has taken months to recover from Best Match changes.” Barely three weeks after roll out of the Top Rated Seller project and simultaneous debut of Best Match II I believe we are seeing the initial results of the churn (def.#7). It is too early for the Google changes to be directly affecting eBay traffic.

Best Match II

eBay is flying by the seat of their pants on the Best Match algorithm, their mathematical genius and owner of the patent, Raghav Gupta (I am not being snarky, he is a genius) quit. It is very probable that continued tinkering with the selection process at the behest of eBay executive directives is having unintended consequences. Think GIGO.

Affiliate Program

eBay affiliate driven traffic is decreasing as affiliates are undergoing their own churn. Just as with sellers, who are being forced to evaluate the profitability and viability of continuing to do business on eBay, affiliates have seen massive “take it or leave it” changes to the payment schedule and structure. Changes which have lowered income for many affiliates, while purportedly increasing efficiency and value for eBay, have encouraged them to move on. Same song, different verse.

I am not in any way qualified to analyze anything about affiliate business but it stands to reason that less affiliate driven traffic will result in less sales for vendors of product which appeals to affiliate marketers.

Google Feeds

eBay is still uploading feeds.

A quick look at the format of the feeds will show that eBay’s goal with Google feeds is to bring traffic to eBay, any traffic. Not to bring a qualified and motivated buyer to the specific product they are seeking but to get them on the site and into the eBay finding experience.

It would not surprise me to learn that to some extent the pending changes to Google Shopping are driven by searchers dissatisfaction at being funneled to eBay regardless of what they are looking for.

Remember those ridiculous advertisements saying “Find ______ (insert word of choice) on eBay”? eBay’s feeds are a variation on that theme using organic search rather than pay per click advertising.

Advertising, Discounts and Coupons


eBay has chosen to embrace coupons instead of paid advertising for the last few years. Coupons work to a certain extent but in the eBay bucks format they are unlikely to bring any meaningful new user traffic to the venue for a variety of reasons. For the existing casual or occasional eBay user:

  • Low priced items only gain the buyer a cent or two per purchase
  • search is so difficult that the size of discount offered is no incentive to bother
  • the program is complicated, and
  • eBay bucks expire before any meaningful benefit can be gained by the occasional buyer.

Even buyers who are internet savvy had problems getting their money from the Microsoft cash back program last year, the promotion was so complex that (in my view) it generated negative attitude and distrust, which is lingering.

Opinion

I think that the drop in sales is a direct result of the notorious eBay tendency to see the results they want to see in the data. If you believe that the majority of eBay sales come from on site traffic why would you have any incentive to improve outside traffic to items listed on the site? It is a self perpetuating problem.

eBay sellers I respect tell me that only a small percentage of their sales come from off eBay sources. This makes sense if the site is not promoting traffic inflow but relying on the user base and their own deeply flawed and manipulated search. I also think the sales slump is not site wide.

What do you think?

A blog post at Series Books for Girls talks about the recent drop in sell-through rates for eBay booksellers in her niche. Meanwhile I am off to buy myself a bird watcher on eBay, just kidding.

Y’all come back!
Henrietta!

Full disclosure: I am an ex-eBay seller currently selling on my own website and Bonanzle.com

One comment.

  1. Excellent post, Henrietta. Just a quick comment on eBay’s affiliates …. another disrupting (sorry, I couldn’t resist using that word) factor for them is the seemingly endless category changes. That irritates eBay sellers and buyers, and it really, really irritates eBay affiliates who can lose a lot of their data whenever eBay changes, moves or deletes a category. This, in turn, results in less traffic to eBay, more work for affiliates and possibly at least some of them deciding to leave the program and put their time into more rewarding projects.
    No one is winning on eBay any more. So sad.

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