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Affiliates | Red Ink Diary

Posts tagged “affiliates”.

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

The Beat Goes On, Skipping eBay. Part II

This is the second of a three part article, (it grew) part one can be found here.

Google showed remarkable restraint when eBay was openly denigrating Google Checkout on their website from 2006 through early 2008.  At what point in time did eBay decide that Google was looking in their toybox and say “MINE”? It is impossible to know what went on behind the scenes at either company but a certain amount of competitive tension between corporations is normal and from a consumer point of view, healthy. I would be inclined to attribute the beginning of ‘Google as adversary’ mindset in San Jose to late in 2005 when eBay really was the two ton budgie in the living room and Google began testing Google Base. Rumors were spreading about Google Purchases, the forerunner to Google Checkout barely three years after eBay paid $1.5B for PayPal. An October 25th article in Wall Street Journal (subscription only) said

“…the existence of Google Base heightens anticipation of the Mountain View, Calif., company’s long-expected entry into direct competition with online auctioneer eBay, which also owns a minority stake in classified listings site Craigslist Inc. It’s going to slowly chip away at eBay’s growth and opportunities, especially in international markets where there is a tremendous amount of growth at Google”

The first publicly visible indication that the truce was ending came when eBay made their move to force the ‘PayPal only in Australia’ policy. Among the submissions to the ACCC was one later discovered to be from Google. This was initially covered in AuctionBytes May 27th 2008, and because this is my blog I can brag, I guessed right!

The Affilate Wars

Meanwhile back at San Jose, the decision was made  to end eBay’s affiliate management association with Commission Junction and only use the in-house eBay Partner Network (EPN) which launched March 17th 2008 and went live on April 1st. In view of eBay’s past launch history this was not an auspicious date. Full disclosure, I know very little about affiliate marketing so I am not going to comment, merely state the facts.

The 465 word March 17th press release complete with a nice BaySpeak quote from Matt Ackley, vice president of Internet marketing

“Affiliate partners are central to eBay’s ongoing strategy of improving the user experience and increasing engagement…The new eBay Partner Network will allow us to have a direct relationship with our affiliates, innovate faster and deliver new products and tools in a more timely and efficient manner, providing new revenue opportunities for our affiliates and creating a more streamlined user experience for our buyers and sellers.”

could have been condensed into four words. You’re fired, re-apply here. Affiliate marketers were required to move their affiliate links over to the eBay Partner Network by May 11, 2008, naturally the format was different.

As sellers you do not need to be told that there were literally thousands of affiliates most of whom had multiple websites with multiple links all of which had to be manually edited, been there, done that. There were the usual ‘glitches’, affiliates were introduced to eBay’s famed Customer Service, lots of damage control PR, and in August the first bomb dropped. If you are as interested as I was in this story a good place to begin reading is the ePN blog it is fairly light, 36 posts in ten months, I started reading in the March archive.

Predictably eBay announced a unilateral alteration to affiliate agreements August 1st.

On November 9th, your reports and payment structure will be updated with your October quality score. This score will serve as an estimate until the system calculates your actual quality score for November on December 9th. At that point, you will be able to re-run your November reports to get the correct payout numbers you will get paid for your November traffic.

Payments would change November 1st from a typical $20 per ACRU, new Active Confirmed Registered User to a sliding scale, value of the referral to be determined by eBay depending upon “quality” of the referral, also determined by eBay and ranging from an insulting $1 to $50. This was received with surprise but not delight by affiliates, as this quote from The Truth About EPN shows

Based on an enigma of unseen data and statistics - another magical attribute that would soon haunt affiliates, your ACRU payoff was calculated behind closed doors. In other words, expect the $1, don’t hold your breath for the $50. Or, perhaps, you were simply part of the crowd who still hadn’t gotten a single ACRU (payment) since the in-house change back in April 2008.

Less than three weeks later eBay terminated hundreds of affiliates, alarming and alienating many more who had just received an introduction to the eBay as judge jury and executioner so familiar to sellers.

Terminated affiliates were all obliquely (def. #5) tarred with the fraud brush although only three were sued, less than 1% of those terminated according to eBay.

How did this affect eBay Sellers?

Y’all come back tomorrow for part three!

Henrietta!