My disillusionment with eBay has been increasing over the past year, and last week, the news that made it all the way to front-page CNN business news, was the last straw, not only for me, but for millions of other eBay sellers who will officially close-up shop on April 30, 2008. This really does suck, since eBay had so much potential and was a fun place to sell stuff. Meg Whitman, outgoing CEO of eBay, and who grew eBay from small auction site to worldwide phenomenon, has decided to leave the company she founded, after more than a decade. No doubt a large part of it is decreasing profits. But unfortunately, eBay has been handed over to John Donahoe, who has clearly demonstrated that he does not anything about the grassroots of eBay, and who really makes the money for the company. He has decided to implement a series of changes, some being implemented immediately, while others being phased in by May 1, 2008. Yes, there is another fee increase, but he actually had the gall to market this as a fee decrease and made it sound as if it benefitted sellers. Listing fees have decreased slightly, while the final value fees (what the seller pays to eBay as commission, so to speak, upon a sale, has increased from 50-65%). Sellers who make up the backbone of eBay profits cannot afford such blatant cash gouges, so they are planning two things: one is a mass exodus from eBay at the end of April (I'll explain why in a minute). The other is a widespread boycott/strike from the 18-25th of this month. The strike/boycott I can't see being very effective, but leaving with your wallet certainly will send a message. Between all my accounts on eBay, I spend tens of thousands of dollars in fees per year (eBay and Paypal), and eBay will no longer have this stream from me at the end of April 2008.
Why end of April? Because that's when eBay will be implementing perhaps the most destructive change it has ever made. It will revoke the seller's ability to leave anything but a positive feedback for a buyer. The rationale, claims Donahoe, who obviously got his MBA by sleeping with the dean of his business school, is to ensure that buyers can no longer be hostages of the feedback system. In some ways, the feedback system was broken in that good buyers would be afraid to leave positives for sellers who are increasingly holding off on leaving feedback until the buyer does. Of course, if the buyer finds the item unacceptable (not as described) or shipping prices ridiculous, they cannot honestly leave a negative, for fear of getting retaliatory feedback. However, this new system hardly levels the playing field, but rather, turns the tables around and allows the seller to be at the mercy of the buyer. A buyer can now have buyer remorse and demand a refund or threaten negative feedback. They can make up any excuse under the sun and leave negative feedback. The seller can only sit back and watch. eBay even has anticipated that seller positive feedback percentages will drop dramatically.
But Donahoe doesn't care. Calling sellers nothing more than a nuisance flea marketers, he has obviously forgotten who is paying his bills and salary and has backstabbed the very people who are paying his salary. But that's OK - this guy won't last long. If he thinks that by gouging the sellers via the biggest FVF hike in history, disguised as a fee decrease, followed by an awful decision to alter the feedback system, which is paramount to buyer and seller confidence, far in favour to the buyer (he believes that this will bring forth more buyers - he's obviously never sold anything on eBay in his life), which eBay has consistently been increasingly catering to, he has something coming. One of the biggest eBay powersellers, Bargainland (based in Tennessee) have left eBay last fall (this is a seller who brings in $25 MILLION a year to the eBay coffers - well, not anymore). Other big sellers are starting to realize that Donahoe's vision will no doubt alienate the sellers who sell unique items, but instead are rewarding the big cookie-cutter sellers who sell en masse and don't care about fees and such - these sellers are turning eBay into a gigantic Walmart. Online auctions have dropped significantly, replaced by fixed-price or store inventory listings (no doubt as a response to fee increases in the past). eBay has been slowly dinging the store and fixed price sellers over the years and under the new proposed structure, they will be charged even more. The smart large volume sellers are realizing that this is the time to leave and have been abandoning their eBay accounts, setting up their own online websites.
I have slowly been moving off of eBay in the past year and have been active selling on Craigslist (which has no fees and no B.S. policies - see my other blogs on eBay that I post here). eBay misleads people into thinking that other forms of payment are not secure and really force you to use PayPal (which they also own and is a big joke from a security and support perspective, since I was scammed on it last year). They have forgotten the people who have helped build eBay to where it is now - the millions of individual sellers who made eBay a fun place to shop. Well, John Donahue, on April 30, 2008, your brilliant idea will backfire in your face and you sinking ship will develop major leaks at that point. Sellers are bailing on you left right and center, based on what I'm seeing in the forums. Thanks for destroying what was once somewhere I was proud to sell stuff, and also make some money to boot. But just like millions of others, I have decided that my patience has its limits, and you guys aren't getting any of my money anymore.
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