Ebay Secrets Blog

Archive for July, 2009

Wouldn’t it be fabulous if we could stop, start, rewind, and fast-forward life? A few years back an Adam Sandler movie, Click, explored this notion. Now you can own your own remote so you can control your reality–the actual gadget from the flick is being sold on eBay. Press your luck.

*Photo licensed to: Photorazzi.com

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I just wanted to give a quick shout-out of congrats to everyone back on the other side of the pond. My accent may have slipped in the 18 years since I left Blighty but I would be remiss if I didn’t wish them a very happy 10th anniversary over at ebay.co.uk!

From the UK AB post…

eBay.co.uk has seen over 950 million items sold in the past decade – testimony to our buyers’ enduring love of shopping and pursuit of a bargain.

From the first ever eBay.co.uk sale (a 3-track CD from German rockers The Scorpions sold for £2.89), the eBay.co.uk site has become an indicator of changing consumer tastes. We’re proud that our site is also a platform for charity fundraising and entrepreneurialism. More than £10.5m has been raised for more than 3,500 charities since the launch of eBay for Charity in 2006. And, of the 123,000 British businesses now trading on eBay, over 170 turn over more than a million pounds a year from selling on our site.

We’d like to take this opportunity to thank all our buyers and sellers for your business over the past 10 years and we look forward to providing you with a great place to buy and sell for the next 10 years. Find out more about eBay.co.uk over the past ten years.

Regards,

The eBay.co.uk Team

I did like the following quick stats:

- 964 million items sold
- 171 businesses turning over more than £1m a year
- From Britney Spears’ discarded tissue, to David Beckham’s BMW and the sale of a handbag every 25 seconds

Congratulations to all involved. Definitely cause for a tipple or two down the pub; I’ll raise a pint and make a “virtual toast” from here in California later today (but I’ll make sure it’s a real beer, unlike Obama’s Bud Light {shudder}).

Cheers!
RBH

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For those of you interested in listening and/or taking part in a Q&A session around Monday’s announcement, there will be a Town Hall event from 3:30 – 5pm PT this afternoon.

From Dinesh Lathi’s AB post earlier today:

Town Hall panelists include:

# Richard Hansen – Senior Director, Trust
# Olivier Dumon – Senior Director, Best Match
# Todd Lutwak – Senior Director, Seller Development
# Clayton Kunz – Product Manager, Resolutions
# Brian Burke, Director, Reputation
# Jarrod Jodoin, Product Manager, Shipping and Insurance

Ask your question LIVE on the air!
The best part of these events is the conversation we have with the Community. If you have a question for me or one of the other panelists on the above topics, call us at our toll-free number – 1-888-327-0061 – and ask us your question on the air. Or if you’d prefer, you can drop us an email with your question or comment about one of the topics in the Fall 2009 Announcement at townhall@ebay.com. We’ll take several of these written questions on the specific topics during the Town Hall as well.

Tune in via wsRadio
We’ll be broadcasting via Internet radio with the help of our friends at wsRadio (the same folks that produce Griff’s eBay Radio show). Members can listen to our live event via Windows Media Player or Real Player. So please visit www.ebay.com/townhall to join the event or for more information.

Finally, if you’d like to hear more about these topics after today’s Town Hall, take part in our upcoming webinar on Thursday, July 30th.

Also, although I’m sure I can think of a million things you’d rather do with your time, I will be joining Kat, Melinda and Beth on their show this afternoon at 5pm PT and I’ll also be joining Griff on his radio show tomorrow afternoon (Thursday) from 3-5pm PT.

Cheers,
RBH

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This is part II of a III part 'eBay Strategies' series detailing and
reacting to eBay's second round of 2009 changes announced today (aka
the Summer release or what they call SR2 internally@eBay).

• Part I  covers the search and seller efficiency changes and is here.
• Part II (you are here) covers the eTRS.
• Part III looks at the Summer changes package and offers some thoughts/analysis.

ChannelAdvisor is also hosting a webinar on August 4th (next
Tuesday) at 2pm ET where we will detail the changes and go through some
tips on how to start preparing for the changes now.  We'll also
highlight some strategies on how to take advantage of the changes
before the holidays.

Be sure to register for the eBay changes webinar here (it's the top webinar, or click here to go directly to registration).

Introducing the eBay Top Rated Seller Program or eTRS as we say in the 'biz'

The logo above is the new 'badge' for the eTRS.  There are a LOT of changes this new program is bringing to the World of eBay sellers so i wanted to dig into them in their own post.  The way I would characterize the changes is: lowering the volume requirements, while significantly raising the quality requirements for powers sellers and then creating a super-elite status eTRS that requires you to have the highest of high customer service ratings (via DSR 2.0) and if you do, you get the rewards of 20% FVF discount as well as raised search status and the dandy little badge above 'may' be in search results.

The changes are best thought of in these chunks:

1. Foundational changes - eBay is changing the whole game with how they look at DSRs. I call it DSR 2.0 and walk you through it here.
2. All seller requirements – Sorry no benefits if you are a lowly 'standard seller'.
   
3. Powerseller requirements – includes some  'diet' benefits.
   
4. eTRS requirements – (Very juicy) benefits.

Foundational changes

• DSRs 2.0 - First, eBay is significantly changing the way DSRs are calculated.  In addition to the 'average' of the DSRs, they are going to look at the actual 1 and 2 star ratings.  This is going to be a major mind-shift for sellers as they are not used to looking at the 1's and 2's specifically.  While these are available in the dashboard, it is not trivial to pull the report and it's monthly. 
• DSRs go domestic - One positive in all this is that eBay seems to finally be acknowledging that there is a material (we see .2 on avg) disconnect between the domestic and non-domestic DSRs.  Thus for these programs and search moving forward they will only be looking at the domestic DSRs.  As best I can tell, non-domestic DSRs don't factor into anything any more, so essentially don't matter and can be ignored (I bet that will change).
• Seller Dashboard 2.0 - eBay is revamping the dashboard to have real-time data around 1's and 2's.

DSR 2.0 calculation primer:

The way the new DSR 2.0 calculations 'work' is a little tricky so I wanted to cover that in detail.  eBay is calling the calculation the 'Max 1s and 2s on DSRs'.  The way it works is for each of the 4 DSRs (1-item descrip, 2-communication, 3-ship time, 4-s+h $), eBay is now looking at the % that receive a 1 or 2 star.  It doesn't matter if it was a one-star or two-star, just that you got something down in that low rating area.

For example, if you have 100 transactions and receive:

• item descrip: 4 one-stars and 2 two-stars
• comm: 3 one-stars and 3 two-stars
• shiptime: 2 one-stars and 4 two-stars
• s+h$: 6 one-stars and 6 two-stars

In that situation you would have these %'s of one and two stars:

• Item descrip: 6% (4+2)/100
• comm: 6% (3+3)/100
• shiptime: 6% (2+4)/100
• s+h$: 12% (6+6)/100

Pretend the requirement is 6% one/two stars on all DSRs, in this example, the S+H$ would trip you up as you would be over.  Remember this as you read on:

• The calculations are based on the % calculated by adding the one and two stars together for each DSR and then dividing by the number of transactions.
  • A formula would be (one-stars+two-stars) / number_of_transactions = MAX 1s or 2s on DSRs.
• Anything OVER the max trips you up and can either keep you out of the eTRS or even being a seller on eBay.

The hardest part of these changes for large sellers is going to be getting actionable solutions to stop the 1's and 2's.  I also think the new view of DSRs is skewed against larger, high volume sellers.  For example, based on our analysis this will be a big problem for 20-25% of eBay's largest sellers.  The 'cure' is to tell them to get less 1's and 2's. Hmmm, ok.

I guess eBay has found that 1's and 2's are really really bad or something as they seem heck-bent to get rid of them.

Requirement and benefits changes

This is really really confusing as they are actually making changes in two different timeframes. There are near-term Oct 09 requirements and longer-term April 2010 requirements.  There are also different segments of sellers impacted.  The way to think about it is in 'stacks'. At the bottom of the
stack you have 'all sellers' – meaning you will be booted
if you don't meet these basic seller requirements.  Next you have Powerseller status and then you
have the new uber-elite eTRS tier.

What I've attempted to do is cover this from the 'bottom' up – or go from the bottom of the stack – all sellers – up to eTRS. Where appropriate, I'll mark 10/09 and 4/10 to make it clear which are near-term vs. further-out.

The next section details the new requirements that all sellers have to meet.

Requirements for ALL sellers

• No insurance – All sellers have to stop offering insurance. (PERIOD!) This is a profit area for many sellers and will put pressure on margins. eBay's suggestion is to not make it optional and to put it in the cost of the item or S+H (but they want free S+H, so they really mean cost of the item).
• New 'Selling Practices' policy – This one makes me pretty
  nervous because it is a very broad net and uses words like:
  "professionalism" and "tone".  The examples they give are extreme like:
  "eBay forces me to do this.", but you can see implementing enforcement
  on this one is going to be very tough and subjective.  If history is an
  indicator, I expect to see a raft of canceled listings and NARUs from
  this one before it gets reeled back some.  Selers will be reporting
  each other for professionalism and tone like crazy in the early days as
  well to gain a competitive advantage.  If you have a couple of hours,
  you can read a 6 page treatment on the thing here. 6 pages?  Really?
• Volume - none.
• Rewards - none
• DSRs - none – they are eliminating the 4.3 min DSRs (kind of) and replacing with:
• DSRs 2.0 (% of 1's and 2s – see foundational section for calcs)
  • 10/09 -You have to be under these MAXs:
    • 3% for Item description DSR
    • 4% for all other DSR
  • 4/10 – You have to be under these MAXs (they are significantly ratcheted up)
    • 1% for item description DSR
    • 2% for all other DSR
• Carrots (well, sticks) – your search standings are basically lowered and you get 0% on FVF credits.

Once you meet the 'seller' criteria, the way this new system works is the better you do on those DSR 2. 0 %'s, the more benefits you get.  The next tier up from vanilla seller is Powerseller.

Powerseller (PS)requirements

In a simple sentence, the PS requirements take the basic seller requirements and add a volume and feedback requirement to get in the program. Thus, most folks that qualify for sellers of any size will make it right into the PS program.  They have essentially lowered the bar here pretty significantly on volume side, but kept the quality/DSR 2.0 bar the same with the 'seller' tier.

• Volume requirements -  (4/10) In what appears to be a fig leaf extended to smaller sellers that have felt really thrown under the bus over the last several years, eBay is significantly lowering the volume requirements to be in the Powerseller program (I will call PS for brevity).  You simply need to be doing 100 transactions or $3k/yr on eBay.  That used to be around $12k to be in the PS program, so they've dropped it 75% essentially.
• Feedback: 98%+
• DSR 2.0 – same as basic seller status above.
• Carrots/Rewards   
  • 10/09 FVF discounts
    • 4.9 DSR – 20%
    • 4.8 DSR – 15%
    • 4.6 DSR – 5%
  • 4/10 FVF discounts (note the above go away 4/10)
    • 5% (to get higher you have to be eTRS, keep readin')
  • Search standing: neutral (to get raised you have to be eTRS), but at least you aren't in the lowered bucket with the poor 'basic sellers', so if it makes you feel better, you are advantaged against them.

eBay Top Rated Seller Program (eTRS) requirements

This new tier really ratchets up the quality and corresponding carrots, but doesn't add anything on volume.

• Volume requirements – same as PS
• Feedback - same as PS
• Min DSRs: (this is different than PS)
  • 10/09 – 4.5 min DSR avg
  • 4/10 – 4.6 min DSR avg
• DSR 2.0s (% of 1's and 2s – see foundational section for calcs)
  • 10/09 and 4/10:
    • All DSRs have to be above .50% on the one/two star scale.
      
    • For small volume sellers, max of 2 one/two stars
  • Said another way, for every 200 transactions you can have ONLY 1 one-star OR two-star, or else you will not qualify.
  • That is a very very high quality bar, especially on the S+H cost DSR – my sense is you could only get here with free shipping based on early data I've researched.  More on this in part III.
• Carrots of the eTRS
  
  • 10/09 and 4/10:
    • 20% FVF discount
    • Raised search standing
    • Top-rated seller icon/badge thingy
    • You can do featured first (so this went away for all but eTRS sellers)

Up next, part III

So there you have it, my best pass at explaining this revamp of the DSR/powerseller program and introduction of the eTRS program as well.

In the next part of the series we'll look at this batch of changes holistically and

SeekingAlpha Disclosure – I am long Amazon and Google. eBay is an investor in ChannelAdvisor

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This is part I of a III part 'eBay Strategies' series detailing and reacting to eBay's second round of 2009 changes announced today (aka the Summer release or what they call SR2 internally@eBay).

• Part I (you are here) covers the search and seller efficiency changes.
• Part II covers the eTRS – which is here (**NOW LIVE**)
• Part III looks at the Summer changes package and offers some thoughts/analysis and lives here.

ChannelAdvisor is also hosting a webinar on August 4th (next
Tuesday) at 2pm ET where we will detail the changes and go through some
tips on how to start preparing for the changes now.  We'll also
highlight some strategies on how to take advantage of the changes
before the holidays.

Be sure to register for the eBay changes webinar here (it's the top webinar, or click here to go directly to registration).

These changes are set to roll out in the Sept/Oct time frame (9/22-10/1 to be specific) and are best examined  in three chunks:

1. Search enhancements (my personal favorite)
2. Seller efficiencies
3. The new eBay Top Rated Sellers (eTRS in eBay-speak) program.

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It’s starting to bake across parts of the country. Time to strip down, but not striptease. A pair of tailored shorts looks new and cool with a tailored, fitted shirt. Cut off the bottoms of skinny jeans at the calf or knee and roll once or twice. Wear with flip-flops, ankle gladiators or heels.

Another cool idea for socializing is the tunic. It’s breezy and goes with just about any bottom.

For work, pick a sleeveless sheath dress. Once inside the office with the A/C blasting, a cover up may be needed. A crop jacket with short sleeves is one good option. Alternately, try a lightweight little cardigan. The thing to bear in mind with the sweater is minimal fabric. Too much, and it looks hot and bulky.

A sack dress is another wise choice for cooling down while maintaining that “I-know-what-I’m-doing” look that’s so necessary for work. Roomy yet chic, it skims the body and is a flattering fit for every shape. Add some statement jewelry – a big necklace or an arresting cuff to finish the look. Sack dresses are wonderful with closed pumps or tribal sandals.

Can can you wear open-toes to work? Of course. Just don’t forget the cucumber pedicure.

*Photo licensed to: Photorazzi.com

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Well… here it is folks… People have been speculating and wondering what was going to be announced regarding the eBay marketplace for the second half of the year. Wonder no more. Today, eBay announced those anticipated changes, most of which will launch between September 22 and October 1, 2009.

There’s a lot to digest, but from what I can tell, the news is broken down into 3 primary initiatives:

1. Rewards for sellers delivering great buyer experiences
2. Enhanced search presents more relevant listings
3. Easier, more profitable selling on eBay

Of course, as with all announcements, the meat of the news is not in the headlines, but in the fine print. Feel free to dig deeper into the news by checking out the AB post.

I’ve read through everything and, rather than regurgitate what was announced, I wanted to try and understand what it means for the good, small seller on eBay (a group of business entrepreneurs that we continue to claim a very strong affinity for but that has, for the most part, shared ill-feelings in the comments section of this blog since inception).

With regard to delivering a great buyer experience:
1. Getting Detailed Seller Ratings (DSRs) of 1s and 2s is bad. No brainer, right? Moving forward, eBay will shift from focusing on average DSR scores to the number of low DSRs (1s and 2s) as a way to better measure buyer satisfaction.

2. Because international transactions can be more readily subject to factors outside a seller’s control, only domestic DSRs will count toward eBay.com requirements. Another benefit of this is that sellers will be able to expand their business globally without fear of impacting their status on eBay.com.

3. The PowerSeller program is getting a new eBay top-rated seller status in October that will reward sellers for providing great buyer experiences based on the new aforementioned way of looking at DSRs. eBay Top-rated sellers will receive 20% Final Value Fee (FVF) discounts, increased visibility in search results for Fixed Price listings, exclusive access to purchase Featured First and a top-rated seller badge on item pages.

Top-Rated Seller Badge (below and right):

According to a press release earlier today, this Top-Rated Seller program is a change to the current PowerSeller program that will immediately qualify 180,000 Top-Rated sellers when the program goes live in October. Any seller with at least 100 transactions a year and $3,000 in sales volume can qualify (based on buyer feedback). If my math is right (let me know if it isn’t), this means that any seller, based on buyer feedback, that sells an average of 2 items per week at an average cost of $30 an item, now qualifies as a Top-Rated Seller in the PowerSeller program. It’s estimated that 70,000 sellers who do not currently meet the volume requirements for the existing PowerSeller program, will earn eBay Top-Rated Seller status.

One thing I did see in the AB post, that I need to get more clarification on, is the following: “Starting in October, there will be a new minimum standard for all eBay sellers based on the number of low DSR (1s and 2s received). The minimum standard will be more strict in April, 2010.” More strict how, exactly?

More key updates:
1. Updates to the Seller Dashboard means that starting in September, you’ll be able to see daily updated snapshots of your low DSRs (1s and 2s) and standing toward the new Top-Rated seller requirements through a link at the top of the Seller Dashboard.

2. A new Search Visibility tool will help you evaluate how your Fixed Price and auction-style listings are performing in search results.

3. A new automated unpaid item resolution process will cut the time in half. It’s being rolled out for the holidays and will block negative feedback when a seller opens a claim and a buyer doesn’t pay.

Like I said, a lot to digest. As always, I welcome your comments and feedback below. I’m also taking suggestions for follow-up posts that dig deeper into certain aspects of today’s announcements. This blog works only with your feedback – regardless of sentiment – so please let me know what you’re thinking.

If you’re discussing the announcement on Twitter, please use the following hashtag in your tweets so we can easily track feedback and answer questions: #eBayTRS.

Webinars
There will be informative webinars on Tuesday, July 28 and Thursday, July 30. You can access those by clicking here.

Other key pages:
- Overview
- Details
- FAQ
- Seller Standards Chart
- Low DSR calculation examples
- Best Practices
- Seller Checklist

Related Reads:
TameBay: eBay.com Announce Changes for Sellers
AuctionBytes: eBay Revamps PowerSeller Program as part of September Changes
eBay Strategies: Major eBay Changes Announced Today: Part I/III
Cheers,
RBH

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Most of the changes will not take place until September 22 with others coming in October

Last year eBay announced that they would give sellers more time to adjust their business to changes on the platform. This is the second planned announcment of 2009.  Normally I list the new changes with my comments, but this one caught me on vacation, so I am just going to list the changes and I will save my analysis for my newsletter that will be out later this week. If you don’t get the newsletter, you can subscribe for free here.

Here is the text of eBay’s announcement:

• PowerSeller program update: rewarding quality over quantity
  • Starting in October, a new eBay top-rated seller status will be added to the PowerSeller program to recognize and reward sellers providing great buyer experiences based on the new way to look at DSRs (very few 1s and 2s). eBay Top-rated sellers will receive the highest PowerSeller Final Value Fee discounts (20%), increased visibility in search results for Fixed Price listings, exclusive access to purchase Featured First and a prominent Top-rated seller badge on item pages. The Top-rated seller badge will be tested in search results pages this summer. The current PowerSeller icon will no longer be displayed on buyer-facing pages including item pages.
  • All sellers with 100 or more annual transactions and at least $3,000 annual sales who meet the requirements for Top-rated seller status will be invited into the PowerSeller program and can start receiving Top-rated seller benefits in October.
  • Next April, the PowerSeller program will also include a requirement for sellers based on the new way to look at DSRs (very few 1s and 2s). PowerSellers that don’t have Top-rated seller status will get 5% Final Value Fee discounts.
  • Meanwhile, the current PowerSeller discount structure will continue until April 1, 2010 to give sellers 8 full months to keep their current discounts while they adjust business practices to qualify for the new Top-rated seller status.
• New minimum standards for all sellers:
  • Starting in October, there will be a new minimum standard for all eBay sellers based on the number of low DSRs (1s and 2s) received. The minimum standard will be stricter in April, 2010.
  • A new Selling Practices policy will define guidelines for professionalism and accuracy in all aspects of listings and transactions.
  • Optional buyer charges for shipping insurance will no longer be allowed. Sellers can still buy shipping insurance and add the cost to the item or shipping price.
• Updates to the Seller Dashboard: You can now see a snapshot of your low DSRs (1s and 2s) and standing toward the new Top-rated seller requirements updated monthly through a link at the top of your Seller Dashboard. In September, you will be able to see daily updates.

  1. Enhanced search presents more relevant listings
  2. Best Match, eBay’s default sort order, will look at listing’s recent sales in relation to the number of recent impressions it received as a key factor for Fixed Price listings. An "impression" is any time a buyer sees a search results page that includes the listing.

See Also

• Learn How To Make Money with an Online Consignment Business Selling on eBay, Craigslist and Other Online Shopping sites
  Complete business manual with contracts, forms and pre-written advertisements to grow your business

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Just Updated: 77 Free eBay Tips to help eBay sellers avoid mistakes, sell more items and build your eBay business

I have been publishing my free eBay tips for the past 6 years. As you can imagine with all of the changes on eBay and the services provided by third parties, these need to be updated frequently. The truth is that I have been a bit lazy and it has been a while since I updated the tips page, but this morning it is good to go.

You can read the tips online here: http://www.skipmcgrath.com/auction_sr/77-tips-tools-selling-ebay.shtml

If you would like to read them later or print them out, scroll to the bottom of the page. There is a link to a PDF file so you can save the document to your computer.

It looks like I will have to change the tips again soon. eBay is coming out with some major announcements next week. They will be rolling out the trusted seller program and changes to rules for shipping, insurance, changes to the power seller program and its looking like many of the optional selling features may be going away. So watch this blog and be sure and sign up for my newsletter to get the latest news and stratergies for coping with the many changes sure to come.

You can subscribe to this blog by clicking on the logo to your home page near the top of this page. You can subscribe to my twice-monthly free newsletter at this link: http://www.skipmcgrath.com/newsletters/

See Also

• Learn how to make money as an eBay Trading Assistant selling on consignment
  Complete eBay Consignment Manual with forms, contracts, and advertising. Everything you need to get started.

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As most of you know I’ve been battling a rather nasty stomach bug for over a month now. It has disrupted my schedule and seen me in and out of the eBay office vs doctor’s office for the past 4 weeks. Yesterday was unfortunately no exception. On a day when PayPal held a Platform Preview and became the first and only global payments platform open to third-party developers and a day in which John Donahoe joined Fortune’s editor at large, Adam Lashinsky, on stage at FORTUNE Brainstorm: TECH 2009 down in Pasadena, I found myself stuck getting yet more tests and sadly had to miss both.

Luckily for me, and consequently you, I was able to get reports back from colleagues attending both events. As a result, here is a recap of John’s onstage discussion from the Brainstorm: TECH event. A huge thanks to Young Mi Kim for providing me with a recap of the proceedings…

There were about 250 people in the room consisting of technologists and business leaders. A poll at the beginning of the session showed that 57% of the audience use eBay; 65% use PayPal; and 59% use Skype.

Overall, John re-emphasized that eBay has changed… and that change had to happen because of consumer expectations and the way in which people now shop online. Again, reiterating the fact that eBay is no longer just about auctions, he stressed that everything we do is in consideration for long-term success: investing in technology and the customer experience.

John speaks to FOX Business News live from the FORTUNE Brainstorm: TECH 2009

Watch the latest business video at FOXBusiness.com

In addition to referencing the PayPal platform news of yesterday – and that there is now the ability to pay someone via Twitter using TwitPay (PayPal is the payment engine behind that) – he also talked about the probability that one day PayPal will be bigger than eBay (although he did refrain from speculating on a possible new company name). PayPal currently represents 35% of company revenue, and off-eBay business grew 32% in Q2. In fact, every area of our business except for the auction format grew this last quarter, and is outpacing e-commerce.

Moving forward, we have two core areas of focus: e-commerce and payments… and we’re in the early days. But we also recognize that we’re at an inflection point … we need to reinvent ourselves and evolve into a truly global e-commerce company.

John speaks to CNBC live from the FORTUNE Brainstorm: TECH 2009

Bottom line, it’s clear that there is an emphasis on elevating the role of technology at eBay, and we’re building out the platform as a result. I hear it and see it in pretty much every meeting I attend. Some of the results of that are yet to see the light of day and until they do, I’m holding off judgment but am not-so-secretly excited to be here as they take place.

No one could say that reporting from eBay HQ for the past year and a half has been boring. eBay is 18 months into a 3-4 year turnaround and I’m very much looking forward to reporting on the next 18 months. Stay tuned.

Cheers,
RBH

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