Between the Lines

eBay has Amazon envy: Cuts fees to get more fixed pricing

Posted in:

Amazon
E-commerce
General
Web Technology
eBay

Can eBay still be eBay as it moves toward a fixed pricing model? Possibly, but it's going to be really difficult to change its auctioneer image. On Wednesday, eBay announced new fee changes (Techmeme, eBay blog). It is lowering its listing fees for sellers that use the "Buy it Now" fixed price feature by 70 percent. Sellers can now list multiple items under Buy it Now for 35 cents for a 30-day listing period. That fee is a big carrot to encourage sellers to use fixed pricing. The new listing fees take effect Sept. 16. In a statement, eBay said the fee was "The change is the most competitive pricing eBay has ever offered sellers." Previously sellers on eBay had to pay more per item listed. The company has multiple examples in its statement and site of potential savings, but each seller will have a different result.

The broader question is whether eBay's Amazon envy makes sense. Let's face it. This move by eBay is all about Amazon. Amazon fixed price structure is easier. And to be honest I have always viewed eBay as the shop of last resort (like when you can't get your kid a hot toy because you procrastinated). I don't have the time or inclination to monitor some auction. Give me a price and I'll pay it or walk. Amazon comes in with its third party selling network and gives eBay a run. Now eBay is downplaying its auction heritage to appear to be a more conventional e-tailer. The problem here is perception. Clearly eBay wants to hang on to its sellers and prod them into putting more inventory on the site. And sellers are likely to be happy with lower fees for fixed price goods. But there's also a consumer angle here. eBay in its statement noted that the fee reductions will set it up nicely for the holiday shopping season. The question, however, remains: Will consumers go to eBay to buy something over Amazon? Probably not. eBay noted in its statement:

While the pricing changes take effect in September, other improvements to the buyer experience on eBay will occur in phases through November. Buyers shopping for a great deal on eBay can expect to find greater selection at better prices than ever before. Improvements to eBay’s product search will make it easier for buyers to find the best deal on the product that’s right for them. Buyers who complete their purchase with PayPal, the safer way to pay and be paid online, will enjoy buyer protection. PayPal will offer protection for the full purchase price and original shipping costs on eligible transactions paid with PayPal at no additional cost to the buyer.

That's a long-winded way to say shopping on eBay was too damn hard. You don't turn that around overnight on the perception front.

posted by Larry Dignan
August 20, 2008 @ 7:02 am

Previous Post: Microsoft, Novell bolster Linux partnership
Next Post: Intel’s roadmap comes into focus: Can rivals respond?

Between the Lines

eBay has Amazon envy: Cuts fees to get more fixed pricing

Last 10 posts: