eBay has announced a partnership with Internet superstore Buy.com, managing to infuriate existing sellers even further in the process.
As if they haven’t already been dealt enough blows, sellers now have to contend with Buy.com swamping categories such as DVDs and games, homewares and electronics. The fight is made even tougher by the fact that eBay's search listings give preference to sellers who can afford to offer deal sweeteners like free shipping and special discounts.
Since January 2008, Buy.com has added over 5 million fixed-price listings to eBay’s marketplace.
What’s more, they appear to be doing it without paying the fees that other sellers have to pay.
In a somewhat belated move to legitimize Buy.com’s activity, eBay has created a new ‘Diamond’ powerseller level for sellers with over $500,000 in sales each month and a minimum of 4.8 across all DSRs.
The biggest benefit for Diamond sellers is customized fee structuring. Diamond powersellers can negotiate their own fees on a case-by-case basis.
Why would eBay go down this route? Once again, they are pointing the finger at their old arch-nemesis Amazon.com. According to eBay, Amazon has changed the way buyers shop. The joy of finding a good deal is apparently no longer enough. Buyers today also want the peace of mind that comes from standardized service, especially in regards to fast delivery and professional packaging.
But is that all there is to it? Some people believe that eBay’s desperation to satisfy its shareholders is the real reason. As a publicly listed company, the pressure is on to get the share price tracking upwards, even if it means abandoning the mum and dad traders that have been behind the company’s success to date.
It seems that eBay is hoping that shedding their ‘flea market’ image and transforming into the #1 product aggregator and marketplace will achieve that goal. But are they destroying the very essence of their brand in the process? And how exactly do they intend to differentiate themselves from Amazon?
Once again, sellers have to evaluate whether eBay is still the right place to do business. Will this venture be successful for eBay? If so – should you take up the challenge of scaling up your businesses to meet eBay’s criteria? Or is it time to move on to alternative auction sites?