Auction Blog

Well today eBay officially launched the Multi-quantity 30-day duration fixed price listing (FP30 for short). 

I'm proud to announce that we are already not only supporting FP30 TODAY at ChannelAdvisor in both our MarketplaceAdvisor Standard and Premium offerings, but we've done some enhancements to take advantage of how the relist works so that our customers will be advantaged with their recent sales.

This was tricky because eBay hasn't had this in the API until it went live on the site at midnight PT, so we had to have a team working on this in real time to support it, test, it, etc.  In fact, this new format won't be in the eBay sandbox for weeks.  Clearly the business changes are coming faster than the rest of the company can keep up right now.

In fact, our sales team heard from one poor Turbolister seller that TL won't even support FP30 for at best a week or two.  Ouch, talk about a disadvantage.  Think of all that sales velocity this seller's competitors will be able to build up.  I don't know if Blackthorne or any of the other myriad eBay listing tools will support FP30 yet, but it's not a long shot given how it was rolled out that they will be days if not weeks behind.

Off to a slow start
Given all the hoopla in the press and supposedly nashing of teeth around this new format, it's off to a slow start.  We have about 150 customers that have listed an FP30.  Here's one of the first ones if you want to see what it looks like 'live' on eBay.

Part of what's going on with the seller base is, for lack of a better word, eBay fatigue.  Sellers feel their businesses have changes so much (DSRs, BestMatch, etc..)  for so little/no/decline in sales that eBay is increasingly becoming a lower priority for them and thus they will tend to be reactive vs. proactive as they would have been as recently as 6 months ago.  To be honest, most of our larger sellers are spending their time getting their websites and other channels ready for the holidays and eBay just isn't a priority.  Of course this doesn't bode well for eBay, but it's the reality of what is going on in the grassroots of ecommerce.

So unless eBay puts a promo on the FP30, I don't see this mass switch to FP30 over the store format or anything until maybe Q1 after the holiday dust settles.

I'll keep a close eye on the trends and report anything of interest.

For those ChannelAdvisor customers that are also blog readers, we have details on our FP30 support on the Strategy and Support Center (SSC) here.

SeekingAlpha disclosure: I am long google and ebay.

Read more:
FP30 is born!

This weekend, a Barrons article cited a report by an investment research firm, Wedge Partners (Brian Blair and Ryan Hunter) that says eBay is planning a 1500 person layoff.

Reuters has re-reported the story as well here. The big question I'm hearing from ChannelAdvisor customers and readers is: What will eBay layoffs mean for sellers?

Where are the people?

With 16,000 people in the company this would be a < 10% reduction.  Given that eBay hasn't really gone through this before, I'd guess this can be done with little to no impact on operations. 

To understand the impact on sellers, we need to think about where the cuts will/would come from.  While eBay doesn't report a break down of the 16k, we can guess where the pockets of people are.  If you peel the onion on eBay you have:

• Paypal - Paypal is the crown jewel of eBay and has grown substantially head-count wise over the last years. Here's where the people are:
  • Paypal has the business people in San Jose at their own campus (view on gmaps)
  • Paypal has tons of customer service/fraud prevention people in Omaha/Salt lake.  I don't think it would be prudent to do anything here given the busiest season starts now.
  • I'm going to guess Paypal has limited business people internationally, but probably big fraud prevention teams in their customer service center.
• Skype - Skype is probably a 1000 person company at this point and given that it's the fastest growing part of eBay.
• eBay marketplaces -
  • I'd guess that 8k of the 16k people are at eBay marketplaces and housed at the 'mother ship'.
  • 2125 Hamilton is the home of eBay Park which you can tour on gmaps with their cool 'Street View' (click here, zoom in and select street view - look to your left for the 4 buildings by starbucks and to your right for the other 4.)
  • With 8 very large building's I'd say there are a good 4-6k people in that park.  This report from 2003 cites 1500 out of eBay's total of 4200 at the time, so I'd imagine that number has more than doubled in the last 5 yrs (wow - eBay's headcount has gone up 4X since then!).  So let's say 5k in eBay Park
  • That leaves 3k that I' would say are about 1000 international and 2000 in Salt Lake.
  • The international offices are run pretty lean with most functions being supported out of the US (engineering and admin for example).
• Misc
  • There are small offices in LA, SFO and a variety of other places from acquisitions (StubHub, rent.com, etc.)

Where are layoffs likely?
This is all speculation on my part, but logically it seems like it wouldn't be prudent to do anything at Skype, Paypal or places like Stubhub that are big growth drivers. Thus you're left with eBay marketplaces which is the anchor to the conlomerate and should bear the weight of any downsizing.

Within eBay marketplaces, I don't think International has room for much change, therefore you're left with the 2k people in SLC and the 5k people in SJC.

This is where it gets tough.  Ebay has talked up the benefits of increasing customer service and TnS staff in SLC with Wall St.  That could make it hard PR-wise to cut there.

That leaves 5k in SJC at the most risk IMO.  If the 1500 were localized to that group, what looked like 10% now becomes 30% which is pretty deep and risky.  In eBay Park you have:

• Lots of 'admin' - finance, hr, legal.  I think one whole building floor is just legal.  With eBay's legal issues though, this could be an area that's hard to reduce.
• Seller experience - possibly impacted
• Buyer experience - probably not impacted as eBay doesn't want to be seen underinvested in such a strategic area.
• Marketing - probably impacted.  With eBay spending less and less on marketing, there are probably big reductions that could be made here
• Engineering - most of eBay's R+D is done in SJC with some pockets outsourced to India and other places.
• eBay Motors - Motors seems to replicate lots of the functions at other parts of eBay.  I'd guess lots of synergies could be found by undoing all of this duplication of effort.
• CS+TnS - eBay has some functions like community, customer service and trust and safety with some headcount in SJC that largely creates policies for folks in SLC.  There maybe room there to trim as well
• Middle management - eBay has lots of VP, Manager, Director level people that JD may look at eliminating as a way to streamline decision making.  Most eBay employees are at least 5+ layers away from JD which seems ripe for

  bureaucracy.

What's all this mean for sellers?

If I'm wrong here and SLC is hit with the bulk of the layoffs, that's where 90+ eBay TSAMs are (Top Seller Account Managers).  That would be bad for sellers as that group is the lifeline a seller has into eBay.  However, if customer service or trust and safety in SLC are decreased that wouldn't directly impact sellers, but it could hurt the buyer experience (which is why I don't think it will be an area that is touched).

Seller development is at risk, but I think it's a smaller group so probably not something that would be cut deeply.  Any admin, marketing or other cuts are likely to not

All in, I'd say there's a low (10-20%) that any reductions would impact sellers, but until we see what eBay does, it's all a guessing game.

SeekingAlpha Disclosure: I am long Google and eBay

Original post:
eBay layoff - impact on sellers?

This is part 2 of a multi part series. Part 1 is here, please make sure to read it first.

As I write this, we are a mere 4 days away from FP30 and sellers are now really turning their attention to the new format and what they should do when it arrives.

In this installment of our “FP30+Finding” series, I wanted to focus on the topic of recent sales.

Why are recent sales important
In Episode I we talked about how auction listings are primarily TES driven and FP30 is recent sales driven.  Thus recent sales is a sellers lever for getting higher search placement.  Therefore it is extremely important.

What are recent sales?
Here's how it works.  You have a FP30 listing with multiple quantities (let's say 100) of an item. You obviously start on day 1 with no sales, and then as you get sales, you receive a recent sales 'score' (details unknown, but pretend it's a scale of 1-10).  What's important is the relative recent sales for your listing vs. the other fp30's you are competing with for traffic.

A very important nuance (that could change) is that recent sales is a 7 day window. In other words, it looks 'back' 7 days to calculate recent sales.  Allow me illustrate with an extreme fictional example.  SellerX lists a fp30 on 9/20 with quant=200.  On 9/22 (day 2) the seller sells 50 and then on 9/30 (day 10), the seller sells 2 items.  the recent-sales looks back 7 days (9/23-9/30 in this example) and thus the score is based off the 2 items and does not include the 50.   Had the 50 and 2 happened within 7 days, they would have been considered in the recent sales score as they would be in the 7 day window.

Do recent sales benefit large sellers because they sell more?
One misperception out there I keep hearing (from fruitcats!) is: “recent sales favors
large sellers because they can list more”.  This couldn't be further
from the truth because recent sales are for a 'listing' and not for a
'seller'.  Let me point this out with an extreme example:

SellerX (big seller) - lists 1m items with quantity 10, let's say they
are DVDs. SellerX has the Little Mermaid for $39.99, but every other
item for .01 BIN and free shipping.

SellerY (small seller) - lists 1 item with quantity 10 - it's a Little Mermaid DVD for $29.99 with free shipping.

SellerX and Y put their DVDs into fp30 starting on 9/20.  SellerY sells 5 in the first 7 days and sellerX sells 2. 

A consumer searches for little mermaid.  Little ole SellerY's listing will be shown ABOVE SellerX's because the LISTING has more recent sales, even though that seller is selling $3m/m in other DVDs.

What about relists?

If you have a fp30 with lots of quanity listing humming along selling 2-3 items a day and it ends, what happens?  The good news is the recent history carries through to a relist IF:

• You do a relist within 7 days of listing end (It will go back and pull the last 7 days of the listings recent sales even if you're 7 days past end of listing)
• You don't change anything - it has to be the EXACT same item.  

For those of you using third party software like that from ChannelAdvisor, you'll want to make sure your vendor is correctly calling the eBay relist APIs to make this work.  Until fp30, “relist matching” wasn't important, but it sure is now.  Yes, CA will be ready for this very shortly.

What about updates to live listings?

Let's say you have a fp30 chugging along with quantity 100 and it starts to sell down and gets to 2 items.  You receive some more inventory so you bump it back up to 100 on day 22 - what happens to recent sales?  Another frequent updated with these fp30 listings is changing the price.

Ebay tells us that the recent sales is not disrupted by any updates.   Note that this is ripe for gaming (start something out at a penny and then jack up the price to $1000 and benefit from the 7 days recent sales at a penny?) and I bet eBay will quickly make it such that a price change (I'd say increase only is smart) clears out the recent sales.  This will be interesting to watch and see how sellers 'optimize' this part of the system.

What's this mean for my strategy?
Ok hopefully your head isn't swimming and you can see how this is essentially a completely different way of thinking than auction/TES listings.  Here are some strategies to consider:

• Keep a mix of auction+fp30 listings - remember that Finding will show auctions+fp30 in a ratio based on demand for every search.  Your top sellers will still need auciton exposure - use BIN+high start if you hate true auction.
• Consider moving your store listings to fp30.  I agree with media+auto parts sellers who believe fp30 will be the death of eBay stores.  There will be enough fp30 inventory out there that store visibility goes to zero.  Thus you'll want to get in front of that ASAP to build your recent sales and stay competitive
• Consider 'cross polination' strategies.  Start a $NR auction for 1 and link it to your fp30's and drive as much traffic from the auction to the fp30 as possible (run multiples so there's strong TES peak time coverage).  This will amp the recent sales of your fp30
• One concern I share with fp30 that most sellers have is that it blows the perception of scarcity.  When a buyer finds a listing and in there it says: “this seller has 9 trillion of these available” as a buyer you tend to think there's room to wait and let the price come in on something like that.  Ideally eBay would solve this and say something like “available” or “in stock” vs. “1000″.  Until that time you may want to do some experimenting with smaller quantities that you update frequantly. 
  • Example, you have 200 widgets.  Instead of kicking off a fp30quant200, you kick off a fp30quant20 and every three days look at adding 20 in there.  This is probably more work than its worth, but something to consider.
  • You could also have 3-4 fp30's.  They would be de-duped, but if one sells out with quant20, the other will now show.  This of course incurs more listing fees and doesn't transfer recent sales between the concurrent listings, but you could transfer it via relists if you wanted to 'tag team'.
• fp30 is terrible for products with choices (e.g. shoes with size and whatnot)  I honestly don't have any advice for you but to keep listing each size separately for now.
• Other than the 'perception of strategy' angle, there is no reason (and in fact it is wasteful for recent-sales and listing $ due to de-dupe) to have multiple listings for the same product in fp30.
  • This is a different mindset for sellers because TES trained us to list things every day to make sure we had a TES for that day.
  • The exception to this rule is title optimization.  Sellers frequently list the same title with 2+ titles to get more keyword exposure.  For example, you may have a SKU (back to the future movie poster) that you want to list as:
    • Back to the future movie poster 1985
    • Robert Zemeckis back to the future
    • Michael J. Fox  Christopher lloyd back to future
    • etc.
• Consider using featured for new products to kick-start recent sales as you won't have a history there.
• Make sure you kick off your strategic fp30's on 9/16 when they go live. Let's say your competitors do this and you don't get around to it until 9/22 (6 days later). There is a scenario where:
  • Your competitors have a 5 day start on recent sales
  • Thus your items are disadvantaged out of the gate and starved off
  • You are
• FP30+recent could have you rethink or balance your DSR/S+H strategy.
  • For example, the boost from a lower core item price (move some to S+H) could boost recent sales and thus outweigh the loss of discounts from potentially lower DSRs. 

Until Episode III…
In our next episode we'll take a look at what's going on with FP30 in the UK.  They have a very different implementation there and history has shown that eBay frequently moves things between countries as they learn more so it gives you an edge to know what's going on in the UK and start thinking about what would happen should those changes come to the US.

SeekingAlpha Disclosure: I am long Google and eBay

Source:
FP30 + Finding - Episode II (Attack of the Recent Sales)

eBay Seller's hearts are pounding today

Today we started to get frantic and panicky inbound calls and emails from sellers that had heard through the grapevine that eBay's new item page that eBay previously been talked about as being in less than 10% 'test' mode, open to lots of changes, etc. is suddenly being talked about as going live for the holidays.  Turns out it was a post the developer blog last night that was the first time it was revealed that this is something that could change by the Holidays.  eBay also introduced another complexity called an iFrame that puts the content of the template into a different domain name to help with some fraud issues.

A seller's item page is where they do all their merchandising and most larger sellers have significant investments in their 'template' (ChannelAdvisor speak for the design of their item page). 

While we have a clarification into eBay around this sudden 'get it done for the holidays' kind-of-announcement, I thought it would be prudent to alert people as since we're hear at mid-September, I'm guessing this would definitely be out as early as Thanksgiving and maybe as early as Halloween.  If we assume Halloween, maybe you have a month to month and a half to adapt.  Based on our early investigations the changes needed could be substantial.

Test your listings now
The good news is any seller can see how their template will look in the new item page by following these directions:

1. Login to eBay under your seller ID
2. Bring up a live listing
3. In the upper right you will see a link that offers to show you how your listing looks under the new View Item Page.
4. Click that link

Challenges with the new design
There's lots of negativity from sellers in general around the new design, but since it looks like its hear to say, I won't spend time on that.  However, some design elements are going to make updating your template a potential MUST.

To understand the challenges, first you have to look at this page eBay provides to identify the various elements of the design (click on image to see an expanded version):

The problem is the width of the description element marked number 4 in the diagram.  The upsell elements 6 and 7 take a good 20-25% of the width and squish the description into a small area.  If your template is wider than this then you get some really weird scroll bars in there that we worry will keep buyers from seeing  a large portion of your template.  We're seeing some designs cut off in weird places, images hidden and a variety of other problems with this setup that sellers will want to have resolved before this goes live or potentially suffer a decrease in conversions and an increase in customer inquiries.

Conclusion
The bottom line is regardless of if this was a mistake and the new new item page isn't really coming out for the Holiday, I think it would be prudent to look at a good 5-10 of your items and start to think about how much work you are looking at and how you could possibly do it by late October.

Credit:
Bombshell: eBay may switch to new ‘Item Page’ before Holidays!

This Wednesday at 2pm ET we’re co-hosting a webinar with Amazon (Sam Wheeler- Director of Merchant Services) around how to take advantage of the various Amazon offerings.

We’ve got a range of introductory to advanced materials so whether you are an Amazon guru or just getting started, I think there will be something for everyone.