Throwing In The Towel On eBay Stores!

One of my favorite eBay Stores Board posters has made the move. As of today 5-17-2006 she has shut down her eBay store. While, she will continue to sell in CORE she just felt it was time to shut down the store.

Perhaps, we could call her leaving "collateral damage" to eBay's efforts to improve the buyer experience but it isn't collateral to her. As you can see from the picture above, she had 100% feedback, with over 4,000 positives and 5 stars across the board with Feedback 2.0.

She is a perfect example of the types of sellers that are leaving eBay Stores. For many of them it no longer makes sense for their business.

Postcardsandmore, you will be missed.

Drive Traffic To eBay And Get Paid For It!

Today's announcement from eBay, highlights the changes in the eBay affiliate program. Now sellers can get affiliate pay for driving traffic to eBay, even if it is only to their own listings. You would need to join the eBay affiliate program to participate. I'm not sure how this will affect the FVF credit that store owners receive.

One thought from my perspective: Why would you want to expend effort and possibly money to drive traffic to eBay; you will still only receive part of the transaction and eBay gets the rest for absolutely no effort? This move lessens eBay's dependence on paid search and benefits eBay in the aggregate while individual sellers get little benefit.

If you are a store owner and want to keep your store presence on eBay it may make since but I would think you would be better off creating your own independent webstore and driving traffic there. Why give eBay even part of the transaction if you are doing all of the work?

Follow-Up to The Case For Yahoo Stores Over eBay Stores

I've been asked several times, since I posted my comparison of Yahoo Stores to eBay Stores, why I didn't compare Yahoo Stores to eBay's Pro Stores instead. The reason is simple, with the reduction in visibility of eBay Stores on eBay.com, store sellers are now forced to market to buyers directly. eBay's preferred method for that is Auctions but most sellers consider Auctions as costly advertising for their stores.

eBay stores are now in the same place as Yahoo Stores and for that matter Pro Stores, in regards to exposure, they have to spend additional money and effort to get buyers to their stores. Yahoo Stores require the seller to spend additional money and effort to bring buyers to their stores as well but that is factored into the pricing. With eBay stores you get charged too much for the exposure they currently provide and seller still needs to spend additional dollars or effort on advertising/exposure.

Yahoo Stores offers some great promotional incentives that eBay Stores do not offer and with Yahoo Stores you own the customer not the marketplace.

The Case For Yahoo Stores Over eBay Stores!

In addition to the uncertainty about eBay Stores/Shops, my recent comparison between Yahoo Stores and eBay Stores was eye-opening.

For my example, I looked at a basic online store with listings of 200 items a month, with a product mix of 150 items under $25 and 50 Items over and made the assumption that the store sold $1,000 in merchandise in a month. If your numbers are greater than this, the savings begins to grow substantially.

Here is the Google Spreadsheet with my comparison, as well as room for you to input your existing eBay Store/Shop Listings and monthly GMV. This will allow you to calculate if there will be a savings by switching to Yahoo Stores. Please plug in your own monthly numbers into the green fields in the spreadsheet. (The spreadsheet refers to US pricing only)

In addition to the cost savings there are also promotional benefits that make moving to Yahoo Stores attractive.

Promotional
With eBay stores you get limited exposure in search on eBay.com and often have to pay for Auction listings as advertising for your store items. There are no additional promotional benefits to having an eBay Store/Shop. You still have to do most of the marketing to get buyers to your store. You also have to contend with the competition on the eBay marketplace.

With Yahoo Stores you get the following: (As of May 11th 2007)

• $50 credit towards Google AdWords (In effect paying for your Store Setup Fee)
• No PayPal fees for 6 months with PayPal Express setup
• 1 Month Free at Shopping.com
• $50 Credit for ShopZilla.com
• 20% off of your Yahoo Listings

But, you will still have to spend some of your savings on other marketing efforts but the offers above give you a head start to see what works for a discount.

My goal as the Seller Evangelist is to provide you with accurate, unbiased, information so that you can make the correct choice for your business. I do not earn any money from either of these two programs nor am I partial to either. If you are serious about making money online you need to make informed decisions. There may be other WebStores that compare just as favorable but with the information provided here you do have a head start on your research.

Additionally:
It is interesting to note that both PayPal and Shopping.com are eBay owned companies and you get a better promotional deal with Yahoo Stores than you do with eBay Stores.

Also, with a Yahoo store you can still use eBay for Auctions but instead of considering Auctions as advertising (it is difficult to move eBay customers off site) you should sell only the items that will convert well and are profitable. A side benefit is that over time some of these customers may choose to buy directly from your Yahoo Store.

One last benefit:
With Yahoo stores your hosting fees can rise based on the number of additional features and increased sales but your FVF's will decrease allowing you to scale your business.

Check out the Yahoo Store of eBay seller Rock Bottom Golf

Oh and I forgot the best part. You can advertise using Yahoo Sponsored Listings and show up in eBay search. Not a bad deal.

Update: Ina Steiner Interviewed the Director of Yahoo Merchant Solutions in her most recent podcast. Listen in for info about Yahoo Stores.

Just my 5 Cents!

Are You Considering Opening An Ebay Store? Wait! Read This First.

I never thought I would say this about eBay Stores/Shops because I love the concept and they are the only place left on eBay to feel like an independent seller but what I am seeing coming down the pike isn’t pretty. If you currently have a store and can make a reasonable profit, I would of course recommend that you stay but if you are considering opening a new store, my suggestion is to wait. Wait until eBay figures out what they want to be when they grow-up.

I am seeing a disturbing trend for eBay sellers. It is the homogenization (such a big word) of eBay. It appears eBay management wants to look and feel like a big online retailer. I believe management is concerned that buyers are beginning to migrate to sites like Amazon in increasing numbers -- this is certainly the case in the Media category – so they are pulling out all of the stops to keep that from happening.

Part of this homogenization is the new Finding Experience. In order to present the best buying experience eBay needs to control the product that is presented to the buyer -- it’s called merchandising. The popular product is at the front of the store and of course the less popular product is at the back. That appears to be the vision of the new eBay.

They can do this on Express because they don’t charge anything to be included on the site but this new approach brings up a dilemma for CORE and Stores/Shops. How do you present the best product to your buyers when you are charging sellers to be included in that search? One seller’s 35 cents is as good as another’s isn’t it. If I want to sell low price commodity products and I’m willing to pay a fee shouldn’t my product get the same exposure as a popular product if we are paying the same fee?

We must remember, eBay doesn’t sell any product. They display seller’s product to buyers and facilitate the transaction and get paid very well for that service. Amazon and Overstock do not have these limitations. They all sell their own product and only charge sellers a FVF so they are free to merchandise to their hearts content.

eBay is introducing Finding to the .com that will change the way buyers see product and the jury is still out as to what will happen to Stores/Shops. Now is not the time to be opening up an eBay Store/Shop. Sure, you can list in core because your listings only stay up for 7 days and you can be in and out of the site with no commitment but Stores/Shops require a commitment. Since eBay itself cannot figure out what to do with Stores how are new sellers going to be able to cope with all of the changes? As a seller you look at Stores/Shops as your little place on the web. You want to personalize it, brand it encourage repeat business but you are left to your own efforts to bring in buyers and with all of that effort and hard work you have the privilege of paying eBay a ton of money. Please realize your store listing fees are more like hosting then they are marketing because your exposure is limited. In order to get buyers into your store you need to spend more money in core. Then if you do actually make a sale from your store eBay takes a hefty 10% of the sale. This amount is 5% less than Amazon charges in some categories and the same as Amazon charges in others – at least in Amazon your items show up in search.

Until eBay figures out what they are going to do with Stores my best advise would be – Stay Away! Once we see what they are ultimately going to be then you can make the assessment to open a store, or not, at that time. Do not waist your money right now.