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14 posts from September 2009

September 30, 2009

eBay rolls out more of the ETRS program in search and sellers aren't happy...

I've had several inbound 'flame mails' about a change eBay made this week as part of their roll out of the SR2 release.  I wanted to show everyone what's going on and get a pulse from readers on where you stand.


Back in late July (seems like 2 years ago!), eBay announced what they internally call SR2 (Seller Release 2).  We had detailed three-part coverage that begins here. A big chunk of the changes is what we call the ETRS program or eBay Top Rated Sellers program.  This program goes through an interim period from Oct 09- April 10 and then is fully live in April.   The way I explain it is that in this interim period, the search aspects go live (the front end or demand side) and then in April the fee aspects go live (or back-end/economics piece).

I've had lots of interviews with reporters about the program and generally think it is a good direction for eBay to be going in.  I've always been concerned (as is usually the case with eBay) that something between the announcement and the implementation/go-live would be a big 'miss'.  It's the eBay 'wait and see' factor.  Some of these things sound great on paper and in AB posts, but when the go live, they just do something so wacky they can cancel out the positive aspects of a program (for example, I'm still excited that ETRS is domestic only).

Today eBay went live with some search functionality that I'm calling the eTRS button that looks to be the wacky feature of SR2 that has caught everyone (even me) by surprise.

The eTRS button

eBay quietly added this prominent checkbox yesterday (Sept 29) and sellers noticed it in about 2 milliseconds.  On some browsers it has a big purple box and others it does not so it looks like eBay is still testing the appearance of the box.   In this screen shot it appears in the bottom left. This is a browse session, in search sessions it is showing up much higher as there usually isn't a big category tree in SERPS.


What this innocent check box does is filters the results to show ONLY eTRS seller's listings.  While eBay has talked about advantaging eTRS seller listings in search, they didn't say they'd be giving buyers a very visible and easy way to 'show only' eTRS listings.  Sellers are in an uproar because this is an extreme advantaging to eTRS listings that wasn't part of  any of the announcements or sample screen shots from the July announcements.  There's a big difference in 'demoted' or 'not advantaged' to 'easily filtered out'.

'eTRS Coverage' -data from the eTRS button

Long-time readers will know I'm a data nut, so this button actually gives us an interesting ability to measure today's and future eTRS coverage for a variety of eBay categories.  What you do is navigate to the category, capture the number of listings and then click the magic eTRS button.  Now you know the eTRS listings, non-eTRS listings, total listings and relative %'s of each.  In other words you can see how many 'top rated' vs. not top rated (low rated?) listings.  I built the following table of eBay's top 15 or so categories using this approach: (click to zoom)


Here's the same data, but sorted from most eTRS coverage to least.


There are some interesting data points here to observe and mull over:
  • Overall 21.3% of eBay listings are top-rated
  • The Camera category is the highest with 28%
  • The DVD category is lowest with 13.2% (ouch)
  • With eBay's first page of results showing 50 items and with a 21% coverage, if a search term has  240 results or more, it's very likely that the entire first page will be eTRS.  That's going to make it really tough for non-eTRS sellers as pretty much every eBay search I ever run comes back with > 2k items unless I get extremely specific.

Moving forward we'll be tracking this on a monthly basis (assuming the eTRS button is here to stay forever) and will report on that as I think it's going to be an interesting way to measure the success of the program.

What do you think about the new eTRS button?

Seller and buyer readers what do you think of this change?  Sound off in comments.  BTW, lots of eBay folks read this blog so this is a way to be heard.

SeekingAlpha Disclosure - I am long Google and Amazon.  I am CEO of ChannelAdvisor where eBay is a minority investor.

September 23, 2009

Live blogging eBay at shop.org V

Q: So is paypal your growth engine going forward? 

A: What we do is find pain points and solve pains via 3rd parties like ChannelAdvisor or our reetailers.  

Q: Tell us more about global
A: If a retailer is looking to expand globally - take Paypal - we are in 100 countries and all currencies.  Second, sell on eBay it's 20% CBT.  Each market is a little different.

Q: Do you regret Skype?
A: Nope

Q: How do you drive change at a large co?
A:  Core values - We used to think auction was a religion.  Then when talked to buyers, turned out they didn't care as much.  The key themes we are driving is we need to be more customer focused.  I do a weekly video blog internally.  John demonstrates how he takes a video and puts it up on eBay.  On a scale of 1-10 they've gone from 2-4 - excited double, but need to get closer to 10.

Q: I'm Dave from Kohler - on PayPal.  Have you heard of shopshield.net? They protect my entire identity.  What's your reaction to that.
A:  There are two parts of payments - the infrastructure.  How do you allow the safe movement of money.  PayPal is the only one.  That intersection is tough.  We have a 10yr head start.  All that's being shared is your email and shipping address.  If I take my example earlier of Twitpay - that's an example of an innovation that we can embrace like this shopshield.

Q: From a stock analyst - Colin Sebastian - If you separated the businesses would that be better? Are things stabilizing?
A: We see stabilization.  We saw a huge decline from august to mid-feb and flattened out across all our properties. In late June we saw a step up and it has held.  I'm cautiously optimistic about this holiday season - no huge V shaped recoveries. On PayPal, IF they ever aren't aligned with us, we would look at it.

Q: (last one!) - Albert at Maternity.com - one of the roadblocks we have is authentication.  Can you help me create a video? (did video) what kind of authentication can paypal offer?
A: the buyer should be protected


Live blogging eBay at shop.org IV


Can I go back, you asked about social networking.  Our approach is there are going to be folks really good at that (facebook/twitter), they will be fabulous at the social graph.  We're going to be really great at commerce+payments.  We may look at bringing pieces in - e.g. facebook on eBay, and they may try to bring payments in on facebook (e.g. paypal on facebook). 

Q: What we are finding in our data, people on facebook are dealing with friends, not looking to shop.

A: When we bought shopping.com one of the big assets was epinions. There will be hubs of some social/ecomm content, and I think we'll be able to access it.  What we've learned is we're good at buyer-generated content, but not on products.  We'll probably syndicate this vs. doing our selves.  Some wonderful value-added configurators that enhance the experience that we will continue to see.

Q: We saw Wet Seal that had a 'build an outfit' and then share it model.

A: Now we are using technology to improve our search experience. Our challenge is unstructured data - we have only 10-20% on a catalog.  The majority there is no catalog that exists.  So we're working on community generated catalogs  Embracing the wisdom of the community.

Q: You have a group called disruptive technology - what do they do?
A: Example - we embraced it - we bought 28% of craigslist and we are craigslist outside of the US. Learning from it and can now provide a balanced experience.

Q: Where do you look in eBay for innovation? e.g. Google has 10% time.
A: Most innovation comes from customers - we didn't think of them ourselves.  The more we think in the ivory tower of San Jose, the worse off we'll be.  

Q: What's the most interesting thing you've heard from them lately?
A: We were hearing a lot of frustration from Paypal users around an account for our family. That raised a kernel of an idea about kids buying online.  We launched earlier this month PayPal student accounts. They have paypal debit cards  Now there's a family account. 

(more to come)

Live blogging eBay at shop.org III

Wrapping up opening comments - proud but humble company.  Proud of what we've accomplished, but humble enough to realize that if we don't change we won't succeed.

If I offer two pieces of advice:
  1. Getting clear at what we are good at - and be really good at it.  Shopping in a marketplace format and be Best in the World in online payments. 
  2. Embrace disruption don't resist. 
Patti Freeman Evans (PFE) takes stage and now we're into Q+A:

Q: You took over and it was already a turnaround and got thumped - who is your competition?
A:  When I took over, I realized our user experience hadn't kept up and we weren't customer-focused enough.  When we thought about competition, we decided to focus on customers vs. a specific customer.  So that's where we re-affirmed we'll be a marketplace and not a retailer - focused on secondary market with a focus on customer service and experience.

Q: You could argue that you guys compete with google given the breadth.

A: We have 90m users/month - 75% is organic - the eBay brand is a strong draw.  Plus we buy 20m keywords/month from google, etc.  - we do a lot for that other 25%.  What we offer sellers is access to tremendous buyer traffic.  Four years ago viewed ourselves as a small destination site, now a platform.

Q: You talked about enabling sellers, opening access, platform/mobile, etc.   Are there key developments that get you closer to that?

A: Historically has been a great place to start a business.  Jack Sheng case study. Over last 18 months have made changes to keep us a home for small biz, but also an opp for large retailers - fixed-price format, fee changes, etc.

Q: Have those innovations come through the API?
A: A lot of our stuff comes through ChannelAdvisor - they have built a SaaS company off eBay's APIs and made it easier for sellers to 

Showed how to send $10 via Paypal (to me for breakfast ;-)

We are not an eBay, will not compete with our sellers.  We are not going to buy a shoe retailer and compete.

When I saw Walmart, I was excited (joking) as they help others succeed - deeply in their genetics. (applause)

Q: You launched as disruptive model, arguable one of the first social networks.  I saw you called 'the pain from Bain' - how will you mobilize the community, what have you learned?
A:  There aren't any secret keys here.  The users feel ownership of the site.  It's a gift.  There's alot of feedback and its like being a Mayor - the feedback doesn't always agree.  So we take that, and look at it and try to chart the best course for our customers.

(more to come)

Live blogging eBay at shop.org II

(continued from last post)

  • We think we are in the early days of ecommerce
    •  5% of commerce is online - still early days 
  • The lines between online and offline blurring - used example of someone in store using iPhone to check prices. 
  • Formats blurring - auction/classified/fixed price
  • Mobile big   

When eBay started people thought ecommerce would be 'winner take all' -  what we see is that ecommerce increasingly reflects what off-line reflects.  There will be multiple winners (fragmented) - amazon, eBay, eforcity, macys can all be winners.

Now payments is a market that lends itself to having one winner ubiquitously - we think paypal will be that platform.

Where does eBay fit?

Where does ebay fit in that world?  We realize we need to change - we connect buyers and sellers.  Two ways we do that:
  1. eBay - allow sellers of all sizes to use eBay as an alternative channel. Used to be just for smaller, always will have that. But increasingly eBay buyers want access to larger retailers. Secondary market - one season old, liquidation - eBay is a strong market for this. The online outlet mall.
  2. Payments - Be the standard for online payments.  

 Thought Skype would be a good fit, wasn't. Talked about the spin-out.

eBay is not a retailer.  

Wants to talk about two trends:

  1. Platform  - When started, took walled garden approach. Made sense, but clear now that is not the way to go. Best example is the iPhone - simply a platform on which thousands of applications have been built.
    1. Creating great consumer experiences 
    2. Doing same thing with paypal - next month will have  a developer conference on this.
    3. Paypal will be the payment platform - allowing innovation to be built on top  
    4. Using the twitpay and facebook examples. 
  2. Mobile and devices - eBay iphone app has gone from bad to good.  4m downloads.  Last week someone bought a $400k Lamborghini via iPhone - $150k boat.  
    1. Growing double digits every month. 
    2. Visual recognition is coming - point at a product, see if available online (amzn app does this fyi)  

(more to come)

Live blogging eBay at shop.org I

It's 9am in Vegas and John Donahoe (JD) is taking the stage for a talk and later will have Forrester analyst Patti Freeman Evans do a fireside chat.   This is a fire side chat kind of format.  I'll be doing some live blogging and tweeting.

Donahoe takes stage

John started with some jokes - Flew in last night from the east coast, hand meetings with Macys, Jack Sheng, etc.  Met with eBay+PayPal people, lots of people walked by and saw Josh from the shop.org team in a bathing suit!

Gave sunglasses to a guy in front row that looked hung over.

eBay talk begins

  • Show of hands - how many people bought on eBay (95%)
  • Show of hands - sold on eBay (50%)
  • Show of hands - paypal  - 95%
  • Show of hands - cross border trade - 10% 
  • Show of hands - Skype  (20%)
  • Show of hands - skype video (10%)  

Every year 300-400m people use our products, which gives us lots of great feedback of what's going on.

It's ironic that people call us disruptive when we are constantly being disrupted.   Wants to talk about ecommerce trends and technology trends.


September 22, 2009

Our new Amazon offering

Over on Amazon Strategies, we have details of ChannelAdvisor's new Amazon solution that I thought everyone would be interested in learning a little more about.

September 21, 2009

ChannelAdvisor and eBay at shop.org...

I'm off today to one of the bigger online retailing shows of the year - Shop.org's Annual summit.  Shop.org is a non-profit trade association that the online group of the National Retailer Federation (NRF).

Shop.org Summit is interesting as it is the last time for retailers to get together and learn what's going on before the big holiday push.   Shop.org has historically been where around 200 or so VP level and higher online retailers meet.  Today the show is really expanding and now is well attended by what I think of as mid-tier retailers - folks in the $30-200m/yr online sales range.  Many of these mid-tier retailers got their start (and still are on) eBay so it's been interesting watching the 'eBay Live' refugees come to this show and Internet Retailer.

eBay at shop.org

You can check out the agenda here and I think long-time eBay strategies readers 

eBay CEO, John Donahoe, will be there which is interesting on a number.of levels:
  • As best I can remember (I checked the 08 online agenda and my 07 conference book) eBay has never presented at this show.
  • eBay has been spending more time at shows for retailers recently.  For example, Stephanie Tilenius was at IRCE in the summer talking about the virtues of eBay for retailers. But, as best I can tell, John Donahoe has never hit the circuit.  
I'll attempt to live blog the talk which is Wednesday morning at 9am PST - here's the blurb from the agenda.  I have to admit I'm curious if this is just a signal that the large retailers are more important these days to eBay or if they have some news that will break at the show.

Keynote: John Donahoe, President and CEO, eBay, Inc.
South Pacific Ballroom C

John will discuss consumer shopping trends and what theymean for commerce online and offline.

John's presentation will be followed by a moderated Q&A session with Patti Freeman Evans, Vice President and Research Director at Forrester Research.

ChannelAdvisor at shop.org

We'll be at shop.org in full force. We are at booth #401 in the exhibit hall and all of our staff (20-30 folks this year!) are wearing light blue shirts with ChannelAdvisor on them.  We're going to be doing some fun events and have a separate room to show more in-depth demos and what-not for those that are interested in our various solutions.  I'll be there spending time at the booth and in a ton of meetings.  I hope we're able to connect -stop by the booth and let them know you read about it on the blog for a little tchotchke we're handing out.

Sound off

What do you think about eBay recruiting more large retailers to the site?  Chime in on comments.

September 18, 2009

eBay takes a step backwards - quietly expanding the adcommerce system to off-eBay advertisers hTh

A retailer we work with for Comparison Shopping Engines (CSE)s recently emailed as they were really confused about a promotion they were sent by eBay pictured here:

The retailer had lots of questions - should they stop their plans to sell direct on eBay, how does the system work, what's the ROI vs. other CPC channels like search/cse, etc.

Before we dig into what this means, let me backtrack for a second and explain the eBay AdCommerce system which is at the heart of this promotion.

About eBay AdCommerce
There are essentially 5 ways to advertise on eBay:
  1. Transactional- list a product for $x, pay $y in final value fee when it sells model.
  2. Yahoo! powered banner ads and sky scrapers on the homepage/SERPS.
  3. Yahoo (now Google) powered sponsored links on null search results.
  4. AdCommerce product links at the bottom of SERPS
  5. Your own custom deal (e.g. UPS,  McAfee, USPS, etc.) where you pay eBay big $$$ to sponsor a part of the site or for an exclusive or something. 

AdCommerce is eBay's third or forth attempt at a cpc on-ebay system and it seems to be sticking as they are clearly expanding it.  The way it works (before this expansion) is eBay sellers sign up and pay a CPC for traffic to their eBay items or eBay store.  Thus we typically say it is an 'in network' system as it doesn't shuffle traffic off eBay like the sponsored link, banner and custom deal programs do.  In a transactional system, staying on-site is good.  In a search engine system (e.g. Google), staying on-site is bad as you aren't finding what you are looking for.

We don't recommend AdCommerce to our customers because it lacks the basic closed-loop tracking that you MUST have for any CPC system to be measurable.  For example, you can't go buy some traffic, send it to an eBay item and then know how much of that traffic converts into orders.  This is because eBay doesn't give the advertiser the conversion data, they just give the number of clicks and impressions which is essentially useless.  Plus this CPC is on top of the already generous take-rate (listing fee and fvf) charged by eBay.

We're also not fans of the program because:
  • I personaly find the ads are 90% of the time not relevent when I'm shopping on eBay.
  • We have data that suggests that when these ads live in front of the page navigation system it keeps buyers from going to page two of search results.  I frequently tell users that this system has single handedly killed page 2 of eBay search results so everyone now has to focus on page 1. 
Think I'm being too harsh?  Here's a screen shot of some AdCommerce ads I was shown today when looking for an apparel item:

So here we have:
  • Pens - totally irrelevent 
  • Cell phone case - also totally irrelevent 
  • Work boots (at least in the category but I was looking for a sweater)
  • A slim shop ad with a blatent typo (expect nothing liss) 
  • A hulk t-shirt (ok I guess the same category?) 
These ads are bigger than the eBay results and push the page nav down.  In other words, eBay would rather you click on this vs. going to page 2 from an economic standpoint.  But is that what is best for the consumer?

AdCommerce goes 'out of network'
Circling back to the new promotion that was sent to an off-eBay retailer above, it looks like eBay is now looking to expand the program to allow 'off eBay' ads via shopping.com into AdCommerce.

The way I imagine this would work:
  1. Retailer specifies which of their shopping.com products they want to advertise
  2. Retailer specifies a CPC for the program or maybe even at the product level
  3. eBay shows off-eBay ads on search result pages.
As stated in the title, I think this is a big step BACKWARDS for eBay.  We were excited to see them announce they were taking the banner page off of SERPs and some of the irrelevency caused by the featured program.  But here we are a short time later seeing them seemingly talking out of both sides of their mouth and not only increasing a program that decreases the relevency of the search results, but now will also include taking buyers off eBay!

eBay needs to do some soul searching and decide what they want to be when they grow up - transactional or advertising (cpc/cpm) based?  Do they want to truly show the most relevent products or do they want to focus on the pure short-term economics?

Stay tuned

We'll be on the lookout for more information about this program, specifically:
  1. Is there closed-loop tracking available?
  2. What is the ROI?  
  3. Is this actually a cheaper way to sell on eBay than selling direct?   
SeekingAlpha Disclosure - I am long Google and Amazon.  I am CEO of ChannelAdvisor where eBay is an investor.

Confirmed: eBay is looking to dump Yahoo! for Google in the US.

Late last night we theorized that it looked like eBay was ramping down traffic to Y! and up at Google in this post. Today, we have confirmation from three firms that have talked to both eBay and Yahoo! about the change.

James Mitchell at Goldman Sachs is out with a note that says: 

Yahoo! has confirmed that eBay is testing the use of Google to provide contextual (search-driven) paid advertisements on eBay’s US site. Previously, Yahoo! powered contextual and display advertising for eBay’s US site, while Google powered advertising for eBay’s international sites. Yahoo! continues to provide display advertising for eBay’s US site.

SeekingAlpha disclosure - I am long Amazon and Google.  I am CEO of ChannelAdvisor where eBay is an investor.