Byline: Leslie Walker
Washington Post columnist Leslie Walker was online Thursday, June 30, at 1:30 p.m. ET to discuss the dream of striking it rich on eBay, the Internet's most heavily trafficked shopping site.
She spent three days last week attending eBay's annual user convention, where 11,600 people descended on the auctioneer's home town of San Jose to celebrate the 10th anniversary of eBay. Most attendees were small merchants trying to earn a living selling everything from Barbie dolls to used Hummers on eBay.
Walker talked to more than 30 high-volume eBay merchants about why they increasingly are testing other Web retail locations besides eBay. Many of these "power sellers" shared details about how their online sales operations are doing.
A transcript of today's discussion is below:
Read her Thursday column about the lifestyle and career ambitions of eBay sellers, and her weekend piece about the heated competition eBay is facing from other Web retailers.
Read Leslie's .com archive .
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Leslie Walker: Hi everyone. We are getting ready to start. Please send us your thoughts, comments, hopes, frustrations and insights into eBay!
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Chicago: I have been selling children's clothes on eBay for three years and the recent fee hike really killed me. When is eBay going to learn not to bite the hand that fees?
Leslie Walker: Boy, that was a refrain I heard A LOT at the eBay convention. I knew the fee hikes galvanized many eBay sellers into looking at alternate sales outlets, but I had no idea how many.
More than half the dealers I interviewed told me they had reacted to the fee hikes by starting their own Web site, or by boosting their marketing for their own Web sites, or by trying rival sites like Overstock, Yahoo and Amazon
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Washington, D.C. : What are the most popular eBay rival auction sites right now?
Leslie Walker: None of eBay's rivals has anywhere near the number of buyers and sellers eBay has, but everyone is watching to see if the fee hikes eBay imposed will help its competitors gain traction.
Amazon.com's marketplace probably had the biggest buzz at the eBay convention, with sellers of newer and commodity merchandise (books, CDs and DVDs) flocking to list stuff there.
Amazon has a different model. Unlike eBay, where buyers and sellers have to complete transactions on their own, Amazon takes payment from buyers, shaves off a commission and forwards the money to the seller. Some high-volume dealers like the fact they don't pay up-front listing fees on Amazon, meaning less risk to them compared to eBay, where they have to pay even when stuff doesn't sell. The trade-off is Amazon's commission tends to run higher than eBay's.
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Washington, D.C.: Leslie: I stopped using eBay a few years ago because I really didn't like their search functionality. Has it improved at all since 2002?
Leslie Walker: Yes, it's greatly improved, with a lot more bells and whistles. You can run filters now by price, category and all kinds of variables. You can use "wild card" asterisks ** like you can on Google. Ebay CEO Meg Whitman told the convention there are actually as many searches being run on eBay as on Google in the United States, or were in recent quarter.
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San Francisco, CA: Ebay seems like a glorified garage sale. Was its conventino as goofy as eBAY?
Leslie Walker: There was some silliness at the convention, for sure, like when eBay flashed up some ridiculous items currently for sale and asked the audience to guess if each had sold and for how much. You had to laugh at the "mind reading machine" that supposedly sold for $710.
But for the most part, eBay appears to be growing up. The last two eBay user conventions I attended were much tackier than this one. Many more businesses displayed products to help eBay sellers on the exhibit floor this year. In years past, you had to navigate past distracting ferris wheels and treasure hunt extravaganzas to find substance at the convention.
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Alexandria, Va.: Why is eBay so unwilling to disclose how many gold and platinum level sellers they have?
Leslie Walker: This is a good question. I think eBay should disclose more about its seller profile than it does. It obviously knows a lot more than it's telling.
That said, it should be noted the "powerseller" program is purely voluntary. A lot more eBay sellers are eligible than actually sign up.
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Bakersfield, CA: Regarding fee hikes by eBay. It seems that many sellers pasted the fee hikes on to the consumer just like in any business. All the fee hikes did was drive sellers and bidders from the eBay site, if recent sales are an indication of what's to come on eBay, we are in trouble unless they do something! I say if you are going to raise the fees then adverstise to bring the bidders back with all the money that is being collected in fee hikes.
Leslie Walker: Good points. A lot of dealers I talked to did just what you described--increased their minimum bid and "buy it now" prices to compensate for the fee hikes. The sellers I talked to, though, didn't see a companion drop in sales--they said people were still buying at the higher prices.
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Reston, Va.: Any backlash at the convention to the fact that Whitman was a candidate for the Disney job?
Leslie Walker: No, I saw no backlash, and since the time that Meg Whitman interviewed for the job as Disney CEO, she has publicly committed to staying at eBay for several more years.
In fact, people a the convention lined up for the chance to meet with her and get photographed with her. Whitman was a highly visible presence at most of the eBay convention functions.
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Washington, D.C.: Do people really make millions of dollars selling on eBay?
Leslie Walker: As near as I can tell, very few. In fact, I suspect there are more dot-com billionaires than eBay millionaires!!
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Germantown, Maryland: Not exactly a question; more of a comment. I used to buy things on ebay fairly regularly. But recently, things have changed.
In my most recent auction, I was one of the losing bidders on a Sharpvision front projection TV. Losing the auction was no big deal. But I was hardly ready for what happened next.
Within 12 hours of the end of the auction, my email was deluged with fake/spoof/spam emails, supposedly from the original seller. I contacted the original seller, who had not sent me anything, and was frightened by the level of information and sophistication that these would be theives have.
Each day since, I have had to get rid of a number of these emails.
I am thinking seriously about not using Ebay anymore.
Leslie Walker: Wow, Germantown, sorry to hear of that awful experience. Unfortunately, it is becoming all too common, and not just at eBay. It sounds like fraudsters hacked into the seller's account to access your email. I wish I could say the problem of hackers/fraudsters/phishers was limited to eBay but it is much bigger than that.
EBay does offer a toolbar you can download and install to help prevent "phishing" attacks in which fraudsters direct you to site that look like eBay but actually are not. You might consider installing it if you have not already.
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Bakersfield, CA: That is exactly the mentality that eBay needs to address. It is not a glorified garage sale in this day and age. Items are sold for 1000's of dollars and if they would advertise such this kind of thinking would not be out there among the masses!
Leslie Walker: I tend to agree that eBay plays up its reputation as the whacky place that sells Virgin-Mary grilled cheese sandwiches way too much. It gets them lots of publicity, but it's debatable how helpful that publicity is to building a serious business!
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Washington, D.C. : What do you think of all these new eBay drop-off stores?
Leslie Walker: For the life of me, I can't figure out how they are going to turn a profit. The drop-off franchises such as QuickDrop typically charge the people who bring them merchandise 30 percent of the final sales price on eBay. The franchise store also has to pay a royalty to the parent company, say 4 percent or more. Then they have brick-and-mortar costs and employee salaries. That's a lot of costs!
Yet eBay drop-off stores were all the rage at the shop, lots of 'em exhibiting on the convention floor.
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Gaithersburg MD: Saw the question asking about making millions of dollars on eBay. Our revenue on eBay this year will be about $2.2M if our current run-rate continues. However, we "make" -(net) far less than that, obviously. Our eBay fees constitute about 12% of gross sales, so I suspect that eBay makes more than we do at this point.
