eBay’s bold move and its consequences

This week has been all about eBay, which is odd to say because last week was also all about eBay.

Last week it was because longtime CEO Meg Whitman was stepping down. This time it’s because CEO-elect John Donahoe is stepping up. Boy oh boy, is he stepping up. As to whether this is a good thing or not depends on which side of the argument you’re on.

If you’re eBay, and you’ve been seeing a steady decline in your value, and you’re watching your market share shrink, then you’re going to feel the need to act in a way that can make your business relevant once more.
If you’re an eBay customer, then you’re a little confounded and angered by the sudden changes.

Here’s what happened: On Jan. 29, Donahoe, in a speech before eBay executives and 200 of the site’s biggest sellers, announced changes in the amount of listing fees for items – a decrease – and a change in the amount of Final Listing Fee, which is a percentage of the sale – a decided increase.

While “giving pennies on the front and taking dollars on the back,” a quote from an e-mail I received this week, has raised the rancor of many, it’s actually the tweak in the feedback system that has people most angry. Dealers can no longer leave neutral or negative feedback on a buyer’s profile, while buyers can still leave whatever feedback they want on a seller’s profile.

Here’s who these changes, in my humble estimation, hurt the most – especially the fee changes: It’s the low and mid-level buyer/seller, someone who spends from $500 to $5000 a year online, of which there have to be – at the very least – several hundred thousand, if not a million or two.
Crunch those numbers and it adds up to a great big pile of dough that Mr. Donahoe is potentially alienating.

In light of these announced changes, Trader last week asked readers if they thought eBay could remain relevant in the antiques and auction marketplace. The response? Simply overwhelming.

Usually, on a good week, I get 30 responses or so. For this question, they’re still trickling in five days later, the number well more than 150. I’ve included as many as I can in this week’s letter pages, and will post as many of the remaining ones as I can on the Antique Trader Web site.

I’ll just say that, with some exceptions, nobody had much good to say, and – as you can read in this week’s lead news story on the subject, there are movements under way to draft other online giants into starting Web auctions, and there are online antique and auction sites holding sales of their own in direct counterpoint to eBay’s bold move.

This fight will continue, and it remains to be seen who will be left standing. It’s a rare event that can get the majority of the antique community agreeing on the same thing, but if ever there was something, then this is it.

Congratulations eBay.

Many an empire has crumbled because it failed to recognize change, and then forced it when it was too late. More than likely eBay will survive this revolution, but at what cost?

Noah Fleisher