In a press release issued on August 20th eBay has signalled a shift towards pushing fixed priced sales over auctions.
The changes include the introduction of a flat rate fee of 35 cents for ‘Buy It Now’ listed items as well as no extra charge for listing multiples of those items. The fee changes amount to around a 70% reduction in costs to the seller. The aim of this being to see a drastic cut in the cost of listing items for sale and therefore encouraging more sales through the site.
Lorrie Norrington, president of eBay Marketplaces commented:
We aim to be the most competitive marketplace online, and this new, incredibly low pricing helps us achieve that goal … A 35 cent listing fee virtually eliminates the upfront cost for sellers to put more of their great inventory on eBay and creates more opportunity than ever for sellers to build successful businesses.
Before now listing a fixed price item could incur multiple and much higher fees, but this move is being seen as eBay’s bid to become more competitive against e-tailers such as Amazon.com. Norrington has also tried to quell fears that eBay is moving away from the auction model, saying:
We love auctions. Auction-style listings remain the ideal choice for sellers who are uncertain about the value of their item, have a scarce item in high demand, or are willing to start at a low price and let bidding determine the final value … With these changes, we’re making sure sellers have competitive opportunities in both formats-auction-style and fixed price.
The new fee structure will be introduced during September.
Read more at eBay.com, found via The New York Times
Matthew’s Opinion
Even though eBay are saying they still love auctions this move clearly makes fixed pricing a very tempting proposition for sellers. It doesn’t benefit small sellers that much or anyone selling a single item that is potentially worth a lot of money to the right collector, but it does push for more shops to open up.
I think eBay have just realized if they want to push on with growing their business then their real competition is Amazon and other large e-tailers. They have no real competition in the auction business, but their growth has slowed and they needed to react.
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