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As the Internet converts to web 2.0 many 1.0 business startups are rethinking their business strategies. eBay, one of the online dinosaurs that lived through the burst, has found their platform is something of a relic. Auctions are now the way of the past. “The auctions are nothing like what they once were. They won’t ever come back,” says Bruce Hershenson. a long time seller on eBay who plans to discontinue using the site and take a stab at his own ecommerce website. Today’s savvy Internet user is an instant gratification junkie. They want what they are looking for and they want it now, at the best price.

Everyone knows what eBay is. eBay has even become a verb. Recently, eBay has started to restructure its business with the departure of their former CEO Meg Whitman. Whitman’s last ad campaigns touted “Shop Victoriously,” while new CEO John Donahoe believes fixed pricing is king. Cantor Fitzgerald analyst Derek Brown states: “eBay has significantly de-emphasized dynamic-priced items in favor of fixed-price listings in the last six months.” eBay’s “Buy it Now” makes up 42% of items sold through their service and is growing 22% each year. With these figures, it’s no wonder eBay is changing up its platform.

Not everyone is happy though. In a push to make this change happen, eBay is increasing its auction rates in hopes of increasing “Buy it Now” listings. Pissed off parties include the Moms and Pops of eBay. “… I am exactly the kind of seller who built eBay and brings people to eBay on a daily basis,” claims Hershenson. “And it seems to me your changes are hitting me hardest.” He says the increased fees would cost him $180,000 a year, where he was previously paying $120,000 a year. In protest, many eBay sellers are holding an old fashioned boycott. “Everybody is mad because they feel that this company got built on them, and when eBay felt that they no longer needed them, they tried to get rid of them. It is deplorable,” says Maggie Dressler, an eBay seller who has auctioned on the site since 2001.

With this new direction, many like Hershenson will have to pack up shop altogether, or go at it alone changing the eBay auction house as we know it.

Comments

6 thoughts on “The End Of an Online Era
  1. Lee says:

    I disagree that people are into instant gratification in today’s online world. While that’s a portion of it, the thing they are after is social interaction. Think of MSFT’s purchase of Jellyfish — this is ebay auctions plus the ability to talk about what you just bought. Even Woot (www.woot.com) is social and interactive. If ebay was smart, they’d look at ways to make their experience more social and interactive as opposed to purely transactional like it is now.

    They also need to cut their fees… I have a ton of small, low priced items that with ebay’s fees make it impossible for me to offload them unless I want to pay ebay for the privilege.

  2. Josh says:

    Lee:

    I could write an entire blog post on your comment, but ill sum it up…

    While I think you bring up an interesting point about the social aspect of purchasing items online, I don’t think this is what eBay needs. I believe they should hold on to what they started and maybe reconfigure things. Maybe even a new GUI. The idea of social consumerism is a huge turn off to me. I can understand music, culture, and arts communities, but one revolving around buying stuff makes me sick. I do understand checking a rating or a review on a significant purchase, but everyday stuff seems like a waste of what little time we have in life. The bottom line is eBay needs to look after those that took care of them and keep their listing fees fair. Also you may want to check the fees page again at eBay. Their fees really aren’t all that much. http://pages.ebay.com/help/sell/fees.html

    Woot.com’s shtick is they have one item at a rock bottom price ’till its sold out. Although they have a forum, thats not their draw. Same with Jellyfish.com. Their shtick is to drop the price of an item they have in stock every second until its sold out. Catch is you don’t know how many they have in stock so you have to play a game. I hate shticks, I hate games. If I need something, after doing some research, Ill buy it. But thats just my opinion.

  3. Amanda Moshier says:

    I don’t feel like buying things is something all that exciting. Not sure my friends really want to hear about my purchases, unless I’m buying something incredible like a new car, a puppy, or my dream house. I don’t know – I think eBay should restructure things to make it easier on sellers, and leave the social networking to social networks.

  4. KRONiS says:

    eBay may need to become a social network to continue to survive into the web 3.0 world however. Especially with all the new innovative companies out there. Check out this site: Reverse Auctions! The winner is the LOWEST UNIQUE BID – what the hell? I wrote a blog post about it a while back on Digital Vegetarian and was initially confused how it works but basically if only one person bids a certain price and it is the lowest, they win the item, be it a Macbook Air for $23.65 or something.

  5. Chris Laub says:

    Haven’t used Ebay in quite a while due to one too many bad experiences, but very interesting news. I personally was always tempted by the Buy It Now option, and even used it if i thought I’d end up paying the same by the time the auction was over. And honestly, do we really feel ‘Victorious’ after we’ve won an ebay auction? As if you won’t start bidding on the next identical product immediately after if you lose.

  6. mutuelle says:

    I don’t feel like buying things is something all that exciting. Not sure my friends really want to hear about my purchases, unless I’m buying something incredible like a new car, a puppy, or my dream house. I don’t know – I think eBay should restructure things to make it easier on sellers, and leave the social networking to social networks

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