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.