It was only a matter of time.   When I first started using Auctiva to launch my eBay auctions I recall sending them messages asking about their “stores” and how I could “disconnect” it from the eBay marketplace.  Seems as if they have now done that, and I must say that with all of the turmoil going on over at eBay it is an extremely smart business decision for them.

Auctiva eCommerce, slated to launch in January is tagged as the eCommerce that works for everyone. 

Features are quite extensive and after years of experience with online shopping we can only hope that they would get it right the first time.   Some of the extensive features list includes:
    Store Setup Wizards
    Product and Image Import
    Real-time Inventory Display
    Automated Emails to Customer and Store Owner
    Flexible Shipping Options Including Weight, and Number of Items
    SSL Enabled
    Flexible Payment Options including Real-time Credit Card Processing
    Promotion Management With Start and End Dates
    Quantity Break Pricing
    Comprehensive Order Management Module
    Automatic Store Manager Notification of Low Inventory Levels
    Complete Reporting Module

The feature list is quite extensive and goes well beyond what I have included above.

My only concern from what I have seen in all of their marketing materials is the pricing model.  At the time of this writing they were promoting a price of $9.95 which is reduced from their normal monthly price of $14.95.  These seemed quite reasonable but then in reading the additional details on the pricing page I was a little disappointed to see that they are also going to take a percentage of all of the sales from your site.  5% to start gradually reducing to .5% if you sell over $100,000 in a month.  

Since I have stopped selling on eBay, my use of Auctiva at this point is zero.   I may decide to look at their eCommerce option in January.  If you have a business online I would encourage you to check it out.  Let us know your thoughts.   Does this type of offering fit into your business plans?

A change that will cause seller uproar this time is that in the Books, Movies & DVDs, Music, and Video Games categories (at least to start with more will be added) there is now going to be a maximum charge allowed for postage and handling.  eBay has indicated that this is one of the primary complaints of the buyers on the site and they are trying to make the buyer’s experience more pleasant so there are a greater number of conversions.   Translated this means they want more final value fees.

On the FAQ found many layers deep… There is a question posed asking what if my actual costs are higher than the maximum allowed… The response:

• ” When selling a bundle or quantity of items, you can use the shipping calculator to charge actual shipping charges
• When selling via fixed price, include all or part of the shipping cost in the item price
• When selling via auction:
  • Continue to list your item with the same start price and a shipping price at or below the maximum shipping cost. Many of our sellers have success with auctions, even at free shipping, because their item looks more competitive to their buyers.
  • If your actual shipping costs are higher than the maximum shipping & handling cost, start the item price higher to cover your shipping cost. This technique will minimize risk that you will lose money on shipping.
  • Move your item to fixed price and include all or part of the shipping cost in the item price.
  • If you are selling a bundle or quantity of items, you can use the shipping calculator to charge actual shipping charges”

Any time you include shipping costs as part of the cost of the item eBay wins.  These charges now become costs that they get to charge a FVF.   So now sellers will have the privilege of paying eBay a fee for not only the listing and the sale but also for the shipping of the item.

The posting goes on to encourage sellers to make shipping free and as an added bonus, Powersellers will get double the discount bonus on their FVF fees for the allowed time frame,  you’ll get free Subtitle upgrades AND higher search rankings with best match.  Don’t forget now that someone pays for shipping somewhere so most likely you’ve included it in the price of your product and NOW as an additional added bonus eBay gets to collect the FVF as well.

As a final KICKER (translated – bend over and lets see how far I can bury my boot) eBay will no longer allow checks and money orders as a form of payment. “Checks and money orders no longer allowed: Beginning in late October, we will no long allow checks or money orders as payment methods on eBay. Only approved electronic methods will be allowed. In January 2009, all accepted payment methods will be integrated into eBay Checkout. For buyers, this change means a more consistent and secure payment experience. For sellers, it means faster payment and fewer unpaid items. (Note this policy will not apply to Vehicles and some categories in Real Estate, Mature Audiences, and Business & Industrial).”

Since the smaller sellers typically do not have their own credit card accounts this means that eBay through their Paypal company will also get a piece of the payment activity. 

Again, all of these changes are under the guise of an improved experience for sellers and buyers.  I suspect there is some pressure in a poor economy to continue performing for investors as well and if they can put a positive media spin on increasing the ways they can gouge their sellers for more of their profit then more power to them.

I’d love to hear your thoughts of these recent changes…

• No negative or neutral feedback can be given to buyers.
• Paypal can hold my money for 21 days
• The fee increase disguised as a decrease.

They are also ranked in order of importance to me.

Let’s look at them individually

Feedback – When I accept payments from buyers I want to know that they aren’t going to stiff me.  A quick review of their feedback lets you know this relatively quickly.  I also will not accept personal checks or money orders from any buyer that has a feedback score that is less than 10 or if they have any payment related negatives. 

The argument that I hear is that when a buyer leaves feedback if it is in any way neutral or negative there are a group of sellers that retaliate and post a negative to the buyer.  In effect they have alienated the buyer from the eBay community and that buyer will no longer buy.  I have been a victim of this.  I posted neutral feedback for a seller due to lack of communication and merchandise that I thought could have been better described.   It wasn’t 30 minutes later and the seller hit me with a negative on every item that I had purchased (I had purchased 5 items.)  As a new buyer I was quite angry.

What is feedback anyway?  I have always thought of it as a rating or indication of how well your portion of the transaction went.  For the seller as soon as you receive payment you should be posting feedback.  If the buyer purchased your item and they paid you for that item what more is there?  For the buyer, once they receive the item and it was as you described, they should leave their feedback.

I would be much happier with a system that required a seller to post feedback for the buyer and limited the buyer from posting feedback until the seller had posted or XX days had past.   If the seller did not post feedback for his portion of the transaction then he doesn’t have an opportunity to post feedback when the buyer post his feedback after the XX days have past.  For example:  I sell a widget to you for 1.00.  You pay me with Paypal the next day.  I as the seller would post feedback at that point indicating my impression of that portion of the transaction.   You your widget arrives broken and you post me a negative feedback based on your experience.   My experience is now pretty negative as well because I know what I sent to you and it wasn’t broken.  I respond to your negative feedback with my comments and you respond to my comment.  End of feedback war.   I blacklist you from my buyer list and I move on.   Cost of doing business online.

In a typical retail transaction if a customer brings something back more often than not they are angry at the situation and the person working on the returns desk is taking the bulk of their negative feedback.  The difference is that in a typical retail transaction you do not get to know anything about your buyer ahead of time but as a retailer I can choose to refuse service to anyone that enters my store based on past experience.

Paypal – I love this method of payment.   I use it pretty extensively to both buy and sell online.  The thing that rubs me a bit wrong about this is that when a deposit is made into my account eBay can arbitrarily decide that the transaction might be an at risk transaction and hold my money for 21 days.  The real kicker is they don’t have to pay any interest on that money they just get to keep it in their coffers and earn interest on it.

If I were to use a normal credit card merchant account I would get the chargeback and they would deduct it from future payments to me.  If there were no future payments they would send me a bill.  What makes eBay think that their “bank” (and for all intents and purposes Paypal IS a banking type institution) should be different from any other banking institution. 

If they want to hold my money they absolutely should pay me interest on that money since they are earning interest on it.   They also need to clearly define what types of transactions they are going to hold payment on.

Fees – They are sure talking up the reduction in listing fees.  Look at what a great company we are.  We are going to reduce the fees to list items so you can list more with us.  God forbid you’d sell an item that is over 20.00. (or whatever that magic number is)    Sellers with a large sell through percentage are the ones that are really getting hit on the backside of the transaction.   Sure they reduce the amount that they charge you to get it into their system but if the transaction finishes they are hitting you with 66% more in Final Value Fees.   So if you do what you hope to do…sell items then in the long run you are in a worse financial situation than before the fee adjustment.

Overall I would have to say that the changes are designed for the buyers.  They want to make the buyers happy.  We all like happy buyers.   When buyers are happy they buy more.  But it is a fine line that you have to walk when you also depend on the sellers.   eBay I think tried to walk the fine line here by disguising the fee decrease as something they are doing for the sellers and the Feedback for the buyers.  (I think they did the Paypal thing for eBay… it’s much easier and more profitable to just keep the sellers money until we’re sure there aren’t going to be buyer disputes.)  Reality shows however that sellers are losing all around on this one.

I don’t think the STRIKE was effective.  I really don’t think eBay cares!   I think they should…with stock prices falling, and competition gaining footholds the “glory days” of eBay I think are over.  With the new leadership at eBay in place it may be an opportune time for some of the big fish to jump into the mix…Will we be seeing a Google Auction Site or a Microsoft Auction Site?  Heck if Microsoft gets Yahoo they have one already to dust off and revitalize.  eBay may still be the big fish… but it takes a lot of little fish to keep a big fish fed…

So having said all of that eBay seems to have the buyers right now for the seller’s product.   What’s it going to take to move that buyer to the alternatives?

What are the alternatives?  ePier.com, Bidville.com, OnlineAuction.com?