My business has dropped 40% in the last quarter....Why? Because Ebay is sucking sellers dry by selling them promoted listings on their own site instead of promoting on Google and Other search sites. If you add 7-9% to Ebay and Paypal fees - you are paying $25% in commissions. This is pure greed on Ebay's part. If you read the article the execs are not concerned....our sales went down, but their profits went up.
According to Ecommercebytes....
eBay's search traffic has reportedly fallen, according to a Wall Street analyst who cited third-party services. Mark May of Citi said eBay's reported decline in search traffic could be related to a recent Google update.
May communicated the news in a report previewing eBay's second-quarter earnings release set for tomorrow (July 17th).
May might have been referring to last month's "diversity" update, about which Google wrote "This site diversity change means that you usually won't see more than two listings from the same site in our top results. However, we may still show more than two in cases where our systems determine it's especially relevant to do so for a particular search..."
Citi's May also discussed a concern about eBay's pullback on marketing and incentives, which we wrote about in April when we reported that eBay's top executives admitted they expected a first quarter decline caused by their decision to significantly reduce marketing activities.
Today, May indicated the decline in eBay's marketing budget continued in the second quarter (April, May, and June). He also noted the reduction in buyer subsidies - readers will likely remember all the sitewide flash sales eBay ran in 2018, where it was basically paying visitors to buy goods.
But while less traffic due to reduced marketing and poorer rankings in Google is devastating news from a seller's point of view, it's not so bad from an investor standpoint - May noted that eBay increased its take-rate "and enabled revenue to grow faster than GMV" (sales).
In today's report, May didn't mention revenue eBay generates from sellers running Promoted Listing ads, which is an obvious byproduct of slower sales growth as sellers battle each other for eyeballs. In fact, in April, when eBay reported a 6% decline in GMV in the US, eBay CEO Devin Wenig told analysts that its own 4% revenue *growth* was partly driven by Promoted Listings - he said sellers were "flocking" to Promoted Listings.
Nor did May mention another good-for-eBay but bad-for-sellers item related to managed payments. Yesterday we wrote about eBay's surprise "per-listing" payment processing fee that will start in October.
We don't know if eBay executives will address the reported Google search problem during Wednesday's call and what they propose to do about it. But if eBay expects sellers to pay for Promoted Listing Ads to get more exposure, shouldn't eBay increase its spend on Google Shopping ads to get greater exposure if it can't do it organically?
Mary
