Impact of Promoted Listings

[8000keys]

Just hoping to get some opinions.

Years-old listing of a niche item that I make. Free shipping. Volume discounts. I have a store to sell just that one item, which had, in my opinion, a good description and photography. My feedback history is large, and excellent.
I monitor prices and make small price adjustments as needed to keep up with trends, demand, and the occasional competitor. Very, very consistent traffic and sales for over a decade.
On rare occasions I've experimented with eBay's Promoted Listings, I wasn't impressed with the cost vs benefit, and generally don't promote.

Three weeks ago, a brand new, very aggressive competitor went live with a promoted listing and price matching.  From Day 1- he's CRUSHED me even with a minimal and sparce listing. My fraffic and sales drop is 60-100% off average.
I adjust my prices to keep pace.  Still getting steamrolled.
I'm advised maybe it's time to give the old listing some new mojo. New listing with new photos, new description. I add some other listings to my store, across multiple categories just to make myself a bigger target. No improvement. 
Send out a coupon to my hundreds of followers. Haven't seen any benefit from that.
I get aggressive with the pricing. I undercut his. No change. Still outselling me 5 to 1.

I cave to eBay's pressure to Promote. A slight improvement that hasn't shown itself to be consistent.

Searching for my item outside of eBay (Google) doesn't seem to favor him over me. The only logical conclusion I'm seeing here is he's set his Promotions percentage to an astronomical amount. 

What could I missing here? It's a pretty simple me-vs-him, not a me-vs-marketplace and his clear 5:1 superiority in attracting sales out of nowhere, despite all the aspects I've been told are critical to strong sales has me stumped.  Price-war race-to-the-bottom didn't seem to work. Seems like it's more of a who's willing to pay eBay to redirect clicks situation.

 All thoughts welcome.

[caldreamer]

I searched for your items and I think I found your "big competitor".     Once of the things he does differently from you....instead of having different listing for every key (they shows all keys in one listing and you select "variation").   Single listing would get "more traction" by search engine because it shows "more sales".

[8000keys]

He's beating me with my own text (that he lifted verbatim, copy and paste, including my typos) and a careful reproduction of the images i've used for over a decade. I guess imitation is the sincerest form of flattery.

I do have the ONE listing with all variations.
That's the one that's performed consistently for over a decade, but suddenly went ice cold when my competitor did his best to mimick it.

The one listing for EACH variation is something I've just done to hopefully cast a wider net,  as I've read that more listings are better.

[8000keys]

I want to stress that I'm not an irrational individual, convinced I'm a victim of eBay's changing algorythm (though it certainly feels like it this month...).

It's just shocking that it appears my competition is able to buy up most of my traffic, and do better, even at higher pricing. (I still appear at the top when you sort by price)

If he's able to give eBay 50% of his sales, vs me cringing in pain at 20%. I get it why he's put in a better position to sell. I just hope I'm missing something.

[cutandcoloredcoins]

Is he promoting his products outside of Ebay? 

[8000keys]

It's possible he's going some great off-eBay marketing.
Except to see if he's some Google darling, I haven't spent much time to figure out how he might be funnelling traffic to a relatively small eBay presence.

I'd love to know what kind of external views he's getting. My external views has been one metric that has NOT dropped off in the last three weeks, which is what steers me to the conclusion he's got his eBay Promoted Listings percentage set sky high.

[redlinear]

All the discounts in the world won't sell anything if you are not being seen.
Therefore, remove the discounts.
Revise your listings to a few cents less than competitor.
Enter everything you possibly can in the item specifics.
Promote the crap out of your listings. Enough so, that when somebody opens one of his listings, They will see yours on his page. 
Go right back at competitor like he's doing to you.

NOTE: You may have drastically slash his prices for awhile.  Because (and this is hard to understand)...In order to sell on eBay anymore, you must sell.
(the more you sell, they more you will sell).
It's like getting a loan.  Gotta have credit to get a loan. Gotta get a loan to get credit. 
(it's kind of the same with selling on eBay any more).

Also, end 20 of your oldest listings.  Revise like stated above. Then wait a week and start re-submitting them one or two each day.  (sell-similar to get them back on ebay, not re-list)
 

[femmefan1946]

So what you are saying is that advertising works?
He is paying for higher visibility in Search.

When you also paid up your PL got better results.

It also seems that your customers are not price sensitive, because they will buy the higher priced item if they see it first.

If he's able to give eBay 50% of his sales, vs me cringing in pain at 20%. I get it why he's put in a better position to sell. I just hope I'm missing something.

What he might be missing is profit. If his PL is too high, he may be losing money on every transaction.

Especially if he is a newbie, who has "borrowed" your pictures and descriptions.

Many don't see beyond the money coming in, without realizing that they will have a Hold on those payments, that they are being charged fees not only on the sale price, but also on the shipping and on the buyer's sales tax.  Plus a 30c service fee.

Sometimes when a price is low, the customer perceives it as low value or poor quality. What might happen if you raise your prices and use the extra income to add a higher PL rate?

But remember to crunch your numbers.

You are here for the profit.

[8000keys]

The idea of fighting back with a higher price, offset by a higher PL is about the only avenue I have left to remain profitable.
It's a scary and risky proposition. Moving large volumes, at lower cost.... just feels better.

[femmefan1946]

Are you thinking as a merchant or as a customer?

[8000keys]

All recommended adjustments to improve SEO have failed.
My PL% is ABSURDLY, unsustainably high, and still getting edged out in the lowest-price sort, and I'm still buried under dozens of less relevant listings when sorted by relevance, even with specifc searches.
Organic sales are down 80%.  After promoted sales, sales are still down 40%.
I expect my February volume to be about half of January's, with twice the fees.

This is pretty discouraging, definitely has me thinking eBay's no longer the best way for me to sell my product.

[my-cottage-books-and-antiques]

@8000keys  My guess....and it's nothing else...is that he got into this after evaluating your sales , probably via Terapeak. (Craftsman Tool Box category is dubbed a "great opportunity" by Terapeak. He may have narrowed it down to "replacement keys"...obviously, a lot easier to ship than actual tool boxes, and, I assume, less up front investment.)

Since you seem to have had the field almost to yourself, he probably figured out two things:

1. If he has the financial cushion to start out with, he can afford to lose money while buying market share.

2. He can buy market share by

1. beating you, or at least matching you, on price and

2. by temporarily paying crazy high PL fees (and maybe by doing targeted advertising on social media as well)

3. He might lose money at first, but if he can afford to do that, he can--- depending on your finances--- eventually force you to give up, at which point he gets the field pretty much to himself, at which point he can drop his PLS rate (maybe eliminate PLS entirely) and set a reasonable price and start making money.

Many businesses have used a similar tactic over the years. It is how Amazon grew, taking enormous losses year after year, but buying more and more market share each year....

[8000keys]

This is entirely reasonable, and what I've been suspecting for several weeks.

I've been looking to lessen the dependence on eBay for several years, but it's been so consistent and stable for so long, I've put it off. I suspect it's time.

[my-cottage-books-and-antiques]

@8000keys  Well, good luck to you whatever you decide. 

[fab_finds4u]

Dog eat dog here on eBay.