eBay's Downfall?

[dugoldstuff]

Very interesting article. I bolded /redded the best parts:

https://seekingalpha.com/article/4188922-ebay-stagnation-mode

eBay: In Stagnation Mode

Jul. 21, 2018 3:18 PM ET

eBay's second-quarter earnings report fell heavily short of analyst expectations, with revenue growth dimming to 9% y/y (from 12% y/y last quarter). The company's below-consensus guidance caused the stock to take its biggest hit. GMV growth in the U.S. also showed its weakest growth rate since a year ago, while the volume of sold items stayed flat. Margins also showed a worrying contraction.

Despite all the signals that keep pointing to its demise, eBay (EBAY), the one-time e-commerce wunderkind, continues to plod forward as if it was still a giant of the internet. Like last quarter's earnings release, eBay's Q2 post showed a company that is continually unable to meet analysts' targets as the company fails to accelerate the process of bringing new buyers to its platform.

Rightly so, eBay has been one of the worst-performing of the large-cap internet stocks all year, despite general enthusiasm for the e-commerce space. Companies like Etsy (ETSY) and Stitch Fix (SFIX) that were earlier pegged as losers, for example, have shot up meaningfully in the first half of 2018, as has perpetual giant Amazon.com (AMZN). eBay, however, seems incapable of reversing its slow decline. Year to date, the stock is down nearly 10%.

Yet, I believe the shares have further to fall. Activity on eBay seems to simply be running cold. Call it the hangover effects of eBay's fee hikes in the past several years - as sellers walked out on eBay in protestation of higher seller fees and took their variety of wares with them, buyers also saw less and less reason to buy on eBay. One of the things shoppers like most about Amazon is that it's the "everything store," where you can type in even the most obscure of items and find at least one seller that carries it. On eBay, with both the selection and volume of items getting thinner, it's getting harder and harder to bring buyers to the platform and, more importantly, reverse the steep deceleration in GMV growth.

[hioctane62]

Not to mention the fact that they choose to play hide and seek with the variety that remains on ebay.

They just don't get it. They think raising fees and calling it a punishment will fix things. Yeah... that'll help.

[sharingtheland]

I disagree with one part; I think ebay is the every thing store but buyers just can't find the things.

In other words, the writer did not know how asshatted search has become, which has led to slow demise.

All the other points, I agree.  

[dugoldstuff]

> Not to mention the fact that they choose to play hide and seek with the variety that remains on ebay.

eBay seems to think that without supply, there can somehow be demand, and even more hilarious, a transaction.

[retrose1]

---

@dugoldstuff wrote:

> Not to mention the fact that they choose to play hide and seek with the variety that remains on ebay.

eBay seems to think that without supply, there can somehow be demand, and even more hilarious, a transaction.

---

ebay seems to think that all buyers want is the same stuff that every other site is selling.

Besides hiding stuff, ebay has forgotten a very important fact.  That sellers are also buyer and buyers often become sellers.  Everything ebay does drives more and more sellers off ebay, and if selling is their business, they start setting up shop on other sites.  And if the sellers leave ebay because they feel victimized, it is doubtful that they will buy on ebay.

And when buyers fall for the it's sooooo eeeeeasy to sell on ebay - just list, sell and get paid, and get scammed out of the cash they needed to pay emergency bills with, that's money they don't have to spend on ebay anymore AND since they lost money on ebay and ebay did nothing to help them, it is doubtful that they will be shopping on ebay again.

[newview]

As eBay continues to play the "don't buy what YOU want to buy ... buy what WE want to sell you" games with the search engine, sellers who were once the talking point of many an eBay commerical back in the day (I got it on Ebay!) are now leaving because ... well, eBay is basically forcing them out by focusing on the "ho, hum everybody's selling one" JUNK from China.

As sellers leave, their unique products show up SOMEWHERE ELSE ... and when "somewhere else" becomes the place to find "unique" and one-of-a-kind, THAT'S where those buyers go. And, being creatures of habit, that's also where they end up to buy  the "ho-hum" also.

The constant daily glitches don't help either. It's the same as going to the "Old Mall". The one with the leaky roof, the toilets that don't flush and the automatic doors that don't open. When eBay has these CONSTANT and often self-induced glitches they are reinforcing themselves in the eyes of buyers as ... the "Old Mall".

I think I'd rather invest in BitCoin than in Ebay stock.

[ittybitnot]

ebay seems to think that all buyers want is the same stuff that every other site is selling.

LOL...I read these boards almost daily and cannot recall one post in the last few months that proclaimed that "ebay is the only site that has the traffic and sales" .   Wonder where those posters are?  Must be too busy packing and shipping their ebay sales????   

I started selling here in 1998.  Fortunately, I have divorced myself from the abusive relationship that it became and once again enjoy ecommerce.  

[wifetrained]

Ebay has no one to blame but itself. All of it's woe's are self inflicted.

[ebbyisme]

I was reading something yesterday, I will see if I can find it, but the major points (as I remember them)

1. If eBay's changes don't show results soon, a course change must be made

2. if the $33 level is broken he can predict no hard bottom

3.  Ebay will never compete with Prime, Prime is more then free shipping.

4. There is one area eBay still beats Amazon badly and is eBay's strength - used and vintage

Of course I would imagine those at corporate think this "expert" is wrong.

I hope if changes have to be made it happens before it is too late, but disruptive innovation predicts loss of business, customers, suppliers, employees and profit until the changes take affect and growth begins.... now can anyone in the ivory tower tell the difference between what should happen in DI and what is a failing business model that will never work?

Those who hope for demise.... be careful what you wish for - you just might get it. Will you be better of with an eBay where you don't like their methods or no eBay at all?

[duncanvr]

I've been selling on eBay for years and the profits are now getting less and less for sellers especially small business sellers in Australia, sole traders who get charged 10% selling fee and are now slapped with a 10% tax when buying from overseas sellers. There is not much meat left on the bone, some years ago it was really good. You'd list one of a kind items and get bidding wars. Now days it only seems stuff starting real low attracts one bidder, you have to sell in high volume to break even. The fees kill any profit. The search engine is 100% hiding BIN items most of my regulars do not even notice BIN items only auctions. If the site continues to rise in cost it will be unusable within a few years. Because if a seller can't profit then what is the point of listing? When eBay manages sellers payments in the next year or two I am most certain they are going to charge a fee for collecting sellers sales money as well. I am really struggling on eBay lately to make enough sales to make it worth while. My eBay hobby business is slowly being strangled to death by money grabbing with fees and taxes. Sadly I don't see it lasting. If its like this now what are fees and the cost of using the site going to be like in several years time? They will continue to find more ways to get money out of sellers. I will keep trying but when they ditch PayPal instant payments from buyers I think that maybe end game. The bank transfers they propose to manage take 2 - 4 days to get to sellers account, great if you have 1 day handling. You ship the item before being paid? I don't like the sound of what is coming for the site. Sales are down 30% and don't seem to be recovering. Ever since Trump came to power the eBay sales have been on a slow decline. Not good for sellers at all. They have to many filters in place now on the search engine if you're items not at the top then good luck. Your item unsold in 30 days its already stale.   

[everything-from-trinkets-to-treasures]

As the articles says...it is his OPINION....and he did throw in some facts which is what in part he is basing his OPINION on.
Everyone has one of those opinion things BTW.

It is also called speculations.

It is an interesting OPINION article...but no more or less so than any other.
And nothing you can use as facts...just something you may think supports your own OPINION.

Funny thing about these articles is next week his opinion could change

[vinashop2017]

I think ebay should open a warehouse in the US so that sellers can ship to it. And ebay must reduce the open store fee. That is very important

[everything-from-trinkets-to-treasures]

And if you really read the whole thing...it also said he doesn't think ebay is going anywhere for a long time.

Can't leave out the part you do not want to pay attention to.

[vintagecraze50]

When all this internet selling started many years ago it was a place where people could fing things at much better prices and unique things you would have a hard time finding in your area. As time has progressed. Ecommerce became the place to buy all things that are readily available at your local stores like Lowes, Home Depot, Walmart, and all the rest. Earlier in the heyday it WAS much cheaper to sell on the internet and maybe this is still true to some degree, but not at all like it was several years ago. Postal services have gone up, people feel the need to insure and signature track their items to prevent problems, and the cost of merchandise has also gone up with the ecomomy going up.  Price points on most sites are around the same. Sometimes better at one or the other but nothing that spectacularlarly different. Retail revival is happeneing with smaller shops wanted to present their merchandise on websites which may be a very good thing because these people offer unique niche type items . UNIQUE is the way to go. 

[everything-from-trinkets-to-treasures]

And while you think it is great to say ebay is going down or hoping it is going down or celebrating ebay going down...millions of people count on ebay to make a living, to put food on the table, pay bills....so that is also in turn, indirectly wishing them to not be able to do so and or celebrating that as well.

Ebay failing, if it ever happens would be "devasting" for millions of people....not something anyone should wish for or celebrate.
In fact you should hope it doesn't ever happen for just that reason alone.