Can eBay Win Back Sellers with a Shift in Focus?

    May 10, 2009
    Chris Crum

eBay recently announced it was returning to its roots as an auction site more focus on the "secondary market". This is probably a wise move as interest and enthusiasm for eBay have both steadily dwindled over the past year or so.

The company had been going for more of the fixed-price Amazon approach. That didn’t seem to be doing it for customers. According to a study from Compete, eBay’s traffic decreased 5.2% last month – compared to the previous year – while Amazon’s traffic rose 18.7% in the same period and Craigslist traffic rose 40% compared to the previous year.

eBay Average Order Value

Other interesting findings from Compete’s study include:

–  The percentage of eBay’s visitors who shopped at Amazon jumped from 41% in February 2008 to 53% last month

– Over the same period, Amazon visitors’ cross-shopping of eBay has remained unchanged at 58%, suggesting eBay’s fixed-price strategy failed to attract significant numbers of new shoppers

– In February, 11% of eBay’s visitors, or 7.8 million customers, made a Buy-it-Now purchase (up 20% from the previous year). However, gains in fixed-priced activity have been eclipsed by declines in eBay’s traditional auction business
–  In total, 1.5 million fewer shoppers placed a bid on eBay last month than did in  February 2008 

Here’s a look at eBay’s sales to bidders vs. buy-it-now purchasers:

Bidders vs Buy-it-now

eBay has driven a lot of its sellers away. Will a shifted focus on the secondary market bring some of them back? Or is it going to take a lot more than that?