What’s wrong with eBay? Before I answer this question, you should download this Wharton case study by Dr. Eric Clemons of The Wharton School, University of Pennsylvania. Dr. Clemons is one of the world’s most renowned experts on information economics, and this case study is currently being taught at Wharton this semester. It goes into great detail discussing eBay’s current challenges, and I believe you will find it insightful.
Okay back to the question… What’s wrong with eBay?
I have been writing quite a bit lately on eBay, and on the developing stories of lagging buyer demand and poor seller economics. Every data point suggests that it is tougher to sell profitably on eBay these days, but it isn’t impossible. There are eBay sellers making a nice living on eBay, and in general terms, the key is to differentiate yourself, to sell products where there is limited competition, and to operate very efficiently.
Yesterday, I mentioned some very interesting research that AuctionBytes recently completed with a survey of more than 1,000 eBay merchants.
The most interesting finding is that eBay sellers are leaving eBay’s platform very quickly. The chart below details where merchants are currently selling their product, and where they plan to sell product 6 months from now. There is a massive 64% decrease in the number of sellers planning to sell on eBay 6 months from now versus today.
The Professional eBay Sellers Alliance (PESA) held its semi-annual gather in San Francisco this past week. The PESA Summit 2006 was a huge success with many of eBay’s largest sellers in attendance in addition to many of the most important companies in ecommerce. buySAFE has sponsored every PESA Summit since the group’s inception in 2004.
Although the group includes eBay in its name, most of these merchants are actually multi-channel retailers seeking to sell product whereever they can make reasonable profits. These days, that actually means eBay sellers want to sell off eBay. AuctionBytes has recently produced some very interesting research on the trend to move beyond eBay. ChannelAdvisor‘s Scot Wingo covered eBay’s challenges on his blog last week as well I will be writing more about this trend over the coming days because it is obviously important for all of us in ecommerce.
Core Capital Partners, one of buySAFE’s venture capital investors, is pretty active this quarter. It was announced last week that Core is leading a $10 million round of financing in Covega Corporation.
One of buySAFE‘s investors is Core Capital. Core Capital is a $370 million fund located in Washington, DC. Core has been a fairly active investor in 2006, and this week, it was announced that Core led a $4.4 million Series B investment in Inlet Technologies.
For those of you that know me, you know that I appreciate inspirational quotes, poems and stories. Life is a complicated journey, and personally, I believe one of the keys to success in life and business is learning from others and their experiences.
As Otto von Bismarck once remarked…
The Professional eBay Sellers Alliance (PESA) has announced that its Fall 2006 Summit will take place in San Francisco, California on 9/20/06 – 9/22/06. I have attended three or four PESA Summits, and they are always fabulous events. The attendees list includes many of eBay’s largest merchants, and since most of them run fairly large multi-channel operations, these sellers also represent some of the most successful small and medium e-commerce retailers in the world. Many of the largest e-commerce service providers will also be in attendance including eBay, Google, Overstock.com Auctions, Amazon.com, PayPal, buySAFE, ChannelAdvisor, and Infopia. Therefore, the Summit is a great business development event as well.
If you haven’t registered for the event, you should do so quickly. The event is limited to the first 300 registrants. You can register at PESA’s website.
Earlier this week, I posted on the subject of eBay and PayPal phishing email scams. It is impossible to completely protect yourself from the bad actors, but I wanted to share with you my recommendations on how to protect yourself from these types of scams. The following are my top 10 tips on how to avoid phishing scams and identity theft:
1) Never click on the hyperlinks in emails
The text you see as an email hyperlink may be cloaked or hidden. The cloaked hyperlink could take you to a website that you weren’t planning to visit. If you aren’t completely sure of the source of the email, you should simply retype the URL directly into your browser. This is one of the best ways to avoid fake hyperlinks and the threats associated with phishing emails.
One of buySAFE’s investors is Grotech Capital located in Timonium, Maryland. It looks like Grotech might well have exit with one of its investments, MEDecision.
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