Ebay...Wha Happened? Amazon...Congrats!!!

Once again Ebay's third quarter report came in with a 29 percent decline in net profit and Amazon's third quarter came in with a 28 percent increase in sales!!! Skype and Paypal are now pretty much holding Ebay up. Mr. Donahoe...how much longer will the madness of disruptive innovation strap Ebay down and beat it up? How much longer will the ridiculous "best match search" be around? Until the last light goes out? You may feel you're changing Ebay's business model but how much revenue and traffic has been lost during this project? Ebay had a monopoly on its niche on the internet - it was the place to go for the rare, the vintage, the collectible you could find nowhere else. That monopoly is now shared with the likes of Bonanzle, eCrater, Etsy, and the like as more and more small sellers leave and take some buyers with them.

The Ebay fiasco seems to be a textbook case in what not to do with a multi-billion dollar company. The sad part in all this are the small sellers - the stay at home moms, the out of work dads, the elderly and the disabled who made real money on Ebay before "the change" started. Many of those small sellers are gone now - pushed out of business by ridiculous new policies - the ones who remain are being treated with suspicion, like crooks and forced to adhere to some pretty draconian policies. From start to finish the new Ebay is a sad joke and each quarterly report verifies that fact. About the only thing that can possibly save Ebay is to split it up into the classic old Ebay where auctions are still king and the small seller is treated like the customers they are - and the new Ebay reserved for the diamond sellers of new chinese junk....but we all know that won't happen.

Mr. Donahoe - sorry, but Ebay can no longer hide behind the economy - not since Amazon's amazing quarterly report. You can no longer say people don't want auctions - they are still popular and fixed price is also available. Traffic is down on your site and buyers are getting rarer and rarer. I beg you to rethink Ebay's path and to once again look at the small sellers who built Ebay and see them as the important customers they truly are.

On the other hand, a company that stuck to its business model, kept its nose to the grindstone and worked hard and honestly to improve its standing on the internet is enjoying a giant leap in stockprices today.

CONGRATULATIONS AMAZON!!!
You're a Class Act!

My artwork for today....a bit of sweetness to go along with the bitter pill ;-)

Ebay's Analyst Day - Nothing New

Watercolor: "Red Woodroses & Lilacs"

Wow! What can I say about Ebay's Analyst Day? Some blogger already put it into one sentence: "Nothing new here - move on". That's about it in a nutshell. Lots of posturing by the speakers and lots of promise for the future and lots of selling so many millions of items a day, per minute - I call them fish stories. You know that fisherman who actually caught an 8 inch fish retelling the story as a three foot fish. In this case though - they are making fish stories around the slow and steady decline of a once mighty company. They are trying to put the blinders on analysts...will they be stupid enough to fall for it? Ebay's management team has succeeded in several things - none good:

1. They succeeded in arriving at the first decline in a quarterly report...and it happened in last years 4th quarter!!! If you can't succeed during the holiday season then you can't succeed...its as simple as that.

2. They've succeeded in driving off thousands of small sellers. The very sellers who attracted buyers through selling their rare, vintage and unique items. The things that could NOT be found in any store.

3. In driving off small sellers they also succeeded in driving off a buying force - since sellers also buy on the site. Secondary - they drove off buyers who frequented these sellers - both can be found on smaller sites.

4. They made it almost impossible for buyers to find what they're looking for. With Ebay's new Best Match - even the inventor of it said it was never intended to be the only search!

5. With Best Match Ebay has succeeded in manipulating search so that the buyer sees what Ebay wants him to see....small sellers are often so buried in the listings that they are forced to go elsewhere.

This is only 5 of the points Ebay's new management team has succeeded in doing in the past year alone. I would say they were let off pretty easy at only getting their pay frozen to last year's standards. I would have offered them $8.75 an hour - take it or leave it!!!

It is clear to me that Ebay is headed pell-mell towards that cliff. Its almost inevitable now that they will fall and fall big. Perhaps that is what is needed in order to bring them down to the size they've earned. Perhaps that's what the board has to see in order for it to come to its senses! Right now they are a failure to most sellers and certainly to small sellers. Their reputation is so tarnished by their treatment of sellers in the past year that that alone could cause their continued downfall no matter what they do at this point. Even if they turned around completely - word of mouth will continue - lack of faith in the company will continue for many many years! Can Ebay outlive its reputation?....I think not.

A good start would have been firing the present management team...but that just isn't going to happen. All we can do is wait and watch....like that guy standing out on a ledge 20 stories up...will he jump?....we all hope not yet he moves ever closer to the edge... :-(

My painting for today is a watercolor: "Red Wood Roses and Lilacs"