Thoughts on Ebay, the Economy, Online Sales & Cupcakes & Wine

Cupcakes & Wine

Lately, I've been reflecting on the economy and on my sales and the sales of other artists. Since I'm retired, its pretty easy for me to think about the future. Financially, I'm not wealthy but I do have a modest income - enough to cover my needs. These days I think more about the people who are out of work and desperate then I do about myself. I keep hoping for a turnaround, but that doesn't seem to be happening yet. I keep wishing that the leader we put into office, with such great hope for change, would begin doing something for the citizens of this nation. It saddens me but there is nothing I can do except be grateful for what I have and hope the rest will prosper soon.

Online sales for small sellers of collectibles and artwork has fallen off to the point where it is almost useless to list items and hand over fees. The smaller sites need AUCTIONS there is no excitement in searching by keywords and blundering onto what you want and the same stuff sits month after month. Their present format is confusing and not successful...yes, I'm talking Etsy, Bonanzle, eCrater, etc. etc. They're gaining more sellers but those precious buyers are still mostly out of their reach. None of them advertise...that I can see. Overstock does advertise but for the life of me I cannot understand why they seem to hide the fact that they have auctions running too - if you don't believe me go to the site and LOOK. Sellers deserve more than this type of service. Sellers are willing to pay for service but most of the small sites operating today aren't prepared to give us that.

As for Ebay, the old CEO, campaigning for California governor, is still bragging about the thousands of little people she helped start a business on Ebay while her hand-groomed successor, the new CEO, tears it apart and puts most of those sellers out of business. No use mentioning any more about them. Its water under the bridge now and not worth the space in this post.

I, along with thousands of other sellers are waiting...we're waiting for the next "Ebay" - the next large community of sellers and buyers. I don't see one on the horizon and if one doesn't show up soon then the whole business of online sales will go to the big, rich, retail companies who only wish to expand their presence to the internet. It will be same brand new chinese junk you now find in any mall or large store and the excitement that was once Ebay and online sales of the eclectic, the rare, the vintage...will perish!

Not the best mood for a Sunday morning but I felt I had to tell it as it appears to me and then we, perhaps, can collectively hope for a turnaround...in the economy and the online sales.

Something different today, an abstract, called "Cupcakes & Wine"

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 ;-)

Mr. Donahoe - What's Ebay Going to Be When it Grows Up?

Watercolor: "Cupcake Party"

Ebay's success came from the little people...buying, selling and becoming a community. Buyers had their favorite sellers, sellers of worth had a following of buyers....and so the cycle of buying and selling goes.

Actually, back in 2004 Ebay began to pare down the strength of auctions. First with the deletion of "Going, Going, Gone" and then the take over of the option feature plus that single handedly dominated many categories, computers, electronics, art, etc. Ebay at that point began to move away from auctions - undoubtedly Meg's idea. The idea of Ebay Express was a stab at fixed price listings but was so poorly thought out and executed -it was bound to fail.

2008, enter John Donahoe - Meg's handgroomed replacement who began to put into place a half-baked plan that was probably cooked up by the two of them. Let's shape Ebay into an Amazonish businessmodel! Well, it took a year for Mr. Donahoe to discover you can't simply change a business model and have it succeed.

Since the "Amazon" plan went into effect, Ebay set buyers against sellers with its feedback and DSR innovations. Ebay upset the balance of buyer/seller and, with countless new and outrageous policies made Ebay a hostile place for small sellers and for many powersellers as well. Thousands of small sellers left...leaving their following unable to find what they were accustomed to buying on Ebay. Sellers who left never came back to Ebay to buy either....then the disastrous 4th quarter holiday season report last year where Ebay declined 16 percent. Right then....John Donahoe and his team should have been let go and a team experienced in online sales AND customer satisfaction should have been brought in to replace them.

At this point Donahoe is outright fishing...first he says they're going to be the world's biggest retailer then at his bright and shiny Analysts Day he claims he is not a retailer but will be more like Overstock, selling end lots and discontinued wares. He pushed Paypal (I suppose so he didn't have to do a whole bunch of explaining about Ebay's core) on everyone and now claims it will be the biggest invention since fire! Anyone who ate that pap wasn't worthy of their job title. Unfortunately the wrong man is in the wrong job, combined with a board of directors who seem to be oblivious, and a multi-billion dollar company and its customers (the SELLERS who pay the bills) are suffering!

As Ebay's attitude says...."let them eat cake" so I thought I'd give you all something to munch on. My painting today is entitled "Cupcake Party"

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"

Ebay Wants to Be Amazon???

"Blue Hydrangea & Sunflowers"
5 X 7" Watercolor

I have a Google Alert on Ebay and throughout the day I get articles and blogs about Ebay - most I delete. I'm only interested in other opinions on the present Ebay and how it is being run. Some of the articles amaze me in how wrong they are about the problems at the world's largest online auction site. Here's my take on it:

Ebay has and is making a big mistake. Donahoe is determined to go toe to toe with amazon and he’s in for a very rude awakening….that awakening has already started only he is too stubborn or uninformed to see it. Amazon built its business model over years of non-profit before it began to make its niche the hard way - thru hard work, determination and a good business plan. Donahoe believes he can bully his sellers into offering some of the same things (customer service, free shipping) that Amazon offers and then Ebay can sit back and rake in the money. He forgets a couple of things. The outraged small sellers are doing a great job of getting the word out about the bully Ebay has become…about its absolutely hostile environment to all but its large diamond sellers and buyers are not only listening they are finding their favorite small sellers elsewhere! Also in Ebay becoming a cheap imitation of Amazon…it is just that….a cheap imitation and nobody likes an imitator! If you want to buy Amazon style why would you go anyplace else but Amazon? Ebay’s niche was in the rare, vintage and unusual items that people could find nowhere else. How foolish they are to kill the very thing that gets people to its site….the very thing that interests people enough to buy on Ebay. Hey…I can get an iPod anyplace (in fact I bought my direct from Apple)….but the 5 milkglass lamps I needed for my vintage chandelier could only be found on Ebay.

The board of directors needs to wise up and fast. They need proper management…management schooled in the hard knocks of online selling. Otherwise, after this next drastic decline in quarter sales they will finally see that Ebay is on the path to destruction! Its rapidly becoming too late for Ebay to survive

My painting for today is something bright and cheerful to hopefully warm up the rest of the country. Take heart...Spring is next month.

Ebay - Going Doooooowwwwnnnnn!

Sunny Garden Path

I digress from Bonanzle to give my 2 cents on Ebay's 4th Quarter 2008 report.

Well, Ebay's 4th quarter 2008 report is out. It is dismal indeed in spite of John Donahoe's spin. This is exactly what veteran sellers have been expecting since Mr. Donahoe began his "disruptive innovation" a year ago. I predict by the end of the first quarter this year there will be NO denying Ebay has taken the wrong path - Mr. Donahoe will NOT be able to spin the decline of Ebay's business or blame 100 percent of it on the economy.

Over 11 years ago the Ebay phenomenon was born and took flight. During these years the company grew to massive proportions. It seemed everything they touched turned to gold and the sellers who flocked to them brought them even more riches then Pierre and Meg could fathom. On the other hand, Ebay became a haven for the elderly, the disabled, the stay at home moms and the out of work dads who needed income. Both sides were very very happy. Then Ebay's success became "expected" and Ebay became more and more arrogant. "If you want to sell here you'll do this and that and pay this and that...ad nauseum". Then they became SO big they felt they were invincible and they had John Donahoe step in to take the company apart and rebuild it into a cheap and cheesey Amazon clone so they could get even bigger and more wealthy. No...don't invest the sweat equity - Ebay is so big they don't have to do that...they can simply have "diamond sellers" do all the work and then Ebay can sit back on its throne and scoop in all the money! give the diamond sellers free or low listing fees and raise fees on the small sellers...heck they have to either take it or leave it! Unfortunately, it reached a point where a LOT of those small sellers had to leave it...they simply couldn't make profits. Well, John, Pierre, Meg...what do you think of your big invincible company now? You never believed in the sellers who built Ebay - you called them "noise" and beat them into complying with your outrageous draconian policies - pay your outrageous fees! Gave buyers the power to scam and cheat your sellers. What do you think of your company NOW! This is just the start of Ebay's long and painful death!

Even I think this post is depressing even though I believe it to be true. Let's have something happy for today's painting. How about a watercolor - "Sunny Garden Path"

Ebay Loses Traffic This Holiday Season!

"The Snowman's Tree"

Sadly, this is almost an "I told you so" but knowing the thousands of good small sellers that Ebay's new attitude has put out of business is way too sad for sneering and saying I told you so.

I think John Donahoe is learning a hard lesson: all the "noise" he heard when he took office was the sound of good business that he infuriated thanks to his outrageous new policies. Donahoe's idea is to destroy a working business model and turn Ebay into an online catalog store - hence the "diamond sellers" he has ushered in and given free or reduced listing fees to peddle their dropshipped junk. He's strangled small sellers to the point where they simply found the site unmanagable and unprofitable and they left...(a LOT of them are flocking to bonanzle.com). I'm sure the fact that most, if not all, of the sellers who left also BOUGHT on Ebay...is giving Donahoe nightmares because he seemed completely oblivious to losing sales when you lose sellers - any CEO with strong Ebay sales experience probably could have warned him.

Donahoe can't seem to understand people don't want....nor do they NEED yet another catalog store online. Amazon fills that bill nicely and every major retailer now has online presence and does it far better then Ebay ever could! What's left? The "noise" Donahoe kicked to the curb! I believe he's slowly learning the site is definitely going to tank without the small sellers who brought their unique, rare and vintage items to the site...THIS is what people want and NEED! Its deceptively simply, John!

An example....I have a white milkglass chandelier that was here when I bought my home. Two of the milkglass shades were broken but I loved the light and so tried to hide the broken shades. The chandelier is probably 40+ years old so you won't find these shades in any store. I've been searching on Ebay and finally found a set of 5 of these exact milkglass shades for the incredible price of only $6.00. I bought them and they are perfect!!! I wanted a large corning teapot that isn't even made anymore...got it on Ebay and love it!! THIS IS WHAT PEOPLE WANT FROM EBAY JOHN!!!! When I bought a new vacuum - I bought it online from Walmart! When I bought a new external hard drive I bought it from Amazon because I knew they would stand behind it. I buy none of these catalog things on Ebay! GET A CLUE JOHN!! WAKE UP BECAUSE THE SHIP IS SINKING AND ITS YOUR FAULT!

After New Year Ebay will be up against far more formidable opponents then Amazon. All the major retailers will layoff workers - streamline and then put on the most stunning sales ever seen in an effort to do enough business to stay afloat and weather our faltering economy! Ebay will be NO match. An example I heard only today is a local furniture store offering $600.00 in gas and $500 in free groceries if you buy a big screen TV from them! Ebay...whatcha gonna do? You're going to tank even faster in the face of competition like this.

So, I humbly suggest....get rid of best match!!! Nobody - not even the buyers - want it. Loosen up the stranglehold on small sellers and let them do what they pay Ebay to do....SELL!! Stop allowing every nutcase buyer that wanders in to destroy seller reputations while giving the sellers NO recourse! Get rid of most of the draconian policies you put in place this year and do it before the economy sinks even farther - which I feel will be mid-January, 2009. If you don't - your company is doomed! This is something sellers have been warning about ALL YEAR and now finally EVERYONE else can SEE it! Wake up!

My painting today is a little ACEO called "The Snowman's Tree"