EBay Sellers Fume, Threaten Strike Over Fee Increase

Angry eBay sellers are threatening a week-long strike by pulling their listings to protest changes in the online auction company's fee structure.

Earlier this week, eBay Inc.'s CEO-elect John Donahoe announced the company's plans to lower the listing fees sellers pay upfront while increasing the fees they pay when they sell their items. Donahoe, who takes over as eBay CEO from the retiring Meg Whitman at the end of March, said the changes will take effect Feb. 20.

"Sellers prefer this structure, as it lowers their risk if an item doesn't sell," said Donahue, in his keynote address at the company's third annual eCommerce Forum in Washington. "Put simply, we will make more of our money when sellers are successful."

Seller Complaints

But many sellers aren't happy with the changes and are making their views known on various message boards, including eBay's own community forum, where some sellers are calling for a strike from Feb. 18-25.

"I read about the strike on the other boards, so I think the message is spreading," said mrskillion on the eBay forum. "We have just been left powerless. We need to take back a little bit. If we all band together eBay will notice. I believe that completely."

"I've never posted here before, but I'm here now because of this fiasco," said a poster named mole314. I have some stuff to dump before closing my account, but I won't be selling anything that week."

And sonar5jr won't be selling anything that week either. "I'm in, but I will stop selling on Feb. 12, so that on Feb. 20 when the extortion scheme begins, I won't have anything running," said sonar5jr on the eBay forum. "I won't list againf until ... one week later."

EBay Response

In an e-mail, eBay spokesman Usher Lieberman, said the company understands that sellers are concerned about the changes.

"Ebay has always had a very passionate community and our members do not hesitate to tell us how they feel," he said. "Over the past week we have presented them with a tremendous amount of bold changes and initiatives and they have a lot to absorb. If our community was not reacting loudly to what we've announced, that would have been a real surprise and something to be concerned about."

However, Lieberman said once sellers review the complete package, assess how the new changes will affect their specific businesses, and consider the fact that eBay consistently drives the largest audience and the best trading velocity on the Internet, most of them will come to the conclusion that eBay is still their best bet.

Over at the AuctionBytes blog, it appears that some eBay sellers haven't yet come to that conclusion.

"Why punish people that actually sell stuff by charging them higher fees? Isn't this kind of a negative reinforcement?" said Joan on the AuctionBytes blog. "I've been waffling on trying an eBay Store [again] but found the 10% on the back end a bit steep. Now they raised that and guess what my store decision is?"

EBay seller Jill Daniel is also unhappy about the changes. "Been a seller since 1998 and I cannot believe these changes," she said on the AuctionBytes blog. "I've been loyal and put up with all the changes targeted to specifically demolish my business, and this new pricing structure will do just that. So long, GreedBay, Time to give Amazon and Overstock my business."

And pcat said, "Looks like the jokes on us sellers ... again. I can't possibly see how this helps me at all - [I] will actually pay more in fees. The bigs at eBay must think we're as stupid as they are greedy."

Cosmic-King said, "I am a longtime power seller with a peak of 2,000 listings down to under 200 listings. I thought this was supposed to be good news but this is more of the same. I will continue to remove my business from eBay. Besides I now do over triple the business on Amazon."

Tim Boyd, an analyst at American Technology Research Inc., is not sympathetic to the sellers' plight.

"These are the same sellers who have been whining for three years about wanting to pay only for performance," he said. "I am so sick of listening to these guys [complaining about this]. That's all they do is [complain]. Let them strike. Someone will step in and take their place. Ebay did not raise its fees, it slashed its insertions fees and raised the final value fees, and for some sellers -- some sellers -- it amounts to a fee increase."

Boyd said eBay had to change its fee structure because the company was losing inventory and volume because auction sites such as Amazon.com weren't charging sellers to list items.

"Amazon only charged people when [they sold something]," Boyd said. "Sellers really liked that because they only paid when they got something. But 60% of the pay out to eBay was upfront, and you didn't know if you were going to get anything and sellers didn't like that. It made them real nervous, and I think as eBay lost traffic share it was put in a pickle where it had to become more like Amazon to draw some sellers back and to draw some inventory back."

Boyd said in making the changes eBay knows what its risks are.

"I've gotten mixed reviews from the seller community. Some sellers think it's a great start, some sellers are furious, some are giddy, but of course it's the ones who are angry who are making all the noise," he said.