eBay Rumored Ready To Cut 10% of Workforce
In an article published last week in Barrons Weekly based on a report from Wedge Partners, Reuters today published a very short article on the rumors. 10% of eBay’s worldwide staffing would peg the number of layoffs at approximately 1500 staffers. eBay has not responded to requests for comment on this report.
With eBay stock reaching a 52 week low of 22.16 which is also a 5 year low, and ending the trading day Friday at 22.55 the company has lost just over 40% of it’s value in the past year.
Analysts are describing seller unrest and poor returns on eBay’s purchase of Skype along with the declining US economy and strengthening of the dollar as possible reasons of this decline.
Seller unrest has risen drastically since January when incoming CEO John Donahoe referred to the seller concerns and complaints to announced site changes as “noise”. eBay has made significant changes to it’s pricing structure including negotiating formerly unheard of reduced or free listing fees and reduced Final Value Fees for large volume sellers, restrictions on payment methods disallowing payments on the site by check, money order or cash, and placing limits on shipping fees sellers can charge in certain categories. Last week eBay announced more changes to the site including changes to the search engine on the site and changes to the Items pages that have sellers scrambling to ensure their listings can be seen by buyers which has increased seller concerns. Sellers cite bugs in the eBay Best Match search engine and concerns that the planned look to the items pages will be glitch ridden and confuse and frustrate buyers.
Sellers Moving to Other Venues
Thousands of posts on blogs and even the eBay Discussion Boards seem to indicate that ecommerce sellers who once believed that eBay was THE place to market are now looking at other venues such as Amazon, Overstock, Bidtopia, eCrater and Etsy and many others. In addition many sellers are ramping up their own websites as marketing venues. Unfortunately especially now as sellers and shoppers get ready for the very busy Q4 shopping season, many of the sites sellers are moving to with the exception of Amazon simply do not have the buying traffic coming to the sites.
Marketing Strategies For the Holiday Season
Oh the weather outside is frightful,,,,,
Believe it or not there are only 121 days until Christmas. You will notice I did not say shopping days till Christmas because in internet marketing every day is a shopping day. How prepared are you for the shopping season as an internet marketer?
If you are not ready and ramped up for the season, you may be facing a frightful few months. Many internet sites have already begun their campaigns and the competition will be fierce.
Marketing For The Holidays
Depending on your niche, holiday season marketing can make or break your business year. Consumer electronics are always hot starting around Labor Day. The one downside is that some manufacturers roll out their new products just prior to the holidays to increase demand and limit supply. Those businesses that can secure the latest versions of a product line do very well during this time of year. Consumers will be looking for the best deals, plain and simple. Big Box consumer electronics ecommerce sites have the advantage of higher search results but there are a few things you can do to increase your sales and visibility. First, know your market, and know what your customers want. Research is the key! Make sure you are paying attention to your competition, because they certainly will be watching you. Secondly, whether you sell on eBay or Amazon, Onlineauction, Overstock or any other online venue get your products listed early and use a Fixed Price format. Buyers of holiday gifts do not want to wait for auction format items. Holiday shoppers do not want to run the risk of not being the high bidder.
Many buyers will be looking for their gifts now before the rush. According to an article by WorkZ.com, most online buyers EXPECT free shipping especially if buying more than one item from the same seller. Free shipping is another great way to attract customers, but if you use email campaigns to promote your sales be careful using Free in the subject line as this may trigger email spam filters.
eCommerce marketers might want to consider a value added type approach to attracting customers such as including a free gift with the sale. I have used this approach in years past and had great success while selling clothing.
Causal marketing, donating a portion of the sale to charity is another great way to attract buyers. If buyers know that part of their purchase will benefit their favorite charity, they are more likely to purchase.
The 2008 Holiday Shopping Outlook
While 2007 was a banner online shopping year, many experts are predicting a leveling off. The economy is the biggest fear among buyers. Mortgage failures, high oil prices and the concern over the presidential race are noted as the biggest reasons for this expected flat growth.
Be Customer Friendly
As you gear up for the holiday season, be customer friendly. Enable your customers. Accept all forms of payment (I know eBay is changing this but do what you can until late October). Communicate with your buyers often to ensure they receive their items and they are pleased. Treat any problems proactively, and professionally.
Feds Pass and Propose New Legislation Affecting eCommerce Sellers
IRS Rule Attached to Foreclosure Prevention Act of 2008 (Enacted)
The federal government continues to seek ways to generate income from internet sales. In an amendment attached very quietly to the Foreclosure Prevention Act of 2008 (S.2636) which President Bush recently signed into law, third party credit card or transaction processing services will be required to report to the IRS those sellers conducting over 200 transactions or those who do over $10,000 worth of transactions per year.
Providers such as PayPal, Google Checkout, and others will be required to provide a 1099 to the seller and the IRS to provide the government with the ability to tax internet sellers. This law will take effect in January 1, 2011.
Organized Retail Crime Act of 2008 (Proposed)
In this proposed legislation HR.6491 would require online auction sites like eBay, Amazon, Onlineauction, Overstock.com and others to retain information about high-volume sellers and provide that information to retailers and to law enforcement officials in cases where police reports have been filed.
It is estimated by the National Retail Federation that organized retail crime costs retailers between 15 and 30 million dollars annually.
With the epidemic of shoplifting and other forms of retail theft, this measure will provide a means for law enforcement to cross check for items that may have been illeagally obtained.
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