eBay’s changing, but not everyone notices

Many still associate the online marketplace with auctions, Wells Fargo says.

Amy Dusto

Over the last several years, online marketplace eBay Inc. has grown to become much more than an online auction web site, but many consumers don’t seem to realize that, according to a recent survey by Wells Fargo Securities LLC. The firm questioned more than 500 U.S. adults online between Sept. 11 and Sept. 16 about their use and perception of eBay.

51.9% of consumers surveyed say they buy on eBay no more than two times annually. Of those respondents, 52.4% say they shop there infrequently because they don’t have patience for the auction format—although more than 70% of transactions on the site are not auction, but “Buy It Now” purchases, Wells Fargo says. And one-third of respondents who say they don’t buy frequently on eBay report it’s because they prefer buying new items rather than used, though more than 73% of goods sold on the site are, in fact, new, according to the firm.

Consumers also seem to be missing some of the newer features eBay has introduced on the site over the last year or so. Those features include free shipping on more than half of transactions (just 54% of survey respondents say they’ve noticed more free shipping on the site), updating its site layout to be more like the image-heavy Pinterest social network (only one-third report noticing the change) and improving its site search engine (40% say they’ve noted better results), according to the survey.

“Ultimately, we think communicating these changes to consumers will help drive further active user growth, which has already started to accelerate over the past seven quarters,” the report’s authors write.

EBay made a big push to update its site layout and functionality in 2012, when it also revamped its logo and started testing same-day delivery in the Bay Area.

“Our eBay business is stronger than ever, as are our product and consumer experiences, and our brand is one of the most valuable in the world,” an eBay spokesman says in response to the report. “We are a leader in the new commerce environment and a partner of choice to retailers and brands seeking to drive their omnichannel growth on our platform by leveraging our technology and innovation across the key drivers of commerce today—local, mobile, global and data.”

In addition to its online marketplace, eBay Inc. owns payment processor PayPal and offers a suite of technologies for e-retailers, including fulfillment, order management and marketing services, via its eBay Enterprise business.

The e-marketplace in its most recent earnings report says it has 119.7 million registered users—that is, the number of people that bid on, bought, listed or sold an item on an eBay marketplace in the past year—up 14% from 104.8 million a year earlier.  That total includes more than 3 million new customers who began using the site in 2012 via eBay mobile apps, the spokesman adds. In the Wells Fargo survey, 10.2% of respondents say they prefer to shop on eBay via mobile appsand 5.7% say they prefer the mobile web site.

One shoe and apparel retailer that sells on eBay, JimmyJazz.com, hasn’t had major problems with consumer confusion over eBay itself, says executive vice president and general manager David Wachter. “While there are some issues with consumer perception about eBay’s old positioning of only being an auction for used and slightly worn items, consumers are starting to understand their newest offerings of ‘Sold New’ and ‘Buy It Now’ from retailers like us,” he says.

But Jimmy Jazz does sometimes have trouble with consumers not understanding the difference between independent sellers offering used Jimmy Jazz items and the retailer selling on eBay, he says.

“Our biggest challenge on eBay is when resellers of our product represent themselves as being affiliated somehow with JimmyJazz.com, which couldn’t be farther from the truth,” he says. “If customers associate that seller’s eBay account with our company, and they end up having a negative impression based on a bad experience with the eBay reseller, that unfairly reflects poorly on our brand name and reputation.”

Jimmy Jazz is No. 430 in the 2013 Top 500 Guide. 82 retailers in the Top 500 and 48 in the Second 500 report selling on eBay.


David Wachter, eBay, JimmyJazz.com, online auctions, online marketplaces, product images, site design, site search, Wells Fargo