A couple of years ago very few people would have expected Amazon to outperform the giant of online selling eBay but that is just what is happening now. Last October Amazon had over 54 million unique visitors compared with eBays 50 million. This was the first time Amazon went ahead in the race for traffic.
But it is not only in the amount of traffic that eBay is falling behind. They are getting very low customer satisfaction ratings. In a recent survey only 13% surveyed gave eBay as their answer to the question which site gives the best shopping experience which is 14% down from a similar survey last March. In the same survey Amazons positive response went up from 36% to 65%.
Probably more worrying for eBay should be the fact that amongst the PowerSellers in a JP Morgan survey, 54% had a negative opinion of the company. The fact that 69% also viewed Amazon positively should also be a cause for concern. It would appear that eBay is starting to leak customers to Amazon at an alarming rate.
There are several
reasons for this, firstly the companys apparent move away from the auction format towards fixed price Buy It Now option. Quite simply in the past eBay has been conceived as the site for bargains but they cannot compete against Amazon on discounts. EBay is not selling their own products so they would have to find a way to encourage their retailers to make the discount offers which will be no easy task.
In the good expanding years eBay paid no more than lip service to the concept of customer care. They ignored complaints, failed to answer questions and concentrated purely on expansion and new markets. In the long term that is not sustainable and now they are paying the price.
You do not have to search very hard on the Internet to find web sites, articles and blog posts complaining about eBay and their methods of operation. One of the big causes of dissent is the way that eBay seem to have abandoned the home based and small retailers as they wooed the large companies. These disenchanted sellers felt it was no longer a level playing field and moved to Amazon in their droves.
In the beginning eBay was very much a community site, albeit a huge community. These days the main concern of the company is towards its shareholders and their profits. In seemingly wanted to abandon their original business model and it could be argued that they have thrown out the baby with the bath water.
It does not look well placed to take on Amazon in the online discount market and perhaps rather than try to re-invent itself it should consider going back to its roots, if it is not too late.
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