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Ebay hopes that by shuffling its priorities it can compete with Amazon and others

It’s hard to argue with Amazon.com’s success in carving out a large portion of the online sales market; much of it out of the waiting hands of eBay.  Some of these gains have been eBay's fault, experts say, as eBay managed to alienate its sellers through a series of rate increases and policy changes.  Some, however, say that busy people just can't keep up with online auctions, and over time the sales approach is falling to instant fixed-price sales.

In the past, sellers could elect to designate an item as "Buy It Now", but this typically carried heavier fees.  Now eBay is overhauling its fees structures to change this.  Under the new system, which goes into effect in mid-September, sellers will be able to list "Buy It Now" or “Fixed Price” items for only 35 cents for listing that range up to a 30 days in duration.  This will also extend the amount of time the items are on site.

Another big change, which affects buyers, is that they will have less payment options.  Buyers can no longer pay with checks, cash, or money orders; a move designed to curb fraud.  Users must now pay with a credit card, debit card, or eBay's subsidiary PayPal.

Though some buyers may perceive the new policy as buyer-unfriendly, eBay CEO John Donahoe says that move is quite the contrary.  Experts are reticent about eBay's moves, but agree change is needed.  Scot Wingo, chief executive of the market research firm ChannelAdvisor states, "Buying online has changed.  Retail sites no longer make customers choose between convenience and price.  The current system puts eBay at a disadvantage."

Lorrie Norrington, president of eBay Marketplace, which includes the eBay site, admits, "Clearly there’s a strong buyer preference for fixed price.  We love the auction model.  It’s still a great model for certain types of sales."

Many sellers are praising the move.  Rhonda Shrader, a maker of women's clothing from San Francisco says she already changed most of her items to fixed price, so the cuts are especially helpful.  She says today only 10 percent of her sales come from auctions.  She adds, "I think the auction was a novelty at the beginning, but now people want what they want, when they want it."

 Wingo commented that in the past there was opposition to fixed price sales at eBay, due to its auction roots.  He continues, "The previous management tried to fight it.  This management is more willing to ride along with it."

The changes come just before the holiday shopping season in which eBay hopes to turn around slumping growth and show off a strong performance.





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