Research Shows Sellers with Focused Expertise Do Better on eBay

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eBay announced they will be killing the Dutch Auction format effective in May.  Since eBay expanded and reduced fees on Fixed Price Listings, the Dutch auction format has been used less and less by sellers where it was once the favored  format for listing multiple items.  Sellers have until May to change their Dutch auction listings over to auction style or fixed price.

eBay also announced that Subtitle will also be free for all sellers who use free shipping and the double fee discounts for free shipping for PowerSellers will be extended until June.

In January when it was announced that eBay would extend their Power Seller fee discounts through March I opined that eBay has lost pricing power –a combination of increased competition from Amazon and other selling venues and the slowing economy.  Offering fee promotions is a smart move on eBay’s part because of the negative response that occurs whenever eBay raises fees.  This way if the economy starts to recover eBay can essentially raise fees by ending the discount promotion rather than announcing a fee increase. And if the economy doesn’t recover, they can just extend the promotion once again.

There may be something bigger about to happen.  It is no secret that many small and occasional sellers have been unhappy with eBay moves that promote large sellers.  eBay has been concerned about small sellers leaving for quite a while but has yet to really address the issue. Well, it may be now.  eBay often tests out ideas overseas before bringing them to the US. 

eBay UK has announced a new fee schedule for Private Sellers (non full-time business sellers) effective March 12^th.  Items listed in the auction format at 99-Pence (about $1.40) are free – no listing fee.  And the Final Value fee schedule has been simplified to a flat 10%.  This is very interesting and I will be watching to see how it works out. I am not quite clear on what level someone goes from private to business seller but plan to look into that and will let you know as this develops.

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• Ten Little Known, Highly Profitable, eBay Niche Businesses Anyone Can Do by eBay Power Seller Skip McGrath
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Today there are plenty of programs and services that allow anyone with no technical experience to create a website. You no longer need to know HTML code or how to use web publishing software. If you can point and click you can develop a website.

Here are some of the popular tools I recommend:

1.      If you want to set up an eCommerce website to sell products, take a look at a builder I use and recommend at www.PowerSellerBuilder.com. I currently have two websites operating that were built and are hosted by this system.

2.      Another great system that comes with good support, training and wholesale sourcing help is the Be Biz Program from the Internet Marketing Center.

3.      If you want to set up a site to make money from Google AdSense or Affiliate Marketing, there is a great system from a company called XsitePro.  I have not used their program, but I have looked at it carefully and received tons of email from users who love their system.

Once you set up your website, you have to get traffic. You can have the most beautiful website in the world, but if no one visits it you can’t make money from it.

Building traffic to your website isn’t really that hard and doesn’t take that much time if you follow a steady routine. Here is an article from a ten-part series from BrightBuilders, the company that powers my website builder tool at www.powersellerbuilder.com. The series is called "Marketing Your Website: All ten tips are available at the following links:

·       Tip #1: Ten Ways to Create Compelling Sales Literature ·       Tip #2: Effective Keyword Research ·       Tip #3: Creating Effective Titles & Descriptions ·       Tip #4: Creating and Marketing to Your Customer List ·       Tip #5: Building Content Pages Search Engines Love ·       Tip #6: Pay Per Click Advertising: Sound Strategies ·       Tip #7: Reaping the Benefits of Paid Inclusion ·       Tip #8: Increase Your Link Popularity ·       Tip #9: How Blogs Can Benefit Your Business ·       Tip #10: Build a Daily Marketing Routine

Building a Marketing Routine

One of the Internet´s major advantages over print media is that it can be updated constantly. A website that has not changed in months seems abandoned to those who frequent the site. So change is necessary for repeat business, and this change comes down to a daily marketing routine.

Content is King

When most people think about marketing, they think of advertising. Don´t fall into that trap. Marketing also encompasses your design, your page copy, etc. According to MediaMetrix, 75% of all repeat visitors come back to a site due to the site´s content. We have mentioned before that "Content is King" on the web. MediaMetrix also states that it is vital that the content be good, compelling, new, and free.

Your Daily Routine

Marketing your site on the Internet should be done on a daily basis. In fact, experts agree that you should get into a daily routine, even if it is only for 15 minutes at a time. Doing so will increase your traffic, your customer loyalty, your sales, and your profits. In other words, it will help you create a "sticky site."

Daily promotion activities include:

• Email: No, we are not referring to email marketing, but to responding to customer email in a timely manner. If this is overlooked, you could lose hard-won customers. Many Internet businesses have earned and kept business based on their ability to respond quickly to customer email. Customers appreciate a timely response.
• Newsgroups: This is not copying and pasting an advertisement in newsgroups, but rather it is finding an area of your expertise and being an "advisor" or "expert" online in that area. Answer questions and give advice freely. Ensure that you reference your website in the signature of your posts, so people who read your posts can find your site. If you gain a solid reputation, you will gain customers.
• Update Your Site: Keeping your site fresh with new content is vital, even if you are selling only one product. For example, you might expand your FAQ page or your product information page. By expanding your content, you are not only giving new content for your customers to read, but you are also expanding the number of pages listed in the search engines, which will increase your chances of appearing in the top of the search results.
• Link Popularity: You can review our article on Link Popularity for detailed information, but this is an area that takes constant work. By contacting sites on a daily basis, your link popularity will increase, and if you do it right, your link reputation will increase as well.
• Guest Articles: Writing a guest article for publication in a newsletter or to post on another website is one of the best methods of promoting and marketing your website. First, the guest article can be posted on your own site as new content; second, the guest article will have a link back to your site which will increase your link popularity; third, if you select a site that has a good profile online, it also has a good reputation, which will increase your link reputation; fourth, you and your company will begin to be recognized as an expert in the field. Your "brand awareness" increases.
• Track the Competition: Go where your #1 competitor goes. Use the Google Alert system to track your top competitor. Wherever their company is mentioned in a page newly indexed by Google, you will be notified. This will uncover a gold mine of information for you and you can ride on the coattails of a successful company in your industry.

This article is copyrighted 2009 by Bright Builders Inc. and used with permission.

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• Ten Little Known eBay Niche Businesses Anyone can do to make extra money on eBay
  Here are ten great little eBay businesses that are low cost and low risk that anyone can start

In my last post I reported that 48 hours after eBay launched the new Fixed Price (FP) listing format and fees that eBay’s listings had hardly budged.  Now 5 days later, listings have climbed from around 16 million to 18.35 million, according to the eBay listing tracking service at Medved.net.

Medved tracks auction counts and sell through rates on eBay.  I also looked at sell through rates (STRs).  Since the new format started earlier this week, the total eBay sell through rate is down about 2%.  However this is not that significant and STRs change based on the days of the week.  We will have to wait a few days to compare Sunday to Sunday and Monday to Monday –typically the two biggest selling days of the week.

As I mentioned in my last post, a likely reason for the slow takeoff was the last of automated seller tools.  I haven’t checked today, but as of a day ago, eBay’s Turbo Lister was not yet updated with tools to use the new 30-day and GTC format.  I use Vendio, a service used by thousands of power sellers.  Their system was updated, but my sales manager edition was pretty clumsy and convoluted to use.  Basically I had to open each inventory item, click on the eBay site specifics, select the GTC option, save the edits, save the file and then launch the FP listing.  Then I had to go back into each listing and undo and save my changes, so I could launch those items as ordinary auctions. 

I only have about 100 different inventory items and this took a couple of hours of work.  I can’t imagine what eBay sellers who have thousands of items are going through.

I don’t know what the situation is at other popular auction management companies such as Auctiva, MarketWorks, Channel Advisor and InkFrog.

My FP listings have only been up for about 24 hours –and so far no sales, but i would expect that.  I am really anxious to see how they do after a week or so. I did the math and if just 22% of my listings make at least one sale per month, then I will be ahead of the game on fees.  eBay’s historic STR on Buy-it-now sales is around 20%, so I am hopeful this will work out.  If I were to get a 25% or higher rate then the new format will work well for me.  Of course this is very product and price dependent. As an eBay seller, you need to run the numbers for your product, your category and your DSR discount.

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When I typed Lehman Brothers into the eBay search engine it came up with 254 items for sale. A few of them were domain names related to the bankruptcy, but most of the items for sale were various advertising giveaway and employee items including golf clubs and golf balls, hats, tee shirts, duffel bags and other items of clothing with the Lehman Brothers name and logo.

One of the most ironic items was an operating principals cube. Here is what the listing said:

Own a piece of Lehman Brothers history as its being made. Brand new and sealed in the original plastic.

Operating Principles cube that opens up in different ways and you can read all the different principles like…

"Demonstrating smart risk management" 

"Demonstrating commitment to excellence" 

"Doing the right thing"

"Maximizing shareholder value"

I especially like the first one.

Another great item is a Lehman Brothers Emergency Evacuation Kit.

It’s not only happening in the US. Here is a link to a story in the UK Telegraph about angry Lehman Brother’s employees selling off their stuff.

Lehman Brothers is not the only one. If you search Merrill Lynch, bought out by Bank of America yesterday, there is a lot of their Merrill selling as well. Could AIG be next?

You can’t buy it on eBay, but I find it interesting that people are still buying Lehman Brothers stock. The stock is trading today for 19-cents a share.  I called a broker friend of mine and asked him about it.  It turns out that Lehman actually has a lot of assets.  Some folks estimate that when the bankruptcy is finally finished shareholders could end up with a couple of dollars per share. But –that could take several years.

Skip McGrath

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About the time eBay was started 15 years ago, Boeing set out to design the next generation airliner.  One of the things Boeing learned back in the 1950s when they started building the first jet airliners was to listen to their customers.  If you fly on airliners, you might think I am talking about you –but I am not.  Boeing’s customers are not the flying public. Boeing’s customers are the airlines.  The same thing is true of eBay. We the sellers –not the eBay bidders and buyers –are the customers.  The bidders and buyers are our customers –not eBay’s. This is analogous to passengers being the airline’s customers.

When Boeing set out the build the next generation aircraft that would become the 787 Dreamliner, soon to begin production, they contacted all of the world’s airlines and invited them to send representatives to Seattle where they met for weeks listening to what the airlines wanted.

Boeing didn’t bring the airline reps in to listen to a sales pitch telling them what the next airliner would look like and how great it would be. They brought them in to listen and give input.   Did Boeing consider the needs of passengers? Of course they did. And, they shared this information with the airlines and the airlines shared their passenger input and data with Boeing.

In a sense the 787 Dreamliner is a collaborative aircraft designed by the customers and Boeing together –both of whom understood the needs of the passenger. But more importantly, Boeing had the input from the Airlines who told them what kind of aircraft they needed to make money.

So what could eBay learn from this? eBay earns enough in fees paid by sellers (eBay’s customers) to fly a couple hundred representative sellers into San Jose for several days of workshops where instead of presenting, eBay spends the time listening. Had eBay leveled with sellers a couple of years ago when the growth started to slow and the current problems were becoming known, they could have made us part of the process and the solution. Who knows, the end result could have been massive changes to the feedback system and even DSRs –but I suspect they would look different –and most importantly the seller community would embrace the changes instead of fighting them because they would have been part of the solution –rather than being asked to accept a solution that was imposed upon them.

It’s not too late. eBay has cancelled eBay Live in 2009. Instead they said they would be doing a series of “events” around the country. What will these events look like?

I have been to some of these eBay “workshops” before. Yes, we get to get to stand in line before a microphone and ask questions and give comments.  And all the players on the stage nod their heads and look concerned. Then they give us answers. Where is the real input?

Does eBay ever send their managers out to sit beside an eBay seller all day and see what we really do –what our challenges are and what we have to contend with to make a profit? Does eBay have workshops where ten sellers sit down with ten managers for an entire day and examine the wealth of data that eBay has amassed. Where we get to ask in-depth questions, submit ideas and concerns and where we tackle the problems together? If this is going on, I don’t know about it.

eBay has a choice. They can continue to try and sell us on their new systems and methods, or eBay can come clean with us and share their data and research. They can stop the spin and actually ask for, consider and respect our input, opinions and ideas –and then go back to San Jose and actually put them to use.

I understand that eBay’s management doesn’t work for us. They work for the stockholders. I was once a stockholder. I bought stock shortly after eBay went public and made a lot of money on eBay stock. But I dumped it shortly after the last split. 

I would like to be a stockholder again. But at $27 a share eBay looks way over priced to me. If, however, eBay were to learn something from Boeing, I might take another look.  eBay could embrace their customers and bring us into the design decisions. There are a few rivets popping on this 15 year old airplane we call eBay, but there is still time to turn this thing around before the flaps start falling off. If eBay would invite us into a truly collaborative effort, we could all build our own Dreamliner together.

Stay tuned – More on this tomorrow

Skip McGrath
www.skipmcgrath.com 

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Karen and I are taking a long vacation in Italy this month. We have been planning and saving money and airline points for this trip for over two years.

Our first stop was Venice –easily one of the most beautiful and interesting cities in the world.  Venice is a true gem or geography, history, art and visual impact.  While we were here we learned a lot about the history of Venice.  History is all about lessons –Lessons learned and not learned by those who live it. One lesson, struck me as being something eBay could learn from the history of this great city.

Venice was originally found by refugees fleeing the invading hordes from the Lombard North.  In the 6th century refugees fleeing the Lombard invaders of Northern Italy sought safety on the largely uninhabited islands. The communities organized themselves (697) under a doge –an elected leader. Venice was perfectly located for handling seaborne trade between East and West, the communities grew, and by the 9th cent. they had formed the city of Venice.

Beside its perfect location, the early Venetians has a novel idea to attract trade.  In the 7th and 8th centuries, Roman and Byzantine ports levied high duties or tariffs on imports through their ports as well as other fees. The second Doge of Venice had the novel idea, that if you lowered tariffs and fees it would attract business. For over 700 years Venice offered traders the lowest cost of any trading port in the Mediterranean. Venice grew in trade, power and wealth.  From about 900 to the early days of the Renaissance, Venice was the leading economic power in the western world. And it all started by lowering fees.

It is difficult to pinpoint the exact year Venice started into decline, but the eventual decline of Venice was also due to fees and taxes. 

Around 1400 the Muslim Caliphate (Ottomans) controlled the spice trade between China, India and the Mediterranean. They began charging high fees on all the spices and goods that moved through their territory.  At the same time in Venice, the publicly elected Doges started giving way to an Aristocracy.  To fund their lavish palaces the aristocracy began raising the tariffs and fees for use of the port and the warehouses.  They also began issuing laws and regulations without input from the merchant class that had ruled the city in a democratic fashion for 700 years. Venice started into a decline that did not reverse itself until it became a tourist destination in the 20th Century.

There are many similarities to the story of Venice and the founding and growth of eBay. Early eBay sellers were essentially economic refugees;  Ordinary people looking for a way to make a buck trading with others. eBay was essentially an electronic Venice –a port that attracted trade with low fees and very little regulation.

Little-by-little however, eBay moved into its own Renaissance period.  Fees were raised little by little each year. Every year saw new regulations.  Many of the early regulations and policies were sorely needed to tame some of the wild behaviour on eBay by everyone from rogue sellers to outright fraudsters –but the regulations and policies and the new fees just kept coming.  At first they were manageable and sellers felt they had some input into the system.  But just like Venice –no one can pinpoint the exact date –at some point an aristocracy took over. Unlike the early Venetian Royals –this modern aristocracy owed its loyalty to the Kingdom of Wall Street and soon forgot the merchant class that founded and nurtured the city.

it is still early and we are not yet at the point of no return. With the number of listings declining and more and more sellers becoming multi-channel sellers, eBay seems to be listening.  I am not sure if the democratic doge has returned, but I think eBay may have figured out that you not only need the merchant class to succeed –you also need to listen to them. 

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Although we make most of our income selling our books and new merchandise, I am always on the lookout for vintage or used goods to sell on eBay where I can make a profit. 

Over the past ten days I have sold about $2,100 worth of goods on eBay.  One of the items was a folk music CD boxed set that I bought for $20.  It sold for $141.33.  I also sold an old Nikon film camera and two lenses.  The camera went for over $750, one lens sold at the BIN price of $499 and the other lens for $788.  All of these very obtained for much much less.

In my newsletter I often feature an article on Niche Market of The Month.  Most of the niches I feature are for used or vintage items.  I also publish an eBook called Ten Highly Profitable eBay Niche Businesses Anyone Can Do , that features several easy to start niche businesses that require very little investment.

A lot of sellers turn their nose up at selling used goods on eBay which is too bad. Consider this:

• The average gross profit for new goods on eBay is about 30%
• Gross profits for many new goods are as high as 90%
• Used goods are easy to source. You can find them at garage sales, estate sales, thrift shops, by advertising on Craigslist or taking out small classified ads in your local paper.
• You don’t need a state sales tax number to source used goods
• You can turn your inventory over quickly. No need to stock large amounts of merchandise that tie up your cash.
• There is far less competition for used merchandise so you will usually come up very high in the search results.

One of the really neat things that you can do today is check prices and values of goods from a PDA or cell phone.  If you have a portable device that is enabled for the internet, it is a snap to check the value of an item before you buy it.  For example, lets say you are at a garage sale and you spot on old tape deck that you think might be valuable.  Just go to eBay and search the brand and model number on eBay completed items search and you will see how much they are selling for before you buy or decide what to offer.

You can even get stuff for free.  One of my readers told me about placing an ad on Craigslist for things he was looking for. Not only did he get messages from people with things to sell, several people offered him things for free if he would just pick them up. One of the free items was a complete stereo system from the 1980s that he sold on eBay for over $300.

Vintage items are the best –usually the most profitable and easy to sell, but really almost any used item in decent condition has a good market on eBay and many products can be the start of a full-time very profitable eBay business.

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I find it rather ironic that Eliot Spitzer is now paying as much per hour for an attorney as he paid for companionship with a prostitute –but that’s another story. Let’s look at a very interesting eBay niche business:

A search of the term Elliot Spitzer the day after the news broke resulted in 40 items for sale. Today that number has jumped to 90 and growing.

Seizing on medial stories is one of the oldest and most profitable niches on eBay.  Every time there is a major scandal, eBay entrepreneurs are quick to launch products that take advantage of news.  The first items to appear are usually T-shirts and this time is no exception.  “Love Client No. 9″ is featured on T-shirts by several sellers. And there is other merchandise as well including a faux credit card issued by the Emperor’s VIP Club.  Other merchandise that has surfaced includes Eliot Spitzer’s High School Year Book, an invitation to his gubernatorial inaugural.

Here are links to some of the more entertaining listings on eBay:

New York Governor Eliot Spitzer Client # 9 Large Tshirt

I WAS THREATENED BY ELIOT SPITZER COFFEE MUG Free Ship

Eliot-Spitzer-Starring-in-CLIENT-9-Mini-Poster

ELLIOT SPITZER, Client No. 9 BUTTON, PIN Brand New

Pay For Luv Guv Newspaper

CLIENT 9 NY GOVERNOR SPITZER EMPEROR CLUB DECAL STICKER

Most of the entrepreneurs who jump on news stories are those who already have the ability to produce T-shirts, coffee mugs, hats and decals.  If you don’t have this equipment, you can still participate by joining Cafe Press.  This is a web site where you just upload your design image and they will print it on a T-shirt, mug, hat or other item and drop ship it directly to your customer.

This niche and several others are covered in my newsletter and my book, Ten eBay Niche Businesses Anyone Can Do.

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For a limited time eBay expert Scott Foster is allowing me to give away the instant-download, (ebook version) of his newest book to my customers and subscribers as a special gift.

It’s called, 91 Common Everyday Items that Bring Huge Profits on eBay

I just finished reading it and can tell you, this eye-opening ebook has more value then most PAID ebooks you find on the market today. I promise you’ve NEVER seen anything like it before. This book is a great compliment to my best-selling book on eBay niche marketing: Ten Little-Known Highly Profitable Niche Markets on eBay.

So may people want to learn how to sell on eBay and just don’t know where to start.  Here are 91 ways to start selling on eBay.

You could have hundreds of dollars just laying around in your garage or attic. This great book contains dozens of very profitable niche products most people have never thought of –many of them that could be developed into profitable markets on eBay.

To download your complimentary copy please use this link: (Don’t wait… Scott is only offering this promotion for a limited time).

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