TORONTO – EBay, regarded in its early days being an endless repository for Beanie babies and baseball trading cards, has transformed beyond being a reliable spot for collectables and gently used goods.
But though 80 per cent of what is sold nowadays on eBay Canada is totally new, its relationship with the remaining 20 per cent is the reason why the site special, according to Andrea Stairs, eBay Canada’s md. Additionally, it presents among the online marketplace’s more bedeviling sticking points.
“The inventory on eBay covers a spectrum of value, everything from new and in-season to end-of-runs, used, refurbished or vintage,” Stairs said in a recent interview from the company’s Toronto headquarters. “That mix – that’s exactly eBay’s secret sauce. That is why consumers come to eBay.”
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Open for 16 years, eBay is an e-commerce grandparent in Canada, where it has long capitalized around the reluctance from the country’s biggest retailers to get involved with digital retail. As a result, Canada continues to be one of eBay’s best global markets, with Canadians spending more than $1 billion buying goods from the site every year, the No. 2 online retailer in Canada behind Amazon.
But critics note eBay can still present a frustrating user experience for individuals because they wade through disparate listings on the site searching for deals or discrete pieces of out-of-season merchandise. And in a digitally-driven shopping universe by which consumers frequently turn to Google first to locate links to sites selling the item they want, eBay’s search results in many cases are pushed down below those of Amazon, to detriment from the business.
Making listings more uniform and Google-friendly is part of a multi-year task for eBay, Stairs said, but it’s a process of some complexity given that eBay’s sellers – from single customers to the small retailers who use eBay being an online selling channel – produce the listings themselves.
A pair of identical Gascan model sunglasses from Oakley, for example, may be listed a large number of times on the website diversely: some pairs may be listed as simply “Oakley sunglasses” and others might have “Gascan” as a product descriptor, while still other listings goes into great detail, providing the model name, the manufacturer’s item number and multiple other attributes. Their pictures might look alike – or otherwise.
“The hardest part of e-commerce is dealing with the considerable amount of SKUs (stock-keeping units, a product-identifying number generated by the manufacturer) and pictures and prices,” said Alex Arifuzzaman, a partner in the Toronto-based retail and real estate specialists InterStratics Consultants.
“Consumers are type of used to that inconsistency with eBay, but when they can improve it, so much the greater.”
After the worldwide operation last year spun off PayPal, its powerhouse secure payments processing business, eBay continues to be looking at ways to drive up the performance of their marketplace as it faces Amazon, Alibaba and also the ever-growing web operations of traditional retailers for example Wal-Mart and Costco.
Revenue for that fourth quarter, reported in January, was US$2.32 billion, flat on the year-over-year basis, along with a forecast for that current quarter of US$2.05 billion to US$2.1 billion fell substandard analyst revenue estimates of US$2.16 billion.
“It’s not just about facing Amazon, it’s about Alibaba, which is very similar to eBay and it is going everywhere,” Alan Middleton, an advertising and marketing professor at York University, said of the Chinese e-commerce giant, that has annual revenue of approximately US$12.5 billion and it has been expanding in to the U.S. and Europe.
“Unlike Amazon and much like eBay, Alibaba has no inventory or warehouses to support, and it doesn’t contend with its merchants,” Middleton said, noting the second businesses take advantage of avoiding those overhead and supply-chain costs. “But Alibaba continues to be a menace to eBay, because unlike eBay, it offers a financing option for buyers who are interested try not to genuinely have the cash.”
Small town retailers find big success on eBay
TORONTO In the middle of the current recession in 2010, Home Hardware dealer Michel Robidoux was near to personal bankruptcy, his small Sainte-Julie, Que.-based retail business not able to pay the bills.
He managed to prop up the company by liquidating some items on the internet and he opened his own website selling fireplaces and some hardware items 2011.
But it had not been until he began selling his goods on eBay the year after that his business really became popular, both on the internet and at his bricks and mortar store.
“That was life-saving for me personally,” Robidoux said of opening his business, Le Monde du Foyer, on eBay this year. “The traffic in the store was increasing, although not by a great amount, so I wanted new ways online to try and develop sales. It had been a user-friendly platform for someone much like me, with no large amount of internet experience.”
Robidoux is part of an increasing niche of eBay Canada’s offline success stories – small business owners in small towns who have developed a healthy international business by selling on eBay.
Since the move to eBay, Robidoux’s sales have gone up by about 50 per cent each year, with eBay sales accounting for over fifty percent of his internet business.
During earlier this Easter weekend, for instance, the internet merchant sold 50 outdoor gazebos, a unbelievable feat by the standards of his prior 20-year career as a gm at Canadian Tire, that might have sold 10 in an entire season.
Retailers have been helped in recent years by the low Canadian dollar – eBay Canada has witnessed a double-digit rise in its in exports towards the U.S. along with other international markets since the dollar’s decline.
“Sellers are scaling their businesses in reaction to increased demand south of the border, but Canadian sellers usually have done well internationally, actually,” said Andrea Stairs, managing director of eBay Canada. “There is really a ‘brand Canada’ type of halo effect they get when they sell to the U.S. in order to Europe, a trust bump.”
The rapid growth of Robidoux’s web business has allowed him to quadruple the square footage of his store in St. Julie, and offer more competitive prices overall.
“I possess the power of purchase on my side,” he explained. “If I buy 200 gazebos, I get a far greater price than should i be buying two of them. We sell a great deal within the U.S. since the exchange rates are so great now, but we also have a lot of customers in Ontario.”
Christine Deslauriers began selling skating gear and apparel on eBay eight years back when she lived within the northern Ontario community of Timmins. The business, Boutique Step Up, became this type of success that they began selling items out of her house and then opened a store in tiny Hamner, about 20 kilometres north of Sudbury, Ont.
“My daughters were into skating, and I knew where you’ll get a great price in Montreal, where (dresses and tights) are manufactured. I was buying some items at overstock for $5 and that i could sell them for US$49 on the site.”
Today, she’s expanded the business into gymnastics and swimwear. Another of her sales go to U.S. customers and about 31 per cent have been in Canada, followed by Europe, Africa, Asia and South America.
“My business outgrew my house,” she chuckled. “I have sold to 60 countries within the last six years.”
Stairs said certainly one of eBay’s biggest priorities is applying structured data to move from the listings-based Internet business into one that looks and operates a lot more like a catalogue.
“It allows us to become more effective at merchandising,” she said. “We can tell, ‘Here are a thousand of the same laptops from the thousand different sellers,’ and (show buyers) a variety of a new comer to used, which generation it’s, and at different prices. And that we can serve that up in just one box for buyers, instead of it being more up to a buyer to figure out which (laptops) are the same via a search.”
But it is a challenge, a “massive undertaking,” to harmonize discrete, identical listings much more Canada alone, eBay presents 200 million ever-changing live listings at any time.
Still, this is an important transformation, not only for consumers searching on the website, but for eBay’s core business performance because it seeks for everyone up higher-ranked listings on Google and further differentiate itself from local online classified businesses such as Kijiji and Craigslist.
Studies show consumers have a tendency to click on the top few Search listings, with a negligible amount moving on to lower links or even the second page of search engine results.
“Moving to more structured data will allow us to put up countless pages that are product pages for connecting buyers with actual listings from different sellers, but those is also product pages that Google can index,” Stairs said.
“The more that we can structure those 200 million listings into a catalogue that is usable for algorithms, the better we could do this.”
To remedy a number of its platform’s legacy issues, eBay has created the eBay Feed, a form of its home page that shows returning consumers new inventory that corresponds with their interests.
It also began the eBay Collections program, internal and user-generated groupings of themed merchandise for example prom dresses, sports and electronics in order to help customers find sales deals and shopping ideas. eBay also markets goods in themed events tied to holidays, seasons, product categories or manufacturers for example Dyson, which uses eBay as an outlet site for its prior season and returned inventory.
Stairs said the company has gained traction from a deals hub it launched 3 years ago to group deals from highly trusted sellers in one place on the website. It makes sense given that consumers make 85 per cent of purchases on eBay in a fixed price, using the “Buy it now” selector, instead of within an auction.
EBay has also worked to give users tips about product photos and listings information to improve their listings because it moves towards appearing like more of an online catalogue for consumers.
“We are managing an ecosystem,” she explained. “You always want to be careful by what you mandate versus that which you recommend (to sellers). You won’t want to make it so difficult for a consumer seller to sell they don’t want to arrived at eBay, because actually that inventory is gold.”
Disorganized listings, while viewed by a few as eBay’s Achilles’ heel, may not bother its regular users, said Jim Danahy, CEO at Toronto-based retail consultancy Customer Lab.
“People on eBay are searching for value, so it’s about scoring that before other people does,” he explained.
“Even if eBay were able to group these items with heterogeneous identifiers, to some extent that undermines the treasure hunts element of (the website). They would need to have very sophisticated category management. Replenishment isn’t their game – offering something unique every single day is.”
hshaw@nationalpost.com
