Ebay hurt by bad economy

Michigan · January 21, 2009 12:01PM

Just like most everyone, no real surprise here.

Ebay reported a weakening in its core marketplace business and forecast poor results for the current quarter as consumer spending continued to wane. Shares of the e-commerce company fell 6 per cent in after-hours trading.

Ebay reported fourth-quarter revenue of $2.04bn, below analyst estimates, and a 7 per cent drop year-over-year, marking the company's first-ever sales decline. Chief executive John Donahoe blamed the crisis-wracked economy and a strengthening dollar for the poor results. "We've been operating in an almost unprecedented external environment," he said.

Fourth-quarter net income fell 31 per cent as the company offered more promotions and sellers cut prices to attract holiday shoppers. "This was an extremely difficult holiday season," said Mr Donahoe. "Even e-commerce saw negative growth for the first time."

Ebay's core marketplace business registered $1.27bn in revenue, a 16 per cent decline. Rivals Amazon and Craigslist continue to steal market share and customers.

However, fourth-quarter earnings per share were 41 cents, against estimates of 39 cents, and were strengthened by smaller units Paypal and Skype.

Since replacing Meg Whitman as chief executive in March, Mr Donahoe has sought to revive growth in Ebay's mature markets. He cut listing fees in hopes of increasing the number of listings and drawing back sellers who had been defecting. Mr Donahoe also attempted to retool Ebay's search and ranking techniques.

The past year was tumultuous for Ebay. Last January Ms Whitman, the company's chief executive of 10 years, stepped down and has indicated that she will run for governor of California in 2010. In October, Ebay cut 10 per cent of its workforce.

Traffic to Ebay has steadily declined. In October, the site recorded 10 per cent fewer viewers than it had during the same period a year earlier, according to Nielsen Online.

Skype, Ebay's free internet phone service, posted $145m revenue in the fourth quarter, a 26 per cent increase from the same time last year. Mr Donahoe referred to Skype, which was initially thought of as an enhancement to the marketplace, as a "stand alone business" and said it was not "a distraction".

COINB0Y · January 21, 2009 12:08PM

Folks trying to unload anything to raise cash! EBay should be BOOMING!

If they can't do it now, they NEVER will.

But wait! The idiots change the format so much that even me, an experienced user absolutely hates it.

The change offers NO FINACIAL BENEFIT or Economy of scale for them so why change?

Yahoo did the same thing to the Financial Message Boards and destroyed a great thing over night. Yahoo has never recovered.

I shorted EBay right before the close as I said I would yesterday.

Down to $10 it goes! (looked at the chart)

jmski52 · January 21, 2009 12:14PM

The subtitle might also be: "Ebay hurt by self-inflicted stupidity"

Chief executive John Donahoe blamed the crisis-wracked economy and a strengthening dollar for the poor results.

If that's what he's blaming poor results on, he hasn't bothered to ask any of the former users who used to provide good business, no questions asked.

"We've been operating in an almost unprecedented external environment," he said.

Yes, the unprecedented environment of which he speaks is that of trying to operate a company while being ***totally clueless***.

Added: I remember the days when I kicked myself for not buying ebay stock because it had already gone up a bunch, only to see it keep on going for years.

No more. Now, I'm glad I never took that road.

tincup · January 21, 2009 12:18PM

"Chief executive John Donahoe blamed the crisis-wracked economy and a strengthening dollar for the poor results. "We've been operating in an almost unprecedented external environment," he said."

"Rivals Amazon and Craigslist continue to steal market share and customers.

LOL...... CEO John Donahoe needs to buy a vowel. Users are jumping ship in a steady rate due to the changes that have been made on eBay. Just to name a few reasons: increased fees, not allowing sellers to give negative feedback, not allowing any payment methods other than PayPal or credit cards, and constantly throwing new formats at users..... nearly always siding with the purchaser whenever there is a dispute..... and on and on.

The company will run into the ground unless they start getting a clue.

Johnp · January 21, 2009 12:22PM

I would agree with you that a bad economy should strengthen Ebay and every garage sale out there people are trying to raise cash in this economy and Ebay is the place to do it. That Paypal is still making money is no surprise as they have monopoly on the Ebay payments and they can raise their fee as much as they want.

seateddime · January 21, 2009 12:24PM

when they drop powerseller requirments you know it got bad

19Lyds · January 21, 2009 12:25PM

Hmmmm. Seems to me eBay started taking a dive way before the economy did.

Oh well. If Donohoe is so damned set in thinking that eBay had nothing to do with the position they are currently in, I guess he can just go down with the ship!

And no I don't like the new format or the stupid feedback policy or the strict requirements to only use PayPal.

Cut out the versatility and you alienate a lot of folks.

291fifth · January 21, 2009 12:29PM

It looks like eBay's attempt to compete with Amazon is failing, just as I thought it would.

I recently did a search on eBay and found 46 items listed (not coins). Not one of the items was a true auction. All of them were nothing more than attempts to sell at essentially full retail. Most had high shipping charges as well. None of the items listed had any bids.

My own true auctions with very low starting prices still do reasonably well. I don't seem to have much competition.

Raufus · January 21, 2009 12:49PM

<< The subtitle might also be: "Ebay hurt by self-inflicted stupidity"

Chief executive John Donahoe blamed the crisis-wracked economy and a strengthening dollar for the poor results.

If that's what he's blaming poor results on, he hasn't bothered to ask any of the former users who used to provide good business, no questions asked.

"We've been operating in an almost unprecedented external environment," he said.

Yes, the unprecedented environment of which he speaks is that of trying to operate a company while being ***totally clueless***.

Added: I remember the days when I kicked myself for not buying ebay stock because it had already gone up a bunch, only to see it keep on going for years.

No more. Now, I'm glad I never took that road. >>

Right on jmski-

I wasted 20 minutes stating just these points to my ebay powerseller cust. svc. rep. They just don't get it. They parrot these stupid lines which they're told to say and just don't process any of it. They're absolutely killing themselves.

derryb · January 21, 2009 12:59PM

Maybe some more "CASHBACK" will help

GrumpyEd · January 21, 2009 1:06PM

It should say "ebay hurt by shooting it's own foot"

Walmann · January 21, 2009 1:33PM

Sadly mismanagement is not limited to ebay. Alot of assets in incompetent hands these days.

RINATIONALS · January 21, 2009 1:40PM

On average ebay got 15k per year since 1998 from me with the exception of last year. In my experience it was a wonderful place at the beginning, truly the 'community' that they spoke about. You could talk to someone helpful if you had a problem and they actively solicited and more importantly listened to your feedback. That all began to change in late 2000 when they ignored the growing fraud problems of shill bidding and outright scammers. I can't remember a single positive change since that time. The final straw was being forced to give them an extra 3% for the paypal only policy and give up most of my rights as a seller - wasn't going to happen.
Great companies grow and stay strong by making changes that keep their customers happy. Companies that alienate their customers by following a policy of 'we'll decide and dictate what you'll get and like it' always end up on the trash heap and its a sad thing to watch.

Coxe · January 21, 2009 1:41PM

If I said what I truly believe, I would receive a cease and desist, or worse, from eBay's shareholder relations department.

Core compentency and being in touch with your customer base on a fanatical level are the hallmarks of a successful service-oriented company. Bean counters generally end up counting the wrong beans and dictators nearly always die tragically.

Boom · January 21, 2009 2:05PM

Chief executive John Donahoe is in a severe state of DENIAL.

Feedback changes, tying sellers' hands, rendering them defenseless,
dictating far too many things and of course, completely wrecking what
once worked just fine couldn't POSSIBLY have anything to do with this!

Wholesale, across the board changes, higher fvf for fixed price listings
that for the MOST PART - DO NOT WORK ,yada, yada, yada couldn't
POSSIBLY have anything to do with the decline! No, uh-uh!

Ship of Fools!

RichieURich · January 21, 2009 2:08PM

<< Chief executive John Donahoe is in a severe state of DENIAL.

Feedback changes, tying sellers' hands, rendering them defenseless,
dictating far too many things and of course, completely wrecking what
once worked just fine couldn't POSSIBLY have anything to do with this!

Wholesale, across the board changes, higher fvf for fixed price listings
that for the MOST PART - DO NOT WORK ,yada, yada, yada couldn't
POSSIBLY have anything to do with the decline! No, uh-uh! >>

I couldn't agree more. Denial is not just a river in Egypt!

Lakesammman · January 21, 2009 2:21PM

So if ebay sucks, as I believe it does, where is the stuff I collect now being listed??

VamGuy · January 21, 2009 2:46PM

<< Down to $10 it goes! (looked at the chart) >>

Betcha it breaks below $10.

Unfortunately, the problems with eBay are obvious and apparent to everybody except the idiot in charge. He's the decider. Respectable, reliable, and conscienscious sellers like myself have no choice but to exit the eBay platform for many of the reasons already listed here.

In 2006, I paid eBay (including paypal) $41,247.74 in fees.
In 2007, I paid eBay (including paypal) $16,718.28 in fees.
In 2008, I paid eBay (including paypal) $11,779.75 in fees.

In 2009, I expect to pay eBay (including paypal) no more than $5,000 in fees. Ebay has reached the point of diminishing returns. The company has commited suicide under the leadership of a moron, a genius in his own mind.

I do feel bad for the folks who made a living solely from selling on eBay, as many of them can no longer afford to do so. I feel bad for the 1,000 eBay employees who have already lost their jobs, and the thousands more that will lose their jobs in the coming year as eBay "grows" under this kind of blind leadership.

It really is sad.

VamGuy · January 21, 2009 2:47PM

Nevermind, I just found out that it's only the economy causing the problems at ebay.

Carry on.

coindeuce · January 21, 2009 2:59PM

Only a self respecting Irishman would accept responsibility for sinking his own ship. John Dona-whore is a classic example of a modern American corporate executive clone. Blame it on someone or something else.

jgrinz · January 21, 2009 4:57PM

The ultimate Laugh will be when he asks the US government for a BAILOUT!
hehehe

1Mike1 · January 21, 2009 5:00PM

<< The ultimate Laugh will be when he asks the US government for a BAILOUT!
hehehe >>

and gets it...

Coxe · January 21, 2009 5:06PM

<< 

<< The ultimate Laugh will be when he asks the US government for a BAILOUT!
hehehe >>

and gets it...

>>

Well, PayPal (may peace be upon it) should get a TARP funds, no?

commoncents123 · January 21, 2009 5:19PM

Paypal is their cash cow.

thisnamztaken · January 21, 2009 6:51PM

<< Users are jumping ship in a steady rate due to the changes that have been made on eBay. Just to name a few reasons: increased fees, not allowing sellers to give negative feedback, not allowing any payment methods other than PayPal or credit cards, and constantly throwing new formats at users..... nearly always siding with the purchaser whenever there is a dispute..... and on and on.

The company will run into the ground unless they start getting a clue. >>

Exactly!

Connecticoin · January 21, 2009 8:28PM

I still cannot believe they are getting away with this Paypal only BS --- I would think several state Attorney Generals would be all over this anti-competitive nonsense.

TwoSides2aCoin · January 21, 2009 8:33PM

A bad economy ?

When you can't manage the farm, you can't manage money and when your leadership is full of idiots who all have their nose up someone else's crack on the corporate ladder, you ain't getting anywhere fast.

Next !

ccmorgan · January 21, 2009 8:46PM

Well IF they stop demanding paypal and their anti 2A policy(these 2 reasons are why I don't go there anymore)their sales/profit might increase.
They had a good thing going and they had to "mess" with it(greed).
Screw paypal and screw their anti-gun(2A)policy = screw ebay. IMO

morgansforever · January 21, 2009 9:06PM

Greed, Greed, Greed, always more. 100 million in fee's a month isn't enough, we need more.

If an item doesn't sell no fee's, nada. That might entice people to list their stuff, no?

50% off listing fee's is a joke, get those offers all the time, wow, I saved 10 cents.

Sorry, 10 cents doesn't arouse me.

Scott

291fifth · January 21, 2009 9:10PM

<< I still cannot believe they are getting away with this Paypal only BS --- I would think several state Attorney Generals would be all over this anti-competitive nonsense. >>

I agree. This also appears to be a step away from their "we are only a venue" stance.

keets · January 21, 2009 9:16PM

eBay is a done-deal already and many of us here realize that fact, it's just gonna take awhile for the process to run its course. i think it's kind of silly that as that venue has been struggling the managers continue to make moves which restrict users in an attempt to funnel more money into PayPal/eBay, with the predictable result; they now get a larger percentage of a smaller overall total, so they've shot themselves in the foot!!!!

sadly, those in control will never, never, never heed the advice that seems so clear to us. expect more moves from eBay in 2009 to further restrict users in the vain attempt to save the sinking ship.

jdimmick · January 21, 2009 9:38PM

There is no sense in re-stating whats already posted in this thread, as I couldnt agree more.

E-bay should be booming with the current economic situation. There are more folks looking to sell anything and everything right now. Yes , the prices realized might be off just a tad, but the larger number of sellers and the way e-bay fee's are structured this should be postive for e-bays bottom line and it inst.

There recent changes will drive them into the red before its over

HalfaDollarShort · January 21, 2009 11:00PM

Ebay did themselves in several years ago when they bent over for big corporations and simultaneously flipped the bird at grass roots businesses with their policy changes. The changes in the past year or so are nothing more than a reflection of horrible management desperate to squeeze every last penny from a sinking ship before they jump like half-soaked rats. Ebay grew on the strength of offering a market venue to small businesses and proprietorships that couldn't afford the associated expenses and commitment of an e-commerce website. The beginning of the end came a long time ago when they decided to implement policies to increase revenues from existing sellers instead of attracting more legitimate businesses to their venue.

shark1970 · January 21, 2009 11:08PM

I thought the policy on no checks or money orders was supposed to go into effect on jan 15.

anyone had auctions ended by ebay???

I still have listings that say so and none of them have been removed.

with the economy the way it is they would be smart not to enforce this new rule.

seanq · January 21, 2009 11:21PM

<< I thought the policy on no checks or money orders was supposed to go into effect on jan 15.

anyone had auctions ended by ebay???

I still have listings that say so and none of them have been removed.

with the economy the way it is they would be smart not to enforce this new rule. >>

I think at this point they're relying on users to report auctions in violation, though I recall reading a thread where they said that in the future they would be scanning auction text for certain keywords.

Ever since the rule went into effect, I've written the seller of every auction I've won and asked if they accept alternate forms of payment. Every one has been happy to take a check or money order. There's not much I can do as a seller, but as a buyer I've sworn not to give PayPal one cent more than I have to.

Sean Reynolds

seanq · January 21, 2009 11:25PM

One observation for those of you here saying eBay is in the early stages of death throes. This morning the US Coins category is over 160,000 listings, which is higher than the run up to Christmas. The average daily listing count late last year was usually in the 125,000-130,000 range. It's only one data point but it does suggest that more people are trying to raise cash through eBay despite the additional roadblocks.

Sean Reynolds

garsmith · January 21, 2009 11:34PM

I thought eBay was being hurt by the piss poor policies they have been enacting of late

cullenbryant · January 21, 2009 11:40PM

couple things that have degraded my ebay'ing

they've defaulted best match as a search return and taken away many of the self policing
tools that made it by the people, for the people and of the people.

they ought to bring back the old stuff and save it. a true auction site it was.

SaorAlba · January 21, 2009 11:47PM

<< Last January Ms Whitman, the company's chief executive of 10 years, stepped down and has indicated that she will run for governor of California in 2010. >>

What? Is this dame thinking she can possibly outdo Grey Davis in snarfing the state of California into an even worse quagmire?

Frankcoins · January 22, 2009 1:10AM

Two big flea markets in the Dallas area have month long waiting lists for space for the first time since 1990. People are having garage sales here in the middle of winter. A place called Town Talk foods that sells dented, out of date, and "railroad salvage" canned food has a problem...their parking lot is so full that the police are giving tickets to customers who park in the steets.

Ebay should be booming in times like these.

crito · January 22, 2009 1:23AM

Taxpayers should bailout EBay, for the good of the monopoly, er, country I mean.

airplanenut · January 22, 2009 1:54AM

<< So if ebay sucks, as I believe it does, where is the stuff I collect now being listed?? >>

You? Heritage, Private Treaty

kranky · January 22, 2009 2:20AM

<< It should say "ebay hurt by shooting it's own foot"

>>

You'd think at some point they'd run out of feet.

CoinJunkie · January 22, 2009 2:30AM

<< One observation for those of you here saying eBay is in the early stages of death throes. This morning the US Coins category is over 160,000 listings, which is higher than the run up to Christmas. The average daily listing count late last year was usually in the 125,000-130,000 range. It's only one data point but it does suggest that more people are trying to raise cash through eBay despite the additional roadblocks. >>

Maybe true, but a much higher percentage of listings are not true auctions anymore.

fc · January 22, 2009 2:38AM

<< 

<< One observation for those of you here saying eBay is in the early stages of death throes. This morning the US Coins category is over 160,000 listings, which is higher than the run up to Christmas. The average daily listing count late last year was usually in the 125,000-130,000 range. It's only one data point but it does suggest that more people are trying to raise cash through eBay despite the additional roadblocks. >>

Maybe true, but a much higher percentage of listings are not true auctions anymore. >>

and to put icing on that thought (cake), many of the listings are for
replicas and copies made in china flooding the areas we normally
look at. it gets real old after a while.

Russ · January 22, 2009 2:45AM

<< One observation for those of you here saying eBay is in the early stages of death throes. This morning the US Coins category is over 160,000 listings, which is higher than the run up to Christmas. The average daily listing count late last year was usually in the 125,000-130,000 range. It's only one data point but it does suggest that more people are trying to raise cash through eBay despite the additional roadblocks.

Sean Reynolds >>

Careful. This looks dangerously close to logic and common sense.

eBay ain't going anywhere, folks. The alternatives are all worse, far worse.

Russ, NCNE

dac076 · January 22, 2009 2:56AM

<< On average ebay got 15k per year since 1998 from me with the exception of last year. In my experience it was a wonderful place at the beginning, truly the 'community' that they spoke about. You could talk to someone helpful if you had a problem and they actively solicited and more importantly listened to your feedback. That all began to change in late 2000 when they ignored the growing fraud problems of shill bidding and outright scammers. I can't remember a single positive change since that time. The final straw was being forced to give them an extra 3% for the paypal only policy and give up most of my rights as a seller - wasn't going to happen.
Great companies grow and stay strong by making changes that keep their customers happy. Companies that alienate their customers by following a policy of 'we'll decide and dictate what you'll get and like it' always end up on the trash heap and its a sad thing to watch. >>

RI, have you moved to another venue, or stopped selling all together?

jmski52 · January 22, 2009 2:58AM

This morning the US Coins category is over 160,000 listings, which is higher than the run up to Christmas. The average daily listing count late last year was usually in the 125,000-130,000 range. It's only one data point but it does suggest that more people are trying to raise cash through eBay despite the additional roadblocks.

It was noted earlier that most listings are now B-I-Ns listed at retail or higher and there are very few auction format coins listed when I search the areas that I want to track.

The stock price reflects their business.

notwilight · January 22, 2009 2:59AM

<< This morning the US Coins category is over 160,000 listings, which is higher than the run up to Christmas. The average daily listing count late last year was usually in the 125,000-130,000 range. It's only one data point but it does suggest that more people are trying to raise cash through eBay despite the additional roadblocks.

It was noted earlier that most listings are now B-I-Ns listed at retail or higher and there are very few auction format coins listed when I search the areas that I want to track.

The stock price reflects their business. >>

BIN isn't all bad and they aren't all overpriced. I've sold $45K in the last 30 days on ebay and 90% of it was BIN. --Jerry

Blackhawk · January 22, 2009 3:09AM

Ebay is increasingly unfriendly to the user.

CoinJunkie · January 22, 2009 3:18AM

<< Ebay is increasingly unfriendly to the user. >>

Well, at least they seem to be equally unfriendly to both buyers and sellers...

Ebay hurt by bad economy

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