Seller Central

	A Message from Bill Cobb

June 27, 2006

Hello,

Earlier this year, I made a promise to the eBay community that I would address the problem of excessive shipping charges.   Members have told us, and we agree – this problem has grown too big, and something must be done.

Excessive Shipping is a turn-off for buyers. In fact, we just completed research that found that the NUMBER ONE reason buyers don’t complete a transaction on eBay is excessive shipping costs.  What’s more, 54% percent of our top buyers on eBay believe that shipping fees are the most important part of an item’s total price.  In fact, half of the buyers surveyed would rather buy an item with a higher total cost  than an item with an unfair shipping cost.  They told us they trust sellers with reasonable shipping costs much more than those with high shipping costs – not surprising.

These sellers aren’t just taking advantage of buyers -- they’re cheating honest sellers, too, by competing unfairly.  They’re avoiding eBay selling fees that the honest sellers pay.  They’re gaming search results.  Most importantly, they’re eroding buyer trust in the eBay marketplace … and that’s bad for everyone.

We do have a policy governing shipping costs – but to be honest, we haven’t done a good job of enforcing it.  We wanted to let the market decide.  That’s why, in September of last year, we improved transparency for buyers by adding a shipping cost column in search results.  But for dishonest sellers, the lure of fee avoidance and search manipulation was too great – and this measure didn’t have quite the impact we’d hoped for.

It’s time we take a firmer stand on excessive shipping, so starting June 19th, we began enforcing our policy more aggressively. We’re doing this to re-level the playing field and regain buyer confidence.

We’ve begun cleaning up the site, but it won’t happen overnight.  We’re starting with the really outrageous abuses.  You know the listings I mean – those listings, for instance, with a Buy It Now price of 95 cents and $50 in shipping fees for an item that costs only a few dollars to ship.

If you’re among the vast majority of eBay sellers who charge shipping and handling fees simply to cover your actual shipping, packaging and overhead costs, you needn’t be concerned about this; in fact, you’re going to benefit.

But if your business model is based on under-pricing items and making up the difference with excessive shipping costs, you need to stop this practice immediately.

We’ll need to work together to correct this imbalance so that we retain a positive marketplace.  I appreciate your support and cooperation, and I invite you to write to me at billcobb@ebay.com with your comments.

Sincerely,
Bill Cobb
President, eBay North America