IS EBAY DYING ???

I wouldn't quite say dying, more just getting old, tired and cranky like the rest of us.

If you check the companies quarterly results to the U.S stock exchange you can get a pretty accurate reflection of how the company is really travelling. Growth in sales is there but it is in the range of 2-5 % compared to other similar online companies that are growing 20-30% per annum. ( Amazon is in the mid to high twenties ). Active buyers are increasing by several % per annum but active sellers are increasing at a similar rate. The companies profit and share price moves around a bit, but has basically been stagnant in the last 3-4 years.

What does this mean for your average small seller ???

Not good news I,m afraid. If you consider the huge rise in Chinese sellers as well as the attractive trading terms offered to the large Australian ( and international ) sellers, the share of the sales pie left for small sellers is shrinking fast. Add to this the fact that seller numbers are increasing on ebay globally and total sales are only growing a few % it validates what many small sellers have already noted. Sales for small sellers are falling very rapidly and by big percentages year on year.

It is worth remembering that sales of new items ( mainly from very large companies ) now make up over 80% of ebays total sales and auctions make up less than 10% of total sales. All signs that things are not going well for small sellers. These small sellers where also often regular buyers on ebay ( I know I once was ). Recycling money from sales to other often small ebay sellers through their ebay purchases.

Ebay has an identity crisis. It is not sure if it is a "mini me" Amazon or an antiques and collectibles fair for rare items. One thing the company is sure of, it doesn't want to be the garage sale of junk it once was and is actively moving away from this segment of the market.

IS EBAY DEAD ???......... I think as company, it is obviously struggling with stagnant growth and continually increasing online global competition. It is hanging in there with its push to large retailers, but if it continues to lose the buyer support from the millions of small ebay sellers worldwide, it could all be over fairly quickly for the company.

Either way, things are not looking very bright for millions of small ebay sellers.

The only thing that can save the company long term is to forget trying to compete with other major online competitors in the increasingly crowded online " mega mall market " and return to its roots of encouraging small sellers with unique items where it has a global competitive niche.