Friday, August 22, 2008

EBAY TO PROMOTE FIXED-PRICE SALES

San Francisco
Financial Chronicle

Acknowledging that most online shoppers cannot be bothered with auctions, eBay planned to announce Wednesday changes to its fee structure that emphasize fixed prices over bidding. The move is intended to help eBay compete more effectively with Amazon.com and other big online retailers.

The announcement, timed to increase sales during the year-end holiday shopping season, is just one of the changes eBay has made in the last few months aimed at reducing its dependence on its auction business, which is growing more slowly than fixed-price sales. It provides yet more evidence that consumers are losing interest in auctions now that online shopping sites have become more affordable and easier to use.

‘‘Buying online has changed,’’ said ScotWingo, chief executive of themarket research firm ChannelAdvisor.

‘‘Retail sites no longer make customers choose between convenience and price.’’ Lower upfront feeswill enable sellers to offer a bigger selection, helping eBay better compete with fixed-price retailers, Wingo said. ‘‘The current system puts eBay at a disadvantage.’’ Among the changes that were to be announced Wednesday was a new pricing plan for sellers who offer fixedprice items in eBay’s ‘‘Buy It Now’’ format.

Starting in mid-September, sellers will pay only 35 U.S. cents to list an item for 30 days, a reduction of about 70 percent in upfront fees.

EBay also announced that it would no longer allow most customers to pay by check or cash, a change aimed at curbing fraud. Users will need to pay with a credit card or through eBay’s PayPal online payment service.

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