Last week I attended the ChannelAdvisor Catalyst Conference and then eBay University on the Saturday. I’ll be posting my thoughts on both over the course of this week.
At Catalyst I had the opportunity to interview Scot Wingo, President and CEO of ChannelAdvisor and he shared his thoughts with me on many topics of interest to eBay traders and ecommerce in general. Timing for our interview couldn’t have been better – eBay released their Q1 results the night before. Scot’s take is that the results were better than expected across the board, with only the growth in active users and number of listings lagging. However if eBay can produce higher profits on fewer listings either selling prices are up or a higher percentage of listings are finding buyers – either (or both) should please sellers. With growth Internationally at 38% and within the US at 18% eBay.com continues to lag behind in it’s contribution to total revenues.
We started with questions on the differences between trading on eBay in the US and UK. Firstly I asked Scot why it appears the US are first for product launches and innovations which benefit sellers, while the UK and other eBay sites around the world appear to be used as guinea pigs for less popular site changes such as feedback 2.0. This is of interest because the US business is only about twice the size of the UK, the UK has the highest spend per head of population on eBay in the world, and the EU marketplace as a whole ($169.2bn) is larger than the US ($156.5bn).
By experimenting with marketplaces outside the US, eBay could be potentially disrupting a larger proportion of their income, than if the changes were tested on the US site. Scot explained that eBay executives naturally consider the US marketplace first as it’s close to home – most of them are US based and eBay.com is the first site they look at. In addition he said the EU market may be seen as more resilient to change, and sellers quicker to adopt change than those in the US.
When asked about the weak dollar and how that’s affected sales Scot stated many US sellers especially in categories such as golfing equipment have been quick to capitalise on selling to the EU. As sellers have seen significant increases in certain products they have started to list on the UK and other EU sites, and in fact some have even shipped stock to the UK to be distributed locally by third parties to take advantage of the situation.
The loss of US visibility for UK sellers has affected cross border sales, but Scot predicted that in the future a listing upgrade could be put in place so that those wishing US visibility for their products could regain that market. Aside from talking to Scot I spoke to several ChannelAdvisor customers who this change caused a lot of pain. The main problem they told me wasn’t the loss of visibility, it was the lack of notice given. If they had had time to adjust their selling strategies they could have minimised financial loss and compensated for loss of visibility with different listing strategies. In the short term it has been a severe disruption to business, but as with most changes on eBay, sellers are adjusting to the new circumstances.
The “Building Trust by Reducing Counterfeits” policy has affected business for ChannelAdvisor customers less than might have been expected – typically a 5% loss according to Scot. However this would vary significantly by country as English speaking markets can list across UK, US, Australia, and Canada and UK, US, and Germany can post the items worldwide. In other markets such as Spain the impact is probably much higher than 5%.
The keyword spamming policy has proved a problem for many sellers with listings removed for stating terms such as “Next day shipping” or “Delivery by Fed Ex”. Scot’s best advice is to insert your terms and conditions into auctions as an image, this way there are no misleading keywords. Scot explained that customer support reps are targeted on removing offending listings and it’s easier to remove them a page at a time than to examine each individually to verify if the listing actually breached a policy.
Scot had some interesting comments on both Amazon and Google. Amazon already have sales data on third party sellers. If they look at 10,000 products sold on Amazon they can easily take the top 1,000 and decide to sell them direct. It’s no secret, but if you make a market for your products on Amazon it’s something to be aware of. Equally with Google Checkout in the future Google will be able to amass data not only on the click through rates on both organic and paid for search results, but will know exactly what your sell through rate is on products compared to your competition. It will be interesting in the future to see what use (if any!) Google make of conversion data.
eBay Express was the only other venue mentioned, Scot stated the site would be better if it wasn’t branded as an eBay site. Possibly a shopping.com branded site would have been better, or of course (the unthinkable) if it had been an Amazon site. Scot likened eBay Express to a “Diet Donut”, it doesn’t really work – there are only so many ways you can extend a brand.
Many sellers in the UK are constantly looking for alternative sites to sell on other than eBay so I asked Scot which, if any, ChannelAdvisor may support in the future. The answer is none are planned – Amazon and eBay are already supported, as are merchants own websites. A typical ChannelAdvisor customer will have built eBay sales using TurboLister to around £20k/mth when they start working with ChannelAdvisor. They’ll build their sales to around £100k/mth and then rather than looking at smaller auction sites will use more sophisticated services such as Search and Comparison Shopping to build business further.
Scot stated that ChannelAdvisor currently have around 100 accounts in the UK, but expect to double that within the next year. Considering the number of eBay sellers in the UK without their own website it seems a realistic goal, and one that Scot appears to have no doubts that they’ll achieve.
The one thing that impressed me from talking to Scot is that he’s not out for a hard sell on ChannelAdvisor, a philosophy that carries through the ethos of his company. Scot and ChannelAdvisor hold many events throughout the year including the Catalyst conference, online workshops and seminars and of course talking at eBay University. Many of these events are at no cost, and the material is always non-specific to ChannelAdvisor. Scot waits for you to assimilate the information and ask the question “And how can I do that with my company” to which the answer is of course “With ChannelAdvisor products and services!” If however you can put in place the proposals and advice given there is no hard sell. Either way I’m always more than keen to listen to what Scot has to say as are many other sellers around the world.
3 Responses
Catalyst was certainly a fascinating event to attend! Thanks to the guys at Channel Advisor for organising it.
I did not get a chance to speak to Scott but I met some familiar and not so familiar faces at Catalyst.
I listened mostly, asked a little and learned a lot.
A great event!
Scot and Channel Advisor do a great job. It’s good to hear the UK Catalyst event was a success. Glacier Bay DVD was one of the first CA Merchant clients and they were always good to work with.