In June, eBay Germany introduced maximum shipping prices in the 34 categories where they believed buyers were most likely to be overcharged on shipping. Now it seems that eBay UK may be considering similar steps. A post from Richard Ambrose on the (PS sign-in needed) asks:
In response, we’re considering a range of possible actions to eradicate excessive P&P on eBay, including imposing maximum or fixed P&P prices by category.
Over the course of the last few years, it’s also become more and more the norm in e-commerce for P&P to be free. We’re also considering how best to increase the availability of free P&P on eBay, including mandating it in some categories and rewarding sellers who offer it with better visibility and/ or lower fees.
Our main goal, as always, is to make eBay as attractive as possible to buyers for your and our benefit. However, obviously the type of changes we’re considering would have a very big impact on sellers in the short-term, so we wanted to hear your views on three questions:
– How would you like to see eBay combat excessive P&P?
– Would you like to see eBay encouraging free P&P? If so, how?
– What would you prefer us NOT to do in either of these two areas?
(I’ve copied the whole post in case of later disappearences.) Richard then goes on to clarify that this will apply to the basic domestic shipping options only.
eBay don’t know what they don’t know
The most common complaint against the policy, and it’s an entirely reasonable one, is how can eBay possibly know what shipping will cost for any particular item? I remember a listing of Chris’s, for five car hands-free kits; he was charging exact-cost Â£12 to deliver the 3kg parcel, but eBay pulled the listing twice for excessive P&P charges, because it was so far above the average for the category. Category averages are not always a relevent measure of reasonableness, and eBay have neither the staff nor the expertise to judge in this area. eBay Germany’s compulsory pricing will often not cover insured shipping, yet the policy affects jewellery sellers. This will be another quagmire of pulled listings, restricted accounts, and annoyed sellers with their livelihoods damaged. Dolphin salad, anyone?
Like several posters on the PS thread, I thought that detailed seller ratings were intended to combat excessive shipping. Sellers who overcharge will be marked down by their bidders, they’ll be disadvantaged in the search results, and therefore will be unlikely to sell much any more. They’ll either mend their scamming ways, or leave the site. So goes the logic.
Do buyers actually care?
If the DSRs haven’t achieved this, I can only come to one conclusion: that the DSRs in this area are not working as eBay think they should. Even sellers who offer free P&P frequently do not have 5 stars: I’ve done some experimenting recently with free P&P on some of my listings, but my P&P DSR for that account sits unmoving at 4.8.
There has been ample evidence that the postage DSR behaves differently to the other three scores: it is routinely lower for almost all sellers. Top sellers on eBay.com have scores for P&P on average around 0.15 lower than for item as described.
I’ve speculated before about why this is. I still think it’s because P&P fees are stated right there in the listing. They’re never a “nice surprise” for buyers, and therefore they’re more likely to be marked with a “good” 4 than an “outstanding” 5. My belief is that buyers are not as stupid as eBay think they are: they know that “free P&P” means it’s been paid for somewhere.
What buyers really want is not free, but fair P&P. I’d like, for example, to see the end of “standard shipping”, and for it to be compulsory for sellers to state what service will be used. Being charged Â£5 to post a t-shirt is excessive for second class, but quite reasonable for Special Delivery. Shouldn’t I get to know what my Â£5 will buy before I spend it?
And perhaps more than anything, buyers want combined shipping if they buy more than one item. If every item has P&P included in its listing price, then where’s the discount for multiple purchases? You alienate as many buyers as you please with free P&P.
Is free P&P normal?
There are arguments to be made for free P&P, and arguments to be made against it. The variables are many: not just what you sell, but how you sell it, where you sell it from, your routines, your buyers’ especial foibles all play a part. To charge or not to charge should be a decision sellers make for themselves.
But Richard says in his post – and he’s said it on several occasions before – that free postage is “becoming the norm” for ecommerce. Looking at things I’ve bought from the internet recently, I would say free P&P is most definitely not the norm.
[poll id=”2″]I’m prepared to be proved wrong on this point though, so I’d like to conduct a little poll. Amongst sellers who have websites (and therefore don’t have to consider eBay fees on those sales), do you charge for P&P, and under what circumstances?
And in the meantime, what do you think of Richard’s proposals? A great way to keep happy buyers coming back for more, or a step too far for eBay? Leave us a comment.
Thanks to Steve from Kingsbridge Karaoke for the heads-up.