Are Promoted Listings encouraging eBay Fee Avoidance?

In years gone by, eBay fee avoidance was rife on the marketplace. It was all too easy to not only boost your position in search results by lowering your price and back ending some of the sale price into postage costs and at the same time you would save on fees due to your lower sales price. eBay put a stop to this when they started to charge fees on postage costs as well as the sale price and this removed the advantage of charging high postage prices.

Recently however things have changed due to the introduction of eBay Promoted Listings. Once again eBay fee avoidance has become attractive to a small group of sellers trying to game the system. What appears to be taking place is that sellers are using the proposition that eBay Promoted Listings fees are only charged on the sale price, not the postage costs. Thus, if they have a product selling for £10 with free postage and bid 10% eBay Promoted Listings fee, they’ll pay an additional £1 per sale. However if they list for £1 with £9 postage and bid 100% eBay Promoted Listings fee they’ll still only pay an additional £1 per sale but are gambling that the higher bid rate will give them a greater boost in search results.

Naturally there are a ton of other factors which influence eBay search results positions and even bidding a high percentage for eBay Promoted Listings coupled with eBay Fee Avoidance by loading costs into postage won’t guarantee you top placement in search. eBay says that in addition to looking at a seller’s set ad rate, other factors are also considered, such as relevancy and how well an item is selling at the time the ad rate is set. Promoted listings from sellers with different ad rates may appear in different page locations.

It’s hard to check how well this tactic would work for sellers employing it and if it really does generate more sales or if buyers are put off by the high postage costs. It’s doubly hard to quantify success as we have no way to discern what eBay Promoted Listings bid rate has been applied to the different listings we’ve viewed.

Have you experimented with a little eBay Fee Avoidance to enable you to bid higher eBay Promoted Listings rates and if so did it work for you? (NB this is not a tactic we are recommending as doubtless eBay will jump on it sooner or later).