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Time to Avoid Auction Format Listings?

Reasons why the vintage format may increasingly be showing its age


Time to Avoid Auction Format Listings?

The auction format is a venerable one on eBay, but a changing eBay culture may soon make it a worse choice than it used to be.

Some have bemoaned eBay's shift away from auction-based selling, but with eBay's choice made there are valid reasons for choosing fixed price rather than online auction as your preferred auction format. Here are some of the biggest.

Reasons for Sellers to Be Wary

  • Auction deadbeats and loosening enforcement. In the last year or two eBay has removed the ability for sellers to leave negative feedback, switched its emphasis away from auction format listings, and added the "require immediate payment" feature for Buy it Now listings. These changes hint that auction outcomes are now seen as "less certain" or "less real" by eBay, a change from the old "your bid is a contract" philosophy. In the past deadbeats were quickly suspended, but these changes leave the way open for eBay to let deadbeat bidding on auction format listings slide as it tries not to lose shoppers to competitors like Amazon.com. You'll simply have to relist or offer second chances much more often with auction format listings.

  • Uncertain pricing. Because of the way auction format listings work, you can't be certain about the ultimate sale price of an item, and sale prices can vary significantly depending on the timing of your listings. In the past, auction format listings gave sellers a way to let the market price items of unclear or uncertain value, but these days with the likes of Amazon.com, Google Shopping, and completed listings searches only a click away, most sellers can easily find the optimal price for an item without leaving it open to the market.

  • Waiting for the close of the deal. Auction listings take time to finish. Longer listings like those lasting 7 or 10 days can slow down what would otherwise be an immediate sale by a week or more, the wait often compounded by the wait for payment-a problem that is non-existent with fixed price auctions that require immediate payment. Shorter auction durations mitigate this problem, but only by reducing the number of pageviews and bids that your auction gets, and thus ultimately by reducing the value of your item.

  • A smaller pool of shoppers/buyers. Like it or not, the early days of eBay and of the internet are past. The population of online shoppers that was willing to spend time learning about eBay's complex bidding system and unique culture and lifestyle have long since been dwarfed by the much larger population of not-so-early internet adopters that just want to shop, mail-order or Amazon.com style, for obviously priced and quickly deliverable goods. With auction listings you lose at least two large swaths of the buying public, those that don't know how bidding works and aren't interested enough to learn, and those that want their item delivered as quickly as possible, without the wait for an auction to close.

  • Better results elsewhere. With buyer demographics and eBay policy and strategies changing, the fact is that in many cases sellers can simply achieve better sale prices and net revenue either using fixed price listings or using other platforms in addition to eBay. But once auctions are just one platform in a multi-pronged sales strategy the auction format, as the lone holdout with unique timing, pricing, risk, and contractual properties, starts to seem cumbersome to manage and not worth the extra effort. This has a circular effect—fewer sellers using auctions means fewer auction eyeballs means fewer auction sales means fewer sellers using auctions. Those that previously specialized in eBay auctions are thus seeing diminishing and often ultimately finding themselves moving on as well.

  • Bookkeeping complexity. Because auctions can be of varying lengths and varying start times, and because both of these affect the values of items in auction format listings, and because the final values of auction format listings can vary widely from item to item even when items are identical, sound bookkeeping and analytics are difficult for auction sellers. The eBay sales game is much easier for fixed price sellers, who need only keep track of fixed price points of their own choosing and the percentage of sold items versus listed items in order to track business performance.
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