Can Top-Rated Seller Program Help eBay?

eBay reports happier customers, but some 'top' sellers remain skeptical.

by Brad and Debra Schepp
- Oct 26, 2009

As October dawned, eBay seemed to have won back the favor of Wall Street analysts and investors, which is clearly good news for the company. The news from the financial world is that eBay's stock is up 55 percent for the year, and shares added an additional 9 percent in September alone, according to Dan Gallagher, writing for MarketWatch.

Gallagher further reports that of 33 analysts watching eBay, only one maintains a sell call. Almost half—15, to be exact—recommend buying the stock, and 17 remain neutral.

With all the hoopla on Wall Street, eBay must be feeling very happy. How does that joy trickle down to the sellers and buyers who make all the money happen on the site? We spent some time asking just that question and gathering an interesting, if mixed, bag full of opinions.

"Analysts will watch financial metrics, balance sheets, competitive factors and more that all drive to impact eBay's bottom line performance each quarter," explains Brandon Dupsky, managing director of the eCommerce Merchants Trade Association. "eBay sellers are in the trenches selling items each day, and paying eBay the selling fees that analysts measure, putting sellers much closer to the real numbers for tracing eBay."

We decided to ask some other successful sellers what their feelings were. Everyone who spoke with us wanted to talk about the Seller Release 2 batch of changes to the platform—and especially the Top-rated seller designation—that took effect on Oct. 1. With the launch of the Top-rated seller program, the familiar PowerSeller icon no longer appears in search results or listing pages. Although there is still technically a PowerSeller designation, it is transparent to buyers.

Not all PowerSellers automatically earned top-rated status, and we'll show you how frustrating that can be in a minute. But first, let's look at the good news.

Because top-rated status is determined by great customer experience, the program can go a long way toward helping eBay regain buyer confidence. In that sense, it will be good for the entire community, because the more confident and comfortable buyers are in the marketplace, the more likely they are to shop and keep that marketplace profitable. With the emphasis focused less on sales volume, the designation is more readily available to smaller and newer sellers, who can add vitality and enthusiasm to the mix.

Many long-time PowerSellers were not automatically welcomed into the new Top-rated seller club

Good in theory

Now on to the other hand—and you knew there would be another hand, didn't you? It is quite bizarre and frustrating to many long-time sellers that formerly successful PowerSellers were not automatically welcomed into the new Top-rated seller club, even though they seem to qualify.

Let's look at the record of one of eBay's great success stories. Stephanie Inge has been selling on eBay for more than 10 years. Not only that, but she's long been an eBay instructor, and she founded the largest eBay sellers group in the country, the Dallas-based eBabes and eMales. She is also the No. 1 Fossil merchandise dealer on the site. You will not find a more dedicated worker or a greater supporter of eBay's marketplace.

At the end of the first week in October, Inge had not earned the Top-rated seller badge! "I pride myself on customer service, excellence in every phase of the auction cycle, and I don't know what else I can possibly do to achieve this badge," she says.

To investigate what this means to Inge's business, we decided to do some "shopping" for Fossil handbags and see what the competition had to offer. Limiting the search to include only Top-rated sellers, we found hundreds of bags for sale. In examining feedback histories, we found several sellers who have been on eBay less than half as long as Inge. Some had feedback numbers as low as 250.

Now, we aren't trying to denigrate these sellers, because we have no reason to say they have a designation that they don't deserve, but we are concerned for long-standing eBay success stories who haven't yet received their recognition.

In this sample search, of course, Inge's listings never appeared in our results. Not only was she not yet a Top-rated seller, but without her PowerSeller designation, she virtually disappeared into a vast marketplace of competitors with no way to distinguish herself.

eBay's reliance on individual sellers still makes it stand out in the e-commerce industry

Optimism intact

Inge tells us she's on target to receive her Top-rated seller badge in the third week of October, and there's no doubt she'll soon be among eBay's elite. But, to disadvantage her for three weeks in the fourth quarter of the year seems, somehow, wrong. We're not the only ones to question this timing.

"With all the recent eBay changes, the jury is still out," says ECMTA's Dupsky. "The uncertainties these changes bring have sellers at a high level of anxiety as the results unfold. We are now in the most important quarter of the year, Q4. This is not the best time of the year for sellers to 'figure out' new selling strategies on eBay and adjust their businesses once more to hope Q4 will be a good one."

Still, some of eBay's successful sellers remain optimistic that these changes will help eBay make necessary course adjustments. Andy Mowery of Debnroo notes that eBay's reliance on individual sellers still makes it stand out in the e-commerce industry.

"eBay's data management model exceeds," he notes. "The data is actually more reliable for the simple fact that a seller's livelihood depends on that accuracy. Those who are sloppy pay a price with feedback and DSRs."

Inge also remains optimistic. In the same way we've seen her face every challenge, she has redoubled her efforts to achieve her goal, and kept her eye on some of the longer term benefits.

"The eBay powers that be may have decided that auctions are still a viable part of eBay's success strategy," Inge says. She notes a 33-percent discount offered in early October for auction-style listings as a positive step.

Dupsky notes the symbiotic relationship between eBay and its larger sellers.

"Sellers are far more concerned with eBay's long-term future say two, three, five, even 10 years out, rather than just how they will perform in the next quarter," he says. "The long-term health of eBay has a direct impact on the livelihood for sellers. If large sellers are disadvantaged too much, this will show a material impact on eBay's gross merchandise value for Q4. Now that is something analysts and sellers both will care about."

Editor's note: This article was written prior to eBay releasing its third-quarter earnings report.

About the Author

Brad and Debra Schepp are the authors of 20 books, including eBay PowerSeller Secrets and The Official Success Guide: Insider Tips and Strategies for Sourcing Products from the World's Largest B2B Marketplace. Their most recent book, which Deb co-authored with John Lawson, Kick Ass Social Commerce for E-preneurs: It's Not About Likes—It's About Sales, was recently named the 2015 Small Business Book of the Year in the social media category.

For further information, visit Brad and Deb's website,

Opinions expressed here may not be shared by Auctiva Corp. and/or its principals.

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