Compete With Yourself
Wednesday, December 3rd, 2008
eBay’s model over the past 13 years is an iconic masterpiece of businesses based on the Web. The auction model took millions of people’s interest, and it became the online shopping experience.
But things have changed since those days. It is harder to get that bargain, the place is crowded, and the effort and cost involved for sellers (and if things go wrong, buyers too) begins to make the benefits of the idea negligible.
Ebay / Paypal have continued to rise prices, and scams become common place. The difference in stress between a one-click buy on Amazon, and a 3 week “am I even going to receive it” gamble on eBay, is palatable. Ebay knows this, and that’s why they have incorporated more and more “buy it now”, and shop features. In other words, they created space for normal online stores, but mixed in with the messy auction system.
I think this is where the mistakes reside. They noticed the problem – good. But what they should have done was create these shops and fixed-price outlets away and separate from the auctions many have grown to loath. Leave eBay.com/.co.uk/.tld-of-your-choice to the auctions, and focus the stores on a different domain. I know why they didn’t do this in the first place – the eBay brand was too important, but they could have incorporated the world eBay in to this new property if they so desired.
Separating the two entities provides clarity for the visitor – one of the most important aspects of running a business online. If a visitor goes to ebay.com, they want to have a set of expectations and leave their decision-making on autopilot. They don’t want to be continuously analysing whether something is an auction, or a fixed-price item. The separation clears this decision making, and buying from either site feels more comfortable.
In the title of this post I say “compete with yourself”. In other words, if you need to diversify from your business model, to the extent eBay has, set up another site, company, whatever, and do that model there, keeping the existing one that is still making money. Don’t feck around with an audience that likes things how they are, but provide a different space for people begging for the new model.
Ebay would be so much better off if they had done this, I am sure of it.