I’ve been pretty good about not commenting too much on eBay-related topics in the press over the past year.
Since I left eBay in May 2007, I’ve tried to be careful here on this blog with regards to eBay. It’s hard sometimes, when you read a column online that is wildly off base, to not want to jump in and “set the record straight”. Of course, when you work for the company, you tend not to do this because it’s hard to separate a personal rebuttal from an official company response. Ironically, when you leave the company, you also really aren’t free to respond, because it now isn’t your place to fight those battles.
I read an article this week, on Auctionbytes, about the new Detailed Seller Ratings and the relatively low ranking of the Top 25 eBay Sellers, and I felt I had to comment.
In case you are unfamilar, eBay rolled out new “Detailed Seller Rankings” to their feedback page last year, in one of the biggest enhancements to the feedback system since it’s debut. These detailed ratings allow buyers to rate sellers on four additional dimensions, from 1-5:
- Item as described
- Communication
- Shipping time
- Shipping & Handling charges
Seems like an obvious improvement to most buyers. However, no part of the eBay ecosystem is simple to modify, and there has been considerable angst and discussion among top sellers about this new improvement.
I’m not going to get into the debate and issues that sellers have raised with the new system. I’m not an expert on the system, and I haven’t read all the arguments in detail. The fact is, the original feedback system did not gather any structured data about the end-to-end service offered by eBay sellers, and this system is definitely a first step in attempting to gather that data. For a company that wants to focus on a great buyer experience, this is absolutely necessary.
Instead, I want to comment on the article, largely because of its conclusion:
A study of eBay’s top sellers reveals they rank poorly in terms of the detailed ratings left anonymously by their customers, with most falling in the bottom 25 percent of all sellers for such ratings.
… It’s troublesome to see that eBay’s top sellers perform poorly with DSRs, and AuctionBytes believes the data indicates eBay needs to reevaluate the new rating system and reconsider its decision to use DSRs to punish and disadvantage sellers. It should also provide much more information about the results – on an ongoing basis – so sellers have a better understanding of how the new system is affecting purchasing decisions and sales.
(BTW The article looks at the Top 500 sellers, according to Nortica.)
Fundamentally, I agree with this line:
It’s troublesome to see that eBay’s top sellers perform poorly with DSRs
But I disagree with the resulting conclusion:
AuctionBytes believes the data indicates eBay needs to reevaluate the new rating system.
In response to this, let me ask the following question:
What if the top sellers on eBay, as measured by feedback score and/or sales volume, actually are not offering the best customer experience to buyers?
Too often at eBay, I would see these two things confused together. There was an assumption that the top sellers, always measured by GMV (gross merchandise volume) or Feedback score got that way by being the best for the end customer, the buyers. However, in order to believe this, you have to believe that you can only build GMV and Feedback with a great customer experience. What if that’s not true?
What if the DSRs are telling us that eBay’s “top sellers” are actually offering buyers a below average customer experience?
Well, I’m a just an eBay seller now myself. I don’t do huge volume, but I have almost 800 feedback, and I flirt constantly with being a bronze PowerSeller. I have an eBay Store, and I use eBay’s Selling Manager.
My DSRs to date are (based on 81 sales with ratings):
- Item as described: 4.9
- Communication: 4.9
- Shipping time: 4.9
- Shipping and handling charges: 4.7
So it looks like I’m in the Top 25% of buyer experience on these ratings (well, above median for S&H).
What if these DSR’s are saying that buyers have a better experience buying from me than when they buy from one of the eBay Top 500 sellers?
Psychohistory 
That was my first thought too. And it’s not even really a slam against the big sellers — although my experience is that their customer service tends to be OK at best — it may just be reflective of how hard it is to scale good customer service. I’d love to see someone dig in and find the largest seller with really good DSRs and see what their practices are …
Cool post Adam.
First, I think this data says something about the marginal utility of different types of “customer service”. I may not be popular in saying this, but I predict that (on average) customer service has diminishing returns for consumers, and therefore means that providing “best” service may not be the best strategy for ebay sellers.
Second, the transparency of FB2.0 could allow better segmentation and a more perfectly priced marketplace. For example… a customer who needs fast shipping will find, be confident, compete, and pay a more perfect price for it. another buyer who doesn’t care about service, will be able to pick up even better deals because the first buyer has found a better fit.
Frys electronics is a fun example of how certain consumers can be willing to put up with bad service in order to reap lower prices and arguably better selection. Frys is one of the most profitable (and popular) private companies in California, despite their famously low customer service.
Hi John,
Totally agree on the marginal utility piece – the problem with the eBay ecosystem is ironically how economically efficient it is. Sellers have optimized their businesses to offer the necessary customer service to maintain their business on eBay – but not a bit more.
Amazon, of course, has implemented systems that require a certain service level from sellers, and now with their fulfillment programs, they can guarantee even better fulfillment from third party inventory.
Fry’s is a good model, but I think the market share in retail for that type of experience is limited.
Adam
Well I agree with the ratings some what. the shipping rating I disagree with. There should be another question instead of shipping. Like would you buy form this seller again. If you rate shipping you have a problem because customers will say that it is to high. so you you knock down the shipping and then now it’s the shipping took to long. It also depends on a great deal of what of what you sell. For instance, let’s say you sell cell phones. People can’t live without their cell phone so if you don’t get them the cell phone within a couple of days your in trouble. As opposed to selling dog beds. No one is going to get mad at you if it took 7 days to ship.
Do I think their needs to be more than just feedback sure I do but I think ebay also needs to limit who can evaluate the seller. What I mean by this is that if someone bid on a item but did not purchase it can still evaluate the seller. It should not be this way. Also customers that do not pay for a item should not be allowed to leave disputes.
Jeremy
Hi Jeremy,
I’m sure eBay will experiment with other questions. The platform actually supports the ability to use multiple questions, beyond the standard four. However, I think they did a good job of picking questions that will not only matter to buyers, but will help predict satisfaction among buyers.
If you sell cell phones, this system means you have to ship faster, if that’s what buyers want. If you sell dog beds, slower is probably OK. The point is, sellers of different items should know what buyers of those items want, and react accordingly.
People keep thinking that these ratings are intended to be some sort of perfect, utopian, fair measure of performance. They aren’t, because buyers themselves aren’t perfect or fair. These ratings are meant to be predictors of what other buyers will think, and in that regard they are excellent.
Buyers who bid but don’t buy cannot leave feedback. Buyers who don’t pay can leave feedback, but then if you file an unpaid item claim, the feedback will be removed. So eBay has addressed both of your concerns.
Adam
The problem is the 5 point rating system with “punishments” below a 4 rating. Most buyers would feel that a 4 is a very positive ranking and reserve the 5 for a seller that goes above and beyond the “call of duty.” I have stellar feedback (1 negative out of close to 3,000) and have noticed my DSR’s declining as more and more buyers click “4” instead of “5.” They should just put it on a 2-point scale to be fair. 1 is bad, 2 is good… no room for subjective judgement on the buyer’s part.
Hi Dan,
I think you are operating under a mistaken assumption. They didn’t pick the numbers for reward/penalty based on guesses, they picked those numbers based on the actual responses of millions of buyers. So, in fact, most buyers ARE picking 5, not 4. The fact that you are seeing your DSRs drop has everything to do with you not meeting the expectations of buyers relative to other sellers.
The fact that you have steller feedback, but are seeing lower DSRs is exactly the reasons DSRs were needed. It’s too easy to get “good feedback” in a binary system, but when you ask how happy buyers are with their purchases on eBay, you find out that everything isn’t good.
If buyers reserve “5” for sellers who go above and beyond the call of duty, then you should know that most sellers are going above and beyond what you believe is the call of duty. And that doesn’t bode well for your definition or your business on or off eBay.
Adam
I charge no shipping no handling and every package goes out the same day except sundays and I still get dinged on S&H and Cost of shipping ratings!!!
It seems to me that shipping/handling cost and speed of shipping should be objective ratings. Instead of Very quickly, it should show “within 3 days”, for example. I ship the same day or day after payment, yet my ratings fluctuate wildly within a week. How is this fair when I consistently ship immediately? I have no control over how fast the item arrives after it ships. I’m thinking I may need to quit shipping internationally and to the west coast since it can take longer to reach them and that hurts my ratings. I use the shipping calculator, yet the same item at the same shipping cost can yield a 5 rating from one customer and a 3 from another. How is this fair?
Hi Lynn,
I disagree. I think this is the big difference between the perspective of a typical eBay sellers and a traditional e-commerce vendor.
In the end, it doesn’t matter whether it was the fault of UPS, the Postal Service, or you – the point is the customer isn’t happy with their service. They are not experts in shipping, nor do they care to be. They just want their product as fast as possible.
There is no magically judge and jury to declare “fairness”. Customers think what customers think. Not all of them are rational or nice about it. But their opinions count, because they are customers.
I agree with you that it would make sense for eBay to ask for more detailed information when there is someone not totally happy. For example – they could put in the date of delivery, or a note on why they weren’t totally satisfied. That would help a lot.
Fact is, all of the numbers and averages look across millions of sellers. So, if your scores are lower than others, it might be good to look at what those other sellers with high scores are doing.
Take care,
Adam
How does it make sense to penalize eBay sellers over something over which they have no control? I understand and agree with your assertion that “customers think what customers think. Not all of them are rational or nice about it”. However, when a seller does everything WITHIN THEIR POWER to get something to the customer in a reasonable amount of time, how does it help the system to penalize the seller because the customer has unreasonable expectations? Shipping costs money and takes time. Shipping materials cost money as well. So, if a customer things a s/h charge is unreasonable, when really it’s just what the seller paid for the materials plus the shipping, is it OK for the buyer to ding the seller in the s/h field because they “are not an expert in shipping” and don’t know how much shipping materials actually cost?
Personally, I sell furniture. It often takes several days just to get a piece packed up and ready for shipment, and depending on which service the customer chooses, it can take up to two or three weeks to get the piece to the customer. Of course everything is communicated beforehand, but what if the customer suddenly decides that it’s taking too long after all? While I suppose that opinion is “valid”, it doesn’t serve anyone, because it’s not realistic, and once a shipping method is agreed upon, it can’t be changed.
I think the thing that people are trying to communicate is that often times, delayed shipping is the fault of the carrier, not the seller, so punishing the seller for issues here doesn’t necessarily make sense.
I will say that despite all this, I have kept my DSR’s pretty high – I attribute this to always keeping in communication with my customers and keeping them updated if for some reason it takes longer than expected to get a piece packed up and sent out. As long as people know what to expect and feel taken care of, they’re usually OK with the outcome.
Jeremy,
I think my post explains exactly why it makes sense to assign responsibility to sellers… they are the retailers. They are the vendors. It’s the feedback from their customers. The fact that, as a good seller, you use communication to help make customers feel comfortable about the delays in getting furniture, is right. The system is set up to reward sellers like yourself, versus those who do not make their customers happy. Period.
In the end, the point is that a retailer is judged by the quality of service they provide their customers. According to them. There is no impartial judge in the sky that will say that even though a customer is unhappy, it’s their fault. Commerce doesn’t work that way. eBay wants to see as many buyers happy as possible. So does Amazon.
No one expects perfect scores. Some buyers will be irrationally unhappy. If you sell a lot, the number of those should be dwarfed by the number who give correct feedback. And since the numbers are calibrated based on actual feedback, we know this is true.
If sellers charge actual shipping & handling costs, and buyers think those costs are too high, then that’s life. Buyers can believe whatever they want, and if they find another vendor, on or off eBay, who doesn’t charge those costs, then more power too them. Do you think shipping at Amazon really is free after you spend $25? It’s not. Some sellers choose to offer the prices with shipping built in, others choose to break it out. In the end, no one is going to tell you how to run your business. But the judge and the jury are your customers, and whether your business practices make sense to them.
It sounds like you are a very good seller and you make your buyers happy even though you are selling a product that is actually very difficult to buy and sell online.
I think what the other post are trying to say is the if Ebay acknowledges that the feedback is not always fair. Then how can you let buyers dictate your stats on eBay and your ability to sell.
If you sell a small amount like you seem to sell over the year, and you have 1 person unhappy with you, they leave you low dsr ratings it affects your overall rating drastically,
I am guessing you already know this since you have worked for eBay.
Perhaps you can explain how if the feedback system is voluntary and, not always fair and accurate. Why is this the only measure of a sellers ability to sell on eBay?
Not to mention,. Every buyer now has 100 positive feedback. No matter how many times they have bowed out on an auction. The system does not seem to be fair or balanced.
Scot, I feel like I’ve answered this multiple times now in this comment stream, and in the original post. The fact that buyers are not always fair or rational doesn’t matter – they are the ultimate arbiter of retail success. This is true offline as well as online. In the end, buyers depend on shopping experiences to be positive, and they vote with their feet and dollars to other venues if they are not happy.
If you sell a small amount, then I’m not sure how much the DSRs really matter to you. If you sell a small amount, it’s very likely that you should be using formats like the auction format to move limited inventory of unique items. $0.99 auctions get plenty of bids, assuming there is demand for your product.
I believe that DSRs do not show at all until you have a certain level of responses… when I left it was 10. I’m not sure what it is now.
DSRs are *not* the only measure of a sellers ability to sell on eBay. That’s the point. They augment, and don’t replace, the existing feedback mechanism. They do, however, affect your ranking in search, since eBay is going to bias towards sellers and items that make buyers happier.
I was recently blocked from posting items due to the new feedback system after a few items were not shipped out promptly. I have 800+ feedback and have been a member for over 9 years. I inquired to what I could do to list again and the response was you can wait. I think this system is going to end up losing them cash and sellers. I do a lot of purchasing and I have seen the items listed under my regular searches drop drastically recently. Chalk it up to another seller just moving on to craigslist to avoid the headache.
I want to say something about Adam’s statement< that i didnt see a reply for…forgive me if there was one.
Adam said: “Buyers who bid but don’t buy cannot leave feedback. Buyers who don’t pay can leave feedback, but then if you file an unpaid item claim, the feedback will be removed. So eBay has addressed both of your concerns.”
I believe that’s incorrect. Buyers can leave negative feedback, even if they don’t pay, and they can do it maliciously. All they have to do, is respond to a sellers UPI dispute, and as long as what they say is not malicious, then they can leave negative feedback, even though they have never paid.
This is the biggest problem with this DSR system, IMHO.
Thanks for the subject!
:o)
My understanding of the policy continues to be that buyers who do not pay for items will have their feedback removed via the UPI process. It’s not sufficient for the buyer to just post something nice – they have to have proof of payment through one of the eBay approved payment methods.
This is not unique to the DSR process at all – it’s part of the general changes to feedback.
Hope this helps.
Adam
DSRs are completely bogus. Ebay pulls a seller’s DSRs out of thin air. DSRs DO NOT reflect the numbers buyers actually leave.
Ebay arbitrarily decides each month how many 5%, 15%, and 20% PowerSeller discounts they want to hand out. Ebay then fudges each seller’s DSRs to go with the number of discounts handed out.
So Ebay adjusts an actual 4.8 to a 4.7. Whatever Ebay needs to ensure only so many sellers get a discount that month.
This is an absolutely ridiculous theory with no basis in fact. Just as likely is that eBay has hired Leprechauns to use their magical powers to grant the wishes of buyers who leave DSRs. Conspiracy theories are fun, though.
There’s an old Cold War quote I like to use “Trust but Verify”. I certainly don”t trust Ebay and verification of DSR data is impossible.
I have another theory that some Americans cheat on their income taxes. I’m sure you would consider that a wildly off base conspiracy theory.
The fact is that DSRs are directly related to Ebay’s bottom line, through PowerSeller/Top Rated Seller discounts. The very nature of this system and lack of verification make it corrupt.
The IRS is smart enough to have an instrument called an audit. Remember, “Trust but Verify”. Unfortunately when it comes to Ebay no such verification process exists. Too many sellers blindly trust Ebay. Ebay says “jump” and the only response from sellers is “how high?”
Ebay finding any and every way to maximize profits certainly seems more plausible than imaginary wish granting leprechauns.
I certainly consider your logic and conjecture “wildly off base”, but I’ll take the bait and respond anyway.
The analogy with the IRS and taxes is completely backwards. Individuals file their taxes (and potentially cheat), the IRS uses audits to help ensure some aggregate level of compliance. The police do the same thing with speeding tickets.
Individuals leave the DSRs, so in your analogy eBay = IRS, and the buyers = taxpayers. Arguing that eBay would tamper with the DSRs is the equivalent of arguing that the IRS is tampering with W-2 forms to manipulate the amount of taxes you owe.
Yes, that is a wildly off-base conspiracy theory. Get your tinfoil hat and go to town.
More importantly, eBay is a public company worth billions. Those are deep, deep pockets. If it were ever discovered that eBay was manipulating these values fraudulently, the potential damages could exceed the value of the marketplace. It would indict every transaction that occurred under the system. I doubt the risk/reward would be worth it.
More importantly, eBay is a highly ethical company, as are the people who work there. I worked there for four years, and I can’t think of anyone who would actually propose or execute on such a crazy scheme. I also didn’t meet any wish-granting leprechauns.
Thanks again for reading, but no need to continue this discussion. I think we’ve both said what we need to say here.
Adam
The thing that I do not understand is that I had 5.0 for each of the DSR points. I then got some feedback which said “Excellent item as described and quick delivery.
Item as described changed to 4.9
Communication changed to 4.9
Shipping time changed to 4.9
Shipping & Handling charges 4.8
Despite them stating that they were happy with each of those things. I believe that these ratings are really good for buyers, but perhaps they should be constrained by eBay for each purchase.
For example,
If your item was won on Monday, and the person receives it on Tuesday, it should not be possible for them to select “0, 1, 2, 3 or 4” for shipping times. If there was not communication then the option should not be available. If shipping charges fall within a certain range (perhaps per category) then there should be a limit on the lowest possible rating.
Just some ideas. What do others think?
I completely agree with Lea.
eBay can cross reference the DSR system with the Shipping Cost and time to delivery using the tracking number. This would really remove the DSR rating for the Shipping time and Shipping & Handling charge entirely.
Case closed!
Why can someone rate you on something that can be rated by eBay automatically? Oh…I guess to express their frustration with the postal services cost and handling times. The question should be “How do you feel about your postal service experience for this transaction?”
Sorry, Mike. I have to disagree with both you and Lea. When it comes to customer satisfaction, it just doesn’t matter who is “right” in this case. I just received my Starcraft II on release day via UPS Next Day Air from Amazon.com. I didn’t pay for next day air, I just paid standard shipping. But Amazon.com knows that for a new release, people care about getting it “that day”. That’s the e-commerce experience that eBay is competing with.
For what it’s worth, my DSRs continue to hover around 4.8 – 4.9, and I really don’t do anything special beyond shipping quickly with USPS the night the sale happens.
I’m actually really starting to embrace the ebay DSR system. It’s a great tool to deal with my competition. Most of us sellers strive for Powerseller and Top Rated Seller status, as well as the 20% discount that goes along with it. A very important piece of maintaining that status is keeping DSRs high.
I’m constantly looking for opportunities to ding my ebay competition that steal sales that would otherwise go to me. Purchasing the competitions items and leaving poor DSRs is simple and easy. Do it a few times and they loose their Powerseller and/or Top Rated Seller status.
Dinging the competition is especially easy when they are naïve enough to sell low priced items (< $5). The few dollars it costs me pays for itself big time in the long run.
I myself stopped selling low priced items completely because it wasn’t worth the risk.