EBay’s bizarre pricing models
By admin | Posted in Tech Rant | No CommentseBay Inc. Online auction site cheats its sellers wherever possible Part 1.
EBay Inc. (eBay) provides an online marketplace for the sale of goods and services, online payments services and online communication offerings to a diverse community of individuals and businesses.
So how is it cheating its sellers? On several levels, firstly on its pricing model; the online behemoth tries its hardest to confuse sellers as to what they actually charge. Instead of having a flat rate across categories, they opt to have a double or triple calculation of costs in fact we don’t even know what it is. You need an accountant just to work out what they are charging you:
EBay chose to charge sellers a listing fee or “insertion fee”, and depending on the items cost can vary at the following percentages:
2.4%, 4.8%, 0.96%. It is not explained as a simple percentage, but as a cost per item value.
Tthen you have their “final value fee”. If we take the last one on the list as an example $1000 we can see that it says: 5.25% of the initial $25.00 ($1.31), plus 3.25% of the initial $25.01 - $1,000.00 ($31.69), plus 1.50% of the remaining closing value balance ($1000.01 - closing value).
The only thing we can decipher from this bizarre pricing strategy is that they try to make it as confusing as possible to disguise what you are actually paying. It makes sense somewhat as the average Joe won’t sit there and calculate the exact percentage based on what his item sold for as there are multiple “charges”. On top of these you have various insertion top-up charges like placing the item in BOLD, having it listed on the featured items (hugely expensive).
What would be wrong with a simple percentage based on price or category, making the whole selling process easier?
