EBay Metrics: What You Need to Know

October 15, 2014

Marketplaces Nic Dawson By Nic Dawson

Winston Churchill once said that ‘To improve is to change; to be perfect is to change often.’ This is a sentiment that we can also apply to eBay’s metrics, which require regular attention and optimisation. As a retailer, you should be keeping an eye on any changes eBay makes to its metrics so you can stay on top of your e-commerce sales.

The latest changes to eBay seller standards and performance measurement came into effect in August. If you haven’t already, it’s high time to read up on these changes and assess how they could be affecting your business. If you missed our introduction to the eBay Defect Rate blog post, you can read it here. As the festive season approaches, we think it’s worth reviewing these recent changes and what they mean for you.

EBay’s most recent metric update was based on identifying what’s important for buyers and what influences their decision to buy again. The eBay ethos: Sellers that offer great service create better shopping experiences and repeat sales. And it’s these retailers that stand to benefit from updates to seller performance standards.

6a00d83451d7ed69e201a73d8bace5970d-320wiHere’s the lowdown: Among other updates, in 2014 eBay introduced a new way to measure seller performance. The four individual detailed seller rating requirements have been overhauled and replaced by a metric known as the ‘defect rate’. This metric is the percentage of a seller’s successful transactions that have one or more of the following defects:

  • Seller ratings of 1, 2 or 3 for item as described
  • Detailed seller rating of 1 for shipping time
  • Negative or neutral feedback
  • Return initiated for reasons that indicate the item was not as described
  • eBay Money Back guarantee or PayPal purchase protection case opened for item not received or item not as described
  • Seller-cancelled transactions

What Does This Mean for Retailers?

EBay has tried to better balance its seller ratings, and as a result, sellers now have to stay on top of customer feedback across the board. This means identifying and responding to seller issues in a timely fashion and ensuring your product descriptions are on point.

When you receive a negative review, you should aim to get further feedback from buyers and, if need be, react by making changes (such as to your product descriptions). This will help boost future ratings. Likewise, it’s important to flag any ratings you think are unfair.

Ratings for retailers that sell 400 or fewer units per month are backtracked by 12 months, and ratings for retailers with over 400 units are based on feedback from the last three months. So the sooner you put these processes in place, the sooner you can enjoy the benefits of being in the top percentile.

What Are the Targets?

EBay has also changed how it measures these defects. Now, up to 5% of a seller’s transactions can have one or more defect (and now each transaction is counted only once toward your defect rate, regardless of the number of defects associated with it). Those that achieve 2% and below qualify for Top Rated Seller status based on a minimum of five unique buyers. Additionally, eBay considers sellers with 5% and lower to be below standard based on a minimum of eight unique buyers.

What Else Is Different?

Sellers no longer need a 98% positive feedback requirement to earn Top Rated Seller status. Buyers, however, are still able to see this rating, which affects your conversion rates.

Your shipping cost and communication are no longer be counted towards your performance ratings, which protects you from low ratings towards shipping cost. Additionally, cases found in your favour through an eBay or PayPal escalation won’t count towards your performance rating.

If you want to dispute a customer’s feedback, you can request that feedback be removed from eBay under its feedback removal policy.

Screen Shot 2014-10-15 at 11.42.28How Do I Deal with Holiday Sales?

  • Extended holiday returns are required for Top Rated statuses on listings (making them eligible for the Top Rated seal and value fee discount). Between 1 November and 31 December, all listings must offer the new extended holiday return option. It’s worth noting that if you don’t offer this extended return, it doesn’t mean you’ll lose your Top Rated Seller status. You’ll just lose the seal and the associated discounts for each item.
  • Like in the past, same-day or one-day handling is required, as well as a 14-day (or more) money back return policy when holiday returns aren’t in effect.
  • Valid tracking numbers must be uploaded within your stated handling time for 90% of all transactions — and must be validated by eBay. This can be any scan in the delivery process, including the final delivery, as long as it falls within your evaluation period.

Why Is The Defect Rate Important?

Your defect rate isn’t visible to buyers, so why should you monitor it? If you maintain a low defect rate, eBay will reward you with an enhanced position in Best Match search results. The better your Best Match ranking, the more likely you are to see an increase in conversions.

Additionally, you can benefit from the 20% final-value fee discounts that eBay offers to Top Rated Sellers. Not too shabby!

5 Tips to Improve Your eBay Metrics

  1. Stay on top of your seller performance: Regularly check your eBay Seller Dashboard to get familiar with your defect rating. Run a report for your defects and investigate why you received them so you can avoid future negatives.
  2. Focus on quality: Conduct a regular audit of your listings to make sure they’re up to date and accurate. If you receive any negative feedback about your product descriptions, use it as an opportunity to rectify any inconsistencies.
  3. Deliver on your shipping promises: Make sure you ship promptly and upload valid tracking details from carriers with scans that eBay can validate.
  4. Excel with customer service: If you receive any complaints or disputes, work hard to resolve them as quickly as possible.
  5. Keep an eye on inventory: Don’t put all the effort into converting a customer only to realise that you don’t have a product in stock. Make sure your inventory numbers are accurate on eBay so you don’t oversell.

If you have any questions about eBay’s metrics, feel free to contact the team at ChannelAdvisor. (After all, Winston may not be able to get back to you!)
Looking for more practical eBay tips? Check out our eBook about The 10 eBay Mistakes That Are Costing You Sales.



Blog post by: Nic Dawson, campaign manager, EMEA, at ChannelAdvisor