eBay DSRs – the downside of transparency… or a Dashboard to declining GMV

March 25, 2009

ChannelAdvisor ChannelAdvisor By ChannelAdvisor

eBay recently released a nice enhancement to the eBay seller dashboard that gives sellers the ability to see more detail in their DSRs (I still argue a seller should be able to see it all vs. an eBay approved ‘slice’, but I digress).

One of the views is international vs. domestic both as a bar chart and you are able to see more details about the 1/2/3/4/5’s DSR scores from domestic and international sellers.
Here at eBay Strategies, since DSRs came out we’ve been talking about the fact that sellers with higher international sales rates suffer severely from those sales in DSRs.  In fact some of our strategies for DSRs are to carve off international or stop selling international all together.
The new transparency that eBay has provided in the dashboard is opening up this issue to a much broader set of sellers and the reaction has been interesting.
First, all of the eBay message boards that I track are lit up with shock that international DSRs are so low.
Second, and we see this in support requests at ChannelAdvisor, sellers are asking how they can stop selling internationally as quick as possible.
As we’ve been saying for over a year, the DSR system is full of unintentended consequences that actually incent sellers to things that I don’t think are aligned with what eBay wants.  For example, I don’t think the eBay management sat in a room wondering how to decrease their cross-border-trade (CBT in eBay-speak) as that’s a big part of the business and growing.  However they are achieving that and now with this new transparency, it is going to accelerate materially.
John Lawson is a top eBay seller and does some social media around ecommerce+eBay topics called ColderICE.  John had a great video on the topic that I’ve embedded here.  He does a better job of explaining this problem with real data from his dashboard than I’ve been able to do in the past:

 

DSRs – time to go!
eBay needs to either dump the DSR system altogether (a core part of my eBay 2.0 plan), or majorly revamp the system to try and fix all of the problems inherent in the way it was hastily implemented.  In conclusion, this new transparency proves that eBay’s DSR system get’s a 1 star –  whichis “very unreasonable” in DSR-land.  Or maybe “very innacurate” or “very unsatisfied” work better?
For all you Wall St. readers, I would add the severe decline of CBT as another headwind facing eBay’s recovery right now.  The company doesn’t report that piece of GMV as best I can tell, but looking across our customer base it was as high as 20% a while ago and is well on it’s way to 10% in the short term and I bet if eBay doesn’t fix this DSR system, it will go to sub 5%.  Layering that on top of the current GMV declines in auction+fixed price doesn’t paint a pretty picture.
eBay Seller Readers are you seeing a huge difference between your domestic and non-domestic buyer DSRs?  Do you plan to stop selling internationally as well?
SeekingAlpha Disclosure – I am long Amazon and Google.