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No eBay Motors Insertion Fees, BUT.....

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by Chad Polk on 14 August 2008, 20:11 0 comments , 323 views
Tags: ebay motors
Date of Last Edit: 9/12/2008

Ok, let's take a quick dive into this new pricing model (assuming you read the previous post).  The scenario below assumes no listing enhancements (category featured, bold, highlight, icons, etc) for simplicity sake.

Pricing Today:
Dealer lists 10 cars on eBay Motors
Insertion fees $400 ($40/listing)
Successfully sell 4 cars on eBay Motors
Final valuation fees (aka Transaction Fees) $200 ($50/successful sale)
TOTAL Out-of-Pocket: $600

Pricing as of Sept 2:
Dealer lists 10 cars on eBay Motors
Insertion fee on first 4 cars $0
Insertion fee on next 6 cars $120
Successfully sell 4 cars on eBay Motors
Final valuation fee (aka Transaction Fees) $500 ($125/successful sale on first 4).
TOTAL Out-of-Pocket: $620

Not bad so far huh?  Now lets take in that eBay Motors old timer dealer who is a high volume seller on the site.

Pricing Today:
Dealer lists 30 cars on eBay Motors
Insertion fees $1200 ($40/listing)
Successfully sell 12 cars on eBay Motors
Final valuation fees $600 ($50/successful sale)
TOTAL Out-of-Pocket: $1800

Pricing as of Sept 2:
Dealer lists 30 cars on eBay Motors
Insertion fee on first 4 cars $0
Insertion fee on next 24 cars $480
Successfully sell 12 cars on eBay Motors
Final valuation fees $500 ($125/successful sale on first 4)
Final valuation fees $800 ($100/successful sale > 4)
TOTAL Out-of-Pocket: $1780

So what is this pricing designed to do?  First let me set somewhat of a timeline:

  1. 2007 NADA eBay Motors Local Market is launched to penetrate dealerships that they were previously not in.  List your entire inventory for $1000 in a 100 mile radius of your store.  Never really caught on and flooded the site with inventory and the same number of eyeballs (hurting existing eBay Motors faithfuls...classic supply and demand).
  2. eBay Motors 2.0 website is live.  This turned out to be a really good site for car shopping and more.
  3. eBay Motors team opens up the ability for any provider under the sun to send them a data file outside of the API.  Let's just circumvent all of our longstanding Preferred Solution Providers (aka AutoRevo) and let mom & pop company post incomplete listings.
  4. eBay Motors teams up with OEMs to pump inventory to the site and lands GM.  Again more inventory same number of eyeballs.
  5. 2008 is full of top secret pricing promotions and evidently they found one they liked.

Ok, so what does this pricing do?

  1. Encourages new dealers to come to the site and list inventory.
  2. Increases the number of listings on the site (aka increases supply with same level of demand)
  3. Reduces the amount of clicks on existing eBay Motors dealer listings (now there is more inventory on the site).

With all of this said, I want to know 2 things:

  1. How are they going to get more viewers on eBay Motors?
  2. Why can't Motors do what they were good at....advertising nationally for car dealers.  The geographic scope of selling cars is expanding everyday.  They were in that space and did it very well.  Plus no one else was in that space!!!???

At the end of the day where is the cost savings for existing customers, increase in sales, or added value created?

Comments anyone....

Current fee schedule: http://pages.ebay.com/help/sell/motorfees.html

New fee schedule: http://pages.motors.ebay.com/pricing/vehicles0903/

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