eBay attempts to welcome back store owners

Company promises to increase merchant store visibility, while keeping selling fees at same level

After making a series of decisions that frustrated some merchants, eBay is wooing store owners.

If a speech from Bill Cobb, president of eBay North America, hints at future relationships between the company and its sellers, the message is to keep your doors open. During a Thursday keynote at eBay's annual sellers convention, Cobb pledged not to increase merchant selling fees this July and said that the stores category will return to the eBay page header within 30 days.

In addition to offering its main auction listings, eBay allows merchants to set up shops and sell wares at fixed prices. Last July relations between store owners and eBay grew contentious when eBay announced an effort "rebalance the overall eBay marketplace," which had seen store listings eclipse auctions listings. The rebalancing meant higher store fees as of last August, and in April the stores tab was removed from eBay page headers.

"For eBay Stores, the last 10 months have been a transition. We are committed to the long-term success of eBay Store owners," Cobb said. While store owners didn't welcome last August's fees, Cobb said he is pleased with the realignment's progress.

Additional efforts to court store owners include 24-hour phone support for Featured eBay Store owners and a reduction in Anchor Store monthly fees.

Among a raft of other initiatives for sellers, Cobb announced a temporary reduction in the Final Value Fee, a charge tacked on to an item's final selling price. Visual navigation, in which photographs play a prominent role in navigation, will be introduced to more categories.

PayPal president Rajiv Dutta addressed merchant security during his portion of the keynote.

"We heard the message on fraud. We know it's a top challenge. I am personally committed to keeping fraudsters off the site," Dutta said.

In an effort to combat phishing, PayPal, eBay's payment division, will make the PayPal Security Key available to all eBay and PayPal users on Friday. The security key device, previously in beta testing, generates unique security codes in 30-second intervals. Users then enter the code when logging on to their PayPal or eBay account.

In August PayPal will launch a payment review system that flags "transactions that pose a risk." The questionable transaction is highlighted, and the seller is told to wait on shipping the item until PayPal confirms that the buyer's account contains adequate purchasing funds.

Meg Whitman, eBay president and CEO, opened the keynote and emphasized that the company is suited to reach its goal of connecting people through three of its divisions. Finding, buying, communicating, entertaining, and paying are main Internet activities, she said. eBay fulfills the buying aspect, PayPal handles payment functions, and VoIP provider Skype, which the company purchased in 2005, provides communication services.

"The lines between finding and buying are blurring. At the core the company is about connecting people," Whitman said.

As eBay executives discussed staying linked and protected, some sellers said they felt a disconnect from the company.

"I'm happy to hear that stores are going back in the header," said Maria Ginter, who sells furniture and home decor on eBay.

Ginter was less impressed that eBay is no longer advertising on Google after a spat this week over a Google event to promote its own online payment system, Google Checkout.

"That's how people find my furniture," she said.

Deb Martin, who sells collectible figurines on her store wanted to hear of security efforts to crack down on dishonest buyers who create new user identifications solely to commit more fraud.

"Buyers have no incentive to keep their name. They just restart their IDs and log back in."

She also questioned the merits behind the temporary fee reduction and saw it as an effort to boost quarterly revenue and benefit shareholders.

Although eBay is emphasizing its auctions, one merchant thinks that form of e-commerce has faded.

"A lot of people are over bidding. They're just buying now," said Judy Pykhoff, who operates the Red Cougar Trading Post store on eBay.

Copyright © 2007 IDG Communications, Inc.

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