eBay eliminates checks and money orders, promotes PayPal

Image representing eBay as depicted in CrunchBase

Image via CrunchBase

eBay recently announced that in late October it will be eliminating checks and money orders as valid payment options for eBay sales. Remaining valid payment methods are as follows.

  • PayPal, owned by eBay
  • ProPay, partnered with eBay
  • Credit or debit card payments direct to seller
  • Payment upon pickup

There are several categories that are exempt from the payment restrictions, including vehicles, real estate, some machinery and the mature audiences category.

Two of the line-item questions on the FAQ are answered in a way that directly answers yes that eBay is trying to eliminate third-party checkout and no to the availability of checkout services offered by Google and Amazon. They say that they’ll work closely to integrate eBay Certified Solution Providers into their eBay checkout in 2009. I guess that Google and Amazon are not allowed into the club.

This change in the payment polices of the Internet’s biggest online auctioneer, a term eBay both needs and can’t accept, follows a fee-change-based depreciation of what used to be its core auction business in favor of more retail sales methods found in its Buy It Now and eBay Stores listings.

eBay can’t be called an auctioneer if it wants to maintain a lack of responsibility for the items sold and remain exempt from auction legislation. It’s biggest legal defense has been we’re not an auctioneer. Every news story, however, adds the tag to eBay like it would define an acronym. Even though it’s becoming more and more difficult to find auctions on eBay, and even though it’s becoming more and more expensive to sell items in a true auction method, the media still refers to eBay as an auctioneer rather than a storefront.

eBay has greatly affected the auction industry. There are auctioneers who were devastated by it and auctioneers who were built by it. Many people falsely believed that because they sold items on eBay they were auctioneers.

eBay has brought the term auction into the forefront of people’s consciousness. This rebirth is good and bad. While the auction method of marketing is now more widely known and understood, it’s also more frequently assumed that when you say auction you mean an eBay auction. The frequency of this assumption is diminishing, but auctioneers have a long way to go to teach the public that there are many other types and methods of auctions than what can be found at ebay.com.

eBay has leveled the playing field. Where once some auctioneers had a solid market for certain antiques and collectibles, eBay stole their buyers away with the lure of sexier, cheaper, like-kind assets. Why wait for 30 minutes at an auction when you can log in and get the item for half what you would pay locally? The other side of the coin finds auctioneers who used to sell rarities for pennies to a small local crowd. The use of eBay’s massive buyer base – by either the auctioneer or the local crowd – skyrocketed their items from $10 lots to $1000 lots.

I’ve always hated eBay’s auctions. I hated the waiting. I used eBay on a regular basis a few years ago, and I would always select to filter for Buy It Now events because I wanted to enact a transaction and get the item. I didn’t want to have to worry about having to worry about it again later. In the same way customers can no longer afford to spend a day at a live auction, eBay is recognizing that for commodity assets, customers are no longer willing to wait to know if they’ve made a purchase or if they have to continue to shop.

As eBay swings more and more away from an auction marketplace and towards an ecommerce storefront model, the aspects that differentiate it from services like Amazon and Google Product Search disappear. eBay has already begun to lose both its dominance and its extraordinary income. As it does, it will look for ways to capture more of the transaction costs. What is the first and most logical way to capture non-commission-based revenue? Take a percentage of the payment. Forcing users to use PayPal means they get to dip from the payment as well as the sale.

Now I’m going to go to eBay and look for my Halloween costume among their Buy It Now listings.

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Aaron Traffas, CAI, ATS, CES

twitter.com/traffas | aarontraffas.com | aarontraffasband.com

Aaron Traffas, CAI, AMM, CES, is an auctioneer from Medicine Lodge, Kansas. He is currently community evangelist for Purple Wave in Manhattan, Kansas. Aaron serves as the current president elect for the Kansas Auctioneers Association and in the past has served on the National Auctioneers Association Education Institute Board of Trustees. He is a past instructor at CAI and co-wrote and instructed the ATS designation course from NAA. He currently instructs the Internet Auction Methods course offered by the NAA. During the summer, Aaron operates a farm in south central Kansas. Aaron is an active singer and songwriter and the Aaron Traffas Band's latest release, Enter: The Wind, can be found at iTunes, Amazon and Spotify.
  • Chad

    Ebay's greed will be the end of them. They among many other company's including sears and of course thousands of other companies seem never satisfied and they change things that work well. I would say if you can't be satisfied with something great then you are bound to lose. My name is Chad Henning and I'm going to re-shape the thinking of great business as a continue to push my idea's. Thanks for listening