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EBay study questions value of Google's main ad service

reuters.com

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Re: EBay study questions value of Google's main ad service

#21

Post by potatolicious »

sounds wrote: post #6

I should disclose that I haven't shopped on eBay in many years. Here's why, and why it's relevant: I have a terrible experience on eBay. The prices are great until the excessive shipping is added. Until payment I can generally get a response from the seller but after that it's like I don't exist. Then there are the outright scams. And please note, I'm a _buyer_. I shudder to think that I should ever be a seller on eB…

Ditto, I haven't gotten anything off eBay in ages. The last time I did was from a guy who made his own camera grips and, for some reason that I will never understand, exclusively uses eBay to sell his goods.

My other problem with eBay is that in some categories the pricing is just wholly unrealistic. Specifically used/vintage cameras - the initial and ending prices on these items on eBay is often much higher than what the same cameras are trading for on enthusiast forums. The demographic of people collecting these on enthusiast forums vs. those buying the same items on eBay is clearly different.

Re: EBay study questions value of Google's main ad service

#22

Post by lingben »

sounds wrote: post #6

I should disclose that I haven't shopped on eBay in many years. Here's why, and why it's relevant: I have a terrible experience on eBay. The prices are great until the excessive shipping is added. Until payment I can generally get a response from the seller but after that it's like I don't exist. Then there are the outright scams. And please note, I'm a _buyer_. I shudder to think that I should ever be a seller on eB…

I just used eBay for the first time! you can rank products based on price+shipping, or just price. found it very useful

Re: EBay study questions value of Google's main ad service

#23

Post by daigoba66 »

hluska wrote: post #11
sounds wrote: post #6

I should disclose that I haven't shopped on eBay in many years. Here's why, and why it's relevant: I have a terrible experience on eBay. The prices are great until the excessive shipping is added. Until payment I can generally get a response from the seller but after that it's like I don't exist. Then there are the outright scams. And please note, I'm a _buyer_. I shudder to think that I should ever be a seller on eB…

I tried selling with eBay and didn't have a whole lot of luck. I never actually received a bid and felt like I was paying fees to become a target of phishing scams... Without hyperbole, I'd rather set up shop on a blanket on the sidewalk than do business with eBay.

Years ago I tried selling a laptop on eBay. The "winner" ended up being someone trying to scam me by having me ship before paying or something, I don't completely remember.

Anyway, the worst part is that eBay collected the listing fees before the auction was handed over to the fraud dept. I got my fees refunded, but in the form of credit. So now every month, for the past 10 years or so, I get a e-mail from eBay reminding me of my current account balance of -$26 and change.

Re: EBay study questions value of Google's main ad service

#25

Post by wildwood »

mistercow wrote: post #16

The problem with this kind of analysis is that it's to short-sighted. The main benefit of advertising has never been direct conversions. Rather, the main benefit is keeping the brand in people's minds, so that they'll be more likely to come to you in the future. When Coke buys a commercial slot on a TV network, do they expect someone to say "Holy crap, I need to drink a Coke right now!", turn off their TV, and drive…

The PPC model is essentially the same model as Direct Response Marketing, just more fine-grained.

Both of these, if used properly, can make insane amounts of money for a company. And, if used improperly, they are little more than a money sink.

Re: EBay study questions value of Google's main ad service

#26

Post by rfergie »

gav wrote: post #17
rfergie wrote: post #14

I have run similar tests myself for a variety of clients. Some end up with the same result as ebay; brand terms generate sales, but the incremental value of this is not worth the media spend. For others, brand search advertising is a complete no brainer and they make a lot of money doing it.

It really depends on the market. I've found that brand terms can convert really well if you can drive them to a targeted microsite or similar segmented area. Usually it means that the customer is far down the purchase funnel, a search for "washing machine" may be just research, "whirlpool washing machine" can mean the brand part of the decision is already made ("whirlpool duet" is even better).

When I say "brand terms" I mean queries for the site's own brand. For example "washing machines on ebay". I've never seen these keywords not convert well; the question is how many of these people would convert anyway even without the advert.

Re: EBay study questions value of Google's main ad service

#27

Post by wildwood »

rfergie wrote: post #26
gav wrote: post #17

Earlier quoted context omitted.

It really depends on the market. I've found that brand terms can convert really well if you can drive them to a targeted microsite or similar segmented area. Usually it means that the customer is far down the purchase funnel, a search for "washing machine" may be just research, "whirlpool washing machine" can mean the brand part of the decision is already made ("whirlpool duet" is even better).

When I say "brand terms" I mean queries for the site's own brand. For example "washing machines on ebay". I've never seen these keywords not convert well; the question is how many of these people would convert anyway even without the advert.

That's why it's so important to track the natural search traffic you're getting by search query, and line it up against the paid search traffic.

If you have strong natural search traffic on the term, then you should be able to scale back your bid on that paid search term without much risk.

Re: EBay study questions value of Google's main ad service

#28

Post by duskwuff »

UnoriginalGuy wrote: post #15
sounds wrote: post #6

I should disclose that I haven't shopped on eBay in many years. Here's why, and why it's relevant: I have a terrible experience on eBay. The prices are great until the excessive shipping is added. Until payment I can generally get a response from the seller but after that it's like I don't exist. Then there are the outright scams. And please note, I'm a _buyer_. I shudder to think that I should ever be a seller on eB…

Can I just bring up etsy here? It seems to me that eBay's most dangerous competition is etsy along with perhaps Amazon's "sellers." You have etsy eating most of eBay's "we make it ourselves" market and you have Amazon which lets people buy "new" goods cheaper with less hassle than the eBay/PayPal mess. You also have Craigslist going after eBay local... The only niche eBay really has right now is cheap Chinese/HK dire…

Etsy really isn't competition for eBay, at least unless they change their policies significantly. They explicitly ban mass-produced items.

Re: EBay study questions value of Google's main ad service

#29

Post by ChuckMcM »

I think this tells a more nuanced story than just "clicks aren't worth it."

Search advertising has been very lucrative for a lot of people, this was especially true when there were few contested keywords and the cost to land on a page was low by comparison.

However, if you look at Google's results over time, they grew spectacularly as they added advertisers and their price per placement was growing. Then the growth of advertisers slowed because there are only so many of them in the world, and in their latest results you can see that the price per click has stabilized (and declined slightly) as well. Both of those point to a maturing of the search advertising market.

My guess, and it's only a guess, is that Google's revenue from search ads has peaked. (Peak Ads anyone :-)) and going forward the dynamics of that market will be a lot more subtle. More complex advertising packages will be created that increase the total number of pages where ads are shown but do so in a way that spreads cost around (like discounting a front page add if enough "page 3" ads are bought at the top of that page).

Re: EBay study questions value of Google's main ad service

#30

Post by ecolak »

This is not news, this is something very basic related to direct navigation traffic vs. paid traffic. If 50% of traffic is through direct navigation (ppl typing www.yourcompany.com on their browser to land on your site), and Google ads can bring you the other 50%, then that's great, otherwise not. Saying that people would've come anyway sounds amateurish and easy to measure. Stop buying ads and compare your traffic to your prior traffic. Direct nav. traffic for big brands such as Amazon and Ebay is around 50% of their total traffic, so obviously they benefit less from Google ads then companies whose direct nav. traffic is 5%...
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