In the past 12 months, Amazon.com has managed to give eBay a run for the money when it comes to traffic. The number of unique visitors to Amazon.com surpassed eBay in November and December 2008, January 2009, but this year's run-up to the holiday shopping season sees Amazon beating eBay in unique visitors earlier this year - in the month of September.
In fact, as I note in Monday's Newsflash news article, eBay is having its worst September in 5 years in terms of traffic, both in unique visitors to the site and number of page views.
So what is causing eBay's drop in visitors? Certainly, Google may be a contributing factor to eBay's traffic decline, with users noting eBay pages not showing as high in natural Google search as they once did. In addition, eBay sellers have been complaining about the Google Base feeds since the search engine company imposed new Item Condition attributes, a problem eBay
acknowledged last month.
In a research note published this weekend, Citigroup's Mark Mahaney noted several areas of concern, including a "flat to declining U.S. user base" and " increased high-end, lowend competition from Amazon, Craigslist, etc…" (He called the third quarter "mixed," see his
report online in PDF format.)
In addition to hosting ecommerce, eBay used to be a community site where buyers and sellers gathered to talk about fashion, collecting, and more. These days, Amazon, Craigslist, Etsy, Bonanzle, storefronts, and social media sites may all be siphoning traffic away from eBay, which laid off most of its staff in charge of community.
And despite today's
AdAge article that talks about eBay's fix to customer service, sellers continue to complain about frustrating experiences dealing with support. After eBay laid off 10 percent of its global workforce late last year, it laid off 700 customer service reps in Canada and another 400 in Germany, while only replacing a fraction of them.
eBay itself has made some radical changes beginning in 2008 to combat slowing growth. It is arguable as to whether some of those changes, particularly to the feedback system and search algorithm - and the sheer number of changes users have to adapt to - are contributing to traffic declines. It is an understatement to say eBay is much more complicated than in the past.
eBay's top management and Wall Street analysts seem convinced that auctions are a liability (AdAge says eBay is "riddled" with auctions, while Citigroup refers to auctions as an anchor). It seems they have forgotten eBay's innate strength - a perfect marketplace where sellers list what buyers want, and supply-and-demand works organically. It seems the more eBay dictates what sellers "should" be selling, the more they get away from the model that made eBay such a success.
Amazon.com Traffic Exceeds eBay in September 
