Marketplaces Like Amazon, eBay, and Etsy Test All The Time
We recently posted a story about eBay Australia suggesting that eBay in Australia may be testing a marketing strategy. Unfortunately, a lack of clear communication from eBay on that story (they did reach out, please read the updates we added) has not made the situation anymore more clear.
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This post is not about that story directly, but it made us think about platform testing and how it may impact sellers.
It is not the first time that sellers have reported on Facebook groups, marketplace community forums, or to other sites covering small business eCommerce that platforms were involved in “involuntary” testing.
Many of these reports we have seen are relatively benign tests, nothing that should raise any major concerns. But there is a group of sellers that have increasingly become more suspicious of marketplace manipulating listings.
Some of this suspicion comes from the fact that marketplaces are changing. They are adapting to new realities in eCommerce, and they have to make a business decision that favors a larger group of seller versus a small group.
That may even mean they know they may lose a few sellers due to a change in policy or due to a platform change. However, in the big picture, they gain more sellers or provide better opportunities for buyers to find items.
It is a tough decision, and certainly, no business wants to alienate buyers or sellers. But sometimes it is a necessary byproduct to keep the overall marketplace competitive.
Having said this, we wonder if there isn’t a more open way to communicate with sellers about trials on live listings.
Etsy, for example, maintains a page that discloses existing marketplace tests. If a marketplace has a community forum, there is an opportunity to offer updates on limited tests as well.
Another option could be to ask sellers if they are willing to participate in live tests. An Opt-In function, maybe even under an NDA (Non-Disclosure Agreement).
If a seller opts in, they should receive notifications of any live listings that have become part of a test and in exchange could be offered an incentive such as waived fees for that listing.
Those are only two suggestions and there could be others depending on what makes sense for a specific marketplace.
Changing Pricing or Other Pertinent Details of The Item
A more problematic issue for marketplaces are marketing strategy tests that may involve purchase incentives.
It is possible a marketplace may want to test offering a special discount based on a shopper’s recent behavior. AI is becoming more critical in today’s marketing, so AI-powered marketing to influence shopping behavior could be a handy tool to increase conversion.
First of all, if the marketplace were to do such a test, certainly, we would hope they would pay for any difference between the listing price and final selling price.
And this is a type of test where the seller really needs to be aware this might be happening. Especially if the seller is in the U.S.
We assume U.S. marketplace operators are well aware of U.S. contract laws that bind some sellers to manufacturer dictated pricing programs such as MAP (Minimum Advertised Price) or “Colgate,” a requirement by the authorized dealer to sell the product at a specific price level.
Even adding “Make Offer” to a listing without a seller’s consent could be a huge problem for a U.S. seller that has to list products according to the Colgate doctrine.
Under the Colgate doctrine, a single violation by the seller would require the manufacturer or brand/trademark holder to terminate the dealer/distribution agreement immediately.
Clearly, that would open up litigation issues if a seller’s price was manipulated by a third party.
Bottom line to platform testing is a bit of clarity. It seems there is a significant mistrust among some sellers for no other reason but that some platforms are not openly disclosing such tests.
Etsy seems to be the one outliers in this area as they provide a method for sellers to check on current tests.
Certainly, anything involving instant coupons, price reductions, etc. is a potential legal issue for US-based sellers that list brand name products.
The use of pricing policies among major brand names is up, and more companies provide enforcement services to these brands.
And this has become a coveted group of sellers as they can list thousands of products, often with high-quality images and copy provided by the brands.
We would love to hear your thoughts on the subject of platform testing. Head over to our Facebook Discussion Group or use the comments section below.
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Richard is co-founder of eSeller365. He has over 17 years of experience on eBay which includes tens of thousands of sales to buyers in over 100 countries and even has experience with eBay’s VeRO program enforcing intellectual property rights for a former employer. And for about two years Richard sold products on Amazon using Amazon FBA in the US.
To “relax” from the daily business grind, for a few weekends a year, he also works for IMSA as a professional race official.
While Etsy does have a test page, they don’t list all tests there. The page usually omits search algorithm tests, and sometimes Etsy removes tests from the page, so there is no public record. Also, the completed tests section never describes any test as having a negative effect – they are all listed as positive or neutral. I guess the ones that disappear were the ones that had a negative impact?
I am sure the test page from Etsy doesn’t show everything. I understand the need for platforms to have a competitive advantage so they don’t want to show their hands all the time. But unlike many others, it is better than nothing. I have also seen more communication in general on Etsy’s community forums taking feedback from sellers on tests. Of course, Etsy is smaller than eBay or Amazon, but still they at least appear to be more proactive than the other marketplaces.
Ultimately, it would be best to have an opt-in program. For sellers with a lot of listings, opting into beta tests would likely not be a big problem, but for sellers with small number of listings, a test that is not showing the expected results can have a tremendous impact. At least with an opt-in, there is a choice, but that amy also require offering some form of incentive as well.
Thank you for your comment
I agree that some communication is better than nothing, but I do see it becoming misleading in many situations, as it can be manipulated (e.g., no tests are reported as having a negative impact, which seems impossible!)
Most tests on Etsy are done by visitor, not by shop/seller, so some buyers/visitors see the test & others do not. That means that shops should be affected equally. As you know, opt-in tests won’t work for almost all types of A/B testing; you want realistic behaviours, not subjects who choose to be analyzed as they shop. (Almost all tests done on shops are for the backend features, and many of them are opt-in.)