Ask yourself a question … If, within your business, you introduced a policy that was flawed and detrimental to your customer retention, however well intentioned towards your customers’ customers, what would you do about it?

Have a careful think about that for a moment, then decide which of the following options your response fits into.

Does your response fall under -

1. Reverse the policy introduction (scrap it)?
2. Modify the policy?
3. Patch the policy with another policy?
4. Introduce a fourth party to make good the shortfalls of the new policy?

It doesn’t matter where you trade from, or where you trade to, I think pretty much every paying eBay customer is in agreement that there are fundamental flaws in the now two year old Detailed Seller Rating (DSRs) system.

When it was introduced in 2007, it was stated that it was to be only a method of buyers leaving more detailed information about the seller and transaction, for the advisement of potential future buyers.  All that changed in January 2008 with announcements that in the ensuing few months it would have direct impact on sellers businesses at a sales volume and cost overheads level.  That’s when the real outcry against the flaws began.

I’m not going to reiterate here all the tales of woe and accusations of manipulation that flooded the Internet throughout 2008.  Those points have been made ad-nauseum.  The one point I will mention again relates directly to what myself and several other international sellers identified on Monday night at eBay’s Top Seller Summit in Chiang Mai, Thailand.

In summary the flaw affecting all cross-border sellers, regardless of location, is that Shipping DSRs disadvantage all international merchants from several levels -

• eBay buyers generally do not read information supplied by sellers or eBay, and rate sellers upon incorrect perceptions of location, transit time, and costs.
• eBay have still not carried out sufficient Buyer-training with regards to the intent of DSRs.
• eBay have tried, but still fail to deliver the message that Despatch Time is not Total Delivery Time.
• eBay’s on-site messaging to buyers continues in the vein of “trash the seller’s reputation, they can’t do the same back to you”.
• eBay have still not built-in DSR Policy weighting for distance between Buyer and Seller, nor for the vagaries and perniciousness of government agencies such as Customs Depts and Homeland Security interventions.
• eBay have still not built-in regional DSR system-blockages for times of natural emergency such as the recent winter storms in the US, or the Australian floods and bushfires, where giving or receiving any DSRs to affected eBayers may be completely unfair.
• eBay’s own statistical data shows that sellers offering “free” shipping are still not getting maximum DSR points at all times.

Those are just six of the unaddressed system flaws that cause paying eBay customers to have ongoing problems related to cross border transactions.

On their part, eBay have made token efforts to improve messaging to buyers during the feedback-leaving flow, both for international transactions and for those where shipping costs were masked into the item price (the so-called “free” shipping).  It would seem that, that is considered enough internal adjustment by eBay, and they are now approaching the above criticisms from a different perspective.

Recognising that a major problem exists with the Despatch Time DSR for South East Asian sellers, eBay have decided the fault lies not with the fundamental construction of the DSR system, but with the shipping methods used by the sellers.  In a nutshell, eBay appear unhappy that so many sellers are using the cheaper costing postal services for delivery, and blame this for the depressed shipping time DSRs (despite SE Asian sellers also having depressed Shipping Cost DSRs compared to western country sellers).  PayPal too have an issue with the SE Asian post offices’ lack of consistency with recording registered deliveries (at both point of despatch and upon receiving delivery confirmation from foreign post offices).

Sounds like fair logic from eBay?  OK, but remember the drive towards all listings having the shipping cost buried in the item price, and thus the increased insertion and Final Value Fees that accompanies that practice.  Then imagine the additional fee revenue for eBay if everyone switched from post office services to courier-based services.  Got that logic embedded?  OK, read on …

Enter DHL international couriers. The Thailand Top Seller Summit positioned DHL as the answer to ever SE Asian seller’s prayers.  Hmmm.  Not many people were convinced.  In fact it was largely greeted with indifference or dismissal, and a large contingent of the foreign traders present took the DHL presentation as an opportunity to go outside for a smoke break.  ‘Nuff said?

Part of the problem with the DHL presentation was that the oral delivery was 100% in Thai language, the handouts and literature were 100% in Thai language, and only the on-screen slides were in English.  This despite it being an international audience, and the international language is … ?

Additionally, those slides were essentially targeted at Bangkok-based businesses (700 Km south of where the summit was held) and much of the data relating to transit time, drop-off points, and other services were simply not applicable to Chiang Mai, or anywhere in the North of Thailand, and therefore largely irrelevant.  As a globalised company, I certainly expected better from DHL’s presentation.

The DHL & eBay staff announced that coming within the next month, a special promotion will be embedded whereby SE Asian sellers will receive a 33% discount on DHL rates, including free packaging supplies and home or office collection.  However, the problem still remains regarding price.  How much does DHL cost?

How do you convince a UK or US buyer of a $5.00 item that they should pay $40.00 for courier delivery, in order to have online-tracked shipping, in order to protect the Seller’s PayPal SPP eligibility?  How will offering such rates reduce the number of listings tagged by western users for excessive Shipping & Handling charges?  The answers obviously are that it will not help at all.

Where courier shipping may become useful is in the larger and high value shipments, although the insurance offering DHL presented is pitiful in comparison to that of the Thai Post Office, and far more expensive.  There should be no reason for this as DHL use their own transport from end to end, including their own fleet of aircraft … and remember, eBay does not allow sellers to self-insure shipments, they must use a recognised third-party insurance provider – does eBay recognise DHL’s insurance cover?

Here’s a couple of shipping comparisons.  The comparison conditions are typed here before visiting the Thai Post Office and DHL sites for rates, so maybe I’ll get a surprise.  Both sample shipments are from packages that I regularly ship, from Thailand to the UK and North America.  (This bit is “live-blogging”.)

Exchange rate today is roughly THB 33.00 to US $1.00, and THB 49.00 to GBP 1.00

Comparison 1 - based on a $10.00 item fitting in a medium sized jiffy bag, and total package weight of 200g.

• ThaiPost -
  • Registered Delivery THB 55.00 (includes insurance to approx $15.00)
  • Airmail (letter rate 7-21 days) THB 150.00 to UK, THB 190 to USA
• Total cost THB 205 (UK), THB 245.00 (USA)

• DHL –
  • Oh dear … a thorough scour of the DHL website shows you have to open an account before they’ll even let you see costs for a comparison.
  • Well that’s a non-starter then, and completely against the law in Thailand, where the law states that all products must be visibly and publicly priced – not that many businesses here take much notice of that.

Comparison 2 - ermmm – why bother?  If DHL want to hide their prices behind a requirement for opening an account, then I have no visibility of any incentive to switch from using the open and transparent postal system.  I’m certainly not going to open an account just to be able to see whether or not their prices make them worth considering.

So, eBay, you have failed to give me a solution to my shipping DSR problems.

This element of the entire summit was really the low point.  I was enthused and remotivated by all the other segments, but this one was a real depressor.  As a cynical commentator, it made me feel that the message from eBay regarding the DSR problems was really, “we’ve made a problem for you, spend money or get over it, we’re not going to fix it”.  Such a stance being the exact opposite of the customer service eBay demands we deliver to eBay buyers.

In defence of the eBay SE Asia team, I also had the impression that they really did not like this situation and messaging, but that their actions were being controlled from California.  We should all remember that eBay staff are real people, and that the majority of them have very similar feelings and emotions to the rest of us.  Unfortunately, in a tightening economy, it’s not so easy to just leave a job in protest at new policies, because there’s no certainty of obtaining a replacement income – and even less so with the traumas being thrust upon the eBay marketplaces worldwide.  It’s no longer a sure-fire salary replacement, nor is it a single marketplace anymore.

Are you a seller affected by the shipping DSRs issue, or a buyer who feels shipping time and cost from SE Asia is impracticable?  Leave your comments below.

If you can find how to get the rates from the DHL site without opening an account, post the link in a comment, and I’ll complete the comparisons above.

Gaz

Tomorrow – a look at MerchantRun GlobalLink, the other 3rd-party at the Summit.  I’ve been trialling their system, and so will be able to give a better opinion than from just the info they presented on Monday night.