Thursday, July 10, 2008

Proposal For Class Action Lawsuit Against eBay For Errant & Unfair Feedback System Changes

In May 2007, eBay began implementing changes to its feedback system - changes that were long overdue as the auction site had a matured user base and generally more savvy users joining up than when it first started.

For the first few months - it seemed as though my feedback score had dropped from several thousand to several dozen because more people were paying attention to the detailed seller ratings.

My "detailed seller rating" yielded a 94% equivalent - while my actual positive feedback was 99.5%.

The two main changes eBay has implemented in the past year have been Detailed Seller Ratings and stripping the ability of a seller to post negative feedback.

At first, I thought that the detailed seller ratings were a good idea. I thought that prompting eBayers on what to say would prompt them to say more things positive. Instead, it seems to have made most eBay buyers more picayune.

Today, while trying to understand how eBay is calculating a 99.6% positive rating for my eBay ID - I noticed this equation when I rolled over "How are feedback percentages calculated?"

The Positive Feedback percentage is calculated based on the total number of feedback ratings received in the last 12 months, excluding Repeat Feedback from the same member in the same week.

Note: This could mean that the number of ratings used for this calculation is different from the same number shown in the Recent Ratings table on the left.

Positives + Neutrals + Negatives

This member's 12 Month Feedback ratings
Positives: 268 Neutrals: 1 Negatives: 0

This member's Positive Feedback percentage

268 + 1 + 0 = 99.6%

In the last 12 months I have 293 positives. Using that percentage I would have a 99.7% rating. * If you observe - even eBay shows I have 293 feedback comments. (Verified by counting one by one. I had no repeat buyers comments within one week.)

It's hard to know if this affects my sales or whether most eBayers notice. All I know is; that I notice.

Secondly, I have a detailed seller rating of 4.6 stars for shipping charges and not a perfect 5.0 stars. How is this possible when I haven't charged for shipping in over a year AND my sales price (including shipping) is purposely priced lower than final end price averages. Either this percentage isn't being calculated properly either or eBay is allowing buyers a new way to hurt sellers.

Notice how I have only 166 Detailed Seller Ratings but 293 positives - this is impossible. This means that I am missing more than 125 Detailed Seller Ratings that calculate what my score is and therefore what I pay to list on eBay.

Previously, it was hard to quantify if a negative meant anything to sales - but now eBay gives discounts to sellers that have high "Detailed Seller Ratings". If they refuse to calculate this percentage properly - how can they provide this discount fairly?

Here is an interview I conducted with a eBay blogger who wished to keep their eBay ID and identity private:

How long have you been on eBay?

6 years

Were you a buyer before you were a seller?


What is your opinion of the detailed seller rating system?

My major problem is that the DSRs are not disclosed.

Because I'm a PowerSeller, my invoice and the amount I pay every week is directly linked to [how high] my DSR rating is. On the flip side, how much ebay makes off of me is directly linked to how well my non-disclosed DSR ratings are doing.

This means it is open to fraud.

The same day that Ebay decided to make it so that 4.9 (30 day DSR) gives you a 20% discount on your final value fees my non-disclosed ratings went from 4.95 to 4.89.

I have also seen my DSR numbers drop, on the feedback page. The number that shows how many ratings you have received. This has happened twice. They should not drop because they are based on 12 months of ratings, and this program has not been in operation for 12 months yet (as of July 2008).

* FixYourThinking Note: Detailed Seller Ratings have been in place since May 3 2007. It was tabulated from this date and started to appear on feedback in late May and early June 2007.

Do you think it's fair?

Of course not, it's not only unfair, it seems illegal. If the amount that I pay is tied directly to the DSR scores, then they should be exposed, for me to see.

What is your opinion of "NO seller negatives"?

It's extremely strange. I rarely leave negatives for buyers anyway, so for me, it doesn't effect me so much. I also rarely cancel seeing negatives on other people's accounts doesn't help me either.

Did you realize that feedback percentages and calculations are being based on 11 months vs 12 months as described on eBay help pages?

I haven't calculated this myself as of yet.

What other inconsistencies in the feedback system have you noticed?

I have noticed that my feedback, sometimes, has not been going up when new buyers leave feedback. I have noticed this at least 3 times since the new feedback changes have come into effect.

Thank you for answering these questions. I appreciate your time and willingness to contribute.

Here is a page from eBay's "Feedback Forum". Does this not say that Neutrals don't count in the way feedback is calculated? Neutrals are being used in the very equation eBay gives as an example.

When we made the changes, we said we would closely watch the impact and, if needed, make adjustments. Today, we announced the following two adjustments:

Neutrals will no longer count as part of the Feedback percentage.

Since we introduced changes to the Feedback system in May, 2008, buyers have significantly decreased the amount of neutral Feedback they are leaving for sellers. Now less than 0.5% of all Feedback left is neutral, and this percentage continues to decline. Since we have removed the ability for sellers to leave negative Feedback, we are confident that buyers are leaving neutrals to represent a neutral experience and not to avoid retaliatory negative Feedback.

I would like any attorney interested in a class action lawsuit against eBay to contact me by leaving a note on this blog. This is a very serious change of terms of doing business eBay vs when we signed up. To say that one doesn't have to sell on eBay is a ridiculous retort - I make a significant part of my living on eBay and I have been selling there for 11 years - the changed selling terms are a dramatic change from my first ten years and I (and others) should be able to expect more consistency from the people whom we pay MILLIONS of dollars in seller fees to.


Anonymous said...

Indeed how is it that Ebay can change the rules of the game I HAD to agree to, bought inventory for, and built a business on that I now am set to lose because Ebay isn't bound by said rules anymore? Ebay sellers absolutely have a case for the damages. Ebay must be held accountable for their unfair business practices!

FYT said...

Have you retained an attorney about this matter yet so that I can join in?

I am "temporarily" on "restricted" status because my detailed feedback score is below a 4 star, even though I mainly purchase on not sell.


Anonymous said...

I have been a power seller for a few years with 100% positive feedback. Then a buyer comes along, does not pay so I cancel the transaction and block buyer from every doing business with me. She then sends $$ thru paypal, that you cannot block. and then leaves me 23 negative feedbacks... about my product (that she never received) about my threatening her (never talked to her and she never answered emails) and about me as a person, (Crazy, unstable, strung out, etc) and I cannot leave her any negative feedback????? She is guilty of tortitous interference, defamation, libel and villification in my opinion. So whom ever gets a class action going, there will be thousands of sellers ready to sign up. I am canceling my 2 power seller ebay stores this week.