eBay Pulls Google Ads Over Marketing Stunt

odoketa writes "According to the BBC, it seems Google scheduled a party to promote their payment system (Google Checkout) on the same day as a big eBay meeting, and this made eBay mad enough to pull their ads with Google. According to the story, eBay says it's merely an 'ongoing experiment' on their marketing. 'Google hoped to alert PayPal users who would have been in Boston attending the eBay Live annual seller event to its own service, according to market experts. It could also have been seen as part of an effort to get eBay to accept Google Checkout, currently banned on the online auctioneer's site. But in a contrite manner, Google cancelled its rival function a day before it was due to happen.'"

Comments

UK promo was good

[Linker3000]

In the UK, Google checkout was offering £10 off any order over £30 with a major online IT supplier I use. The number of small orders I placed last month for toners and other parts was quite exceptional!

Re:UK promo was good

[KingJ]

I took advantage of this too, in effect it gave me free delivery. Certainly swayed me to use their payment system and it's a year long promotion, I wonder what the fees are that google charges retailers in comparison to ordinary card processing services?

Re:UK promo was good

[daeg]

We use Google Checkout. Under their promotions, retailers have it good for the start, too. The ending rates are great, too, much better than PayPal. The Terms of Service are much more agreeable to both the buyer and seller, particularly for physical goods. I'm not sure how they compare to digital goods, but PayPal isn't very good on that front, either.

Re:UK promo was good

[DrogMan]

The promo was/is good and I was about to sign up to Google Checkout to accept smallish payments on a system I'm working on, but was really put off by the fact that Google insist on the person making the payment sign up to a Google account. PayPal dropped this a long time ago, and much as I dislike PayPal, at least now you have the choice to letting your clients make their own decision to signing up to PayPal, or not.

Once Google removes this restriction, I'll probably use them to accept small payments rather than use PayPal.

/DM/

Re:UK promo was good

[WhoBeDaPlaya]

Not to mention that eBay loves double-dipping - charge ya for auction closing fees and then PayPal fees.

Re:UK promo was good

[bkr1_2k]

Hopefully you've let google know that. Otherwise it's just wishful thinking.

Re:UK promo was good

[bkr1_2k]

I knew someone was going to say that as soon as I posted. I decided not to bother posting to correct my statement though.

Of course google would have figured it out eventually, it's not anything particularly insightful for them to do. However, the sooner the customers make comments, the sooner google (or any company) will react. If it looks like there's an obviously high demand from the onset, then it will be implemented sooner.

Wrong...

[djupedal]

You're seeing eBay guides, pages.ebay.com and/or pulling from either a local or ISP cache.

I tried yesterday, and again just now and nada. No eBay seller item links on the radar. No items being sold, including bowling balls.

eBay wouldn't do that

[91degrees]

They don't advertise on Google to do Google a favour. They advertise on Google to draw traffic to eBay. If they pull their advertising, they hurt themselves. Not as much as they hurt Google, because they can easily spend the advertising budget elsewhere, but still a case of cutting of their nose to spite their faces.

Re:eBay wouldn't do that

[Rik Sweeney]

They advertise on Google to draw traffic to eBay

Precisely! Otherwise, how would I know that I can find sinusitis relief on eBay?

Re:eBay wouldn't do that

[Applekid]

Is eBay not a big enough player to require Google advertising?

This got me thinking of advertising in general. Do consumers REALLY need another 5,000 Coke commericals nationwide today, too? Are they afraid that we'll all of a sudden forget they exist? Afraid that people who like Coke would switch to Pepsi thanks to those ads so we'd better innundate them with our ads to keep that from happening?

There are defining sites out there on the internet. You wouldn't google for online auctions unless you're looking for an eBay alternative. You wouldn't goggle for user shared video sites unless you're looking for a YouTube alternative.

Or, at least I wouldn't. :)

Re:eBay wouldn't do that

[xappax]

Do consumers REALLY need another 5,000 Coke commericals nationwide today, too? Are they afraid that we'll all of a sudden forget they exist?

It's a good question, it seems intuitive that those brands are so deeply entrenched in our collective awareness and habits that they've sort of transcended advertising. It seems like we could never see another ad for Nike, and we'd still remember them and buy their shoes just as much.

But it's not true. The reason we can tell it's not true is that companies like Nike universally continue to spend gobs upon gobs of money on advertising campaigns, which they could've otherwise kept in their pockets. I think the main reason mega-brands advertise is not because they're afraid we'll forget, but because they're afraid we'll start paying attention (or more attention) to their competitors, or even other industries we'd rather spend our money on. Nike doesn't care if we remember them in general, they care if they're the top brand on our minds when we walk into the shoe store, and that we associate them with all the cool things of today.

In this way, advertising is like an arms race. You may have enough advertising to let people know about your product, but another advertiser is just going to step up their campaign and draw even more attention to themselves (and consequently away from you). Keeping the attention on your brand is what keeps you alive as a corporation, so you have no choice but to increase your advertising campaign to even more intensity...they respond in kind, and the cycle continues.

Of course, the result of this marketing cold war is what we have today: an almost completely ad saturated environment. It's difficult to look anywhere in an urban environment without seeing a logo or advertisement - it's so universal that people start to tune it out as background noise, which simply means advertisers must come up with newer, more subtle or outrageous or manipulative ways of increasing their brand awareness and appeal.

Re:eBay wouldn't do that

[Aladrin]

This is probably the most profound and sensible thing said so far. (It's probably a quote, but just roll with me here.)

Advertising is amazingly hard to quantify. How do you -know- if someone bought that item because of advertising, or because they just saw it in the store. Did your advertisement in Magazine X bring in any sales? Was it the TV commercials? Was it the fact that you advertised in 6 different ways? Could you have eliminated one of them with the exact same results, or even better results? Could you have added another?

It would be easy to spend more money trying to determine how successful your ads were than the actual ads cost.

The only thing that could make pulling Google ads worthwhile would be to make a big stink about it on 'moral' grounds and get the news media to advertise for you for a while. Getting Google to cancel their event was a great bonus.

Re:eBay wouldn't do that

[rainman_bc]

which simply means advertisers must come up with newer, more subtle or outrageous or manipulative ways of increasing their brand awareness and appeal. Great post! I want you to run the marketing department in our office ;)

Thing is though, the outrageous stuff is what gets me. This morning I was watching the morning news, and from the traffic chopper out comes a freaking ad from the traffic lady's mouth. How can the morning news not think that this just annoys viewers, and that most of us are intelligent enough to look past that garbage?

I don't choose what beverage I drink from what's on TV. I've never seen an ad for Orangina on TV and that's my favourite beverage. I pick a restaurant based on reviews online at dinehere.ca (I'm from Vancouver so it makes sense). I refuse to buy Nike because honestly they are way overpriced for the value you get. If I am an athlete where the extra spring in my step makes a difference, I'll let Nike put there shoes on me for free. Until them, Umbro or Adidas or Puma is fine for me and I'll keep the other $150 in my pocket thanks. I don't pick my beer based on how slutty looking the models on TV are. I like Hoegarden and Amstel myself, and don't see much ads for those.

I've sat in on marketing conversations at the place I work, and they truly seem to believe that end users are easily manipulated. I think marketers have beliefs about consumers that just aren't true any more.

Re:eBay wouldn't do that

[Dhalka226]

Advertising is amazingly hard to quantify. How do you -know- if someone bought that item because of advertising, or because they just saw it in the store.

Well, there are absolutely people who look into those sorts of things. Besides which, it's probably enough to do some statistics with it; if I'm selling 1,000,000 units a day on average, I run a new ad campaign and all of the sudden I'm doing 1,250,000 units a day, the two probably aren't related.

But there are three points to make about advertising in general, rather than about the effectiveness of specific ad campaigns:

1. They do work to some degree. There's no denying it. I'm sure we've all had moments where we see something on TV, decide "that looks good" or "that looks cool" and go buy it. Even if we don't rush out to buy it specifically, if I see, for example, a new commercial for a drink that sounds really good I may well forget about it but then see it in the store and buy it. I don't think anybody denies this point.

2. You have to do what your competition is doing. A few posts up somebody asked if we really need 5,000 Coke commercials to prevent us from forgetting about it. No, we don't. However if they don't run ads but Pepsi does, it will undoubtedly bite into their sales--so they run them. Pepsi does the same thing.

3. And here comes the potentially controversial one... there is a theory that advertising, as a whole, isn't about the products they pitch. Advertising is about making you feel like whatever you have, it isn't enough. It wants to make you feel like things are missing. Most every commercial has attractive people in it even if they're completely unrelated to the product; it's not so much about "drink Coke and hot women will fawn over you!" as much as it is about making you feel like something is missing and maybe you can buy it. It doesn't necessarily help Coke that you feel like something is missing, but if that feeling gets you to go out shopping that's a win for all companies running ads.

Paypal useless

[hesaigo999ca]

I am soooooo glad that eBay will now have competition from on of the top dogs for their
paypal excuse for a payment system. I hope google can actually tie this into your gmail account with higher security, although if eBay will not use this service, I dont know where else except the p0rn
sites where this might be usefull?

Message To Ebay: This Is Suicide

[osewa77]

Knowing how much traffic Google drives through search and Adwords, this move by Ebay is nothing but suicide. It's a good thing - for Ebay - that Google has decided to back down.

Ebay is in a bad position, really, because they don't drive their own traffic. If Google decides to launch an auction website, it'd be a real bloodbath, because Ebay is nothing without it's famously massive traffic, much of with it has to buy.

I suspect that they have an agreement with Google that prevents Google from implementing a simple competitor in the auction space.

What happens if Ebay boycotts Google? We'll get less "buy used baby's from Ebay" spam. That's it.

Re:Message To Ebay: This Is Suicide

[AutopsyReport]

It's not suicide. Most Internet users have been to eBay. eBay was successful long before Google showed up and they will continue to be successful because their success is attached to the name, how easy it is to remember, and how quickly you can type "ebay.com" in the location bar without having to go through a search engine.

Re:Message To Ebay: This Is Suicide

[winnabago]

I don't have a source, but it is interesting that ebay still feels the need to tout their own payment systems in real life. About a month ago in Boston, they started putting PayPal ads on the tops of taxis, in bus shelters, and such places. Now that this Google Checkout issue has come out, it makes sense. They saw the pressure from Google coming.

I don't think ebay feels that Paypal can run via its own momentum, with others trying to gain share in that market.

Paypal and Checkout

[kanwisch]

I ditched Paypal when I couldn't reject a credit card payment (I didn't accept them). Assuming Checkout doesn't have the same issue, it'll be my preferred method of payment/receipt for the long-haul.

I PRAY Google takes eBay down at some point.

[Mewtwo]

...and this is coming from someone who does fairly significant business through eBay.

eBay's fees are ridiculous now, and PayPal even moreso. eBay has continually raised their fees year after year, taking a far too large cut of small items. What's worse is that 2.9% + 30 cents bit on PayPal transactions, whether or not it was actually funded through a credit card. I understand needing to pay yourself back should someone actually pay with a credit card and get small fee on top of that, but when money is moved from one PP account to another, that costs them $0...not to mention that PayPal's fee is done on the TOTAL, not the pre-shipping price, so they end up taking 2.9% of the money that you're supposed to have to ship the item as well. ...and since eBay and PayPal are so closely knit, and almost everyone on eBay only uses PayPal to pay, trying to use any of the smaller players is pretty much futile. The only payment service that can reasonably knock PayPal off of its pedestal is Google Checkout, and eBay knows this.

Between those two things, I'm losing well over 10% on any item that doesn't cost a huge amount of money. They wonder why people do stuff like use eBay contact info to sell outside of eBay and to list $1 items with hundred or even thousand-dollar shipping cost to avoid paying eBay as much as they can.

eBay claims that they want to have payment services with established track records or something like that. Just wait a year or two, and then possibly sue for inclusion, or at least under some law about anti-competitive acts? If Google could get GBay up...

GBay + "do no evil" = death of eBay.

Re:I PRAY Google takes eBay down at some point.

[LynnwoodRooster]

As someone who had a business that accepted CCs (we had the contract with a CC processor, terminal, could swipe cards) the fees charged by Paypal are actually in line with real CC charges. Around 2.4% of total sale (don't break out shipping - total amount) and $0.30 per transaction. Processing of CC charges ranged from 1.8% to 3.3% depending upon the volume of sales you did (we did around $30K/month and were at the 2.4% price range).

EBay's fees are quite high, though, and I don't have any experience with Paypal's CS so can't comment there, but the fees they're charging seem to be somewhat in line with meatspace...

So hard to choose sides

[antifoidulus]

I mean, on one side we have google, a tremendously useful tool that has saved me countless hours when troubleshooting problems/doing research.

And on the other side we have paypal who called me a liar on the phone because I told them that they, not I, made a mistake

So hard to choose sides!

Re:So hard to choose sides

[The Breeze]

This is obvious a fake post.

I mean, come on, someone claiming to have actually gotten Paypal on the phone? How likely is that?

"We're Paypal. We don't care. We don't have to."
-apologies to SNL.

Death of the one trick shop

[Stu101]

Now its down to who blinks first, im guessing that Google either have:

A) An ebay alternative (Killer? )
B) The resources to create one pretty quick.

We will have to see what countermeasures Ebay can conjour up. My guess is not a lot because Ebay, to my mind at least, is a one trick pony.

The BBC is spinning this...

[owlnation]

This is not what it seems. I read this article on the BBC earlier today and it annoyed me then.

Their use of the word "angry" in the headline is preposterous. This is shamefully hyperbolic sensationalist tabloid journalism -- something the BBC is pandering to more and more -- they really need to fire some editors. Also, it seems to me that someone in the Richmond offices of eBay has the ear of someone in the BBC, eBay gets an astonishingly high amount of free publicity from the BBC (The BBC does not allow advertising -- um, yeah, sure...). Again, they really need to fire some editors, I'd be astonished if at least some of them were not taking backhanders every now and again -- it certainly looks that way.

Why would a medium sized corporation be "angry". And particularly in this case, although eBay is the largest user of Adwords, eBay is still a very small company compared to Google. eBay has no alternative to Adwords. It's use them, or fail trying something else.

While I'm personally convinced that eBay's management are far from the sharpest executives out there, they are at least smart enough to realize that they need Google much more than Google needs them. Sure, there's some Corporate game playing around checkout etc, and perhaps this move is simply a reflection of that. eBay, like any firm, needs to try to assert themselves occasionally to negotiate better deals. This is business. This is not news.

If Google was planning their own negative party then perhaps it would be good for someone to examine their mission statement -- while not exactly evil, that action isn't something that would give any company the moral high ground.

This is all a storm in a teacup. The whole thing reeks of publicity stunt. Publicity stunts are things the BBC falls for regularly -- especially where eBay are concerned.

Re:Ebay/Google

[AutopsyReport]

I would think that EBay was independent enough for people to know the name and use them without the use of Google or any other advertisement (aside from television).

Exactly. eBay is like Google; you don't go to Yahoo to find Google, and so you don't go to Google to find eBay. This was a calculated decision, not necessarily a bad one. If people believe it was a suicidal decision, recall the numerous fee increases that caused the community to throw up their arms in revolt. You would think that was suicidal, but eBay is still just as strong.

Re:Now we will see who has more behind them

[Anonymous Coward]

I've closed my paypal account because they've become a bank and moved to a EU rather than UK system..

1. Although it's high time PayPal were regulated as a bank, their move will not make them one any more than they are currently.
2. The UK is in the EU and has been for a very long time, making the second half of your sentence non-sensical.

Hypocrisy? Or just sour grapes?

[WidescreenFreak]

Wait. Let me get this straight. eBay can deny their customers the ability to use alternate payment methods (Western Union, Google Checkout) in an anti-competitive move to try to force people to PayPal, which eBay owns. That's just a-OK. But if Google tries to take advantage of the opportunity to make people aware of Google Payments, which eBay is denying their paying sellers to implement, all hell breaks loose and eBay gets all upset!

Don't get me wrong. I like eBay and PayPal. I've never had a bad experience with either of them. But I found it to be more than coincidental that very shortly after eBay bought PayPal suddenly they have to ban Western Union and other payment services, citing "consumer fraud protection". Oh, f**king spare me!! I used Western Union several times for my auctions with no problems at all. Even eBay's sellers tools will reject the submission of an auction if the words "Western Union" are found in the description!

So, now Google decides to take advantage of an opportunity to make themselves known to eBay customers, and eBay gets all pissed off? Wow.

Greed Ego and Why Ebay Sucks

[grapeape]

http://news.com.com/Google+cancels+rain+on+eBays+p arade/2100-1024_3-6190905.html goes into much more detail.

You have to love Ebay's comments as to why they dont allow Google Checkout, it reliability is unproven. Which of course translates into we dont get anything out of allowing their service and are much happier double-dipping on our "customers". Their real fear is that people would ditch paypal in droves, which is true, I dont know anyone who really likes paypal but its the only choice you have in dealing with Ebay. Ebay may be surprised to find that accepting other forms of payment would bring people back to ebay. I hated paypal so much after being ripped off for a second time that I just stopped using ebay completely, a better choice of payment options might tempt me back. I did still find myself led to Ebay by google often when searching for specific items.

I'd like to see the real numbers on traffice from google to ebay, I have seen it listed as much as 10% and as little as 2%. Still it looks like this hurts Ebay more than Google, I havent seen any numbers suggesting revenue from Ebay totalling more than 1-2%. If I was Google I'd stick to my guns and not allow them back until checkout was declared acceptable.

But where will I buy my search results now?

[glindsey]

This is horrible! Now, when I search for "software interrupt," I won't see "Looking for software interrupt? Find new and used software interrupt and thousands more items on eBay!"

This is going to make things much more difficult.

Re:BEWARE of Google Checkout

[D-Cypell]

I understand this frustration. I used to work for a company that provided payment services and spent at least some of that time doing customer/technical support.

Our system had a similiar mechanism to google. If a particular card was rejected by the bank, our software would refuse to resubmit the card to the bank for a period of 24 hours. This sounds like an irritating policy I know (and I had to discuss the issue with many people in the same situation as yourself), however what I can tell you is that your case is 1% of the story. The remaining 99% are fraudsters who get hold of a card number and spank that card number against as many merchants as possible hoping it will go through. Often these numbers are posted online so instead of one frauster you get a couple of hundred. The lines that the banks use for CC auths are shockingly obsolete and very low bandwidth so were a finite resource for us, there was thousands of lines of defensive code to limit access to this bandwidth. I did suggest that maybe would should only block after x amount of failures, but the CTO didn't want to know!

What we would generally do is advise any cardholders to contact the merchant they were purchasing from, who had the facility to unblock a card manually.

Its a PITA, I know, and I do think there are ways for processors to make this less of a problem, but just so you understand why...

Re:BEWARE of Google Checkout

[ArhcAngel]

That explains the why of it. It does not however explain the lack of communication with the customer during and long after the problem.

Re:BEWARE of Google Checkout

[cloudmaster]

Did you actually correspond with someone from PayPal who helped you, or are you just presuming that, in the instance you needed help, you could get it by corresponding with them?

I ask because a few months ago I sold a cordless drill on eBay through PayPal. I clearly said that either the battery or charger was dead in the as-is ad, and that I didn't know which one. I also said that I woudn't ship the battery in order to save the recipient shipping costs. When it sold, though, I found that everything fit best in a flat-rate box, which would save the buyer about $1.00. Since the battery also fit (and didn't affect the shipping cost), I threw it in so they could maybe more easily find a replacement.

The buyer filed an "item not as described" complaint when they got it because it didn't work with a new battery they bought. I actually tested the drill and charger beforehand, but didn't mention that because it sounds like a guarantee - but anyway, I know that they worked. And it was clearly (in large bold letters) sold "as-is, untested". So what did PayPal do? They sided with the buyer (who had started sending obscene emails and left offensive feedback).

When I called to ask why PayPal resolved the dispute in the buyer's favor, the person on the phone looked at the auction and said "yeah, it says that it doesn't work in the ad." I asked why again, and she said "You're right, it looks like they didn't look at the ad". Then she said "have a nice day" and hung up. The resolution didn't change.

So, apparently all you have to do is say "item not as described" and PayPal will give you your money back - even if it's exactly as described.