How Donahoe Broke eBay

eBay (EBAY) used to be "just a venue" where sellers could list rare, unique, or unusual items for sale and buyers could find them. Now it appears that eBay is much more than just a forum and specializes in iPods that can be purchased anywhere. What happened to eBay's magic? John Donahoe gave it away.

His gross mismanagement of the site has resulted in an unprecedented erosion of listings as a direct result of Donahoe making one fatal mistake after another while trying to implement his buyer experience plan. Now he blames sellers for his failure and raised their fees. This did not go unnoticed and sellers are leaving.

How did Donahoe break eBay?

1) Off site advertising competes with sellers. When Donahoe took away the free advertising premium store owners got and replaced it with off site advertising, a number of seller listings started looking like a toboggan run. When was the last time you saw Microsoft (MSFT) put Apple (AAPL) advertising on their site or Wal-Mart(WMT) put ads on Targets (TGT) site?

2) He opted millions of buyers into guinea pig tests without their consent. These buyers vowed never to visit eBay again because tracking cookies were downloaded into their computers making escape difficult if not impossible.

3) The site is technically unstable. What buyer is going to tolerate a site where they are stalked by tracking cookies, links that dont work, abundant page loading errors, page loads as slow as molasses if at all, and site issues that are never announced much less fixed?

4) Best Match doesnt work! What buyer is going to search through thousands of meaningless search results just to find one item? There are literally thousands of complaints on eBay Discussion Boards because buyers can no longer find it, causing listings and sales to plummet.

5) Seller tools are broken. The shipping calculator doesnt work because is not designed to calculate dimensional weights (a well kept eBay secret). Markdown manager never has worked and the "sell your item" form works intermittently at best.

7) Rolling server blackouts. Sellers pay for their listings to be shown 24/7 yet eBay selectively shows listings to predetermined regions of the country and blacks out all other areas.

8) Sellers are canceling Paypal accounts. Donahoes new plan includes a provision by which all a buyer need say is IM NOT HAPPY GIVE ME A REFUND and a 21 day hold is automatically placed on the seller's Paypal account even after the purchase has been shipped.

Hello Amazon (AMZN)!

Disclosure: Author is a long time eBay seller