In an attempt to compete with other online retailers, eBay has recently started a Guaranteed Delivery (GD) program that advertises specific delivery dates to buyers and provides compensation when items arrive late. Confident that buyers will ‘love’ the program, it may prove to be harder to convince sellers. Read on to discover the what, how and why of eBay’s new Guaranteed Delivery program and the possible benefits and disadvantages to sellers.
What is eBay’s Guaranteed Delivery program?
Guaranteed Delivery is an eBay program that was officially launched in September 2017 and featured in the Fall Seller update. It was rolled out gradually but by mid-October, all US eBay sellers will be able to opt-in to the program if eligible. For sellers in other countries, it appears eBay intends to roll out the program further in 2018.
The idea behind the program is simple. Qualified sellers guarantee delivery of an item by a specified date. If the item does not arrive on time, the buyer is compensated for this delay. Other major online retailers have had similar programs in place for years.
Sellers who offer Guaranteed Delivery will receive, according to eBay, increased exposure and happier customers.
How it works
Eligible sellers who opt-in to the Guaranteed Delivery program can select individual listings they want to guarantee in one of two ways:
- Handling time option – Seller guarantees same-day or one-day handling and must use eBay labels for shipping. The delivery date of the item is determined and guaranteed by eBay. If the seller met their handling time and the package was scanned on time at the post office, eBay will compensate buyer if delivery is late. Likely to be more popular with smaller sellers.
- Door-to-door option – Seller takes full control over deciding a guaranteed delivery date, based on their ability to deliver to various regions and carriers’ service level by region. With this option, compensation for late deliveries is organised and paid for by the seller. More suited to larger sellers.
Note that sellers must choose one of the above options for all of the listings they want to guarantee. It is not possible to choose the handling time option for one listing and then the door-to-door option for another.
If ‘guaranteed’ delivery is late
If an item arrives after the guaranteed delivery date, a buyer has two compensation options:
- Get a refund on the shipping costs but keep the item. If shipping was free, a $5 voucher is offered instead.
- Full refund of item and shipping cost as well as a free return label. Note that the refund of the original item cost is always covered by the seller, no matter which Guaranteed Delivery a seller chooses.
eBay claims that it will manage all customer service related to the Guaranteed Delivery program, avoiding more work for sellers. Buyers will be able to choose between these compensation options via a special Guaranteed Delivery page.
Correspondingly, sellers in the program will have a new Guaranteed Delivery dashboard within Seller Hub. Sellers will also be able to use two new shipping tools – a working days calendar and shipping rate tables.
To be able to opt-in to the Guaranteed Delivery program, sellers must:
- Have a performance level at or above standard
- Offer returns
- Sell eligible items with immediate payment
Sellers wanting to use the handling time option have to also offer 0-1 day handling time and use eBay labels.
To be eligible for the door-to-door Guaranteed Delivery option, sellers must upload tracking, use eligible carriers and deliver in 4 days or less.
Benefits of eBay’s Guaranteed Delivery program
It is reasonable for any eBay seller, large or small, to wonder why they should join the optional Guaranteed Delivery program. The following are the main reasons at the time of program launch.
- No extra risk. For sellers opting into the handling time option, there is no more risk or work to the seller since eBay is covering the customer service aspect and voucher program. As long as the item is shipped on time, eBay claims to take care of the rest. Sellers may have to accept a return based on the late delivery, but one of the requirements of the GD program is to accept returns anyway.
- No dramatic increase in returns. In theory, sellers are unlikely to experience a dramatic increase in returns due to late delivery. Buyers do typically want an item when they purchase it, and for most people, arriving a little late will not be a problem.
- More buyers. The GD program may attract a new base of customers to eBay. When looking for items to arrive quickly, many online shoppers head to the larger retailers as they are able to ensure fast shipping. Guaranteeing arrival of an item within three days or less may make more online shoppers move away from the larger retailers and think about eBay in a different way.
- Get an edge over the competition. Offering Guaranteed Delivery on an item may improve standings over a competitor. While being part of the GD program alone doesn’t boost search rankings, buyers can filter search results to see listings with Guaranteed Delivery only.
- No extra work. eBay claims that it will handle all additional customer service related to the program. It has also been promised that eBay will remove any negative feedback relating to shipping as long as the seller met their handling time commitment and the package gets scanned.
Disadvantages and controversies
There are quite a few potential seller concerns regarding the Guaranteed Delivery program. Here are some of the major issues causing disagreement.
- Third party involvement. One of the biggest disadvantages of GD is the reliance on third parties – the post office and shipping companies. Making delivery guarantees with such a heavy dependence on scans from external parties sounds a bit like a disaster waiting to happen. Technical issues happen and eBay is trying to guarantee something it cannot personally control.
- Guaranteed doesn’t really mean guaranteed. Even shipping companies, the ones that are physically moving packages around the country, cannot absolutely 100% guarantee arrival dates for customers. Sometimes things do go wrong. In reality, guaranteed means “we will try our very best.” While customers may be happy to receive a refund or credit as appropriate, eBay may still lose more customer confidence than they expect.
- What’s in it for sellers? The reward for sellers taking part in the Guaranteed Delivery program isn’t obvious. eBay claims that buyers will be “happier” and that sellers who take part will receive increased exposure. While it is true that buyers will now be able to filter their searches by which sellers offer Guaranteed Delivery, it is unknown how many buyers will actually do this. If sellers in the program actually received a direct boost in search ranking, the exposure would be more tangible.
- Shipping coercion. One of the requirements of the GD program is to use eBay labels for shipping or use one of eBay’s label partners. Some sellers find eBay labels more inconvenient and more expensive than working directly with shippers such as UPS who may offer substantial discounts.
- Unforeseen circumstances. At this point, it is not clear how the GD program will adapt to slower shipping times during the holiday season. Along the same lines, eBay has not been clear about timeline requirements during natural disasters. Most likely, this will be decided on a case-by-case basis as and when natural disasters happen, but this won’t inspire much confidence for sellers, especially those that live in high-risk areas.
- Eventual force opt-in? As with every new eBay program launch, a lot of people have the fear that Guaranteed Delivery will one day be mandatory for sellers. At the moment, it is an opt-in program for US sellers only.
- Wrong target audience? Offering guaranteed delivery makes sense for perishable and urgently needed items like groceries, household supplies and medication. These are the types of items sold by the large online retailers offering very fast delivery. With eBay sellers more likely to sell ‘discretionary’ products such as collectables and clothing, some are asking whether eBay buyers were really asking for this type of service at all.
Conclusion of first impressions
The Guaranteed Delivery program will no doubt appeal to those eBay buyers who want more certainty about their item’s arrival date. Whether or not buyers will actually filter searches with the Guaranteed Delivery option remains to be seen. eBay seems certain that this service will attract new buyers to the eBay marketplace and enable sellers to sell more items. This also is hard to comment on at launch. For these reasons, it is difficult to say of the true benefit of the Guaranteed Delivery program for sellers at this point.
The handling time option does not seem to involve much more effort for most sellers but this depends on whether eBay is able to hold up their promise of handling any additional customer service issues relating to the program. For larger sellers, the door-to-door option appears to come with a lot of responsibility without any huge advantage at this time. With the program as it is right now, Guaranteed Delivery is likely to be much more popular with customers than sellers.
What do you think about eBay’s Guaranteed Delivery program? Will you be opting-in?