Reselling News: eBay Says a 3 Percent Ad Take Is Not a Ceiling

Investor conferences are where a company says the quiet part in a room full of people who reward it for saying so. eBay spent Tuesday in one of those rooms, and two things it said there are worth a reseller's morning.

eBay named a target for how much of your sale price it wants in ad revenue

CEO Jamie Iannone and CFO Peggy Alford presented at the Goldman Sachs Communacopia and Technology Conference on Tuesday, September 8. Value Added Resource pulled the seller-facing pieces out of the session, and the published conference transcript carries the rest.

The line to write down came from Alford. Advertising is running about 2.8 percent of gross merchandise volume, the near-term target is 3 percent, and she said the company does not treat 3 percent as a ceiling.

That is a rate, not a bill. In August eBay reported advertising at 596 million dollars in Q2, or 2.7 percent of everything sold on the site, and that figure averages in every seller who never buys an ad. So when the site-wide average climbs past 3, it is not because non-advertisers started advertising. It is because the sellers who do advertise pay more, or because more listings need an ad to be seen at all.

What to do about it: pull your own Promoted Listings numbers for the last 90 days and work out ad spend as a percentage of your own sales, not eBay's. Under 3 percent with items still moving means you have room. At 6 or 8 percent, you are funding the average, and the fix is choosing which listings need the ad instead of a blanket rate across the store.

The Live numbers are real, and they are also a sales pitch

Iannone put hard figures on eBay Live: eightfold year-over-year GMV growth last quarter, 90 percent of sellers who start using Live keep using it, Live sellers growing about three times faster than comparable sellers who are not, and collectibles buyers who watch Live buying about 70 percent more.

Notice what all four have in common. Each compares Live sellers to non-Live sellers, and nobody was assigned to a group at random. Sellers who show up to run a live show already have inventory depth, a camera and two spare hours, and would likely grow faster anyway. That does not make eightfold growth fake. It means the number tells you where eBay is spending, not what happens to your store if you turn a camera on.

Where eBay is spending is the useful part. Iannone said 70 percent of the business now sits in Focus Categories, C2C or recommerce, each up about 20 percent in Q2. Used goods sold by regular people is now the growth story eBay shows investors, which is a good sign for anyone whose inventory came out of a thrift store.

What to do about it: if Live has been on your list, the subsidized moment is now, because promotional support behind a growth push is the first thing to come off once growth stops needing help. Test it with a category you already know sells.

The one lawsuit about eBay's ad reporting ended without a ruling

A footnote to the advertising story closed this week. In May, former eBay employee Paige Williams sued the company in Utah federal court over her January 2024 termination. Among the employment claims was an allegation that an internal team was, in her complaint's words, "deliberately and artificially manipulating metrics, data, or reporting associated with eBay's Promoted Listings program," which she said she took to the SEC.

eBay moved in July to push most of the case into private arbitration. Value Added Resource, reading the docket, reported on September 9 that the case was dismissed without prejudice for failure to prosecute after Williams stopped responding to the motion and to later court orders.

That reads as vindication or cover-up and is neither. The court never ruled on arbitration and never tested the allegation on its merits. A claim that dies because the person who filed it stopped showing up is not evidence either way.

What to do about it: keep the habit it should reinforce. Attribution inside any ad dashboard is the platform grading its own homework, on eBay and Amazon alike. Track spend against total sales in your own spreadsheet, and check whether the months you spent more were the months you took home more.

The takeaway

A company that names 3 percent as a target and then declines to call it a limit has told you where the fee structure is heading, and it is not down. You cannot vote on that. You can decide, listing by listing, which items need to rent visibility and which sell on the strength of the title and the photos. That sorting is the difference between an ad budget and an ad leak, and it is the kind of thing we work through together inside The Income Lab.

Hero image: the Goldman Sachs World Headquarters at 200 West Street in New York, photographed from Battery Park City by Z4dude, released into the public domain via Wikimedia Commons.