Reselling News: eBay's Ad Business Grew 16 Percent While Its Core Buyer Count Grew 1 Percent, and Mercari Opens Japan Authentication to US Buyers

The advice here yesterday was to ignore the stock reaction to eBay's quarterly report and wait for the numbers that change a seller's decisions. Those numbers are out, and one pair of them is worth more than the whole press release.

eBay grew 14 percent, and almost none of it was new buyers on the core site

eBay reported third quarter results Tuesday afternoon. Revenue came in at $3.2 billion, up 14 percent. Gross merchandise volume was $23.2 billion, up 15 percent. Active buyers reached 147 million, up 10 percent year over year. Taken alone, that reads like a marketplace getting busier.

eBay's own earnings release, filed with the SEC, carries the sentence that reframes it. Strip out the Depop and Tise acquisitions and active buyers were 136 million, up 1 percent. The buyer pool you are actually listing into barely moved. Most of the headline growth was eBay buying two other companies, Depop for $1.4 billion in cash back in July.

So where did a 14 percent revenue increase come from? A meaningful share of it came from sellers. First-party advertising revenue was $575 million for the quarter, up 16 percent, inside $607 million of total advertising revenue. That is money sellers paid to be visible to a buyer population that grew by one percent. Value Added Resource read the same quarter and reached the same place, noting organic growth slipping while ad spend climbed. eBay also told investors to expect $130 million to $150 million in restructuring expense in the fourth quarter, which follows the staff cut earlier this month.

What to do: price promoted listings in as a cost of doing business, not as a bonus you buy when you feel like it. If the same number of shoppers is being divided among more sellers paying for placement, then the unpaid listing quietly moves down the page over time. Work out your real ad spend as a percentage of each sale, put it next to your fees and shipping, and decide your floor price with that number included. Be honest about which items can carry it. A $12 item generally cannot.

Mercari opens its Japanese authentication service to US buyers

Mercari began rolling its Japan authentication service out to buyers in the US and Taiwan on October 21 through its Global App, and announced the expansion on October 27. Value Added Resource has the full breakdown. It covers trading cards, sneakers, and fashion and luxury goods.

The pricing has two tiers. On qualifying purchases of $300 or more the authentication is required and carries no extra charge. Below that threshold a buyer can opt in for $11.90 per trading card, $12.90 for sneakers, or $29.90 for fashion and luxury. The item travels to a facility in Japan for physical inspection before it leaves the country, which typically adds three to five business days to delivery. Anything that fails inspection, or cannot be reviewed, is canceled and refunded automatically.

Read this as a sourcing item rather than a selling one. The Global App is for buying Japanese inventory, Mercari's US marketplace runs separately, and there is no announced plan to send US inventory the other direction. The limits matter too. Raw and graded cards can qualify, but sealed packs and boxes are excluded, and so are cards graded by companies outside Mercari's approved list.

What to do: if you source cards, sneakers, or branded fashion, this removes the single largest reason most resellers never touched Japanese listings, which was having no way to verify an expensive item before it crossed an ocean. Start small and treat the three to five extra days as part of your hold time, not a surprise. At $300 and up the inspection is free, which is the band worth testing first.

The thread running through both

Each of these items shifts a cost or a risk onto somebody, and it is worth naming who. eBay's quarter shows the cost of visibility moving toward the seller. Mercari's announcement moves the risk of a fake away from the buyer. Neither is a fee notice, and that is exactly why both get skimmed past.

Reading a quarterly report or a feature launch for what it will do to your margin six months out is a skill, and it is one of the things we work through together inside The Income Lab.