eBay promises 20% fees cut for top sellers

The online giant announced on Monday that it will slash fees by 20 % for its top-rated sellers and push their listings higher up in the search queue, part of steps to try to galvanize growth in its main retail unit, whose auctions and fixed-price sales connect buyers and sellers. The aim of its latest move is to reward the most reputable sellers, who drive shoppers to the site and give top customer service.

Besides, California-based eBay Inc said it would bestow on nearly 150,000 top sellers a "Top-Rated Seller" designation that buyers can search for on the site as they choose to conduct business with the most reputable. Sellers eligible for that program, which is expected to be launched in October in the United States, the United Kingdom and Germany, must conduct 100 transactions a year and post at least $3,000 in annual sales volume, and they must have a detailed seller rating of at least 4.6 out of a possible 5 -- a measure that encompasses criteria such as whether an item is described accurately, shipping time and cost.

EBay has been trying to improve its feedback system in which buyers bestow a customer service rating on a seller with whom they have just conducted a transaction. Nevertheless, some sellers complain that system is unfairly skewed to buyers, who have the power to bestow a negative rating even if unmerited, which will hurt future sales. EBay said that it will now place a greater emphasis on a seller's lack of negative ratings rather than the difference between a good or stellar rating such as a 4 or a 5, which can be an arbitrary distinction.

Furthermore, other changes eBay is making include a more streamlined claims process when winning auction bidders do not pay, an easier system for editing listings of bulk items and a tool that allows sellers to see the factors affecting the placement of their items on eBay's site. The lingering slump in consumer spending has taken a bite out of eBay's sales. Stalled growth in Marketplaces has concerned investors and kept shares under pressure.

Additionally, last week the company, which also has fast-growing online payments unit PayPal, posted better-than-expected second-quarter results, providing some relief to investors anxious for a turnaround. Shares of eBay rose to 2.1 % at $21.68 on Monday afternoon on the Nasdaq.