There are 5,000 "Super Powersellers" on eBay out of a total of about 250,000 sellers, ChannelAdvisor's CEO said on Friday. Scot Wingo was speaking at a conference call sponsored by securities firm SoundView Technology Group.
Powersellers are top sellers enrolled in eBay's Powerseller program, and Wingo said that 20% of them do 80% of the business on eBay. But about 2% of eBay's total sellers do almost 40% of the business, he said. These Super Powersellers earn an average of $80,000 in Gross Merchandise Sales each month, with some earning as much as $2 million in sales per month. ChannelAdvisor is an auction-management vendor and eBay preferred solutions provider.
Wingo believes his company can double the revenue of top Powersellers with the introduction of ChannelAdvisor Merchant software by automating the selling process on eBay. As evidence, he brought along four customers who participated in the Merchant pilot program last fall. Andrew Waites of eValueville, Randy Smythe of Glacier Bay Entertainment, Craig Zimmer of MobilePC.com, and David Schultz of IEPVisions Enterprises, all introduced their businesses to investors and fielded questions during the call.
All companies have seen sales grow despite the poor economy, the war and the SARS epidemic. Smythe of Glacier Bay Entertainment, which is eBay's number one seller of DVDs, said he believes he only has to add more titles in order to grow sales. His sell-through rate of 40% has not changed as he went from offering 1,000 titles to 6,000 titles.
Glacier Bay Entertainment currently sells exclusively on eBay, though it plans to build a Web site and sell on Amazon within the next 18 months. Smythe began selling on eBay in January 2001. In 16 months, he realized $625,000 in sales. From May to December 2002, he realized $905,000 in sales. In the first quarter of 2003, he realized $805,000 in sales. The DVDs are listed on eBay in auction format with a Buy-It-Now, or BIN, fixed-price option. They realize 74% of orders through BIN and 26% through the straight auction format.
While all the stories were positive, it's important to point out that SoundView is bullish on eBay; ChannelAdvisor was parading some of its best customers; and eBay has invested in ChannelAdvisor Corporation. eBay is going through major shifts as small sellers of collectibles face shrinking margins, and companies selling "practicals" like DVDs are moving onto eBay. Friday's conference call was one look into how eBay may be able to continue to grow its business.
