According to Shaun Rein of the China Market Research Group in a post on SeekingAlpha.com, the reason eBay is losing ground in China may have more to do with perceptions of poor customer service than its competitor TaoBao, an Alibaba company. Respondents to a survey of young consumers did not like eBay's lack of a phone number that consumers could call when they had a problem. In addition, customers preferred TaoBao's Alipay payment system as well as the real-time haggling and bargaining on Taobao (unlike eBay, it allows buyers and sellers to contact each other directly). However, respondents overwhelmingly felt that items auctioned on eBay were more likely to be real because eBay did a better job of "policing" the site. There's much more worth reading in the SeekingAlpha article, link follows.

http://china.seekingalpha.com/article/19322